Chemed Corporation (CHE) reported adjusted earnings per share (EPS) of $5.20 in the first quarter of 2024, up 21.5% year over year. However, the figure missed the Zacks Consensus Estimate by 4.9%.The company’s GAAP EPS was $4.24, up 18.4% from last year’s reported figure.Revenues in DetailRevenues in the reported quarter improved 5.2% year over year to $589.2 million. The metric topped the Zacks Consensus Estimate by 0.3%.Segmental Details  Chemed operates through two wholly owned subsidiaries — VITAS (a ma ...

Chemed (CHE) came out with quarterly earnings of $5.20 per share, missing the Zacks Consensus Estimate of $5.47 per share. This compares to earnings of $4.82 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -4.94%. A quarter ago, it was expected that this operator of the Roto-Rooter plumbing service and Vitas Healthcare hospices would post earnings of $6.25 per share when it actually produced earnings of $6.60, delivering a sur ...

[Q1 2024 Financial Highlights](index=1&type=section&id=Chemed%20Reports%20First-Quarter%202024%20Results) Chemed Corporation reported strong first-quarter 2024 results with increased consolidated revenue and significant growth in both GAAP and Adjusted Diluted EPS [Consolidated Operating Results](index=1&type=section&id=Consolidated%20operating%20results) Chemed Corporation reported a solid first quarter for 2024, with consolidated revenue increasing by 5.2% to $589.2 million. Both GAAP and Adjusted Diluted EPS showed strong growth, rising 18.4% and 21.5% respectively, indicating improved profitability Consolidated Operating Results Summary | Metric | Q1 2024 | YoY Change | | :--- | :--- | :--- | | Revenue | $589.2 million | +5.2% | | GAAP Diluted EPS | $4.24 | +18.4% | | Adjusted Diluted EPS | $5.20 | +21.5% | [Changes to Non-GAAP Metrics](index=1&type=section&id=Changes%20to%20Non-GAAP%20Metrics) Effective from the quarter ending September 30, 2023, Chemed no longer excludes the costs of its pandemic-related licensed healthcare professional retention bonus (Retention Program) from its non-GAAP metrics for current or prior periods. In Q1 2023, this program had a pre-tax expense of $10.9 million - The company has ceased excluding the Retention Program costs from non-GAAP metrics starting in Q3 2023[4](index=4&type=chunk) - The Retention Program expense in Q1 2023 was **$10.9 million** pre-tax and **$8.3 million** after-tax, which is now included in prior-period non-GAAP comparisons[4](index=4&type=chunk) [Segment Performance](index=1&type=section&id=Segment%20Performance) VITAS Healthcare segment achieved strong revenue and profit growth, while Roto-Rooter segment experienced a decline in revenue and profitability [VITAS Healthcare Segment](index=1&type=section&id=VITAS) The VITAS segment demonstrated strong growth in Q1 2024, with net patient revenue increasing 14.0% to $354.0 million. This was primarily driven by a 10.3% increase in Average Daily Census (ADC) and an 11.5% rise in days-of-care. Profitability improved significantly, with Adjusted EBITDA growing 67.2% and margins expanding by 544 basis points, aided by lapping prior-year retention program costs VITAS Healthcare Segment Performance | Metric | Q1 2024 | YoY Change | | :--- | :--- | :--- | | Net Patient Revenue | $354.0 million | +14.0% | | Average Daily Census (ADC) | 19,665 | +10.3% | | Admissions | 16,911 | +4.5% | | Adjusted EBITDA (excl. Medicare Cap) | $60.7 million | +67.2% | | Adjusted EBITDA Margin (excl. Medicare Cap) | 17.0% | +544 bps | - Revenue growth was driven by an **11.5%** increase in days-of-care and a **2.6%** increase in the geographically weighted average Medicare reimbursement rate[6](index=6&type=chunk) - The gross margin, excluding Medicare Cap, improved to **23.7%** from **19.0%** in Q1 2023. Approximately **370 basis points** of this improvement is attributed to the absence of the prior-year's Retention Program expense[6](index=6&type=chunk) - On April 17, 2024, VITAS completed the acquisition of hospice assets from Covenant Health and Community Services, Inc. for **$85 million** in cash[7](index=7&type=chunk) [Roto-Rooter Segment](index=2&type=section&id=Roto-Rooter) The Roto-Rooter segment faced a challenging quarter, with revenue declining 5.8% to $235.2 million. Both residential and commercial revenues decreased, by 3.5% and 10.5% respectively. This led to a 15.6% drop in Adjusted EBITDA to $60.7 million and a 299-basis point contraction in the Adjusted EBITDA margin to 25.8% Roto-Rooter Segment Performance | Metric | Q1 2024 | YoY Change | | :--- | :--- | :--- | | Revenue | $235.2 million | -5.8% | | Adjusted EBITDA | $60.7 million | -15.6% | | Adjusted EBITDA Margin | 25.8% | -299 bps | - Residential revenue decreased by **3.5%**, with declines in drain cleaning (**-5.6%**) and water restoration (**-8.5%**) partially offset by growth in excavation (**+1.5%**)[9](index=9&type=chunk) - Commercial revenue saw a broader decline of **10.5%**, with decreases across all service categories including drain cleaning (**-9.9%**), plumbing (**-11.9%**), and excavation (**-13.0%**)[15](index=15&type=chunk) [Corporate Overview](index=3&type=section&id=Chemed%20Consolidated) Chemed maintains a strong financial position with no debt and significant liquidity, reiterating its full-year adjusted EPS guidance [Financial Position and Capital Allocation](index=3&type=section&id=Financial%20Position%20and%20Capital%20Allocation) Chemed maintained a strong balance sheet as of March 31, 2024, with $313.4 million in cash and no debt. The company has significant liquidity with $404.8 million available under its revolving credit facility. During the quarter, Chemed repurchased 50,000 shares for $32.3 million, leaving $281.7 million in its buyback authorization - As of March 31, 2024, the company held **$313.4 million** in cash and cash equivalents with no current or long-term debt[10](index=10&type=chunk) - The company has approximately **$404.8 million** of undrawn borrowing capacity under its **$550 million** credit agreement[18](index=18&type=chunk) - In Q1 2024, Chemed repurchased **50,000 shares** for **$32.3 million** at an average price of **$646.87** per share[19](index=19&type=chunk) [2024 Full-Year Guidance](index=4&type=section&id=Guidance%20for%202024) Chemed's management has reiterated its full-year 2024 guidance for adjusted earnings per diluted share, expecting it to be in the range of $23.30 to $23.70. This guidance excludes certain items such as non-cash stock option expenses and litigation costs. An update is anticipated with the Q2 2024 earnings release - Management reiterates its full-year 2024 adjusted EPS guidance range of **$23.30** to **$23.70**[21](index=21&type=chunk) - Updated 2024 guidance is expected to be provided with the second-quarter earnings release[21](index=21&type=chunk) [Financial Statements & Reconciliations](index=6&type=section&id=Financial%20Statements) Detailed consolidated financial statements and segment-level reconciliations to non-GAAP metrics are presented for Q1 2024 [Consolidated Statements of Income](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20INCOME) For Q1 2024, Chemed's service revenues and sales grew to $589.2 million from $560.2 million in the prior-year period. Despite higher costs, income from operations was relatively stable at $72.3 million. A significant increase in 'Other income--net' to $12.6 million, primarily from market value adjustments, boosted income before taxes to $84.5 million, resulting in a net income of $65.0 million, up from $54.1 million in Q1 2023 Consolidated Statements of Income (in thousands) | (in thousands) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Service revenues and sales | $589,233 | $560,157 | | Income from operations | $72,333 | $72,819 | | Income before income taxes | $84,485 | $71,165 | | Net income | $65,017 | $54,121 | | Diluted EPS | $4.24 | $3.58 | [Consolidated Balance Sheets](index=7&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2024, Chemed's balance sheet shows a substantial increase in cash and cash equivalents to $313.4 million, compared to $58.1 million a year prior. Total assets grew to $1.73 billion. The company eliminated all long-term debt. Total stockholders' equity increased significantly to $1.18 billion from $880.1 million, reflecting strong earnings retention and share repurchases Consolidated Balance Sheets (in thousands) | (in thousands) | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $313,350 | $58,054 | | Total current assets | $539,617 | $262,221 | | Total Assets | $1,727,633 | $1,431,485 | | Long-term debt | $0 | $16,250 | | Total Liabilities | $544,138 | $551,132 | | Total Stockholders' Equity | $1,183,495 | $880,053 | [Consolidated Statements of Cash Flows](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) In Q1 2024, Chemed generated $84.5 million in net cash from operating activities, a significant increase from $60.5 million in the prior year. Investing activities used $19.4 million, mainly for capital expenditures and business combinations. Financing activities used $15.8 million, driven by share repurchases ($38.5 million) and dividends, partially offset by proceeds from stock option exercises ($37.2 million). The company's cash position increased by $49.4 million during the quarter Consolidated Statements of Cash Flows (in thousands) | (in thousands) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $84,549 | $60,492 | | Net cash used by investing activities | ($19,385) | ($17,013) | | Net cash used by financing activities | ($15,772) | ($59,551) | | Increase/(decrease) in Cash | $49,392 | ($16,072) | [Segment Financials and Reconciliations](index=9&type=section&id=Segment%20Financials%20and%20Reconciliations) The consolidating statements show that in Q1 2024, VITAS contributed $44.0 million in net income, while Roto-Rooter contributed $40.9 million. Reconciliations from GAAP to non-GAAP metrics detail adjustments for items like stock option expenses and severance costs, resulting in a consolidated Adjusted EBITDA of $114.6 million and Adjusted Net Income of $79.8 million for the quarter [Consolidating Statements of Income](index=9&type=section&id=CONSOLIDATING%20STATEMENTS%20OF%20INCOME) In Q1 2024, the VITAS segment generated $53.1 million in operating income on $354.0 million of revenue. The Roto-Rooter segment produced $50.0 million in operating income on $235.2 million of revenue. After taxes and other items, VITAS's net income was $44.0 million, and Roto-Rooter's was $40.9 million Consolidating Statements of Income (in thousands) | Q1 2024 (in thousands) | VITAS | Roto-Rooter | Corporate | Consolidated | | :--- | :--- | :--- | :--- | :--- | | Service revenues and sales | $354,007 | $235,226 | - | $589,233 | | Income/(loss) from operations | $53,120 | $50,047 | ($30,834) | $72,333 | | Net income/(loss) | $43,970 | $40,853 | ($19,806) | $65,017 | [Reconciliation of EBITDA and Adjusted EBITDA](index=10&type=section&id=RECONCILIATION%20OF%20EBITDA%20AND%20ADJUSTED%20EBITDA) For Q1 2024, consolidated EBITDA was $100.7 million. After adjustments for items including stock option expense ($9.0 million) and a severance arrangement ($5.3 million), Adjusted EBITDA reached $114.6 million. This compares to a consolidated Adjusted EBITDA of $100.1 million in Q1 2023 Reconciliation of EBITDA and Adjusted EBITDA (in thousands) | Q1 2024 (in thousands) | VITAS | Roto-Rooter | Consolidated | | :--- | :--- | :--- | :--- | | EBITDA | $63,535 | $64,114 | $100,718 | | Adjusted EBITDA | $58,312 | $60,650 | $114,622 | [Reconciliation of Adjusted Net Income](index=11&type=section&id=RECONCILIATION%20OF%20ADJUSTED%20NET%20INCOME) Chemed's Q1 2024 reported GAAP net income of $65.0 million, or $4.24 per diluted share, was adjusted for several pre-tax costs, including stock option expense and amortization. These adjustments led to an Adjusted Net Income of $79.8 million, or $5.20 per diluted share, representing a 21.5% increase from the $4.28 adjusted EPS in Q1 2023 Reconciliation of Adjusted Net Income (in thousands, except per share) | (in thousands, except per share) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income as reported | $65,017 | $54,121 | | Adjusted net income | $79,831 | $64,723 | | Diluted EPS as reported | $4.24 | $3.58 | | Adjusted Diluted EPS | $5.20 | $4.28 | [VITAS Operating Statistics](index=12&type=section&id=OPERATING%20STATISTICS%20FOR%20VITAS%20SEGMENT) VITAS's operational metrics for Q1 2024 show an 11.5% increase in total days of care to 1,789,504. The Average Daily Census (ADC) grew to 19,665 from 17,830 in the prior year, with routine homecare ADC showing the largest increase. The average length of stay increased slightly to 103.9 days, and total admissions rose by 4.5% to 16,911 VITAS Operating Statistics | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total Days of care | 1,789,504 | 1,604,681 | | Total Average Daily Census (ADC) | 19,665 | 17,830 | | Total Admissions | 16,911 | 16,179 | | Average length of stay (days) | 103.9 | 99.9 |

Chemed’s (CHE) wholly owned subsidiary, VITAS Healthcare Corporation, recently entered into an agreement to acquire all hospice operations and an assisted living facility from Covenant Health and Community Services, Inc. (Covenant). The aggregate purchase price of the transaction is fixed at $85 million.The transaction is structured as an asset purchase and the parties will seek to close the same in second-quarter 2024, subject to certain regulatory and other approvals.More on the NewsVITAS stands to gain s ...

CINCINNATI--(BUSINESS WIRE)--VITAS Healthcare Corporation, a wholly-owned subsidiary of Chemed Corporation (“Chemed”) (NYSE: CHE), announced it entered into an agreement on March 12, 2024 to acquire all hospice operations and an assisted living facility from Covenant Health and Community Services, Inc. d/b/a/ Covenant Care (“Covenant”) for an aggregate purchase price of $85 million. Covenant’s hospice operations span the panhandle of Florida and Alabama, specifically including the Tallahassee, Marianna, For ...

CINCINNATI--(BUSINESS WIRE)--Chemed Corporation (NYSE:CHE) today announced that it will deliver a virtual presentation at the Oppenheimer 34th Annual Healthcare Conference on Tuesday, March 12, 2024, at approximately 12:00 p.m. (ET). The virtual presentation will be webcast live and can be accessed, along with the presentation materials, through the Chemed website at www.chemed.com (Investor Relations). The webcast replay will be available within 24 hours of the live presentation and will be accessible for ...

Growth investors focus on stocks that are seeing above-average financial growth, as this feature helps these securities garner the market's attention and deliver solid returns. However, it isn't easy to find a great growth stock.That's because, these stocks usually carry above-average risk and volatility. In fact, betting on a stock for which the growth story is actually over or nearing its end could lead to significant loss.However, the task of finding cutting-edge growth stocks is made easy with the help ...

Chemed Corporation (CHE) reported adjusted earnings per share (EPS) of $6.60 in the fourth quarter of 2023, up 35% year over year. The figure also surpassed the Zacks Consensus Estimate by 5.6%.The company’s GAAP EPS was $5.90, up 42.9% from last year’s reported figure. For the full year, the adjusted EPS was $20.30, reflecting an 8.1% increase from the year-ago period.Revenues in DetailRevenues in the reported quarter improved 7.2% year over year to $585.9 million. The metric missed the Zacks Consensus Est ...

Call Start: 10:00 January 1, 0000 10:42 AM ET Chemed Corporation (NYSE:CHE) Q4 2023 Earnings Conference Call February 28, 2024, 10:00 am ET Company Participants Holley Schmidt - Assistant Controller Kevin McNamara - President & CEO Mike Witzeman - CFO Nick Westfall - CEO, VITAS Healthcare Corporation Conference Call Participants Joanna Gajuk - Bank of America Michael Murray - RBC Capital Markets Holley Schmidt [Call Starts Abruptly] Financial Results for the Fourth Quarter of 2023 ended December 31, 2023. B ...

Revenue Dependence and Financial Performance - VITAS generates over 90% of its revenue from the Medicare program, indicating significant reliance on government funding[40] - Over 95% of VITAS' revenue comes from Medicare and Medicaid payments, primarily on a "per diem" basis, making the company vulnerable to cost management challenges[86] - VITAS derives over 95% of its net patient service revenue from Medicare and Medicaid, making its profitability highly dependent on managing service costs[154] - VITAS' net patient service revenue and profits are highly dependent on payments from Medicare and Medicaid, with potential material impacts from changes in payment rates or methods[184] - VITAS' profitability could be negatively impacted by potential reductions in Medicare and Medicaid payments, particularly for hospice services[155] Regulatory Compliance and Legal Risks - VITAS has satisfied the requirements of a Corporate Integrity Agreement with the Office of the Inspector General, concluding on June 22, 2023[54] - The Medicare Conditions of Participation require hospices to meet specific standards to receive payments, with ongoing compliance being critical[74] - VITAS must maintain clinical records for each patient, ensuring compliance with regulatory requirements[52] - The company is subject to heightened scrutiny from state and federal regulators regarding acquisitions of non-profit hospice programs, which may increase costs or hinder future acquisitions[85] - VITAS maintains compliance with applicable licensure and certification requirements, but non-compliance could adversely affect operations and participation in Medicare and Medicaid programs[111] - The company faces potential penalties under the Anti-Kickback Law, which could include fines and exclusion from Medicare and Medicaid programs[96] - Legislative and regulatory changes could require VITAS to invest substantially in new information systems, negatively impacting profitability and cash flows[213] Market Competition and Industry Landscape - The hospice care industry is highly fragmented, with VITAS being one of the largest providers, competing against numerous small, community-based hospices[42] - The company faces competition from national and regional hospice providers, as well as other healthcare entities diversifying into hospice care[70] - VITAS faces intense competition in the hospice care market, competing with national and regional companies, physician groups, and home health agencies[218] Operational Challenges and Workforce Issues - The current nationwide shortage of qualified nurses and aides is impacting VITAS' ability to provide quality hospice services, leading to increased wages and benefits to attract and retain staff[216][217] - VITAS' operations are significantly exposed to hurricanes due to its headquarters in South Florida, which could adversely affect billing and service delivery during major weather events[225] - The company has established a reserve for environmental liabilities related to historical contamination, but actual cleanup costs may exceed current estimates, potentially impacting financial condition[228] Financial Management and Strategic Decisions - The company has engaged in twelve significant acquisitions or divestitures since its inception, focusing on maximizing shareholder value[35] - VITAS' ability to repay or refinance its indebtedness depends on operating performance, which may be affected by various external factors[208] - The company has not experienced any known data breaches that compromised customer data, but it maintains safeguards against cyber-attacks[182] - VITAS has historically incurred debt to finance operations, and insufficient cash flows may force the company to reduce capital expenditures or restructure debt[230][231] Employee Engagement and Corporate Culture - The "Difference Maker Program" provided over $31.6 million in bonuses to employees during the pandemic, with $8.9 million remaining accrued for bonuses earned through June 2024[146] - The company emphasizes the importance of a diverse and inclusive workforce to foster innovation and better serve its diverse customer base[173] - Roto-Rooter has implemented extensive training programs for employees, focusing on safety, human resources, and regulatory compliance[171] Risk Management and Future Outlook - VITAS maintains a reputation management risk program to mitigate adverse publicity and maintain referral sources' willingness to refer patients[201] - VITAS' future success is contingent on the continued service of senior management personnel, with potential negative impacts from the loss of key management[191] - Future public health concerns, similar to the COVID-19 pandemic, may negatively impact VITAS' ability to operate and serve patients, affecting demand for services[232]