Chemed Reports First-Quarter 2024 Results

Rhea-AI Summary

Chemed (NYSE: CHE) reported positive financial results for the first quarter of 2024, with a 5.2% revenue increase to $589.2 million. GAAP Diluted EPS increased by 18.4% to $4.24, while Adjusted Diluted EPS rose by 21.5% to $5.20. VITAS segment saw growth in Net Patient Revenue, ADC, and Admissions. Roto-Rooter segment experienced a decrease in revenue but maintained a 51.9% gross margin. Chemed had total cash of $313.4 million with no debt. Management provided a full-year 2024 earnings per diluted share guidance range of $23.30 to $23.70.

Positive

• Chemed reported a 5.2% increase in revenue to $589.2 million for Q1 2024.
• GAAP Diluted EPS rose by 18.4% to $4.24, and Adjusted Diluted EPS increased by 21.5% to $5.20.
• VITAS segment showed growth in various metrics, including Net Patient Revenue, ADC, and Admissions.
• Roto-Rooter segment experienced a revenue decrease but maintained a gross margin of 51.9%.
• Chemed had $313.4 million in total cash with no debt as of March 31, 2024.
• Management provided a full-year 2024 earnings per diluted share guidance range of $23.30 to $23.70.

Negative

• None.

Insights

Financial Analyst

The reported increase in GAAP Diluted EPS of 18.4% and Adjusted Diluted EPS of 21.5% could be interpreted as a sign of robust financial health for Chemed Corporation. These expanded margins in both the VITAS and Roto-Rooter segments suggest cost control measures are effective and may point to operational efficiencies achieved over the year. The revenue increase in the VITAS segment, primarily from an 11.5% increase in days-of-care and a Medicare reimbursement rate increase, indicates a strong demand for hospice services which could be driven by demographic trends such as an aging population.

However, the decrease in Roto-Rooter's revenue and net income is noteworthy. The 5.8% drop in revenue and 15.6% decline in Adjusted EBITDA could raise concerns about this segment's market position and competitive pressures. Additionally, the decrease in commercial and residential revenues in this segment must be closely monitored as it could signal underlying challenges in maintaining market share or pricing power.

From a balance sheet perspective, Chemed's strong cash position with no current or long-term debt is commendable and provides financial flexibility for future growth opportunities or share repurchases. The continuation of the share repurchase program, with $281.7 million of remaining authorization, demonstrates confidence in the company's value proposition and could be supportive of the stock price.

Healthcare Industry Analyst

The increase of 14% in net patient revenue for VITAS is indicative of the growing need for end-of-life care services and may reflect broader industry trends towards hospice care. The increase in average daily census and admissions points to a solid market demand and good execution on service delivery. The average revenue per patient per day improvement is also a positive indicator, though the shift in acuity mix and Medicare Cap's impact should be evaluated for potential future risks in reimbursement variability.

The acquisition of hospice assets and an assisted living facility of Covenant Health indicates a strategic move to expand services and regional presence. This $85 million acquisition could be seen as an investment in long-term growth, potentially increasing market penetration and creating new revenue streams. Investors should look for integration success and synergy realization as key factors in determining the acquisition's success.

Corporate Governance Analyst

The transition in Non-GAAP metrics reporting to include costs associated with the Retention Program is a noteworthy change in corporate transparency. Investors generally favor clear and consistent reporting practices; thus, such changes could impact investor perception and trust in financial communications. The company's commitment to reiterating its full-year 2024 earnings guidance could be seen as a signal of management's confidence in their strategic initiatives and financial forecasting abilities.

Furthermore, the lack of current or long-term debt reflects a conservative capital structure which can be attractive to risk-averse investors, though some may argue that in a low-interest-rate environment, leveraging could be utilized to accelerate growth. The company's capital allocation strategy, particularly the repurchase of 50,000 shares, indicates a possible view that the stock is undervalued and an interest in enhancing shareholder value.

CINCINNATI--(BUSINESS WIRE)-- Chemed Corporation (Chemed) (NYSE: CHE), which operates VITAS Healthcare Corporation (VITAS), one of the nation’s largest providers of end-of-life care, and Roto-Rooter, the nation’s largest commercial and residential plumbing and drain cleaning services provider, reported financial results for its first quarter ended March 31, 2024, versus the comparable prior-year period.

Changes to Non-GAAP Metrics

Chemed uses certain non-GAAP metrics such as EBITDA, adjusted EBITDA, adjusted net income and adjusted diluted earnings per share, to provide additional context and perspective to reported operational results.

Chemed’s previously reported non-GAAP metrics during the four sequential quarters from September 30, 2022 through June 30, 2023 excluded the 12-month pandemic-related licensed healthcare professional retention bonus (Retention Program).

Starting with the quarter-ended September 30, 2023, the Company no longer excludes the cost of the Retention Program when presenting non-GAAP operating metrics in current or prior periods.

For the quarter-ended March 31, 2023, the pretax and after-tax Retention Program expense was $10.9 million and $8.3 million, respectively. There was no material impact on financial results for the quarter-ended March 31, 2024 as a result of the Retention Program.

Results for Quarter Ended March 31, 2024

Consolidated operating results:

• Revenue increased 5.2% to $589.2 million
• GAAP Diluted Earnings-per-Share (EPS) of $4.24, an increase of 18.4%
• Adjusted Diluted EPS of $5.20, an increase of 21.5%

VITAS segment operating results:

• Net Patient Revenue of $354.0 million, an increase of 14.0%
• Average Daily Census (ADC) of 19,665, an increase of 10.3%
• Admissions of 16,911, an increase of 4.5%
• Net Income, excluding certain discrete items, of $44.0 million, an increase of 77.6%
• Adjusted EBITDA, excluding Medicare Cap, of $60.7 million, an increase of 67.2%
• Adjusted EBITDA margin, excluding Medicare Cap, of 17.0%, an increase of 544-basis points

Roto-Rooter segment operating results:

• Revenue of $235.2 million, a decrease of 5.8%
• Net Income, excluding certain discrete items, of $42.7 million, a decrease of 15.8%
• Adjusted EBITDA of $60.7 million, a decline of 15.6%
• Adjusted EBITDA margin of 25.8%, a decline of 299-basis points

VITAS

VITAS net revenue was $354.0 million in the first quarter of 2024, which is an increase of 14.0% when compared to the prior-year period. This revenue increase is comprised primarily of an 11.5% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.6%. Acuity mix shift negatively impacted revenue growth 60-basis points in the quarter when compared to the prior-year period’s revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by approximately 50-basis points.

In the first quarter of 2024, VITAS accrued $2.4 million in Medicare Cap billing limitations. This compares to a $2.8 million Medicare Cap billing limitation in the first quarter of 2023.

Of VITAS’ 30 Medicare provider numbers, 27 provider numbers have a trailing 12-month Medicare Cap cushion of 10% or greater, two provider numbers have a cushion between 0% and 10%, and one provider number has a trailing 12-month Medicare Cap billing limitation totaling $6.4 million.

Average revenue per patient per day in the first quarter of 2024 was $203.08 which is 212-basis points above the prior-year period. Reimbursement for routine home care and high acuity care averaged $177.67 and $1,074.78, respectively. During the quarter, high acuity days-of-care were 2.8% of total days of care, a decline of 10-basis points when compared to the prior-year quarter.

The first quarter 2024 gross margin, excluding Medicare Cap, was 23.7%. This compares to the prior year quarter’s gross margin of 19.0%, excluding Medicare Cap. Approximately 370-basis points of this difference is attributable to the expense associated with the Retention Program. Selling, general and administrative expenses were $23.8 million in the first quarter of 2024 and compares to $23.3 million in the prior-year quarter.

Adjusted EBITDA, excluding Medicare Cap, totaled $60.7 million in the quarter, an increase of 67.2%. Adjusted EBITDA margin in the quarter, excluding Medicare Cap, was 17.0%, which is 544-basis points above the prior-year period. Approximately 370-basis points of this difference is attributable to the expense associated with the Retention Program.

As previously announced, VITAS completed its acquisition of the hospice assets and an assisted living facility of Covenant Health and Community Services, Inc. (Covenant Health) on April 17, 2024 for $85 million in cash.

Roto-Rooter

Roto-Rooter generated quarterly revenue of $235.2 million in the first quarter of 2024, a decrease of 5.8%, when compared to the prior-year quarter.

Roto-Rooter branch commercial revenue in the quarter totaled $53.7 million, a decrease of 10.5% from the prior-year period. This aggregate commercial revenue decline consisted of drain cleaning revenue declining 9.9%, plumbing declining 11.9%, excavation declining 13.0%, and water restoration declining 2.5%.

Roto-Rooter branch residential revenue in the quarter totaled $162.9 million, a decrease of 3.5%, over the prior-year period. This aggregate residential revenue decline consisted of drain cleaning decreasing 5.6%, plumbing decreasing 1.1%, excavation expanding 1.5%, and water restoration decreasing 8.5%.

Roto-Rooter’s gross margin in the quarter was 51.9%, a 126-basis point decline when compared to the first quarter of 2023. Adjusted EBITDA in the first quarter of 2024 totaled $60.7 million, a decrease of 15.6%. The Adjusted EBITDA margin in the quarter was 25.8%, which is 299-basis points below the prior-year period.

Chemed Consolidated

As of March 31, 2024, Chemed had total cash and cash equivalents of $313.4 million and no current or long-term debt.

In June 2022, Chemed entered into a five-year $550 million Amended and Restated Credit Agreement (Credit Agreement). This Credit Agreement consisted of a $100 million amortizable term loan and a $450 million revolving credit facility. The interest rate on this Credit Agreement has a floating rate that is currently SOFR plus 100-basis points. There is approximately $404.8 million of undrawn borrowing capacity under the Credit Agreement after excluding $45.2 million for Letters of Credit.

During the quarter, the Company repurchased 50,000 shares of Chemed stock for $32.3 million which equates to a cost per share of $646.87. As of March 31, 2024, there was approximately $281.7 million of remaining share repurchase authorization under its plan.

Guidance for 2024

Management reiterates its estimated full-year 2024 earnings per diluted share, excluding: non-cash expense for stock options, tax benefits from stock option exercises, costs related to litigation, and other discrete items, guidance range of $23.30 to $23.70. Management anticipates providing updated 2024 earnings guidance and related subsidiary operating metrics as part of the June 30, 2024 earnings press release.

Conference Call

As previously disclosed, Chemed will host a conference call and webcast at 10 a.m., ET, on Thursday April 25, 2024, to discuss the company's quarterly results and to provide an update on its business. Participants may access a live webcast of the conference call through the investor relations section of Chemed’s website, Investor Relations Home | Chemed Corporation or the hosting website https://edge.media-server.com/mmc/p/as75yrfc.

Participants may also register via teleconference at: https://register.vevent.com/register/BIc1af400b429d468491b37732bcb93819.

Once registration is completed, participants will be provided with a dial-in number containing a personalized conference code to access the call. All participants are instructed to dial-in 15 minutes prior to the start time.

A taped replay of the conference call will be available beginning approximately two hours after the call's conclusion. You may access the replay via webcast through the investor relations section of Chemed’s website.

Chemed Corporation operates in the healthcare field through its VITAS Healthcare Corporation subsidiary. VITAS provides daily hospice services to patients with severe, life-limiting illnesses. This type of care is focused on making the terminally ill patient's final days as comfortable and pain-free as possible.

Chemed operates in the residential and commercial plumbing and drain cleaning industry under the brand name Roto-Rooter. Roto-Rooter provides plumbing, drain cleaning, and water cleanup services through company-owned branches, independent contractors and franchisees in the United States and Canada. Roto-Rooter also has licensed master franchisees in the republics of Indonesia and Singapore, and the Philippines.

This press release contains information about Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS, which are not measures derived in accordance with GAAP and which exclude components that are important to understanding Chemed’s financial performance. In reporting its operating results, Chemed provides EBITDA, Adjusted EBITDA and Adjusted Diluted EPS measures to help investors and others evaluate the Company’s operating results, compare its operating performance with that of similar companies that have different capital structures and evaluate its ability to meet its future debt service, capital expenditures and working capital requirements. Chemed’s management similarly uses EBITDA, Adjusted EBITDA and Adjusted Diluted EPS to assist it in evaluating the performance of the Company across fiscal periods and in assessing how its performance compares to its peer companies. These measures also help Chemed’s management to estimate the resources required to meet Chemed’s future financial obligations and expenditures. Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS should not be considered in isolation or as a substitute for comparable measures calculated and presented in accordance with GAAP. We calculated Adjusted EBITDA Margin by dividing Adjusted EBITDA by service revenue and sales. A reconciliation of Chemed’s net income to its EBITDA, Adjusted EBITDA and Adjusted Diluted EPS is presented in the tables following the text of this press release.

Forward-Looking Statements

Certain statements contained in this press release and the accompanying tables are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "hope," "anticipate," "plan" and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Chemed does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause Chemed's actual results to differ from those expressed in such forward-looking statements.

These risks and uncertainties arise from, among other things, possible changes in regulations governing the hospice care or plumbing and drain cleaning industries; periodic changes in reimbursement levels and procedures under Medicare and Medicaid programs; difficulties predicting patient length of stay and estimating potential Medicare reimbursement obligations; challenges inherent in Chemed's growth strategy; the current shortage of qualified nurses, other healthcare professionals and licensed plumbing and drain cleaning technicians; Chemed’s dependence on patient referral sources; and other factors detailed under the caption "Description of Business by Segment" or "Risk Factors" in Chemed’s most recent report on form 10-Q or 10-K and its other filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on such forward-looking statements and there are no assurances that the matters contained in such statements will be achieved.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)(unaudited)
		Three Months Ended March 31,
		2024				2023
Service revenues and sales		$	589,233			$	560,157
Cost of services provided and goods sold			385,127				370,705
Selling, general and administrative expenses (aa)			115,873				100,095
Depreciation			13,287				12,286
Amortization			2,521				2,513
Other operating expense			92				1,739
Total costs and expenses			516,900				487,338
Income from operations			72,333				72,819
Interest expense			(425	)			(1,551	)
Other income/(expense)--net (bb)			12,577				(103	)
Income before income taxes			84,485				71,165
Income taxes			(19,468	)			(17,044	)
Net income		$	65,017			$	54,121
Earnings Per Share
Net income		$	4.30			$	3.62
Average number of shares outstanding			15,121				14,966
Diluted Earnings Per Share
Net income		$	4.24			$	3.58
Average number of shares outstanding			15,339				15,110
(aa) Selling, general and administrative ("SG&A") expenses comprise (in thousands):
		Three Months Ended March 31,
		2024				2023
SG&A expenses before long-term incentive compensation
and the impact of market value adjustments related to
deferred compensation plans		$	98,418			$	97,902
Long-term incentive compensation			9,121				2,514
Market value adjustments related to deferred
compensation trusts			8,334				(321	)
Total SG&A expenses		$	115,873			$	100,095
(bb) Other income/(expense)--net comprises (in thousands):
		Three Months Ended March 31,
		2024				2023
Market value adjustments related to deferred
compensation trusts		$	8,334			$	(321	)
Interest income			4,243				150
Other			-				68
Total other income/(expense)--net		$	12,577			$	(103	)

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)(unaudited)
		March 31,
		2024				2023
Assets
Current assets
Cash and cash equivalents		$	313,350			$	58,054
Accounts receivable less allowances			177,334				153,816
Inventories			10,712				10,663
Prepaid income taxes			9,790				10,633
Prepaid expenses			28,431				29,055
Total current assets			539,617				262,221
Investments of deferred compensation plans held in trust			117,649				97,436
Properties and equipment, at cost less accumulated depreciation			202,784				204,164
Lease right of use asset			131,751				131,219
Identifiable intangible assets less accumulated amortization			88,137				97,348
Goodwill			591,519				581,586
Other assets			56,176				57,511
Total Assets		$	1,727,633			$	1,431,485
Liabilities
Current liabilities
Accounts payable		$	56,203			$	40,279
Current portion of long-term debt			-				5,000
Income taxes			27,353				11,223
Accrued insurance			62,055				63,150
Accrued compensation			49,802				50,152
Accrued legal			7,183				6,061
Short-term lease liability			39,279				38,291
Other current liabilities			40,099				69,304
Total current liabilities			281,974				283,460
Deferred income taxes			24,899				35,418
Long-term debt			-				16,250
Deferred compensation liabilities			117,550				97,285
Long-term lease liability			106,861				106,212
Other liabilities			12,854				12,507
Total Liabilities			544,138				551,132
Stockholders' Equity
Capital stock			37,297				36,884
Paid-in capital			1,398,733				1,186,119
Retained earnings			2,505,892				2,246,354
Treasury stock, at cost			(2,760,543	)			(2,591,588	)
Deferred compensation payable in Company stock			2,116				2,284
Total Stockholders' Equity			1,183,495				880,053
Total Liabilities and Stockholders' Equity		$	1,727,633			$	1,431,185

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)(unaudited)
		For the Three Months Ended March 31,
		2024				2023
Cash Flows from Operating Activities
Net income		$	65,017			$	54,121
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization			15,808				14,799
Noncash long-term incentive compensation			9,106				2,024
Stock option expense			9,025				8,482
Benefit for deferred income taxes			(5,422	)			(3,195	)
Amortization of debt issuance costs			80				95
Changes in operating assets and liabilities, excluding
amounts acquired in business combinations:
Decrease/(increase) in accounts receivable			5,345				(14,318	)
Decrease/(increase) in inventories			1,302				(391	)
Decrease in prepaid expenses			1,909				1,236
Decrease in accounts payable and
other current liabilities			(43,012	)			(24,109	)
Change in current income taxes			23,871				19,118
Net change in lease assets and liabilities			25				(632	)
Increase in other assets			(12,243	)			(2,173	)
Increase in other liabilities			13,332				5,313
Other sources			406				122
Net cash provided by operating activities			84,549				60,492
Cash Flows from Investing Activities
Capital expenditures			(12,163	)			(17,020	)
Business combinations, net of cash acquired			(7,300	)			-
Proceeds from sale of fixed assets			86				146
Other uses			(8	)			(139	)
Net cash used by investing activities			(19,385	)			(17,013	)
Cash Flows from Financing Activities
Purchases of treasury stock			(38,460	)			-
Proceeds from exercise of stock options			37,242				25,680
Dividends paid			(6,050	)			(5,685	)
Capital stock surrendered to pay taxes on stock-based compensation			(5,725	)			(3,166	)
Change in cash overdrafts payable			(2,115	)			-
Payments on long-term debt			-				(76,250	)
Other uses			(664	)			(130	)
Net cash used by financing activities			(15,772	)			(59,551	)
Increase/(decrease) in Cash and Cash Equivalents			49,392				(16,072	)
Cash and cash equivalents at beginning of year			263,958				74,126
Cash and cash equivalents at end of year		$	313,350			$	58,054

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
(in thousands)(unaudited)
														Chemed
		VITAS				Roto-Rooter				Corporate				Consolidated
2024 (a)
Service revenues and sales		$	354,007			$	235,226			$	-			$	589,233
Cost of services provided and goods sold			271,896				113,231				-				385,127
Selling, general and administrative expenses			23,792				61,260				30,821				115,873
Depreciation			5,166				8,108				13				13,287
Amortization			26				2,495				-				2,521
Other operating expense			7				85				-				92
Total costs and expenses			300,887				185,179				30,834				516,900
Income/(loss) from operations			53,120				50,047				(30,834	)			72,333
Interest expense			(46	)			(117	)			(262	)			(425	)
Intercompany interest income/(expense)			5,194				3,442				(8,636	)			-
Other income—net			29				22				12,526				12,577
Income/(loss) before income taxes			58,297				53,394				(27,206	)			84,485
Income taxes			(14,327	)			(12,541	)			7,400				(19,468	)
Net income/(loss)		$	43,970			$	40,853			$	(19,806	)		$	65,017
2023 (b)
Service revenues and sales		$	310,478			$	249,679			$	-			$	560,157
Cost of services provided and goods sold			253,654				117,051				-				370,705
Selling, general and administrative expenses			23,336				60,813				15,946				100,095
Depreciation			4,958				7,312				16				12,286
Amortization			26				2,487				-				2,513
Other operating expense			12				1,727				-				1,739
Total costs and expenses			281,986				189,390				15,962				487,338
Income/(loss) from operations			28,492				60,289				(15,962	)			72,819
Interest expense			(50	)			(133	)			(1,368	)			(1,551	)
Intercompany interest income/(expense)			4,648				2,743				(7,391	)			-
Other income/(expense)—net			189				29				(321	)			(103	)
Income/(loss) before income taxes			33,279				62,928				(25,042	)			71,165
Income taxes			(8,515	)			(15,275	)			6,746				(17,044	)
Net income/(loss)		$	24,764			$	47,653			$	(18,296	)		$	54,121
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING SUMMARIES OF EBITDA
FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
(in thousands)(unaudited)
														Chemed
		VITAS				Roto-Rooter				Corporate				Consolidated
2024
Net income/(loss)		$	43,970			$	40,853			$	(19,806	)		$	65,017
Add/(deduct):
Interest expense			46				117				262				425
Income taxes			14,327				12,541				(7,400	)			19,468
Depreciation			5,166				8,108				13				13,287
Amortization			26				2,495				-				2,521
EBITDA			63,535				64,114				(26,931	)			100,718
Add/(deduct):
Intercompany interest expense/(income)			(5,194	)			(3,442	)			8,636				-
Interest income			(29	)			(22	)			(4,192	)			(4,243	)
Stock option expense			-				-				9,026				9,026
Severance arrangement			-				-				5,337				5,337
Long-term incentive compensation			-				-				3,784				3,784
Adjusted EBITDA		$	58,312			$	60,650			$	(4,340	)		$	114,622
2023
Net income/(loss)		$	24,764			$	47,653			$	(18,296	)		$	54,121
Add/(deduct):
Interest expense			50				133				1,368				1,551
Income taxes			8,515				15,275				(6,746	)			17,044
Depreciation			4,958				7,312				16				12,286
Amortization			26				2,487				-				2,513
EBITDA			38,313				72,860				(23,658	)			87,515
Add/(deduct):
Intercompany interest expense/(income)			(4,648	)			(2,743	)			7,391				-
Interest income			(121	)			(29	)			-				(150	)
Stock option expense			-				-				8,482				8,482
Long-term incentive compensation			-				-				2,514				2,514
Litigation settlement			-				1,756				-				1,756
Adjusted EBITDA		$	33,544			$	71,844			$	(5,271	)		$	100,117
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
RECONCILIATION OF ADJUSTED NET INCOME
(in thousands, except per share data)(unaudited)
		Three Months Ended March 31,
		2024				2023
Net income as reported		$	65,017			$	54,121
Add/(deduct) pre-tax cost of:
Stock option expense			9,026				8,482
Severance arrangement			5,337				-
Long-term incentive compensation			3,784				2,514
Amortization of reacquired franchise agreements			2,352				2,352
Litigation settlements			-				1,756
Add/(deduct) tax impacts:
Tax impact of the above pre-tax adjustments (1)			(2,388	)			(2,852	)
Excess tax benefits on stock compensation			(3,297	)			(1,650	)
Adjusted net income		$	79,831			$	64,723
Diluted Earnings Per Share As Reported
Net income		$	4.24			$	3.58
Average number of shares outstanding			15,339				15,110
Adjusted Diluted Earnings Per Share
Adjusted net income		$	5.20			$	4.28
Average number of shares outstanding			15,339				15,110
(1) The tax impact of pre-tax adjustments was calculated using the effective tax rate of the operating unit for which each adjustment is associated.
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
OPERATING STATISTICS FOR VITAS SEGMENT
(unaudited)
		Three Months Ended March 31,
OPERATING STATISTICS		2024				2023
Net revenue ($000) (c)
Homecare		$	304,860			$	267,050
Inpatient			30,303				29,093
Continuous care			24,169				19,941
Other			4,084				3,021
Subtotal		$	363,416			$	319,105
Room and board, net			(2,944	)			(2,769	)
Contractual allowances			(4,090	)			(3,108	)
Medicare cap allowance			(2,375	)			(2,750	)
Net Revenue		$	354,007			$	310,478
Net revenue as a percent of total before Medicare cap allowance
Homecare			83.9	%			83.7	%
Inpatient			8.3				9.1
Continuous care			6.7				6.2
Other			1.1				1.0
Subtotal			100.0				100.0
Room and board, net			(0.8	)			(0.8	)
Contractual allowances			(1.1	)			(1.0	)
Medicare cap allowance			(0.7	)			(0.9	)
Net Revenue			97.4	%			97.3	%
Days of care
Homecare			1,447,912				1,286,437
Nursing home			283,158				265,429
Respite			7,752				5,760
Subtotal routine homecare and respite			1,738,822				1,557,626
Inpatient			26,645				26,369
Continuous care			24,037				20,686
Total			1,789,504				1,604,681
Number of days in relevant time period			91				90
Average daily census ("ADC") (days)
Homecare			15,911				14,294
Nursing home			3,112				2,949
Respite			85				64
Subtotal routine homecare and respite			19,108				17,307
Inpatient			293				293
Continuous care			264				230
Total			19,665				17,830
Total Admissions			16,911				16,179
Total Discharges			16,170				15,405
Average length of stay (days)			103.9				99.9
Median length of stay (days)			16.0				15.0
ADC by major diagnosis
Cerebro			43.6	%			41.8	%
Neurological			13.4				19.3
Cancer			10.1				10.5
Cardio			16.1				16.0
Respiratory			7.2				7.3
Other			9.6				5.1
Total			100.0	%			100.0	%
Admissions by major diagnosis
Cerebro			27.7	%			26.4	%
Neurological			7.5				10.7
Cancer			24.6				24.7
Cardio			15.6				16.2
Respiratory			10.8				10.9
Other			13.8				11.1
Total			100.0	%			100.0	%
Estimated uncollectible accounts as a percent of revenues			1.1	%			1.0	%
Accounts receivable --
Days of revenue outstanding-excluding unapplied Medicare payments			42.3				34.7
Days of revenue outstanding-including unapplied Medicare payments			34.3				29.2
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
FOOTNOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
(unaudited)
(a)		Included in the results of operations for 2024 are the following significant credits/(charges) which may not be indicative of ongoing operations
		(in thousands):
				Three Months Ended March 31, 2024
				VITAS			Roto-Rooter				Corporate				Consolidated
		Stock option expense		$	-		$	-			$	(9,026	)		$	(9,026	)
		Severance arrangement			-			-				(5,337	)			(5,337	)
		Long-term incentive compensation			-			-				(3,784	)			(3,784	)
		Amortization of reacquired franchise agreements			-			(2,352	)			-				(2,352	)
		Pretax impact on earnings			-			(2,352	)			(18,147	)			(20,499	)
		Excess tax benefits on stock compensation			-			-				3,297				3,297
		Income tax benefit on the above			-			548				1,840				2,388
		After-tax impact on earnings		$	-		$	(1,804	)		$	(13,010	)		$	(14,814	)
(b)		Included in the results of operations for 2023 are the following significant credits/(charges) which may not be indicative of ongoing operations
		(in thousands):
				Three Months Ended March 31, 2023
				VITAS			Roto-Rooter				Corporate				Consolidated
		Stock option expense		$	-		$	-			$	(8,482	)		$	(8,482	)
		Long-term incentive compensation			-			-				(2,514	)			(2,514	)
		Amortization of reacquired franchise agreements			-			(2,352	)			-				(2,352	)
		Litigation settlements			-			(1,756	)			-				(1,756	)
		Pretax impact on earnings			-			(4,108	)			(10,996	)			(15,104	)
		Excess tax benefits on stock compensation			-			-				1,650				1,650
		Income tax benefit on the above			-			1,089				1,763				2,852
		After-tax impact on earnings		$	-		$	(3,019	)		$	(7,583	)		$	(10,602	)
(c)		VITAS has 11 large (greater than 450 ADC), 19 medium (greater than 200 but less than 450 ADC) and 20 small (less than 200 ADC) hospice programs. Of Vitas' 30 Medicare provider numbers, for the trailing 12 months, 27 provider numbers have a Medicare cap cushion of greater than 10%, one provider number has a Medicare cap cushion between 5% and 10%, one provider number has a Medicare cap cushion between 0% and 5%, and one provider number has a Medicare cap liability.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240424189490/en/

Michael D. Witzeman

(513) 762-6714

Source: Chemed Corporation

FAQ

What was Chemed 's (NYSE: CHE) revenue increase for the first quarter of 2024?

Chemed reported a 5.2% revenue increase to $589.2 million for the first quarter of 2024.

What was the percentage increase in GAAP Diluted EPS for Chemed in Q1 2024?

The GAAP Diluted EPS for Chemed increased by 18.4% to $4.24 in the first quarter of 2024.

What guidance range did Chemed provide for full-year 2024 earnings per diluted share?

Chemed provided a guidance range of $23.30 to $23.70 for full-year 2024 earnings per diluted share.

What was the gross margin for Roto-Rooter segment in the first quarter of 2024?

Roto-Rooter segment maintained a gross margin of 51.9% in the first quarter of 2024.

How much total cash did Chemed have with no debt as of March 31, 2024?

As of March 31, 2024, Chemed had total cash and cash equivalents of $313.4 million with no current or long-term debt.