Chemed Corporation Releases Updated Guidance
August 05 2019 - 8:00AM
Business Wire
The VITAS and Chemed (NYSE:CHE) updated guidance includes the
increase and rebasing of hospice reimbursement rates announced by
CMS on July 31, 2019, and effective October 1, 2019. This updated
guidance also includes certain increased costs related to revenue
pass-through under certain inpatient unit agreements. The guidance
issued in February 2019 assumed a 1.5% effective rate increase
effective October 1, 2019.
Revenue growth for VITAS in 2019, prior to Medicare Cap, is
estimated to be in the range of 7.5% to 8.0%. Admissions are
estimated to expand approximately 2.5% to 3.0% and Average Daily
Census in 2019 is estimated to expand approximately 5.0% to 5.5%.
Full-year Adjusted EBITDA margin, prior to Medicare Cap, is
estimated to be 18.1%. We are currently estimating $7.8 million for
Medicare Cap billing limitations in the second half of calendar
2019.
The Roto-Rooter updated guidance includes the Oakland
acquisition announced in July 2019 as well as the HSW RR, Inc.
acquisition announced on August 5, 2019. These acquisitions are
immediately accretive to earnings. However, given the size and
complexity of these acquired territories, it will take several
quarters before the operating performance of these acquisitions
begin to approximate the overall Roto-Rooter branch
performance.
Roto-Rooter is forecasted to achieve full-year 2019 revenue
growth of 12% to 13%. This revenue estimate is based upon the
marginal impact from our previously announced 2018 and 2019
acquisitions, increased job pricing of approximately 2%, continued
growth in core plumbing and drain cleaning services as well as
continued but slowing revenue growth from water restoration
services. Roto-Rooter’s Adjusted EBITDA margin for 2019 is
estimated at 23.5%.
Based upon the above, full-year 2019 adjusted earnings per
diluted share, excluding non-cash expense for stock options, tax
benefits from stock options, costs related to litigation, and other
discrete items, is estimated to be in the range of $13.65 to
$13.85. This 2019 guidance assumes an effective consolidated
corporate tax rate of 25.2%. Chemed’s 2018 reported adjusted
earnings per diluted share was $11.93.
Listed on the New York Stock Exchange and headquartered in
Cincinnati, Ohio, Chemed Corporation (www.chemed.com) operates two
wholly owned subsidiaries: VITAS Healthcare and Roto-Rooter. VITAS
is the nation's largest provider of end-of-life hospice care and
Roto-Rooter is the nation’s leading provider of plumbing and drain
cleaning services.
Statements in this press release or in other Chemed
communications may relate to future events or Chemed's future
performance. Such statements are forward-looking statements and are
based on present information Chemed has related to its existing
business circumstances. Investors are cautioned that such
forward-looking statements are subject to inherent risk that actual
results may differ materially from such forward-looking statements.
Further, investors are cautioned that Chemed does not assume any
obligation to update forward-looking statements based on
unanticipated events or changed expectations.
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version on businesswire.com: https://www.businesswire.com/news/home/20190805005068/en/
David P. Williams (513) 762-6901
Chemed (NYSE:CHE)
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