Financial Data and Key Metrics Changes - For Q3 2023, the company reported revenue of $411.4 million and adjusted revenue of $424 million, aligning with expectations of $420 million to $430 million [4] - The net loss was $5.5 million, translating to a diluted loss per share of $0.07, while adjusted net income was $12.5 million, with adjusted diluted earnings per share of $0.17, reflecting a 13.9% and 13.3% increase respectively over Q3 2022 [4] - Adjusted EBITDA for the quarter was $23.3 million, a 10.2% increase compared to Q3 2022, and cash flow from operations was $2.9 million, with adjusted cash flow from operations at $18 million, marking a 208.9% increase over Q3 2022 [4][15] Business Line Data and Key Metrics Changes - Revenue from the Housekeeping & Laundry segment was $190.9 million, while the Dining & Nutrition segment generated $220.5 million [30] - Adjusted revenues for these segments were $194.6 million and $229.4 million respectively, with segment margins of 5.4% for Housekeeping & Laundry and 0.9% for Dining & Nutrition [30] - Adjusted segment margins were 7.2% for Housekeeping & Laundry and 4.7% for Dining & Nutrition [30] Market Data and Key Metrics Changes - The company experienced strong cash collections, achieving over 98% of billed amounts in Q3, primarily affected by the timing of new business adds [5][19] - Days Sales Outstanding (DSO) for the quarter was 82 days, with adjusted DSO at 79 days, showing a four-day improvement over the previous quarter [15] Company Strategy and Development Direction - The company is focused on three priorities: managing adjusted cost of services at 86%, improving cash collections, and executing an organic growth strategy [5][11] - The company anticipates a neutral-to-positive effect on future revenue and earnings from recent client restructuring actions, which involve divesting facilities to new operators [6] - The company is optimistic about industry fundamentals improving, with a stabilizing labor market and reimbursement increases contributing to occupancy recovery [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the fourth quarter and 2024 outlook, raising expectations for cash flow from operations to a range of $35 million to $45 million for the second half of 2023 [12] - The company noted ongoing uncertainty regarding regulatory changes, particularly the proposed minimum staffing rule by CMS, which has faced significant opposition [9][11] - Management emphasized the importance of visibility in business operations and the positive momentum heading into Q4 [19][37] Other Important Information - The company introduced supplemental non-GAAP financial tables to enhance transparency and align reporting with management's view of the business [14] - Adjusted cost of services was reported at $366.2 million, or 86.4%, consistent with the company's target [31] Q&A Session Summary Question: Impact of client restructurings on revenue - Management indicated that the recent restructurings did not significantly impact revenue for the quarter, but they expect future opportunities from new operators [35] Question: Guidance for cash flow from operations - The revised cash flow guidance for the second half of the year is a GAAP number, reflecting increased confidence due to improved collections and industry recovery [36][44] Question: Margins in housekeeping and dining segments - Management acknowledged a decrease in margins for both segments and attributed it to various operational factors, while maintaining confidence in overall margin management [45][46] Question: Sales pipeline and demand outlook - The sales pipeline is ramping up, with strong demand anticipated as the company prepares for growth in 2024 [54]

PART I — FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited consolidated financial statements for the period ended June 30, 2023, accompanied by detailed notes on significant accounting policies and financial components [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) As of June 30, 2023, total assets increased to **$761.8 million**, net income for the six months rose to **$21.3 million**, and net cash used in operating activities decreased to **$8.9 million** | | June 30, 2023 ($) | December 31, 2022 ($) | | :--- | :--- | :--- | | **Total Current Assets** | 549,086 | 508,632 | | **Total Assets** | 761,758 | 718,334 | | **Total Current Liabilities** | 189,664 | 178,619 | | **Total Liabilities** | 311,169 | 292,162 | | **Total Stockholders' Equity** | 450,589 | 426,172 | | | Three Months Ended June 30, 2023 ($) | Three Months Ended June 30, 2022 ($) | Six Months Ended June 30, 2023 ($) | Six Months Ended June 30, 2022 ($) | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | 418,931 | 424,857 | 836,161 | 851,668 | | **Income before income taxes** | 11,410 | 8,250 | 28,966 | 24,031 | | **Net Income** | 8,598 | 6,820 | 21,282 | 18,149 | | **Diluted EPS** | 0.12 | 0.09 | 0.29 | 0.24 | | | Six Months Ended June 30, 2023 ($) | Six Months Ended June 30, 2022 ($) | | :--- | :--- | :--- | | **Net cash used in operating activities** | (8,887) | (21,164) | | **Net cash (used in) from investing activities** | (637) | 4,158 | | **Net cash from (used in) financing activities** | 11,907 | (22,107) | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's accounting policies, segment information, revenue recognition, receivables, share-based compensation, and line of credit, including an increased allowance for doubtful accounts and Dietary segment's larger revenue share - The company is organized into two reportable segments: Housekeeping (housekeeping, laundry, linen and other services) and Dietary (dietary department services)[28](index=28&type=chunk) | Segment | Revenue (Six Months Ended June 30, 2023, $) | % of Total | | :--- | :--- | :--- | | Housekeeping | 384.3 million | 46.0% | | Dietary | 451.8 million | 54.0% | | Allowance for Doubtful Accounts | Six Months Ended June 30, 2023 ($) | | :--- | :--- | | **Beginning Balance (Dec 31, 2022)** | 73,464 | | **Bad Debt Expense** | 18,170 | | **Write-Offs (net)** | (11,972) | | **Ending Balance (June 30, 2023)** | 79,662 | - As of June 30, 2023, the company had **$40.0 million** in borrowings under its **$300.0 million** bank line of credit and was in compliance with all financial covenants[123](index=123&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, including a Q2 2023 revenue decrease offset by improved net income, and details liquidity, capital resources, and the shift to a share repurchase strategy [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Q2 2023 saw a **1.4%** consolidated revenue decrease to **$418.9 million**, while net income increased **38.3%** to **$11.4 million**, driven by improved cost management despite Housekeeping revenue decline | Metric | Q2 2023 ($) | Q2 2022 ($) | % Change | | :--- | :--- | :--- | | **Consolidated Revenues** | 418.9M | 424.9M | (1.4)% | | - Housekeeping | 190.8M | 199.1M | (4.1)% | | - Dietary | 228.1M | 225.8M | 1.0% | | **Income Before Taxes** | 11.4M | 8.3M | 38.3% | | Metric | H1 2023 ($) | H1 2022 ($) | % Change | | :--- | :--- | :--- | | **Consolidated Revenues** | 836.2M | 851.7M | (1.8)% | | - Housekeeping | 384.3M | 400.8M | (4.1)% | | - Dietary | 451.8M | 450.9M | 0.2% | | **Income Before Taxes** | 29.0M | 24.0M | 20.5% | - The decrease in bad debt provision as a percentage of revenues in Q2 2023 was driven by the absence of a significant customer receivership event that occurred in Q2 2022, which had resulted in a **$7.1 million** increase to the provision in that period[147](index=147&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2023, the company maintained strong liquidity with **$121.8 million** in cash and **$359.4 million** in working capital, shifting its capital allocation strategy to share repurchases from dividends - As of June 30, 2023, the company had cash, cash equivalents and marketable securities of **$121.8 million** and working capital of **$359.4 million**[172](index=172&type=chunk) - On February 14, 2023, the Board of Directors suspended the quarterly dividend and authorized the repurchase of up to **7.5 million** shares; during the six months ended June 30, 2023, the company repurchased **0.2 million** shares for **$2.2 million**[177](index=177&type=chunk)[178](index=178&type=chunk) - The company had **$40.0 million** in borrowings under its **$300 million** line of credit as of June 30, 2023, and was in compliance with all financial covenants, including a Funded Debt to EBITDA ratio of **1.32** (vs. limit of <3.50)[179](index=179&type=chunk)[180](index=180&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk on its **$121.8 million** investment portfolio, where fair value could be adversely affected by interest rate changes - The company's main market risk is interest rate risk on its investment portfolio of **$121.8 million** in cash, cash equivalents, and marketable securities[189](index=189&type=chunk) - The market value of fixed-rate securities may be adversely impacted by an increase in interest rates, while floating-rate securities may produce less income if interest rates fall[190](index=190&type=chunk) [Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal controls over financial reporting during the quarter - Management, including the Principal Executive Officer and Principal Financial Officer, concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2023[192](index=192&type=chunk) - No changes occurred in the company's internal controls over financial reporting during Q2 2023 that have materially affected, or are reasonably likely to materially affect, these controls[193](index=193&type=chunk) PART II — OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various ordinary course legal proceedings, with management not expecting a material adverse effect, though outcomes for some claims remain unestimable - The company is subject to various claims and legal actions in the ordinary course of business, including labor, contract, and personal injury matters[195](index=195&type=chunk) - For certain pending litigation claims, the company is unable to reasonably estimate possible losses or determine if an unfavorable outcome is probable, reasonably possible, or remote[196](index=196&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2022 - No material changes to risk factors were reported since the company's Annual Report on Form 10-K for the year ended December 31, 2022[198](index=198&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board authorized a repurchase of up to **7.5 million** shares in February 2023, with no shares repurchased during Q2 2023, leaving **7.3 million** shares authorized under the plan - A share repurchase plan for up to **7.5 million** shares was authorized in February 2023; no shares were repurchased during the three months ended June 30, 2023, leaving **7.3 million** shares authorized for repurchase[199](index=199&type=chunk) [Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - The company reports no defaults upon senior securities[200](index=200&type=chunk) [Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reports no mine safety disclosures - The company reports no mine safety disclosures[201](index=201&type=chunk) [Other Information](index=41&type=section&id=Item%205.%20Other%20Information) The company reports no other information for this item - The company reports no other information for this item[202](index=202&type=chunk) [Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the Amended and Restated 2020 Omnibus Incentive Plan, Sarbanes-Oxley Act certifications, and iXBRL formatted financial data - Key exhibits filed with this report include the Amended and Restated 2020 Omnibus Incentive Plan, Sarbanes-Oxley Act Section 302 and 906 certifications, and iXBRL data files[203](index=203&type=chunk)

Financial Data and Key Metrics Changes - Revenue for Q2 2023 was $418.9 million, with GAAP net income of $8.6 million or $0.12 per share, and adjusted EBITDA of $26.3 million [25][9] - Direct cost of services was reported at $367.7 million, or 87.8%, with a target of managing direct costs at 86% excluding CECL [9][5] - SG&A was reported at $41.4 million, with an actual SG&A of $39.1 million or 9.3%, and the company expects 2023 SG&A to be between 8.5% to 9.5% [9][25] Business Line Data and Key Metrics Changes - Housekeeping and laundry segment revenues were $190.8 million with a margin of 8.7%, while dining and nutrition segment revenues were $228.1 million with a margin of 5.5% [9][25] - The company experienced a slight decline in housekeeping revenue quarter-on-quarter due to normal course exits, while dining saw a step up from new business ads [55][56] Market Data and Key Metrics Changes - The company noted improvements in industry fundamentals, a stabilizing labor market, and state-based reimbursement increases contributing to occupancy recovery [7][5] - Specific states like Florida, Illinois, Pennsylvania, Texas, and Ohio have seen reimbursement increases, although the impact varies by state [43][42] Company Strategy and Development Direction - The company is focused on three priorities for the second half of the year: managing direct costs at 86% excluding CECL, improving cash collections, and realizing business development efforts for new facility starts [28][26] - The management expressed confidence in the growth mode pivot for the second half of 2023 and into 2024, emphasizing the importance of management capacity in supporting growth [17][37] Management's Comments on Operating Environment and Future Outlook - Management highlighted the positive momentum in cash collections in May and June following a shortfall in April, indicating a strong outlook for Q3 and the back half of the year [26][30] - There is ongoing uncertainty regarding minimum staffing requirements, but management remains hopeful that CMS will consider the impact on operators before finalizing any rules [7][51] Other Important Information - Cash flow from operations for the quarter was $7.4 million, impacted by increases in accrued payroll and accounts receivable [30][9] - The company is targeting free cash flow of $25 million to $30 million for the back half of the year [58][9] Q&A Session Summary Question: What is the outlook for collections and DSO? - Management indicated that DSO for the quarter was 83 days and they are actively working to recapture delayed payments from April, expecting improvements in collections [32][30] Question: How is the new business pipeline and management training program performing? - Management acknowledged that the ability to grow has historically depended on having sufficient management capacity and training, and they are now focused on aligning this capacity with growth opportunities [14][17] Question: What is the confidence level for revenue growth in the second half of the year? - Management provided a revenue range of $420 million to $430 million for Q3, indicating that this includes both existing business and new business ads [27][45] Question: How are CECL reserves expected to stabilize? - Management expects CECL adjustments to moderate as cash collections improve, indicating a more normalized approach moving forward [49][41] Question: What is the company's capital allocation strategy? - The company remains focused on internal investments and organic growth, while also exploring selective inorganic opportunities [42][51]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 0-12015 HEALTHCARE SERVICES GROUP, INC. (Exact name of registrant as specified in its charter) Pennsylvania 23-2018365 (State or ot ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________ Commission file number: 0-12015 HEALTHCARE SERVICES GROUP, INC. (Exact name of registrant as specified in its charter) (State or ...

Healthcare Services Group, Inc. (NASDAQ:HCSG) Q4 2022 Earnings Conference Call February 15, 2023 8:30 AM ET Company Participants Ted Wahl - President and CEO Matt McKee - Chief Communications Officer Conference Call Participants Sean Dodge - RBC Capital Markets Tao Qiu - Stifel Andy Wittmann - Baird A.J. Rice - Credit Suisse Jack Melick - William Blair Taji Phillips - Jefferies Operator Good morning, and welcome to the Healthcare Services Group 2022 Annual Earnings Call. At this time, all lines are in liste ...

Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 0-12015 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 HEALTHCARE SERVICES GROUP, INC. (Exact name of registrant as specified in its charter) Pennsylvania 23-2018365 (State or oth ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 0-12015 HEALTHCARE SERVICES GROUP, INC. (Exact name of registrant as specified in its charter) Pennsylvania 23-2018365 (State or ot ...

Financial Data and Key Metrics Changes - Revenue for Q1 2022 was reported at $426.8 million, with direct cost of services at $373.3 million, representing 87.5% of revenue, which is above the historical target of 86% [10][13] - Net income for the quarter was $11.3 million, translating to earnings of $0.15 per share [13] - Cash outflow from operations was $30.2 million, primarily due to a $27.2 million increase in accounts receivable and a $24.9 million increase in accrued payroll [13][91] Business Line Data and Key Metrics Changes - Housekeeping and laundry segment revenues were $201.7 million, while dining and nutrition segment revenues were $225.1 million [10] - Segment margins for housekeeping and laundry were 10.1%, and for dining and nutrition, they were 4.2% [11] Market Data and Key Metrics Changes - The company noted positive facility census trends, with occupancy increasing from 72.5% to 73.6% over an eight-week period [72] - The company expects to exit the year with cost of services aligned with the historical target of 86% [7][102] Company Strategy and Development Direction - The company is focused on modifying service agreements to account for inflation and aims to complete these modifications by the end of Q2 2022 [7][102] - There is an emphasis on operational efficiency and management development to support business growth [48][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth outlook, citing favorable demographics and the value proposition of their services [9] - The company is actively engaged with clients to address inflation-related issues and is optimistic about achieving their financial targets [24][70] Other Important Information - The board approved an increase in the dividend to $0.2125 per share, marking the 76th consecutive cash dividend payment [15][16] - The company is not actively pursuing M&A opportunities but remains open to opportunistic acquisitions, particularly in the education space [76][78] Q&A Session Summary Question: Progress on service contract modifications - Management indicated that they are making good progress on modifying service agreements, with a goal to exit the year with cost of services at 86% [24][70] Question: One-time impacts on margins - Management clarified that there were no significant one-time impacts on margins for the quarter, attributing improvements to operational efficiencies [26] Question: Impact of food costs and supplemental billing revenue - Management noted that there was no benefit from supplemental billing revenue and discussed the lag in food cost adjustments due to inflation [33][84] Question: DSO and client payment ability - Management stated that while there are challenges, they have not seen systematic issues with client payments, attributing the increase in DSO primarily to timing [40][96] Question: Genesis contract pricing modifications - Management confirmed that the sunsetting of pricing adjustments contributed approximately $2.5 million in Q1 [44] Question: Management development and staffing - Management emphasized the importance of management development and noted that they are focused on recruiting and training to support business operations [48][49] Question: Client pushback on price increases - Management acknowledged that while there is some pushback from clients, most recognize the increased costs of doing business and appreciate the value of their partnership [57][61] Question: Dividend philosophy and cash balances - Management reiterated that dividend decisions are evaluated quarterly, with a focus on sustainability and organic growth as priorities [98]

Healthcare Services Group, Inc. (NASDAQ:HCSG) Q2 2021 Results Conference Call July 21, 2021 8:30 AM ET Company Participants Ted Wahl - President and CEO Matt McKee - Head of Corporate Communications Conference Call Participants Nat Putnam - Credit Suisse Thomas Keller - RBC Capital Markets Andrew Wittmann - Baird Nick Spiekhout - William Blair Jack Slevin - Jefferies Mitra Ramgopal - Sidoti Tao Qiu - Stifel Operator The matters discussed on today's conference call include forward-looking statements about th ...