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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For Quarter Ended March 31, 2003
Commission File Number 1-8351
CHEMED CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 31-0791746
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
2600 Chemed Center, 255 E. Fifth Street, Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip code)
(513) 762-6900
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
---- ----
Indicate by check mark whether the registrant is an accelerated
filer (as defined in Rule 12b-2 of the Act). Yes X No
---- ----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Amount Date
Capital Stock 9,824,542 Shares April 30, 2003
$1 Par Value
Page 1 of 18
CHEMED CORPORATION AND
SUBSIDIARY COMPANIES
Index
Page No.
---------
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Consolidated Balance Sheet -
March 31, 2003 and
December 31, 2002 3
Consolidated Statement of Income -
Three months ended
March 31, 2003 and 2002 4
Consolidated Statement of Cash Flows -
Three months ended
March 31, 2003 and 2002 5
Notes to Unaudited Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 10
Item 4. Controls and Procedures 13
PART II. OTHER INFORMATION 14
Page 2 of 18
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED BALANCE SHEET
(in thousands except share and per share data)
March 31, December 31,
2003 2002*
---------- -----------
ASSETS
Current assets
Cash and cash equivalents $ 43,625 $ 37,731
Accounts receivable, less allowances of $3,392
(2002- $3,309) 14,685 16,071
Inventories 9,090 9,493
Statutory deposits 10,536 12,323
Current deferred income taxes 7,631 7,278
Prepaid expenses and other current assets 12,056 13,332
---------- ----------
Total current assets 97,623 96,228
Investments of deferred compensation plans held in trust 15,000 15,176
Other investments 32,789 37,326
Note receivable 12,500 12,500
Properties and equipment, at cost less accumulated
depreciation of $63,496 (2002 - $62,370) 47,297 48,361
Identifiable intangible assets less accumulated
amortization of $7,319 (2002 - $7,167) 2,739 2,889
Goodwill less accumulated amortization of $30,477
(2002 - $30,457) 111,403 110,843
Other assets 17,232 15,606
---------- ----------
Total Assets $ 336,583 $ 338,929
========== ==========
LIABILITIES
Current liabilities
Accounts payable $ 4,261 $ 5,686
Current portion of long-term debt 472 409
Income taxes 8,506 7,348
Deferred contract revenue 17,323 17,321
Accrued insurance 17,631 16,978
Other current liabilities 18,515 22,127
---------- ----------
Total current liabilities 66,708 69,869
Long-term debt 25,802 25,603
Deferred compensation liabilities 14,925 15,196
Other liabilities 11,872 10,798
---------- ----------
Total Liabilities 119,307 121,466
========== ==========
MANDATORILY REDEEMABLE CONVERTIBLE PREFERRED SECURITIES
OF THE CHEMED CAPITAL TRUST 14,186 14,186
---------- ----------
STOCKHOLDERS' EQUITY
Capital stock-authorized 15,000,000 shares $1 par;
issued 13,451,281 shares (2002 - 13,448,475 shares) 13,451 13,448
Paid-in capital 168,568 168,299
Retained earnings 134,160 132,793
Treasury stock - 3,626,739 shares (2002 - 3,630,689 shares),
at cost (111,476) (111,582)
Unearned compensation (4,259) (4,694)
Deferred compensation payable in company stock 2,294 2,280
Notes receivable for shares sold (933) (952)
Accumulated other comprehensive income 1,285 3,685
---------- ----------
Total Stockholders' Equity 203,090 203,277
---------- ----------
Total Liabilities and Stockholders' Equity $ 336,583 $ 338,929
========== ==========
*Reclassified to conform with 2003 presentation.
See accompanying notes to unaudited financial statements.
Page 3 of 18
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED STATEMENT OF INCOME
(in thousands except per share data)
Three Months Ended
March 31,
----------------------
2003 2002*
-------- --------
Continuing Operations
Service revenues and sales $ 77,645 $ 80,853
Cost of services provided and cost of goods sold 46,152 48,508
General and administrative expenses 16,524 12,654
Selling and marketing expenses 11,078 11,993
Depreciation 3,052 3,492
-------- --------
Total costs and expenses 76,806 76,647
-------- --------
Income from operations 839 4,206
Interest expense (539) (773)
Distributions on preferred securities (268) (270)
Other income - net 4,263 2,589
-------- --------
Income before income taxes 4,295 5,752
Income taxes (1,742) (1,947)
-------- --------
Income from continuing operations 2,553 3,805
Discontinued operations - 867
-------- --------
Net income $ 2,553 $ 4,672
======== ========
Earnings Per Common Share
Income from continuing operations $ .26 $ .39
======== ========
Net income $ .26 $ .47
======== ========
Average number of shares outstanding 9,890 9,843
======== ========
Diluted Earnings Per Share
Income from continuing operations $ .26 $ .39
======== ========
Net income $ .26 $ .47
======== ========
Average number of shares outstanding 9,903 9,883
======== ========
Cash Dividends Paid Per Share $ .12 $ .11
======== ========
*Reclassified for operations discontinued in 2002.
See accompanying notes to unaudited financial statements.
Page 4 of 18
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Three Months Ended March 31,
----------------------------
2003 2002*
---------- ----------
Cash Flows From Operating Activities
Net income $ 2,553 $ 4,672
Adjustments to reconcile net income to net cash
provided by operating activities:
Gains on sale of investments (3,544) (1,141)
Depreciation and amortization 3,236 3,696
Provision for deferred income taxes (917) (177)
Provision for uncollectible accounts receivable 85 691
Discontinued operations - (867)
Changes in operating assets and liabilities,
excluding amounts acquired in business
combinations
Decrease/(increase) in accounts receivable 1,301 (419)
Decrease in inventories 403 391
Decrease in statutory deposits 1,787 773
Decrease/(increase) in prepaid expenses
and other current assets (576) 1,338
Decrease in accounts payable, deferred
contract revenue and other current
liabilities (4,273) (8,872)
Increase in income taxes 3,215 4,793
Other - net 1,915 1,877
--------- ----------
Net cash provided by continuing operations 5,185 6,755
Net cash used by discontinued operations - (116)
--------- ----------
Net cash provided by operating activities 5,185 6,639
--------- ----------
Cash Flows From Investing Activities
Proceeds from sale of investments 4,493 1,917
Capital expenditures (2,062) (2,530)
Net uses for discontinued operations (524) (816)
Business combinations--net of cash acquired (168) (1,229)
Other - net - 1,228
--------- ----------
Net cash provided/(used) by investing activities 1,739 (1,430)
--------- ----------
Cash Flows From Financing Activities
Dividends paid (1,188) (1,083)
Issuance of capital stock 194 523
Proceeds from issuances of long-term debt - 5,000
Purchases of treasury stock (58) (3,141)
Other - net 22 (168)
--------- ----------
Net cash provided/(used) by financing activities (1,030) 1,131
--------- ----------
Increase in Cash and Cash Equivalents 5,894 6,340
Cash and Cash Equivalents at Beginning of Period 37,731 8,725
--------- ----------
Cash and Cash Equivalents at End of Period $ 43,625 $ 15,065
========= ==========
*Reclassified for operations discontinued in 2002.
See accompanying notes to unaudited financial statements.
Page 5 of 18
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
Notes to Unaudited Financial Statements
1. The accompanying unaudited consolidated financial statements have
been prepared in accordance with Rule 10-01 of SEC Regulation S-X.
Consequently, they do not include all the disclosures required
under generally accepted accounting principles for complete
financial statements. However, in the opinion of the management
of Chemed Corporation (the "Company"), the financial statements
presented herein contain all adjustments, consisting only of
normal recurring adjustments, necessary to present fairly the
financial position, results of operations and cash flows of the
Company and its consolidated subsidiaries ("Chemed"). For further
information regarding Chemed's accounting policies, refer to the
consolidated financial statements and notes included in Chemed's
Annual Report on Form 10-K for the year ended December 31, 2002.
The Company uses Accounting Principles Board Opinion No. 25 ("APB
25"), Accounting for Stock Issued to Employees, to account for
stock-based compensation. Since the Company's stock options
qualify as fixed options under APB 25 and since the option price
equals the market price on the date of grant, there is no
compensation expense for stock options. Stock awards are expensed
during the period the related services are provided.
The following table illustrates the effect on net income and
earnings per share if the Company had applied the fair-value-
recognition provisions of Financial Accountings Standards Board
Statement No. 123, Accounting for Stock-Based Compensation (in
thousands, except per share date):
Three Months Ended March 31,
----------------------------
2003 2002
---------- ---------
Net income as reported $ 2,553 $ 4,672
Add: stock-based compensation
expense included in net
income as reported, net of
income tax effects 34 30
Deduct: total stock-based employee
compensation determined
under a fair-value-based
method for all stock options
and awards, net of income
tax effects (225) (105)
---------- ----------
Pro forma net income $ 2,362 $ 4,597
========== ==========
Earnings per share
As reported $ .26 $ .47
========== ==========
Pro forma $ .24 $ .47
========== ==========
Diluted earnings per share
As reported $ .26 $ .47
========== ==========
Pro forma $ .24 $ .47
========== ==========
Page 6 of 18
2. Service revenues and sales and aftertax earnings by business
segment follow (in thousands):
Three Months Ended
March 31,
---------------------
2003 2002
-------- --------
Service Revenues
and Sales
Roto-Rooter $ 64,725 $ 65,279
Service America 12,920 15,574
-------- --------
Total $ 77,645 $ 80,853
======== ========
Aftertax Earnings
Roto-Rooter $ 3,602 $ 3,479
Service America 40 327
-------- --------
Total segment earnings 3,642 3,806
Corporate
Gains on sales of investments 2,151 775
Overhead (3,583)(a) (972)
Net investing and financing
income 343 196
Discontinued operations - 867
-------- --------
Net income $ 2,553 $ 4,672
======== ========
(a) Amount includes aftertax severance charges of $2,358,000.
3. Earnings per common share are computed using the weighted average
number of share of capital stock outstanding. Diluted earnings
per share are computed as follows (in thousands, except per share
data):
Income Shares Income
(Numerator) (Denominator) Per Share
---------- ------------- ---------
Income from Continuing Operations -
For the Three Months Ended March 31,
- ---------------------------------------
2003
Earnings $ 2,553 9,890 $ .26
Dilutive stock options - 13 =======
---------- -----------
Diluted earnings $ 2,553 9,903 $ .26
========== =========== =======
2002
Earnings $ 3,805 $ 9,843 $ .39
Dilutive stock options - 40 =======
---------- -----------
Diluted earnings $ 3,805 9,883 $ .39
========== =========== =======
Net Income -
For the Three Months Ended March 31,
- ---------------------------------------
2003
Earnings $ 2,553 9,890 $ .26
Dilutive stock options - 13 =======
---------- ----------
Diluted earnings $ 2,553 9,903 $ .26
========== ========== =======
2002
Earnings $ 4,672 $ 9,843 $ .47
Dilutive stock options - 40 =======
---------- -----------
Diluted earnings $ 4,672 9,883 $ .47
========== =========== =======
The impact of the convertible preferred securities has been
excluded from the above computations because it is antidilutive on
earnings per share from continuing operations for both periods.
Page 7 of 18
4. Other income--net from continuing operations comprises the
following (in thousands):
Three Months Ended
March 31,
-------------------------
2003 2002
--------- ----------
Gains on sales of investments $ 3,544 $ 1,141
Interest income 815 636
Unrealized gains/(losses) on
investments (652) (71)
Dividend income 616 615
Other--net (60) 268
--------- ----------
Total other income--net $ 4,263 $ 2,589
========= ==========
5. In March 2003, the Company and a corporate officer reached
agreement providing for termination of the officer's employment in
exchange for payment under her employment contract. The payments
comprise a $1,000,000 lump sum payment made in March 2003 and
monthly payments of $52,788 beginning March 2003 and ending May
2007. The present value of these payments ($3,627,000) is
included in general and administrative expenses.
6. The Company had total comprehensive income of $153,000 and
$4,760,000 for the three months ended March 31, 2003 and 2002,
respectively. The difference between the Company's net income and
comprehensive income relates to the cumulative unrealized
appreciation/depreciation on its available-for-sale securities.
7. During 2003, one purchase business combination was completed
within the Roto-Rooter segment for a purchase price of $574,000
($168,000 in cash and a note payable for $406,000). The business
acquired provides drain cleaning and plumbing services under the
Roto-Rooter name. The results of operations of this business are
not material to the consolidated operations of the Company.
The purchase price was allocated as follows (in thousands):
Goodwill $ 474
Other assets 100
-------
Total $ 574
=======
8. In the normal course of business the Company enters into various
guarantees and indemnifications in its relationships with
customers and others. Examples of these arrangements would
include guarantees of service and product performance. These
guarantees and indemnifications would not materially impact the
Company's financial condition or results of operations.
9. In August 2001, the Financial Accounting Standards Board ("FASB")
approved the issuance of Statement of Financial Accounting
Standards ("SFAS")No. 143, Accounting for Asset Retirement
Obligations. This statement became effective for fiscal years
beginning after June 15, 2002, and requires recognizing legal
obligations associated with the retirement of tangible long-lived
assets that result from the acquisition, construction, development
Page 8 of 18
or normal operation of a long-lived asset. Since the Company has
no material asset retirement obligations, the adoption of SFAS No.
143 in 2003 did not have a material impact on Chemed's financial
statements.
10. In July 2002, the FASB approved the issuance of SFAS No. 146,
Accounting for Costs Associated with Exit or Disposal Activities.
Generally, SFAS No. 146 stipulates that defined exit costs
(including restructuring and employee termination costs) are to be
recorded on an incurred basis rather than on a commitment basis as
is presently required. This statement is effective for exit or
disposal activities initiated after December 31, 2002. The
adoption of SFAS No. 146 in 2003 did not have a material impact on
Chemed's financial statements.
11. November 2002, the FASB approved the issuance of FASB
Interpretation ("FIN") No. 45, Guarantor's Accounting and
Disclosure for Guarantees, Including Indirect Guarantees of
Indebtedness of Others. The initial recognition and initial
measurement provisions of the Interpretation are applicable to
guarantees issued or modified after December 31, 2002. The
adoption of FIN No. 45 in 2003 did not have a material impact on
Chemed's financial statements.
12. In January 2003, the FASB approved the issuance of FIN No. 46,
Consolidation of Variable Interest Entities. It is effective for
variable interest entities created after January 31, 2003, and for
variable interest entities in which an enterprise obtains an
interest after that date. Because the Company has no such
investments, the adoption of this statement did not have a
material impact on the Company's financial statements.
Page 9 of 18
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
Financial Condition
- -------------------
The decline in other investments from $37,326,000 at December
31, 2002 to $32,789,000 is due to the sale of various available-for-
sale securities in the first quarter of 2003. The decline in other
current liabilities from $22,127,000 at December 31, 2002 to
$18,515,000 is primarily due to the payment of incentive compensation
and discretionary thrift plan contributions for 2002 in the first
quarter of 2003. There are no other significant changes in the
balance sheet accounts during the first three months of 2003.
At March 31, 2003, Chemed had cash and cash equivalents of $43.6
million and approximately $53.4 million of unused lines of credit with
various banks. Management believes its liquidity and sources of
capital are satisfactory for the Company's needs in the foreseeable
future.
Results of Operations
- ---------------------
Data relating to (a) the decrease in service revenues and sales
and (b) aftertax earnings/(loss) as a percent of service revenues and
sales for each segment are set forth below:
Service Revenues Aftertax Earnings as a %
and Sales - % Of Revenues (Aftertax Margin)
Increase/(Decrease) -----------------------------
------------------- 2003 2002
2003 vs. 2002 ------- -------
Three Months Ended
March 31,
- ------------------
Roto-Rooter ( 1)% 5.6% 5.3%
Service America (17) 0.3 2.1
Total (4) 4.7 4.7
First Quarter 2003 versus First Quarter 2002
- --------------------------------------------
Service revenues and sales of the Roto-Rooter segment for the
first quarter of 2003 totaled $64,725,000, a decline of 1% versus the
$65,279,000 recorded in the first quarter of 2002. Revenues of the
drain cleaning business and the plumbing services business declined 2%
and 1%, respectively, for the first quarter of 2003, as compared with
revenues for 2002. Each of these businesses' revenues accounts for
42% and 38%, respectively, of Roto-Rooter's total revenues and sales.
As a result of Roto-Rooter's disposing of most of its heating and
cooling businesses and non-Roto-Rooter-branded operations in 2002,
revenues of this line of business declined by $1,794,000 in 2003. The
aftertax margin of this segment during the first quarter of 2003 was
5.6% as compared with 5.3% in the first quarter of 2002. This
increase is attributable to a higher gross profit margin in the 2003
quarter.
Service revenues and sales of the Service America segment
declined 17% from $15,574,000 in the first quarter of 2002 to
$12,920,000 in the first quarter of 2003. This decline is attributable
to a decline in contract renewals in 2003 and lower retail sales in
2003. The aftertax margin of this segment was .3% in the first
quarter of 2003 as compared with 2.1% in the first quarter of 2002.
Page 10 of 18
This decline is attributable to a decline in the gross profit margin
(3.4 percentage points) in the 2003 quarter, partially offset by lower
operating expenses as a percent of sales (1.0 percentage points). The
lower gross margin is primarily due to higher labor costs (as a
percent of revenues) in 2003.
Income from operations declined from $4,206,000 in the first
quarter of 2002 to $839,000 in the first quarter of 2003. This
decline is attributable to charges of $3,627,000 (included in general
and administrative expenses) for the settlement of an employment
contract with a corporate officer in March 2003. The amount of the
charge represents the present value of payments beginning in March
2003 and ending in May 2007.
Interest expense declined from $773,000 in the first quarter of
2002 to $539,000, as a result of lower debt levels during 2003.
Other income-net increased from $2,589,000 in the first quarter
of 2002 to $4,263,000 in the first quarter of 2003 primarily due to
higher capital gains on the sales of investments in the 2003 quarter.
These gains totaled $3,544,000 in the first quarter of 2003 versus
$1,141,000 in the first quarter of 2002.
The effective income tax rate during the first quarter of 2003
was 40.6% as compared with 33.8% during the first quarter of 2002.
The higher effective rate in 2003 versus the rate for 2002 is
primarily attributable to a higher effective state income tax rate in
2003 related to gains on the sales of investments and favorable tax
adjustments in 2002.
Income from continuing operations declined from $3,805,000 ($.39
per share) in the first quarter of 2002 to $2,553,000 ($.26 per share)
in the first quarter of 2003. Income for 2003 included aftertax
severance charges of $2,358,000 ($.24 per share) and aftertax gains on
the sales of investments of $2,151,000 ($.22 per share). Income for
2002 included aftertax gains on the sales of investments of $775,000
($.08 per share).
Net income declined from $4,672,000 ($.47 per share) in the
first quarter of 2002 to $2,553,000 ($.26 per share) in the first
quarter of 2003. Income for 2003 included aftertax severance charges
of $2,358,000 ($.24 per share) and aftertax gains on the sales of
investments of $2,151,000 ($.22 per share). Income for 2002 included
aftertax gains on the sales of investments of $775,000 ($.08 per
share) and discontinued operations of $867,000 ($.08 per share).
Recent Accounting Statements
- ----------------------------
In August 2001, the Financial Accounting Standards Board
("FASB") approved the issuance of Statement of Financial Accounting
Standards ("SFAS")No. 143, Accounting for Asset Retirement
Obligations. This statement became effective for fiscal years
beginning after June 15, 2002, and requires recognizing legal
obligations associated with the retirement of tangible long-lived
assets that result from the acquisition, construction, development or
normal operation of a long-lived asset. Since the Company has no
material asset retirement obligations, the adoption of SFAS No. 143 in
2003 did not have a material impact on Chemed's financial statements.
In July 2002, the FASB approved the issuance of SFAS No. 146,
Accounting for Costs Associated with Exit or Disposal Activities.
Generally, SFAS No. 146 stipulates that defined exit costs (including
restructuring and employee termination costs) are to be recorded on an
Page 11 of 18
incurred basis rather than on a commitment basis as is presently
required. This statement is effective for exit or disposal activities
initiated after December 31, 2002. The adoption of SFAS No. 146 in
2003 did not have a material impact on Chemed's financial statements.
In November 2002, the FASB approved the issuance of FASB
Interpretation ("FIN") No. 45, Guarantor's Accounting and Disclosure
for Guarantees, Including Indirect Guarantees of Indebtedness of
Others. The initial recognition and initial measurement provisions of
the Interpretation are applicable to guarantees issued or modified
after December 31, 2002. The adoption of FIN No. 45 in 2003 did not
have a material impact on Chemed's financial statements.
In January 2003, the FASB approved the issuance of FIN No. 46,
Consolidation of Variable Interest Entities. It is effective for
variable interest entities created after January 31, 2003, and for
variable interest entities in which an enterprise obtains an interest
after that date. Because the Company has no such investments, the
adoption of this statement did not have a material impact on the
Company's financial statements.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995 Regarding Forward-Looking Information
- -------------------------------------------------------------
In addition to historical information, this report contains
forward-looking statements and performance trends that are based upon
assumptions subject to certain known and unknown risks, uncertainties,
contingencies and other factors. Variances in any or all of the
risks, uncertainties, contingencies, and other factors from the
Company's assumptions could cause actual results to differ materially
from these forward-looking statements and trends. The Company's
ability to deal with the unknown outcomes of these events, many of
which are beyond the control of the Company, may affect the
reliability of its projections and other financial matters.
Page 12 of 18
Item 4. Controls and Procedures
The Company maintains disclosure controls and procedures that
are designed to ensure that information required to be disclosed in
the Company's Exchange Act reports is recorded, processed, summarized
and reported within the time periods specified in the SEC's rules and
forms, and that such information is accumulated and communicated to
the Company's management to allow timely decisions regarding required
disclosure. Management necessarily applies its judgment in assessing
the costs and benefits of such controls and procedures which, by their
nature, can provide only reasonable assurance regarding management's
control objectives.
Within 90 days prior to the date of this report, the Company
carried out an evaluation, under the supervision of the Company's
President and Chief Executive Officer, and with the participation of
the Executive Vice President and Treasurer and the Vice President and
Controller, of the effectiveness of the design and operation of the
Company's disclosure controls and procedures pursuant to Exchange Act
Rule 13a-14. Based upon the foregoing, the Company's President and
Chief Executive Officer, Executive Vice President and Treasurer and
Vice President and Controller concluded that the Company's disclosure
controls and procedures are effective in timely alerting them to
material information relating to the Company and its consolidated
subsidiaries required to be included in the Company's Exchange Act
reports. There have been no significant changes in internal controls
or in other factors that could significantly affect internal controls
subsequent to the date the Company carried out its evaluation.
Page 13 of 18
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
--------
Exhibit No. Description
----------- -----------
99.1 Certification by Kevin J. McNamara pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
99.2 Certification by Timothy S. O'Toole pursuant
to Section 906 of the Sarbanes-Oxley Act of
2002.
99.3 Certification by Arthur V. Tucker, Jr.
pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
(b) Reports on Form 8-K
-------------------
- A current Report on Form 8-K, dated April 17, 2003, was
filed April 18, 2003. The report includes the Company's
first quarter 2003 earnings release dated April 17,
2003.
- A current Report on Form 8-K, dated April 23, 2003, was
filed April 24, 2003. The report includes the Company's
First Quarter Report for the period ending March 31,
2003.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
Chemed Corporation
(Registrant)
Dated: May 9, 2003 By Kevin J. McNamara
----------- -----------------
Kevin J. McNamara
(President and Chief
Executive Officer)
Dated: May 9, 2003 By Timothy S. O'Toole
----------- ------------------
Timothy S. O'Toole
(Executive Vice President and
Treasurer)
Dated: May 9, 2003 By Arthur V. Tucker, Jr.
----------- ---------------------
Arthur V. Tucker, Jr.
(Vice President and Controller)
Page 14 of 18
CERTIFICATIONS PURSUANT TO RULE 13A - 14 OF THE EXCHANGE ACT OF 1934
I, Kevin J. McNamara, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Chemed
Corporation;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results
of operations, and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14)
for the registrant and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which
this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on
our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of
directors:
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal controls; and
Page 15 of 18
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weakness.
Date: May 9, 2003 Kevin J. McNamara
----------- -----------------
Kevin J. McNamara
(President and Chief
Executive Officer)
I, Timothy S. O'Toole, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Chemed
Corporation;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results
of operations, and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14)
for the registrant and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which
this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on
our evaluation as of the Evaluation Date;
Page 16 of 18
5. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of
directors:
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weakness.
Date: May 9, 2003 Timothy S. O'Toole
----------- ------------------
Timothy S. O'Toole
(Executive Vice President
and Treasurer)
I, Arthur V. Tucker, Jr., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Chemed
Corporation;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results
of operations, and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14)
for the registrant and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant, including
Page 17 of 18
its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which
this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on
our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of
directors:
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weakness.
Date: May 9, 2003 Arthur V. Tucker, Jr.
----------- ---------------------
Arthur V. Tucker, Jr.
(Vice President and
Controller)
Page 18 of 18
EXHIBIT 99.1
CERTIFICATION BY KEVIN J. MCNAMARA
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002.
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the
undersigned, as President and Chief Executive Officer of Chemed
Corporation ("Company"), does hereby certify that:
1) the Company's Quarterly Report of Form 10-Q for the quarter
ending March 31, 2003 ("Report"), fully complies with the
requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of
operations of the Company.
Dated: May 9, 2003 Kevin J. McNamara
----------- -----------------
Kevin J. McNamara
(President and Chief
Executive Officer)
E - 1
EXHIBIT 99.2
CERTIFICATION BY TIMOTHY S. O'TOOLE
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002.
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the
undersigned, as Executive Vice President and Treasurer of Chemed
Corporation ("Company"), does hereby certify that:
1) the Company's Quarterly Report of Form 10-Q for the quarter
ending March 31, 2003 ("Report"), fully complies with the
requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of
operations of the Company.
Dated: May 9, 2003 Timothy S. O'Toole
----------- ------------------
Timothy S. O'Toole
(Executive Vice President and
Treasurer)
E - 2
EXHIBIT 99.3
CERTIFICATION BY ARTHUR V. TUCKER, JR.
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002.
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the
undersigned, as Vice President and Controller of Chemed Corporation
("Company"), does hereby certify that:
1) the Company's Quarterly Report of Form 10-Q for the quarter
ending March 31, 2003 ("Report"), fully complies with the
requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of
operations of the Company.
Dated: May 9, 2003 Arthur V. Tucker, Jr.
----------- ---------------------
Arthur V. Tucker, Jr.
(Vice President and Controller)
E - 3