AMED Amedisys Inc

Amedisys, Inc. (NASDAQ: AMED) today reported its financial results for the three and nine-month period ended September 30, 2018.

Three Month Periods Ended September 30, 2018 and 2017

• Net service revenue increased $43.6 million to $417.3 million compared to $373.7 million in 2017 (1).
• Net income attributable to Amedisys, Inc. of $31.4 million compared to $14.6 million in 2017.
• Net income attributable to Amedisys, Inc. per diluted share of $0.96 per diluted share compared to $0.42 in 2017.

Adjusted Quarterly Results*

• Adjusted EBITDA of $45.3 million compared to $36.9 million in 2017.
• Adjusted net service revenue of $417.3 million compared to $380.2 million in 2017.
• Adjusted net income attributable to Amedisys, Inc. of $30.9 million compared to $19.2 million in 2017.
• Adjusted net income attributable to Amedisys, Inc. per diluted share of $0.95 compared to $0.56 in 2017.

Nine Month Periods Ended September 30, 2018 and 2017

• Net service revenue increased $114.9 million to $1,228.2 million compared to $1,113.3 million in 2017 (1).
• Net income attributable to Amedisys, Inc. of $91.9 million compared to $34.1 million in 2017.
• Net income attributable to Amedisys, Inc. per diluted share of $2.71 per diluted share compared to $1.00 in 2017.

Adjusted Year to Date Results*

• Adjusted EBITDA of $136.7 million compared to $105.0 million in 2017.
• Adjusted net service revenue of $1,229.9 million compared to $1,119.8 million in 2017.
• Adjusted net income attributable to Amedisys, Inc. of $92.3 million compared to $56.5 million in 2017.
• Adjusted net income attributable to Amedisys, Inc. per diluted share of $2.73 compared to $1.65 in 2017.

* See below for the definition and reconciliations of non-GAAP financial measures to GAAP measures.

(1) Subsequent to our adoption of Accounting Standards Updates 2014-09 and 2015-14 on January 1, 2018, using the full retrospective method, amounts previously classified as provision for doubtful accounts are now classified as price concessions in determining the transaction price of our net service revenue.

Paul B. Kusserow, President and Chief Executive Officer stated, “I am proud of our third quarter results and the strong execution of our team. We are pleased with the growth trends we continue to see in home health. Our performance in home health helped drive our significant results this quarter and I am delighted with the progress the home health segment has made this year. Our hospice segment continues its stellar performance, with another quarter of double digit ADC growth. We look forward to welcoming all of our new Compassionate Care Hospice team members to the Amedisys family once our deal closes early next year and are excited about the continued growth potential within our hospice segment. Our personal care segment continues with their impressive integration engine and has built out a platform for growth within Massachusetts and beyond. Above all else, our clinical quality metrics continue to be at, or near, the top of the industry in both home health and hospice. Providing our clinically distinct care to as many patients wherever they call home is and will always be our first priority. Finally, thanks to our team of over 18,500 employees for continuing to do all that you do to drive such impressive results and provide such incredible care.”

Updated 2018 Guidance

• Net service revenue is anticipated to be in the range of $1.65 billion to $1.67 billion.
• Adjusted EBITDA is anticipated to be in the range of $177 million to $180 million.
• Adjusted diluted earnings per share is anticipated to be in the range of $3.54 to $3.60 based on an estimated 33.50 million shares outstanding.

This guidance excludes the effects of any future acquisitions, if any are made.

We urge caution in considering the current trends and 2018 guidance disclosed in this press release. The home health and hospice industry is highly competitive and subject to intensive regulations, and trends are subject to numerous factors, risks, and uncertainties, some of which are referenced in the cautionary language below and others that are described more fully in our reports filed with the Securities and Exchange Commission (“SEC”) including our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and subsequent Quarterly Reports on Form 10-Q, and current reports on Form 8-K which can be found on the SEC’s internet website, http://www.sec.gov, and our internet website, http://www.amedisys.com.

Earnings Call and Webcast Information

Amedisys will host a conference call on Tuesday, October 30, 2018, at 11:00 a.m. ET to discuss its third quarter results. To participate on the conference call, please call before 11:00 a.m. ET to either (877) 524-8416 (Toll-Free) or (412) 902-1028 (Toll). A replay of the conference call will be available through November 30, 2018 by dialing (877) 660-6853 (Toll-Free) or (201) 612-7415 (Toll) and entering conference ID #13684177.

A live webcast of the call will be accessible through our website on our Investor Relations section at the following web address: http://investors.amedisys.com.

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 provision for income taxes, net interest expense and depreciation and amortization, excluding certain items; (2) adjusted net service revenue, defined as net service revenue excluding certain items; (3) adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. excluding certain items; and (4) adjusted net income attributable to Amedisys, Inc. per diluted share, defined as net income attributable to Amedisys, Inc. common stockholders per diluted share 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 personal care. Amedisys is focused on delivering the care that is best for our patients, whether that is home-based personal care; recovery and rehabilitation after an operation or injury; care focused on empowering them to manage a chronic disease; or hospice care at the end of life. More than 3,000 hospitals and 59,000 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 18,500 employees, in 421 care centers within 34 states and the District of Columbia, Amedisys is dedicated to delivering the highest quality of care to the doorsteps of more than 369,000 patients and clients in need 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,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “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: changes in Medicare and other medical payment levels, our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively, 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, competition in the healthcare industry, our ability to integrate our personal care segment into our business efficiently, changes in the case mix of patients and payment methodologies, changes in estimates and judgments associated with critical accounting policies, our ability to maintain or establish new patient referral sources, our ability to attract and retain qualified personnel, changes in payments and covered services by federal and state governments, future cost containment initiatives undertaken by third-party payors, our access to financing, our ability to meet debt service requirements and comply with covenants in debt agreements, business disruptions due to natural disasters or acts of terrorism, our ability to integrate, manage and keep our information systems secure, our ability to comply with requirements stipulated in our corporate integrity agreement and changes in law 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
	Vice President, Strategic Finance	Vice President, Marketing & Communications
	(855) 259-2046	(225) 299-3720
	IR@amedisys.com	kendra.kimmons@amedisys.com

AMEDISYS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except per share data) (Unaudited)

	For the Three-Month Periods Ended September 30								For the Nine-Month Periods Ended September 30
		2018				2017				2018				2017
Net service revenue	$	417,335			$	373,704			$	1,228,200			$	1,113,311
Cost of service, excluding depreciation and amortization		249,739				227,269				730,612				664,139
General and administrative expenses:
Salaries and benefits		79,367				77,130				232,213				226,532
Non-cash compensation		4,842				3,558				12,653				11,788
Other		40,335				38,189				124,119				120,223
Depreciation and amortization		3,164				4,185				9,882				13,139
Securities Class Action Lawsuit settlement, net		—				—				—				28,712
Operating expenses		377,447				350,331				1,109,479				1,064,533
Operating income		39,888				23,373				118,721				48,778
Other income (expense):
Interest income		29				44				263				104
Interest expense		(1,991	)			(1,335	)			(5,834	)			(3,600	)
Equity in earnings from equity method investments		1,625				900				6,461				3,149
Miscellaneous, net		1,822				1,043				2,782				3,282
Total other income, net		1,485				652				3,672				2,935
Income before income taxes		41,373				24,025				122,393				51,713
Income tax expense		(9,825	)			(9,364	)			(29,984	)			(17,324	)
Net income		31,548				14,661				92,409				34,389
Net income attributable to noncontrolling interests		(171	)			(103	)			(524	)			(240	)
Net income attributable to Amedisys, Inc.	$	31,377			$	14,558			$	91,885			$	34,149
Basic earnings per common share:
Net income attributable to Amedisys, Inc. common stockholders	$	0.99			$	0.43			$	2.78			$	1.02
Weighted average shares outstanding		31,815				33,838				33,075				33,640
Diluted earnings per common share:
Net income attributable to Amedisys, Inc. common stockholders	$	0.96			$	0.42			$	2.71			$	1.00
Weighted average shares outstanding		32,691				34,363				33,852				34,255

AMEDISYS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share data)

	September 30, 2018 (unaudited)				December 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	14,010			$	86,363
Patient accounts receivable		195,030				201,196
Prepaid expenses		11,679				7,329
Other current assets		11,949				16,268
Total current assets		232,668				311,156
Property and equipment, net of accumulated depreciation of $93,432 and $146,814		30,215				31,122
Goodwill		324,145				319,949
Intangible assets, net of accumulated amortization of $32,443 and $30,610		44,309				46,061
Deferred income taxes		41,149				56,064
Other assets		53,406				49,130
Total assets	$	725,892			$	813,482
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	24,519			$	25,384
Payroll and employee benefits		92,385				89,936
Accrued expenses		101,177				89,104
Current portion of long-term obligations		1,209				10,638
Total current liabilities		219,290				215,062
Long-term obligations, less current portion		54,853				78,203
Other long-term obligations		6,253				3,791
Total liabilities		280,396				297,056
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; 36,146,649 and 35,747,134 shares issued; and 31,877,278 and 33,964,767 shares outstanding		36				35
Additional paid-in capital		592,539				568,780
Treasury stock, at cost 4,269,371 and 1,782,367 shares of common stock		(240,536	)			(53,713	)
Accumulated other comprehensive income		15				15
Retained earnings		92,089				204
Total Amedisys, Inc. stockholders’ equity		444,143				515,321
Noncontrolling interests		1,353				1,105
Total equity		445,496				516,426
Total liabilities and equity	$	725,892			$	813,482

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 September 30								For the Nine-Month Periods Ended September 30
		2018				2017				2018				2017
Cash Flows from Operating Activities:
Net income	$	31,548			$	14,661			$	92,409			$	34,389
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		3,164				4,185				9,882				13,139
Non-cash compensation		4,842				3,558				12,653				11,788
401(k) employer match		2,040				2,180				6,934				6,547
Loss (gain) on disposal of property and equipment		88				(169	)			738				(22	)
Deferred income taxes		5,771				9,646				14,916				17,228
Equity in earnings from equity method investments		(1,625	)			(900	)			(6,461	)			(3,149	)
Amortization of deferred debt issuance costs/debt discount		203				185				596				555
Return on equity investment		2,169				1,240				4,373				4,656
Changes in operating assets and liabilities, net of impact of acquisitions:
Patient accounts receivable		2,562				(4,013	)			6,166				(10,846	)
Other current assets		11,648				996				(32	)			(5,896	)
Other assets		38				(11,054	)			726				(12,202	)
Accounts payable		(4,293	)			(6,523	)			(670	)			(5,430	)
Securities Class Action Lawsuit settlement accrual, net		—				(28,712	)			—				—
Accrued expenses		10,210				25,327				14,758				22,584
Other long-term obligations		115				(406	)			2,462				201
Net cash provided by operating activities		68,480				10,201				159,450				73,542
Cash Flows from Investing Activities:
Proceeds from sale of deferred compensation plan assets		92				57				563				622
Proceeds from the sale of property and equipment		40				118				51				118
Investments in equity method investees		(3,477	)			—				(3,477	)			(436	)
Purchases of property and equipment		(4,073	)			(1,625	)			(5,684	)			(9,074	)
Acquisitions of businesses, net of cash acquired		—				—				(4,074	)			(24,128	)
Net cash used in investing activities		(7,418	)			(1,450	)			(12,621	)			(32,898	)
Cash Flows from Financing Activities:
Proceeds from issuance of stock upon exercise of stock options and warrants		140				11				2,749				4,214
Proceeds from issuance of stock to employee stock purchase plan		630				611				1,787				1,798
Shares withheld upon stock vesting		(2,589	)			(728	)			(5,421	)			(6,454	)
Noncontrolling interest distribution		(180	)			(126	)			(530	)			(216	)
Proceeds from borrowings under revolving line of credit		—				—				127,500				—
Repayments of borrowings under revolving line of credit		(70,000	)			—				(70,000	)			—
Principal payments of long-term obligations		(596	)			(1,569	)			(91,071	)			(4,069	)
Debt issuance costs		—				—				(2,433	)			—
Purchase of company stock		—				—				(181,402	)			—
Repurchase of noncontrolling interest		(361	)			—				(361	)			—
Net cash used in financing activities		(72,956	)			(1,801	)			(219,182	)			(4,727	)
Net (decrease) increase in cash and cash equivalents		(11,894	)			6,950				(72,353	)			35,917
Cash and cash equivalents at beginning of period		25,904				59,164				86,363				30,197
Cash and cash equivalents at end of period	$	14,010			$	66,114			$	14,010			$	66,114
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	909			$	1,016			$	2,989			$	2,188
Cash paid for income taxes, net of refunds received	$	4,868			$	31			$	11,017			$	315
Days revenue outstanding (1)		40.6				40.7				40.6				40.7

(1)      Our calculation of days revenue outstanding at September 30, 2018 and 2017 is derived by dividing our ending patient accounts receivable by our average daily patient revenue for the three month periods ended September 30, 2018 and 2017, respectively.

AMEDISYS, INC. AND SUBSIDIARIES SEGMENT INFORMATION (Amounts in millions, except statistical information) (Unaudited)

Segment Information - Home Health

	For the Three- Month Periods Ended September 30,
		2018				2017
Financial Information (in millions):
Medicare	$	208.0			$	191.4
Non-Medicare		86.9				72.7
Net service revenue		294.9				264.1
Cost of service		181.8				168.3
Gross margin		113.1				95.8
Other operating expenses		69.6				71.7
Operating income	$	43.5			$	24.1
Same Store Growth (1):
Medicare revenue		10	%			(7	%)
Non-Medicare revenue		20	%			18	%
Total admissions		4	%			1	%
Total volume (2)		6	%			5	%
Total Episodic admissions (3)		3	%			1	%
Total Episodic volume (4)		5	%			3	%
Key Statistical Data - Total (5):
Medicare:
Admissions		46,371				46,823
Recertifications		28,551				26,996
Total volume		74,922				73,819
Completed episodes		73,114				71,454
Visits		1,301,090				1,259,156
Average revenue per completed episode (6)	$	2,855			$	2,820
Visits per completed episode (7)		17.6				17.4
Non-Medicare:
Admissions		29,325				26,686
Recertifications		14,539				12,263
Total volume		43,864				38,949
Visits		698,181				592,742
Total (5):
Visiting Clinician Cost per Visit	$	82.78			$	82.53
Clinical Manager Cost per Visit		8.18				8.30
Total Cost per Visit	$	90.96			$	90.83
Visits		1,999,271				1,851,898

	For the Nine- Month Periods Ended September 30,
		2018				2017
Financial Information (in millions):
Medicare	$	619.3			$	588.4
Non-Medicare		251.2				213.6
Net service revenue		870.5				802.0
Cost of service		532.7				496.1
Gross margin		337.8				305.9
Other operating expenses		207.6				210.5
Operating income	$	130.2			$	95.4
Same Store Growth (1):
Medicare revenue		7	%			(5	%)
Non-Medicare revenue		18	%			14	%
Total admissions		4	%			1	%
Total volume (2)		7	%			3	%
Total Episodic admissions (3)		3	%			1	%
Total Episodic volume (4)		6	%			3	%
Key Statistical Data - Total (5):
Medicare:
Admissions		142,884				143,711
Recertifications		84,218				78,878
Total volume		227,102				222,589
Completed episodes		220,726				217,190
Visits		3,933,290				3,794,001
Average revenue per completed episode (6)	$	2,841			$	2,811
Visits per completed episode (7)		17.5				17.3
Non-Medicare:
Admissions		88,485				80,244
Recertifications		40,862				33,949
Total volume		129,347				114,193
Visits		2,049,662				1,727,618
Total (5):
Visiting Clinician Cost per Visit	$	81.06			$	81.41
Clinical Manager Cost per Visit		7.98				8.42
Total Cost per Visit	$	89.04			$	89.83
Visits		5,982,952				5,521,619

(1)      Same store information represents the percent increase (decrease) in our Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume for the period as a percent of the Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume of the prior period. (2)      Total volume includes all admissions and recertifications. (3)      Total Episodic admissions includes admissions for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis. (4)      Total Episodic volume includes admissions and recertifications for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis. (5)      Total includes acquisitions. (6)      Average Medicare revenue per completed episode is the average Medicare revenue earned for each Medicare completed episode of care. (7)      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 September 30,
		2018				2017
Financial Information (in millions):
Medicare	$	98.0			$	91.4
Non-Medicare		5.4				4.5
Net service revenue		103.4				95.9
Cost of service		53.4				48.4
Gross margin		50.0				47.5
Other operating expenses		21.7				19.2
Operating income	$	28.3			$	28.3
Same Store Growth (1):
Medicare revenue		7	%			17	%
Non-Medicare revenue		19	%			11	%
Hospice admissions		8	%			7	%
Average daily census		11	%			14	%
Key Statistical Data - Total (2):
Hospice admissions		6,765				6,257
Average daily census		7,768				7,026
Revenue per day, net	$	144.71			$	148.43
Cost of service per day	$	74.72			$	74.96
Average discharge length of stay		101				95
	For the Nine- Month Periods Ended September 30,
		2018				2017
Financial Information (in millions):
Medicare	$	286.7			$	257.9
Non-Medicare		15.4				11.9
Net service revenue		302.1				269.8
Cost of service		155.2				136.7
Gross margin		146.9				133.1
Other operating expenses		62.5				56.9
Operating income	$	84.4			$	76.2
Same Store Growth (1):
Medicare revenue		11	%			18	%
Non-Medicare revenue		28	%			(1	%)
Hospice admissions		7	%			13	%
Average daily census		12	%			15	%
Key Statistical Data - Total (2):
Hospice admissions		20,444				19,010
Average daily census		7,514				6,705
Revenue per day, net	$	147.28			$	147.43
Cost of service per day	$	75.65			$	74.78
Average discharge length of stay		98				92

(1)      Same store information represents the percent increase (decrease) in our Medicare and Non-Medicare revenue, Hospice admissions or average daily census for the period as a percent of the Medicare and Non-Medicare revenue, Hospice admissions or average daily census of the prior period. (2)      Total includes acquisitions.

Segment Information - Personal Care

	For the Three- Month Periods Ended September 30,
		2018			2017
Financial Information (in millions):
Medicare	$	—		$	—
Non-Medicare		19.0			13.7
Net service revenue		19.0			13.7
Cost of service		14.5			10.6
Gross margin		4.5			3.1
Other operating expenses		3.1			3.1
Operating income	$	1.4		$	—
Key Statistical Data:
Billable hours		810,427			616,036
Clients served		12,380			7,978
Shifts		357,382			281,904
Revenue per hour	$	23.40		$	22.21
Revenue per shift	$	53.06		$	48.54
Hours per shift		2.3			2.2
	For the Nine- Month Periods Ended September 30,
		2018			2017
Financial Information (in millions):
Medicare	$	—		$	—
Non-Medicare		55.6			41.5
Net service revenue		55.6			41.5
Cost of service		42.7			31.3
Gross margin		12.9			10.2
Other operating expenses		9.7			9.3
Operating income	$	3.2		$	0.9
Key Statistical Data:
Billable hours		2,357,608			1,822,653
Clients served		15,731			10,980
Shifts		1,062,422			830,151
Revenue per hour	$	23.57		$	22.76
Revenue per shift	$	52.30		$	49.98
Hours per shift		2.2			2.2

Segment Information - Corporate

	For the Three- Month Periods  Ended September 30,
		2018			2017
Financial Information (in millions):
Other operating expenses	$	31.3		$	25.9
Depreciation and amortization		2.0			3.1
Total operating expenses	$	33.3		$	29.0
	For the Nine- Month Periods  Ended September 30,
		2018			2017
Financial Information (in millions):
Other operating expenses	$	92.6		$	85.4
Depreciation and amortization		6.5			9.6
Total operating expenses before Securities Class Action Lawsuit settlement, net		99.1			95.0
Securities Class Action Lawsuit settlement, net		—			28.7
Total operating expenses	$	99.1		$	123.7

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”):

	For the Three- Month Period  Ended September 30,								For the Nine- Month Period Ended September 30,
		2018				2017				2018				2017
Net income attributable to Amedisys, Inc.	$	31,377			$	14,558			$	91,885			$	34,149
Add:
Income tax expense		9,825				9,364				29,984				17,324
Interest expense, net		1,962				1,291				5,571				3,496
Depreciation and amortization		3,164				4,185				9,882				13,139
Certain items (1)		(609	)			7,590				615				37,014
Interest component of certain items (1)		(451	)			(95	)			(1,280	)			(95	)
Adjusted EBITDA (2) (6)	$	45,268			$	36,893			$	136,657			$	105,027

Adjusted Net Service Revenue Reconciliation:

	For the Three- Month Period Ended September 30,						For the Nine- Month Period Ended September 30,
		2018			2017			2018			2017
Net service revenue	$	417,335		$	373,704		$	1,228,200		$	1,113,311
Add:
Certain items (1)		—			6,506			1,687			6,506
Adjusted net service revenue (3) (6)	$	417,335		$	380,210		$	1,229,887		$	1,119,817

Adjusted Net Income Attributable to Amedisys, Inc Reconciliation:

	For the Three- Month Period Ended September 30,							For the Nine- Month Period Ended September 30,
		2018				2017			2018			2017
Net income attributable to Amedisys, Inc.	$	31,377			$	14,558		$	91,885		$	34,149
Add:
Certain items (1)		(450	)			4,592			455			22,394
Adjusted net income attributable to Amedisys, Inc. (4) (6)	$	30,927			$	19,150		$	92,340		$	56,543
Adjusted Net Income Attributable to Amedisys, Inc. per Diluted Share:
	For the Three- Month Period Ended September 30,							For the Nine- Month Period Ended September 30,
		2018				2017			2018			2017
Net income attributable to Amedisys, Inc. common stockholders per diluted share	$	0.96			$	0.42		$	2.71		$	1.00
Add:
Certain items (1)		(0.01	)			0.13			0.01			0.65
Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share (5) (6)	$	0.95			$	0.56		$	2.73		$	1.65

 (1)           The following details the certain items for the three and nine month periods ended September 30, 2018 and 2017:

Certain Items:

	For the Three-Month Period Ended September 30, 2018				For the Nine-Month Period Ended September 30, 2018
	(Income) Expense				(Income) Expense
Certain Items Impacting Net Service Revenue:
Florida self-audit (pre-acquisition)	$	—			$	1,687
Certain Items Impacting Operating Expenses:
Acquisition costs		857				1,732
Legal fees - non-routine		304				1,409
Certain Items Impacting Total Other Income (Expense):
Legal settlements		(1,437	)			(1,437	)
Miscellaneous, other (income) expense, net		(333	)			(2,776	)
Total	$	(609	)		$	615
Net of tax	$	(450	)		$	455
Diluted EPS	$	(0.01	)		$	0.01

	For the Three-Month Period Ended September 30, 2017				For the Nine-Month Period Ended September 30, 2017
	(Income) Expense				(Income) Expense
Certain Items Impacting Net Service Revenue:
Florida ZPIC audit	$	6,506			$	6,506
Certain Items Impacting Operating Expenses:
Acquisition costs		—				976
Legal fees - non-routine		176				1,410
Securities Class Action Lawsuit settlement accrual, net		—				28,712
Restructuring activity		1,670				1,670
Data center relocation		—				940
Certain Items Impacting Total Other Income (Expense):
Legal settlements		(647	)			(2,014	)
Miscellaneous, other (income) expense, net		(115	)			(1,186	)
Total	$	7,590			$	37,014
Net of tax	$	4,592			$	22,394
Diluted EPS	$	0.13			$	0.65

(2)   Adjusted EBITDA is defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, excluding certain items as described in footnote 1. (3)   Adjusted net service revenue is defined as net service revenue plus certain items as described in footnote 1. (4)   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. (5)   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. (6)   Adjusted EBITDA, adjusted net service revenue, 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 measure 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.