Addus HomeCare Announces First Quarter 2024 Financial Results

FRISCO, Texas—Addus HomeCare Corporation, a provider of homecare services, announced its financial results for the first quarter ended March 31, 2024.

First Quarter 2024 Highlights:

• Revenues Grow 11.6% to $280.7 Million
• Net Income of $15.8 Million, or $0.97 per Diluted Share
• Adjusted Net Income per Diluted Share Increases to $1.21
• Adjusted EBITDA Increases 24.6% to $32.4 Million
• Cash Flow from Operations of $38.7 Million

Overview

Net service revenues were $280.7 million for the first quarter of 2024, an 11.6% increase compared with $251.6 million for the first quarter of 2023. Net income was $15.8 million for the first quarter of 2024, compared with $12.7 million for the first quarter of 2023, while net income per diluted share was $0.97 compared with $0.78 for the same period a year ago. Adjusted EBITDA increased 24.6% to $32.4 million for the first quarter of 2024 from $26.0 million for the first quarter of 2023. Adjusted net income per diluted share was $1.21 for the first quarter of 2024 compared with $0.97 for the first quarter of 2023. Adjusted net income per diluted share for the first quarter of 2024 excludes acquisition expenses of $0.12 and stock-based compensation expense of $0.12.

“We are pleased to report a great start for Addus in 2024, delivering a strong financial and operating performance as we continued to build momentum as a leading provider of home-based care services,” said Dirk Allison, chairman and chief executive officer. “With solid execution, we achieved impressive top-line growth with overall revenues up 11.6% and adjusted EBITDA up 24.6% compared with the first quarter of 2023. The heightened awareness of the value and safety of home-based care is helping to drive our growth, and our team has done an exceptional job in meeting the increased demand with a proven operating model across the continuum of homecare.

“Our personal care segment, which accounted for 74.1% of our business, was a key driver of our growth with a 9.3% revenue increase over the first quarter of last year on a same-store basis,” Allison continued. “We continued to benefit from steady volume trends as well as rate increases in certain state markets. We have also experienced a more stable labor environment, and we continue to see an improved ability to hire and retain caregivers from our investments in more efficient and effective hiring and scheduling systems, which support our ability to efficiently manage higher patient volume.

“Our first quarter results included the operations from Tennessee Quality Care, a provider of home health, hospice, and private duty nursing services, which we acquired August 1, 2023. We were pleased to see continued steady improvement in our hospice care business, with organic revenue growth of 5.8% over the same period last year, which included the benefit of a 3.1% rate increase as of October 1, 2023, and the impact of additional Tennessee locations. Our volume trends in hospice care also improved, with higher admissions, patient days, and revenue per patient day compared with the first quarter of last year. Hospice care now accounts for 20.0% of our business, and we will look to continue to drive organic growth and expansion in this critical area of care,” said Allison.

Cash & Liquidity

As of March 31, the company had cash of $76.7 million and bank debt of $101.4 million, with capacity and availability under its revolving credit facility of $486.9 million and $377.5 million, respectively. Net cash provided by operating activities was $38.7 million for the first quarter of 2024, and $30.9 million exclusive of a net $7.8 million in ARPA funding.

Looking Ahead

Allison continued, “We have continued to generate strong cash flow from operations, allowing us to further reduce our revolver balance by $25.0 million and strengthen our balance sheet in the first quarter. At the same time, we are focused on making the necessary investments in our business to support continued growth. We have the financial flexibility to remain focused on identifying acquisition opportunities in attractive markets in 2024. Our primary objective is to acquire accretive operations that enhance our current personal care services, either by building scale or adding complementary clinical services. Our size and scale are important competitive advantages for Addus, and we will look for additional opportunities to leverage our strong market presence, particularly in markets where we participate in value-based contracting models or may have the opportunity to do so.

“We are pleased with the favorable trends in our business, reflecting the consistently growing demand for our home-based care services. We are extremely proud of the important work we are doing to allow more patients to receive safe, quality care in their preferred setting of their home. Our success as a provider is due to the dedicated caregivers who represent Addus in the marketplace, and we are grateful for the outstanding care they are providing to patients and families. We look forward to the opportunities ahead for Addus in 2024 as we extend our market reach and deliver greater value for our shareholders,” added Allison.

Non-GAAP Financial Measures

The information provided includes adjusted net income, adjusted EBITDA and adjusted net income per diluted share, which are non-GAAP financial measures. The company defines adjusted net income as net income before acquisition expenses, stock-based compensation expenses and restructure and other non-recurring costs. The company defines adjusted EBITDA as earnings before interest expense, other non-operating income, taxes, depreciation, amortization, acquisition expense, stock-based compensation expense and restructure and other non-recurring costs. The company defines adjusted net income per diluted share as net income per share, adjusted for acquisition expenses, stock-based compensation expense and restructure and other non-recurring costs. The company defines adjusted net service revenues as revenue adjusted for the closure of certain sites. The company has provided, in the financial statement tables, a reconciliation of adjusted net income to net income, a reconciliation of adjusted EBITDA to net income, a reconciliation of adjusted diluted net income per share to net income per share and a reconciliation of adjusted net service revenues to net service revenues, in each case, the most directly comparable GAAP measure. Management believes that adjusted net income, adjusted EBITDA, adjusted diluted net income per share, and adjusted net service revenues are useful to investors, management and others in evaluating the company’s operating performance, to provide investors with insight and consistency in the company’s financial reporting and to present a basis for comparison of the company’s business operations among periods, and to facilitate comparison with the results of the company’s peers.