ADUS Announces Second Quarter 2023 Financial Results
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July 31, 2023
“For our personal care segment, we achieved an impressive 12.6% organic growth in revenue on a
same-store basis over the second quarter of 2022. These results reflect both sequential and year-over-year improvement in volume trends, which have continued to gain momentum in 2023 from our ongoing efforts in caregiver hiring and retention
strategies begun last year. We also benefitted from two statewide rate increases in our largest state market of Illinois, which went into effect on January 1, 2023, and April 1, 2023, respectively. For the second quarter of 2023, our
home health revenues declined 10.9% on a same-store basis over the prior-year period as we continue to limit admissions from payers which have lower paying contracts, improving the overall profitability of our home health segment. While this segment
is still a very small part of our overall business, we believe there are opportunities to continue to expand these operations both organically, by acquisition and by strategic partnerships. For our hospice business, which accounted for 19.3% of
revenue, we continued to see modest sequential improvement in average daily census and median length of stay, which was 29 days in the second quarter, the highest it has been since before the pandemic. For the second quarter of 2023, hospice
revenues were lower by 1.1% on a same-store basis compared with the same period last year, however, exclusive of the impact of sequestration our revenues would be essentially flat as compared to the prior year period.” said Allison.
Cash and Liquidity
As of June 30, 2023, the Company
had cash of $84.2 million and bank debt of $81.4 million, with capacity and availability under its revolving credit facility of $409.3 million and $319.9 million, respectively. Net cash provided by operating activities was
$41.6 million for the second quarter of 2023, inclusive of a net $1.0 million in ARPA funds utilization.
Looking Ahead
Allison continued, “We have generated very strong cash flow from operations in 2023, which has allowed us to repay debt and strengthen our balance sheet.
As such, we are well positioned to continue making strategic investments in our business that will expand our operations and enhance our services across the continuum of care. In addition to organic growth opportunities, we remain focused on
pursuing acquisitions that meet our desired operational and geographic profile and are accretive to our business. At the end of the second quarter, we announced a definitive agreement to acquire the entities comprising Tennessee Quality Care, a
provider of home health, hospice, and private duty nursing services. Tennessee Quality Care serves an average daily census of approximately 1,800 patients through 17 locations covering a service area of over 50 counties in Tennessee, a certificate
of need state for both home health and hospice services. This transaction is based on our acquisition strategy to leverage our strong personal care presence and add clinical services in select markets, especially where we have the opportunity to
enter into value-based contracting models.
“We are very pleased with the trends in our business though the first half of the year and our ability to
meet our key performance objectives. As always, we acknowledge the dedicated efforts of our caregivers who work hard every day to provide outstanding care for more patients and families. We are excited about the opportunities ahead for Addus in
2023, and we will continue to pursue a strategic direction that supports the patients in our care and delivers greater value to our shareholders,” added Allison.
Non-GAAP Financial Measures
The information provided in this release 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 included in this press release, a reconciliation of adjusted net income to net
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