Enhabit (EHAB) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices. A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years. Individual inves ...

Core Insights - The management's discussion during the earnings call will significantly influence the sustainability of immediate price changes and future earnings expectations [1] - A positive Earnings ESP reading is a strong predictor of an earnings beat, especially when combined with a solid Zacks Rank [8] Earnings Estimates - The consensus EPS estimate for the upcoming quarter has remained unchanged over the last 30 days, indicating a stable reassessment by covering analysts [2] - Enhabit is expected to report earnings of $0.06 per share, reflecting a year-over-year increase of +50% [23] - The Most Accurate Estimate for Enhabit is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +63.64% [15] Revenue Expectations - Revenues for Enhabit are projected to be $265.99 million, which is an increase of 1.4% from the same quarter last year [18] Earnings Surprise History - Over the last four quarters, Enhabit has beaten consensus EPS estimates two times, indicating a mixed performance history [10] - The upcoming earnings report on August 6, 2024, could significantly impact the stock price depending on whether the results meet or exceed expectations [17] Investment Considerations - Betting on stocks expected to beat earnings expectations can increase the odds of success, making it essential to check a company's Earnings ESP and Zacks Rank before quarterly releases [5] - Enhabit is viewed as a compelling earnings-beat candidate, but investors should consider other factors before making investment decisions [11]

Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate. Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. This provider of home health and hospice services h ...

Financial Performance - For the three months ended March 31, 2024, consolidated net service revenue was $262.4 million, a decrease of 1.0% compared to $265.1 million in the same period of 2023[86]. - Net income attributable to Enhabit, Inc. for the three months ended March 31, 2024, was $0.2 million, a decline of 92.6% from $2.7 million in the same period of 2023[86]. - Adjusted EBITDA for the three months ended March 31, 2024, remained stable at $25.3 million, unchanged from the same period in 2023[95]. - Home health net service revenue decreased by 1.2% to $213.2 million for the three months ended March 31, 2024, compared to $215.8 million in 2023[101]. - Hospice net service revenue slightly decreased by 0.2% to $49.2 million, with general and administrative expenses reduced by 3.7%[110]. Revenue Breakdown - The home health segment net service revenue was $213.2 million, accounting for 81.2% of consolidated revenue, while the hospice segment net service revenue was $49.2 million, representing 18.8% of consolidated revenue[97]. - Medicare admissions fell by 11.4% to 25,944, while non-Medicare admissions increased by 25.2% to 30,881 during the same period[101]. - The shift to more non-Medicare admissions in home health contributed to the decrease in net service revenue[87]. Expenses and Costs - Interest expense increased to $11.1 million for the three months ended March 31, 2024, compared to $9.5 million in the same period of 2023, reflecting higher interest rates and increased leverage[90]. - The effective income tax rate for the three months ended March 31, 2024, was 50.0%, significantly higher than 31.9% for the same period in 2023[91]. - Cost of service as a percentage of net service revenue increased to 51.5% in Q1 2024 from 50.1% in Q1 2023[105]. - Home health segment adjusted EBITDA decreased by 2.5% to $43.2 million, primarily due to lower net service revenue and increased cost of service[107]. Cash Flow and Capital Expenditures - The company had $36.5 million in cash and cash equivalents as of March 31, 2024, up from $27.4 million at the end of 2023[117]. - Net cash provided by operating activities decreased to $17.3 million for the three months ended March 31, 2024, compared to $29.6 million in 2023[118]. - Capital expenditures for the three months ended March 31, 2024, were $1.8 million, compared to $0.6 million in the same period of 2023[124]. - The company expects to spend approximately $5 million to $10 million on capital expenditures during 2024[124]. Debt and Obligations - Total long-term debt obligations amounted to $365.0 million, with $180.0 million under the revolving credit facility as of March 31, 2024[122]. - Long-term debt, including interest, totals $139.7 million, with $43.0 million due in the current period[123]. - The company has $180.0 million in revolving credit facility obligations, all classified as long-term[122]. - Operating lease obligations total $70.4 million, with $10.8 million due in the current period[122]. - Total consolidated contractual obligations as of March 31, 2024, amounted to $772.7 million, with long-term debt obligations excluding revolving credit facility at $365.0 million[122]. Strategic Outlook - The proposed 2025 Hospice Rule by CMS suggests a 2.6% estimated net increase in payments compared to 2024, potentially resulting in a net increase of approximately 3.2% in Medicare payment rates for the company[79]. - The company remains committed to enhancing shareholder value and will evaluate all opportunities to do so following the conclusion of its strategic alternatives review[78]. - There have been no material changes to critical accounting estimates from those disclosed in the Form 10-K[125].

Enhabit (EHAB) came out with quarterly earnings of $0.07 per share, beating the Zacks Consensus Estimate of $0.05 per share. This compares to earnings of $0.09 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 40%. A quarter ago, it was expected that this provider of home health and hospice services would post earnings of $0.02 per share when it actually produced earnings of $0.06, delivering a surprise of 200%.Over the last fou ...

Financial Performance - Net service revenue for Q1 2024 was $262.4 million, a decrease of 1.0% compared to $265.1 million in Q1 2023[5]. - Adjusted EBITDA remained stable at $25.3 million for both Q1 2024 and Q1 2023, with an Adjusted EBITDA margin of 9.6%[5][6]. - The company reported a net income attributable to Enhabit, Inc. of $0.2 million, a significant decrease of 92.6% from $2.7 million in Q1 2023[5][6]. - Net income for Q1 2024 was $0.9 million, a decrease of 71.9% from $3.2 million in Q1 2023[24]. - Adjusted earnings per share (EPS) for Q1 2024 was $0.07, down from $0.09 in Q1 2023, representing a decline of 22.2%[25]. - Net cash provided by operating activities was $17.3 million in Q1 2024, a decrease of 41.0% from $29.6 million in Q1 2023[24]. - Adjusted free cash flow for Q1 2024 was $18.6 million, down from $28.3 million in Q1 2023, representing a decrease of about 34.0%[35]. - Gross margin as a percentage of revenue was 48.9% in Q1 2024, compared to 50.0% in Q1 2023, indicating a decline of 1.1 percentage points[37]. - Adjusted EBITDA margin improved slightly to 9.6% in Q1 2024 from 9.5% in Q1 2023[37]. Operational Highlights - Non-Medicare admissions increased by 25.2%, contributing to a total admission growth of 5.3% year over year[5][7]. - The company added 151 net new full-time nursing hires in Q1 2024, enhancing operational capacity[5]. - The 30-day hospitalization readmission rate in home health is 20.5% better than the national average, indicating improved patient outcomes[5]. - Two new hospice de novo locations were opened in Texas in March 2024, supporting market expansion efforts[5]. Cost Management - General and administrative expenses decreased by 4.2% year over year, reflecting improved cost control measures[5][6]. - The company reported unusual or nonrecurring items totaling $3.7 million in Q1 2024, compared to $2.3 million in Q1 2023, reflecting increased strategic review costs[33]. - Unusual or nonrecurring items in Q1 2024 amounted to $3.7 million, compared to $2.3 million in Q1 2023, reflecting an increase of approximately 60.9%[34]. - Capital expenditures for maintenance increased to $1.8 million in Q1 2024 from $0.6 million in Q1 2023, a rise of 200%[35]. Guidance and Future Outlook - The company reaffirmed its full-year 2024 guidance for net service revenue between $1,076 million and $1,102 million[13]. - Adjusted EPS guidance for 2024 is set between $0.12 and $0.43[13]. - Future growth opportunities may be influenced by regulatory developments and changes in reimbursement rates, as indicated in the forward-looking statements[39]. - The company aims to successfully integrate technology in operations and complete acquisitions to enhance market presence[39]. - The management emphasizes the importance of attracting and retaining key personnel to support strategic plans and operational efficiency[39]. Balance Sheet and Assets - Total assets increased to $1,445.2 million as of March 31, 2024, compared to $1,433.6 million at December 31, 2023, reflecting a growth of 0.8%[22]. - Total current liabilities increased to $150.5 million as of March 31, 2024, up from $137.7 million at December 31, 2023, marking an increase of 9.9%[22]. - Total stockholders' equity increased to $700.0 million as of March 31, 2024, compared to $696.7 million at December 31, 2023, an increase of 0.5%[22]. - Cash, cash equivalents, and restricted cash at the end of Q1 2024 totaled $39.4 million, slightly down from $39.6 million at the end of Q1 2023[24]. - Principal payments on debt in Q1 2024 were $5.0 million, consistent with Q1 2023[24].

Part I [Business](index=5&type=section&id=Item%201.%20Business.) Enhabit, Inc. is a leading U.S. provider of home health and hospice services, strategically focused on organic growth, Medicare Advantage contracts, and exploring strategic alternatives - Enhabit is the **fourth-largest provider** of home health services and a leading provider of hospice services in the U.S. by 2022 Medicare revenues, operating **255 home health** and **110 hospice locations** across 34 states as of December 31, 2023[17](index=17&type=chunk) Segment Revenue Contribution (FY 2023) | Segment | Net Service Revenue (in millions) | Percentage of Total | | :--- | :--- | :--- | | Home Health | $850.1 | 81.2% | | Hospice | $196.2 | 18.8% | Revenue Sources by Payor (FY 2021-2023) | Payor | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Medicare | 71.5% | 78.4% | 81.9% | | Medicare Advantage | 19.0% | 14.2% | 10.6% | | Managed care | 8.2% | 6.1% | 5.9% | | Medicaid | 1.2% | 1.2% | 1.4% | | Other | 0.1% | 0.1% | 0.2% | | **Total** | **100.0%** | **100.0%** | **100.0%** | - The company's growth strategy includes driving organic growth, executing a de novo strategy (41 new locations since 2015), creating revenue opportunities through improved Medicare Advantage contracts, and leveraging care transition expertise[43](index=43&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) - On August 23, 2023, the company announced an ongoing formal process to explore strategic alternatives, including a potential sale or merger, with no set timetable[51](index=51&type=chunk) - The company utilizes an electronic medical records system and a predictive analytics platform to improve patient care, manage workflows, and identify patients at risk for hospitalization[138](index=138&type=chunk)[141](index=141&type=chunk) [Risk Factors](index=22&type=section&id=Item%201A.%20Risk%20Factors.) The company faces significant risks from Medicare reimbursement changes, complex healthcare regulations, operational challenges including staffing and competition, and uncertainties related to its spin-off and ongoing strategic alternatives review - **Reimbursement Risks:** The company's revenue is heavily dependent on Medicare, facing risks from rate reductions, sequestration, and future PDGM adjustments that could significantly decrease payments[145](index=145&type=chunk)[148](index=148&type=chunk)[150](index=150&type=chunk) - **Regulatory Risks:** Compliance with extensive healthcare laws like the Anti-Kickback Statute and FCA is critical, as non-compliance can lead to significant penalties, fines, and exclusion from federal programs amidst aggressive enforcement[181](index=181&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk) - **Operational & Financial Risks:** Key risks include potential cybersecurity breaches, intense competition from other providers including large insurance companies, and shortages of qualified clinical personnel increasing staffing costs and reducing profitability[189](index=189&type=chunk)[196](index=196&type=chunk)[203](index=203&type=chunk) - **Goodwill Impairment Risk:** The company holds **$1.1 billion** in goodwill as of December 31, 2023, with impairment charges of **$85.8 million** (hospice) in 2023 and **$109.0 million** (home health) in 2022, indicating a risk of future impairments[222](index=222&type=chunk) - **Separation from Encompass Risks:** The tax-free status of the 2022 spin-off could be jeopardized by certain strategic transactions, potentially incurring significant tax liabilities and restricting mergers or equity issuances until July 2024[229](index=229&type=chunk) - **Strategic Alternatives Risks:** The ongoing review of strategic alternatives, announced in August 2023, is costly, time-consuming, and creates uncertainty, potentially diverting management attention and negatively impacting stock price without assurance of a transaction[232](index=232&type=chunk)[233](index=233&type=chunk)[234](index=234&type=chunk) [Unresolved Staff Comments](index=36&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) The company reports no unresolved staff comments - The company reports no unresolved staff comments[243](index=243&type=chunk) [Cybersecurity](index=36&type=section&id=Item%201C.%20Cybersecurity.) Enhabit manages cybersecurity risk via a NIST-guided program, overseen by the Board's committee and led by the CIO, focusing on awareness, monitoring, and incident response, with no material impact from past threats - The company's cybersecurity program is structured around the National Institute of Standards and Technology (NIST) Cybersecurity Framework[245](index=245&type=chunk) - The Board of Directors delegates cybersecurity oversight to the Care, Compliance, and Cybersecurity Committee, with the Chief Information Officer (CIO) leading the program and reporting quarterly[244](index=244&type=chunk)[247](index=247&type=chunk)[249](index=249&type=chunk) - To date, experienced threats like malware and virus attacks have not materially affected the company's business, financial position, or operations[252](index=252&type=chunk) [Properties](index=37&type=section&id=Item%202.%20Properties.) As of December 31, 2023, Enhabit operates from its Dallas headquarters and 292 leased agency offices, with 255 home health and 110 hospice locations across 34 states, including 33% in CON states - The company's principal executive office is in Dallas, Texas, supplemented by **292 leased agency offices** as of December 31, 2023, typically small with lease terms of five years or less[253](index=253&type=chunk)[254](index=254&type=chunk) Locations by State (Top 3) | State | Home Health Locations | Hospice Locations | Total | | :--- | :--- | :--- | :--- | | Texas | 51 | 23 | 74 | | Alabama | 29 | 27 | 56 | | Florida | 23 | 0 | 23 | - Approximately **33%** of the company's home health and hospice locations are in states with Certificate of Need (CON) laws, which can pose a barrier to entry or expansion[103](index=103&type=chunk) [Legal Proceedings](index=38&type=section&id=Item%203.%20Legal%20Proceedings.) Enhabit is involved in routine legal actions and audits, with no currently material pending proceedings, but acknowledges the risk of undisclosed "qui tam" lawsuits - In the ordinary course of business, the company is a party to various legal actions, proceedings, and governmental audits, with management not believing any pending legal proceedings are currently material[258](index=258&type=chunk) - The company acknowledges the possibility of existing "qui tam" actions filed under the False Claims Act that may be under seal and unknown to the company[260](index=260&type=chunk) [Mine Safety Disclosures](index=39&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable - The company reports that this item is not applicable[261](index=261&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=40&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities.) Enhabit's common stock trades on the NYSE under "EHAB", with no anticipated cash dividends, and the company repurchased shares in Q4 2023 for employee tax obligations - The company's common stock is listed on the NYSE under the symbol **"EHAB"**[263](index=263&type=chunk) - The company has not declared or paid any cash dividends and does not anticipate doing so in the foreseeable future[264](index=264&type=chunk) - In Q4 2023, the company repurchased **12,076 shares** to satisfy employee tax-withholding obligations from vested stock awards[265](index=265&type=chunk) [Reserved](index=41&type=section&id=Item%206.%20%5B%20Reserved%20%5D.) This item is reserved [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=41&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) In FY2023, Enhabit's net service revenue decreased by 2.3% to $1.046 billion, resulting in an $80.5 million net loss and reduced Adjusted EBITDA, alongside an $85.8 million goodwill impairment and credit facility amendments Consolidated Results of Operations (in Millions) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Net service revenue | $1,046.3 | $1,071.1 | (2.3)% | | Operating (loss) income | $(47.6) | $(11.4) | 317.5% | | Impairment of goodwill | $85.8 | $109.0 | (21.3)% | | Net (loss) attributable to Enhabit | $(80.5) | $(40.4) | 99.3% | Adjusted EBITDA Reconciliation (in Millions) | Metric | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net (loss) income | $(79.0) | $(38.3) | $112.9 | | **Adjusted EBITDA** | **$97.6** | **$149.3** | **$197.2** | - The company's credit facilities were amended in June and November 2023, increasing the maximum permitted total net leverage ratio and permanently reducing the revolving credit facility commitment from **$350.0 million** to **$220.0 million**[326](index=326&type=chunk)[330](index=330&type=chunk) - Critical accounting estimates include revenue recognition, where a shift to Medicare Advantage payors has increased collection complexity, and goodwill valuation, where Q2 and Q3 2023 impairment tests indicated fair value was close to carrying value for both reporting units[347](index=347&type=chunk)[357](index=357&type=chunk)[358](index=358&type=chunk) [Segment Results of Operations](index=46&type=section&id=Segment%20Results%20of%20Operations) In FY2023, Home Health revenue decreased 3.1% to $850.1 million with a 16.3% EBITDA drop, while Hospice revenue grew 1.1% to $196.2 million but saw a 6.0% EBITDA decrease due to higher labor costs Home Health Segment Performance (FY 2023 vs 2022) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Net Service Revenue | $850.1M | $877.1M | (3.1)% | | Segment Adjusted EBITDA | $169.3M | $202.2M | (16.3)% | | Total Admissions | 207,448 | 202,495 | 2.4% | | Cost per Visit | $91 | $89 | 2.2% | Hospice Segment Performance (FY 2023 vs 2022) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Net Service Revenue | $196.2M | $194.0M | 1.1% | | Segment Adjusted EBITDA | $36.1M | $38.4M | (6.0)% | | Average Daily Census | 3,441 | 3,519 | (2.2)% | | Cost per Patient Day | $77 | $70 | 10.0% | [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) As of December 31, 2023, Enhabit had $27.4 million cash and $33.4 million available credit, having amended its credit facility twice in 2023 to ensure covenant compliance despite decreased operating cash flow - The company amended its credit facilities in June and November 2023, increasing the maximum permitted Total Net Leverage Ratio to **6.75x** for Q4 2023 and reducing the Revolving Credit Facility commitment to **$220 million**[326](index=326&type=chunk)[330](index=330&type=chunk) - As of December 31, 2023, the company was in compliance with its financial covenants, with forecasted results indicating continued compliance for one year from the financial statement issuance date[332](index=332&type=chunk) Cash Flow Summary (in Millions) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $48.4 | $80.1 | | Net cash used in investing activities | $(5.3) | $(42.3) | | Net cash used in financing activities | $(40.5) | $(18.6) | [Critical Accounting Estimates](index=53&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates involve significant judgment in revenue recognition, complicated by Medicare Advantage shifts, and goodwill valuation, where recent impairment tests showed fair values close to carrying values, indicating high sensitivity - **Revenue Recognition:** Estimating the transaction price is complex due to various allowances and potential adjustments, with a growing shift to Medicare Advantage payors slowing collections and increasing complexity[344](index=344&type=chunk)[347](index=347&type=chunk) - **Goodwill:** Goodwill is tested for impairment annually, with a Q2 2023 quantitative analysis resulting in an **$85.8 million** impairment charge for the hospice unit, and Q3 2023 tests showing fair values of both units exceeded carrying values by less than **7%** and **5%**, indicating high future impairment risk[352](index=352&type=chunk)[362](index=362&type=chunk)[363](index=363&type=chunk) - **Income Taxes:** The company makes subjective judgments regarding income tax exposures and deferred tax asset realizability, with no valuation allowance recorded as of December 31, 2023[365](index=365&type=chunk)[368](index=368&type=chunk) [Quantitative and Qualitative Disclosures About Market Risks](index=57&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risks.) The company's primary market risk is interest rate changes on its variable-rate debt, mitigated by a $200.0 million interest rate swap, with a 1% rate change impacting cash flow by approximately $3.5 million - The primary market risk is interest rate changes on variable-rate debt, totaling **$547.1 million** as of December 31, 2023[378](index=378&type=chunk) - The company uses a **$200.0 million** notional value interest rate swap, maturing in October 2025, to hedge a portion of its cash flow risk from variable-rate debt[378](index=378&type=chunk) - A hypothetical **1%** change in interest rates would result in an approximate **$3.5 million** change in cash flow over the next 12 months[378](index=378&type=chunk) [Financial Statements and Supplementary Data](index=58&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section indicates that the company's audited consolidated financial statements and related notes are appended to the Annual Report, as indexed in Item 15 - The required financial statements and supplementary data are appended to the Annual Report and indexed in Item 15[381](index=381&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=58&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure.) None reported - The company reports no changes in or disagreements with its accountants on accounting and financial disclosure[382](index=382&type=chunk) [Controls and Procedures](index=58&type=section&id=Item%209A.%20Controls%20and%20Procedures.) As of December 31, 2023, management concluded that disclosure controls and internal control over financial reporting were effective, following the successful remediation of three material weaknesses related to accounts receivable and goodwill impairment - Management concluded that as of December 31, 2023, the company's disclosure controls and procedures and its internal control over financial reporting were effective[384](index=384&type=chunk)[386](index=386&type=chunk) - The company successfully remediated three previously reported material weaknesses as of December 31, 2023[388](index=388&type=chunk)[391](index=391&type=chunk) - The remediated material weaknesses related to controls over monitoring accounts receivable recoverability, identifying goodwill impairment triggering events, and determining carrying amount and measuring potential goodwill impairment[389](index=389&type=chunk)[390](index=390&type=chunk) [Other Information](index=59&type=section&id=Item%209B.%20Other%20Information.) None reported - The company reports no other information[393](index=393&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=59&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections.) Not applicable - The company reports that this item is not applicable[394](index=394&type=chunk) Part III [Directors, Executive Officers, and Corporate Governance](index=60&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%2C%20and%20Corporate%20Governance.) Information for this item is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of stockholders - Information is incorporated by reference from the 2024 proxy statement[397](index=397&type=chunk) [Executive Compensation](index=60&type=section&id=Item%2011.%20Executive%20Compensation.) Information for this item is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of stockholders - Information is incorporated by reference from the 2024 proxy statement[398](index=398&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=60&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters.) Information for this item is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of stockholders - Information is incorporated by reference from the 2024 proxy statement[399](index=399&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=60&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence.) Information for this item is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of stockholders - Information is incorporated by reference from the 2024 proxy statement[400](index=400&type=chunk) [Principal Accountant Fees and Services](index=60&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services.) Information for this item is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of stockholders - Information is incorporated by reference from the 2024 proxy statement[401](index=401&type=chunk) Part IV [Exhibit and Financial Statement Schedules](index=61&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules.) This section provides an index to the audited consolidated financial statements and lists all exhibits filed with the Form 10-K, including the auditor's report and core financial statements - This section contains the index to the company's audited consolidated financial statements and a list of all filed exhibits[404](index=404&type=chunk)[406](index=406&type=chunk) [Report of Independent Registered Public Accounting Firm](index=62&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued unqualified opinions on Enhabit's FY2023 financial statements and internal controls, highlighting goodwill impairment and accounts receivable valuation as Critical Audit Matters due to significant judgment - PricewaterhouseCoopers LLP issued unqualified opinions on both the consolidated financial statements and the effectiveness of internal control over financial reporting as of December 31, 2023[410](index=410&type=chunk) - The audit identified two Critical Audit Matters (CAMs): interim goodwill impairment assessments due to significant management judgment in estimating fair value, and valuation of accounts receivable due to significant judgment in estimating price concessions and uncollectible amounts[419](index=419&type=chunk)[425](index=425&type=chunk) - The auditor's report includes an Emphasis of Matter paragraph highlighting the November 2023 amendment to the company's credit facility covenants[414](index=414&type=chunk) [Consolidated Financial Statements](index=65&type=section&id=Consolidated%20Financial%20Statements) For FY2023, Enhabit reported a **$79.0 million** net loss on **$1.046 billion** revenue, with total assets decreasing to **$1.43 billion** due to an **$85.8 million** goodwill impairment, and debt including a **$367.1 million** term loan and **$180.0 million** revolving credit facility Consolidated Income Statement Highlights (in Millions) | Line Item | 2023 | 2022 | | :--- | :--- | :--- | | Net service revenue | $1,046.3 | $1,071.1 | | Impairment of goodwill | $85.8 | $109.0 | | Net (loss) income attributable to Enhabit, Inc. | $(80.5) | $(40.4) | Consolidated Balance Sheet Highlights (in Millions) | Line Item | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $27.4 | $22.9 | | Accounts receivable, net | $164.7 | $149.6 | | Goodwill | $1,061.7 | $1,144.8 | | Total Assets | $1,433.6 | $1,526.8 | | Long-term debt, net of current portion | $530.1 | $560.0 | | Total Liabilities | $731.9 | $751.5 | | Total Stockholders' Equity | $696.7 | $770.1 | - The company recorded a goodwill impairment charge of **$85.8 million** for the hospice reporting unit in Q2 2023, following a **$109.0 million** impairment for the home health unit in Q4 2022[561](index=561&type=chunk)[570](index=570&type=chunk) - As of December 31, 2023, long-term debt consisted primarily of a **$367.1 million** term loan and **$180.0 million** drawn on the revolving credit facility[578](index=578&type=chunk) [Form 10-K Summary](index=105&type=section&id=Item%2016.%20Form%2010-K%20Summary.) None provided - The company provides no summary for this item[643](index=643&type=chunk)

Enhabit, Inc. (NYSE:EHAB) Q4 2023 Results Conference Call March 7, 2024 10:00 AM ET Company Participants Barb Jacobsmeyer - President, CEO Crissy Carlisle - CFO Conference Call Participants Brian Tanquilut - Jefferies Jason Cassorla - Citi Joanna Gajuk - Bank of America Enjia Cao - UBS Ryan Langston - TD Cowen Operator Good morning, everyone. Welcome to Enhabit Home Health and Hospice's Fourth Quarter 2023 Earnings Conference Call. Today's conference call is being recorded. If you have any objections, you ...

Exhibit 99.1 Enhabit Reports Fourth Quarter Results and Issues Full-Year 2024 Guidance Company to host a conference call tomorrow, March 7, 2024, at 10 A.M. EST DALLAS, TX – March 6, 2024 – Enhabit, Inc. (NYSE: EHAB), a leading home health and hospice care provider, today reported its results of operations for the fourth quarter ended December 31, 2023. "Persistent focus on our Company's strategies drove our positive fourth quarter results," said Enhabit's President and Chief Executive Officer Barb Jacobsme ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________ FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-41406 ___________________ Enhabit, Inc. (Exact name of registrant as specified in its charter) | 47-2409192 | | --- | | Delaware | (State or other j ...