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Amedisys Reports First Quarter 2024 Financial Results
Source: Nasdaq GlobeNewswire / 24 Apr 2024 15:45:46 America/Chicago
BATON ROUGE, La., April 24, 2024 (GLOBE NEWSWIRE) -- Amedisys, Inc. (NASDAQ: AMED) today reported its financial results for the three-month period ended March 31, 2024.
Three-Month Periods Ended March 31, 2024 and 2023
- Net service revenue increased $15.0 million to $571.4 million compared to $556.4 million in 2023. Prior year included $15.0 million of net service revenue from our personal care business which was divested on March 31, 2023.
- Net income attributable to Amedisys, Inc. of $14.4 million, which is inclusive of merger-related expenses totaling $20.7 million ($19.8 million, net of tax), compared to $25.2 million in 2023.
- Net income attributable to Amedisys, Inc. per diluted share of $0.44 compared to $0.77 in 2023.
Adjusted Quarterly Results*
- Adjusted EBITDA of $59.9 million compared to $57.8 million in 2023.
- Adjusted net income attributable to Amedisys, Inc. of $33.9 million compared to $32.7 million in 2023.
- Adjusted net income attributable to Amedisys, Inc. per diluted share of $1.03 compared to $1.00 in 2023.
* See pages 11 - 12 for the definition and reconciliations of non-GAAP financial measures to GAAP measures.
The supplemental slides provided in connection with the first quarter 2024 earnings release can be found on the Investor Relations page of our website. In light of the pending merger of the Company with UnitedHealth Group Incorporated, Amedisys will not conduct a quarterly earnings call to discuss the first quarter results.
Non-GAAP Financial Measures
This press release includes reconciliations of the most comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”) to non-GAAP financial measures. The non-GAAP financial measures as defined under SEC rules are as follows: (1) adjusted EBITDA, defined as net income attributable to Amedisys, Inc. before net interest expense, provision for income taxes and depreciation and amortization, excluding certain items; (2) adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. calculated in accordance with GAAP excluding certain items; and (3) adjusted net income attributable to Amedisys, Inc. per diluted share, defined as net income attributable to Amedisys, Inc. common stockholders per diluted share calculated in accordance with GAAP excluding certain items. Management believes that these non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, are useful gauges of our current performance and are also included in internal management reporting. These non-GAAP financial measures should be considered in addition to, and not more meaningful than or as an alternative to, the GAAP financial measures presented in this earnings release and the company’s financial statements. Non-GAAP measures as presented herein may not be comparable to similarly titled measures reported by other companies since not all companies calculate these non-GAAP measures consistently.
Additional Information
Amedisys, Inc. (the “Company”) is a leading healthcare at home company delivering personalized home health, hospice and high acuity care services. Amedisys is focused on delivering the care that is best for our patients, whether that is in-patient hospital, palliative and skilled nursing facility ("SNF") care in their homes, home-based recovery and rehabilitation after an operation or injury, care focused on empowering our patients to manage a chronic disease or hospice care at the end of life. More than 3,000 hospitals and 110,000 physicians nationwide have chosen Amedisys as a partner in post-acute care. Founded in 1982, headquartered in Baton Rouge, LA with an executive office in Nashville, TN, Amedisys is a publicly held company. With approximately 18,700 employees in 520 care centers within 37 states and the District of Columbia, Amedisys is dedicated to delivering the highest quality of care to the doorsteps of more than 469,000 patients every year. For more information about the Company, please visit: www.amedisys.com.
We use our website as a channel of distribution for important company information. Important information, including press releases, investor presentations and financial information regarding our company, is routinely posted on and accessible on the Investor Relations subpage of our website, which is accessible by clicking on the tab labeled “Investors” on our website home page. Visitors to our website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations subpage of our website.
Forward-Looking Statements
When included in this press release, words like “believes,” “belief,” “expects,” “strategy,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “will,” “could,” “would,” “should” and similar expressions are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. These risks and uncertainties include, but are not limited to, the following: disruption from the proposed merger with UnitedHealth Group with patient, payor, provider, referral source, supplier or management and employee relationships; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement with UnitedHealth Group or the inability to complete the proposed transaction on the anticipated terms and timetable; the risk that necessary regulatory approvals for the proposed merger with UnitedHealth Group are delayed, are not obtained or are obtained subject to conditions that are not anticipated; the failure of the conditions to the proposed merger to be satisfied; the costs related to the proposed merger; the diversion of management time on merger-related issues; the risk that termination fees may be payable by the Company in the event that the merger agreement is terminated under certain circumstances; reputational risk related to the proposed merger; the risk of litigation or regulatory action related to the proposed merger; changes in Medicare and other medical payment levels; changes in payments and covered services by federal and state governments; future cost containment initiatives undertaken by third-party payors; changes in the episodic versus non-episodic mix of our payors, the case mix of our patients and payment methodologies; staffing shortages driven by the competitive labor market; our ability to attract and retain qualified personnel; competition in the healthcare industry; our ability to maintain or establish new patient referral sources; changes in or our failure to comply with existing federal and state laws or regulations or the inability to comply with new government regulations on a timely basis; changes in estimates and judgments associated with critical accounting policies; our ability to consistently provide high-quality care; our ability to keep our patients and employees safe; our access to financing; our ability to meet debt service requirements and comply with covenants in debt agreements; business disruptions due to natural or man-made disasters, climate change or acts of terrorism, widespread protests or civil unrest; our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively; our ability to realize the anticipated benefits of acquisitions, investments and joint ventures; our ability to integrate, manage and keep our information systems secure; the impact of inflation; and changes in laws or developments with respect to any litigation relating to the Company, including various other matters, many of which are beyond our control.
Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law.
Contact: Investor Contact: Media Contact: Amedisys, Inc. Amedisys, Inc. Nick Muscato Kendra Kimmons Chief Strategy Officer Vice President, Marketing & Communications (615) 928- 5452 (225) 299-3720 IR@amedisys.com kendra.kimmons@amedisys.com AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENTS
(Amounts in thousands, except per share data)
(Unaudited)For the Three-Month
Periods Ended March 31,2024 2023 Net service revenue $ 571,414 $ 556,389 Operating expenses: Cost of service, inclusive of depreciation 321,537 315,010 General and administrative expenses: Salaries and benefits 127,946 126,339 Non-cash compensation 7,433 3,273 Merger-related expenses 20,667 720 Depreciation and amortization 4,271 4,443 Other 57,941 64,225 Total operating expenses 539,795 514,010 Operating income 31,619 42,379 Other income (expense): Interest income 1,727 406 Interest expense (8,119 ) (7,517 ) Equity in earnings from equity method investments 910 123 Miscellaneous, net 1,090 (682 ) Total other expense, net (4,392 ) (7,670 ) Income before income taxes 27,227 34,709 Income tax expense (12,633 ) (9,800 ) Net income 14,594 24,909 Net (income) loss attributable to noncontrolling interests (194 ) 337 Net income attributable to Amedisys, Inc. $ 14,400 $ 25,246 Basic earnings per common share: Net income attributable to Amedisys, Inc. common stockholders $ 0.44 $ 0.78 Weighted average shares outstanding 32,670 32,558 Diluted earnings per common share: Net income attributable to Amedisys, Inc. common stockholders $ 0.44 $ 0.77 Weighted average shares outstanding 32,979 32,643 AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)March 31, 2024
(unaudited)December 31,
2023ASSETS Current assets: Cash and cash equivalents $ 108,234 $ 126,450 Restricted cash 12,470 12,413 Patient accounts receivable 359,359 313,373 Prepaid expenses 20,332 14,639 Other current assets 26,053 30,060 Total current assets 526,448 496,935 Property and equipment, net of accumulated depreciation of $96,056 and $92,422 42,684 41,845 Operating lease right of use assets 88,425 88,939 Goodwill 1,244,679 1,244,679 Intangible assets, net of accumulated amortization of $15,128 and $14,008 101,778 102,675 Other assets 85,857 85,097 Total assets $ 2,089,871 $ 2,060,170 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 36,249 $ 28,237 Payroll and employee benefits 131,631 136,835 Accrued expenses 147,464 140,049 Termination fee paid by UnitedHealth Group 106,000 106,000 Current portion of long-term obligations 37,232 36,314 Current portion of operating lease liabilities 26,284 26,286 Total current liabilities 484,860 473,721 Long-term obligations, less current portion 356,080 361,862 Operating lease liabilities, less current portion 62,220 62,751 Deferred income tax liabilities 43,229 40,635 Other long-term obligations 828 1,418 Total liabilities 947,217 940,387 Equity: Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued or outstanding — — Common stock, $0.001 par value, 60,000,000 shares authorized; 38,146,546 and 38,131,478 shares issued; 32,676,115 and 32,667,631 shares outstanding 38 38 Additional paid-in capital 795,063 787,177 Treasury stock, at cost, 5,470,431 and 5,463,847 shares of common stock (469,243 ) (468,626 ) Retained earnings 762,325 747,925 Total Amedisys, Inc. stockholders’ equity 1,088,183 1,066,514 Noncontrolling interests 54,471 53,269 Total equity 1,142,654 1,119,783 Total liabilities and equity $ 2,089,871 $ 2,060,170 AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND DAYS REVENUE OUTSTANDING
(Amounts in thousands, except statistical information)
(Unaudited)For the Three-Month
Periods Ended March 31,2024 2023 Cash Flows from Operating Activities: Net income $ 14,594 $ 24,909 Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation and amortization (inclusive of depreciation included in cost of service) 6,138 5,694 Non-cash compensation 7,886 3,273 Amortization and impairment of operating lease right of use assets 8,566 8,622 Loss (gain) on disposal of property and equipment 4 (70 ) Loss on personal care divestiture — 2,186 Deferred income taxes 2,594 2,772 Equity in earnings from equity method investments (910 ) (123 ) Amortization of deferred debt issuance costs 248 248 Return on equity method investments 170 1,787 Changes in operating assets and liabilities, net of impact of acquisitions: Patient accounts receivable (46,806 ) (7,476 ) Other current assets (1,696 ) (4,128 ) Operating lease right of use assets (1,042 ) (918 ) Other assets 155 (111 ) Accounts payable 8,652 (3,457 ) Accrued expenses 3,029 741 Other long-term obligations (591 ) (28 ) Operating lease liabilities (7,532 ) (7,960 ) Net cash (used in) provided by operating activities (6,541 ) 25,961 Cash Flows from Investing Activities: Proceeds from the sale of deferred compensation plan assets 21 19 Purchases of property and equipment (2,670 ) (1,350 ) Investments in technology assets (223 ) (210 ) Investment in equity method investee (196 ) — Proceeds from personal care divestiture — 47,787 Acquisitions of businesses, net of cash acquired — (350 ) Net cash (used in) provided by investing activities (3,068 ) 45,896 Cash Flows from Financing Activities: Proceeds from issuance of stock under employee stock purchase plan — 816 Shares withheld to pay taxes on non-cash compensation (617 ) (1,308 ) Noncontrolling interest contributions 1,764 — Noncontrolling interest distributions (756 ) (285 ) Purchase of noncontrolling interest — (800 ) Proceeds from borrowings under revolving line of credit — 8,000 Repayments of borrowings under revolving line of credit — (8,000 ) Principal payments of long-term obligations (8,941 ) (55,313 ) Net cash used in financing activities (8,550 ) (56,890 ) Net (decrease) increase in cash, cash equivalents and restricted cash (18,159 ) 14,967 Cash, cash equivalents and restricted cash at beginning of period 138,863 54,133 Cash, cash equivalents and restricted cash at end of period $ 120,704 $ 69,100 For the Three-Month
Periods Ended March 31,2024 2023 Supplemental Disclosures of Cash Flow Information: Cash paid for interest $ 8,188 $ 6,654 Cash paid for income taxes, net of refunds received $ 828 $ 352 Cash paid for operating lease liabilities $ 8,574 $ 8,878 Cash paid for finance lease liabilities $ 2,236 $ 2,457 Supplemental Disclosures of Non-Cash Activity: Right of use assets obtained in exchange for operating lease liabilities $ 7,173 $ 7,083 Right of use assets obtained in exchange for finance lease liabilities $ 4,326 $ 20,790 Reductions to right of use assets resulting from reductions to operating lease liabilities $ 168 $ 141 Reductions to right of use assets resulting from reductions to finance lease liabilities $ 496 $ 369 Days revenue outstanding (1) 54.1 46.3 (1) Our calculation of days revenue outstanding at March 31, 2024 and 2023 is derived by dividing our ending patient accounts receivable by our average daily patient revenue for the three-month periods ended March 31, 2024 and 2023, respectively. AMEDISYS, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Amounts in millions, except statistical information)
(Unaudited)Segment Information - Home Health For the Three-Month Periods
Ended March 31,2024 2023 Financial Information (in millions): Medicare $ 215.8 $ 215.4 Non-Medicare 148.2 127.9 Net service revenue 364.0 343.3 Cost of service, inclusive of depreciation 210.4 197.0 Gross margin 153.6 146.3 General and administrative expenses 91.0 89.1 Depreciation and amortization 1.8 1.1 Operating income $ 60.8 $ 56.1 Same Store Growth(1): Medicare revenue — % (7 %) Non-Medicare revenue 16 % 12 % Total admissions 10 % 8 % Total volume(2) 8 % 5 % Key Statistical Data - Total(3): Admissions 112,215 101,963 Recertifications 43,961 43,325 Total volume 156,176 145,288 Medicare completed episodes 72,998 73,563 Average Medicare revenue per completed episode(4) $ 2,998 $ 2,974 Medicare visits per completed episode(5) 11.9 12.4 Visiting clinician cost per visit $ 105.38 $ 100.00 Clinical manager cost per visit 11.99 10.97 Total cost per visit $ 117.37 $ 110.97 Visits 1,792,629 1,775,206 (1) Same store information represents the percent change in our Medicare, Non-Medicare and Total revenue, admissions or volume for the period as a percent of the Medicare, Non-Medicare and Total revenue, admissions or volume of the prior period. Same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center. (2) Total volume includes all admissions and recertifications. (3) Total includes acquisitions, startups and de novos. (4) Average Medicare revenue per completed episode is the average Medicare revenue earned for each Medicare completed episode of care. (5) Medicare visits per completed episode are the home health Medicare visits on completed episodes divided by the home health Medicare episodes completed during the period. Segment Information - Hospice
For the Three-Month Periods
Ended March 31,2024 2023 Financial Information (in millions): Medicare $ 190.0 $ 182.7 Non-Medicare 11.0 10.7 Net service revenue 201.0 193.4 Cost of service, inclusive of depreciation 105.3 101.4 Gross margin 95.7 92.0 General and administrative expenses 48.1 47.9 Depreciation and amortization 0.7 0.6 Operating income $ 46.9 $ 43.5 Same Store Growth(1): Medicare revenue 4 % — % Hospice admissions (3 %) (5 %) Average daily census — % (1 %) Key Statistical Data - Total(2): Hospice admissions 12,657 12,998 Average daily census 12,767 12,730 Revenue per day, net $ 173.04 $ 168.83 Cost of service per day $ 90.64 $ 88.21 Average discharge length of stay 92 90 (1) Same store information represents the percent change in our Medicare revenue, Hospice admissions or average daily census for the period as a percent of the Medicare revenue, Hospice admissions or average daily census of the prior period. Same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center. (2) Total includes acquisitions and de novos. Segment Information - Personal Care (1)
For the Three-Month Periods
Ended March 31,2024 2023 Financial Information (in millions): Medicare $ — $ — Non-Medicare — 15.0 Net service revenue — 15.0 Cost of service, inclusive of depreciation — 11.1 Gross margin — 3.9 General and administrative expenses — 2.3 Depreciation and amortization — — Operating income $ — $ 1.6 Key Statistical Data - Total: Billable hours — 440,464 Clients served — 7,892 Shifts — 191,379 Revenue per hour $ — $ 33.97 Revenue per shift $ — $ 78.19 Hours per shift — 2.3 (1) We completed the sale of our personal care business on March 31, 2023. Segment Information - High Acuity Care
For the Three-Month Periods
Ended March 31,2024 2023 Financial Information (in millions): Medicare $ — $ — Non-Medicare 6.4 4.7 Net service revenue 6.4 4.7 Cost of service, inclusive of depreciation 5.8 5.5 Gross margin 0.6 (0.8 ) General and administrative expenses 5.9 4.4 Depreciation and amortization 0.9 0.8 Operating loss $ (6.2 ) $ (6.0 ) Key Statistical Data - Total: Full risk admissions 139 158 Limited risk admissions 622 459 Total admissions 761 617 Total admissions growth 23 % 85 % Full risk revenue per episode $ 10,073 $ 11,343 Limited risk revenue per episode $ 6,780 $ 5,711 Number of admitting joint ventures 9 9 Segment Information - Corporate
For the Three-Month Periods
Ended March 31,2024 2023 Financial Information (in millions): General and administrative expenses $ 69.0 $ 50.9 Depreciation and amortization 0.9 1.9 Total operating expenses $ 69.9 $ 52.8 AMEDISYS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES
(Amounts in thousands)
(Unaudited)Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") Reconciliation: For the Three-Month Periods
Ended March 31,2024 2023 Net income attributable to Amedisys, Inc. $ 14,400 $ 25,246 Add: Income tax expense 12,633 9,800 Interest expense, net 6,392 7,111 Depreciation and amortization 6,138 5,694 Certain items(1) 20,296 9,987 Adjusted EBITDA(2)(5) $ 59,859 $ 57,838 Adjusted Net Income Attributable to Amedisys, Inc Reconciliation:
For the Three-Month Periods
Ended March 31,2024 2023 Net income attributable to Amedisys, Inc. $ 14,400 $ 25,246 Add: Certain items(1) 19,548 7,489 Adjusted net income attributable to Amedisys, Inc.(3)(5) $ 33,948 $ 32,735 Adjusted Net Income Attributable to Amedisys, Inc. per Diluted Share Reconciliation:
For the Three-Month Periods
Ended March 31,2024 2023 Net income attributable to Amedisys, Inc. common stockholders per diluted share $ 0.44 $ 0.77 Add: Certain items(1) 0.59 0.23 Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share(4)(5) $ 1.03 $ 1.00 (1) The following details the certain items for the three-month periods ended March 31, 2024 and 2023: Certain Items (in thousands):
For the Three-Month Periods
Ended March 31,2024 2023 (Income) Expense (Income) Expense Certain Items Impacting Cost of Service, Inclusive of Depreciation: Clinical optimization and reorganization costs $ — $ 114 Certain Items Impacting General and Administrative Expenses: Acquisition and integration costs — 1,667 CEO transition — 750 Merger-related expenses 20,667 720 Clinical optimization and reorganization costs — 3,170 Personal care divestiture — 514 Certain Items Impacting Total Other Income (Expense): Other (income) expense, net (371 ) 3,052 Total $ 20,296 $ 9,987 Net of tax $ 19,548 $ 7,489 Diluted EPS $ 0.59 $ 0.23 (2) Adjusted EBITDA is defined as net income attributable to Amedisys, Inc. before net interest expense, provision for income taxes and depreciation and amortization, excluding certain items as described in footnote 1. (3) Adjusted net income attributable to Amedisys, Inc. is defined as net income attributable to Amedisys, Inc. calculated in accordance with GAAP excluding certain items as described in footnote 1. (4) Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share is defined as diluted income per share calculated in accordance with GAAP excluding the earnings per share effect of certain items as described in footnote 1. (5) Adjusted EBITDA, adjusted net income attributable to Amedisys, Inc. and adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share should not be considered as an alternative to, or more meaningful than, income before income taxes or other measures calculated in accordance with GAAP. These calculations may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate these non-GAAP financial measures in the same manner.