Amedisys(AMED) - 2023 Q1 - Quarterly Report

Financial Performance - For the three-month period ended March 31, 2023, consolidated net service revenue was $556.4 million, an increase from$545.3 million in the same period of 2022, representing a year-over-year growth of approximately 2.0%[121] - Operating income decreased by $6 million to$42.4 million, impacted by the return of sequestration and acquisitions, despite an $11 million increase in net service revenue[122] - The hospice segment, which contributed significantly to revenue, is expected to see a 3.8$8 million, with a 5% total volume growth[128] - Operating income in the Home Health Segment decreased by $10 million despite an$8 million increase in net service revenue[127] - Operating income in the Hospice Segment increased by $9 million on flat net service revenue, positively impacted by increased reimbursement rates[134] - Net service revenue in the Hospice Segment remained flat, affected by the reinstatement of sequestration at 2$1 million on a $1 million increase in net service revenue driven by rate increases[139] Expenses and Costs - General and administrative expenses increased by$10 million year-over-year, primarily due to clinical optimization initiatives and planned wage increases[122] - General and administrative expenses in the Home Health Segment increased by $6 million, primarily due to planned wage increases and higher IT fees[130] - Total cost of service in the Home Health Segment increased by 6$4 million year over year due to higher interest rates on outstanding term loan borrowings[123] - Corporate general and administrative expenses increased by $7 million to$50.9 million for the three-month period ended March 31, 2023, compared to $43.5 million in the same period of 2022[149] Cash Flow and Financing - Cash provided by operating activities decreased by$22.6 million to $26.0 million for the three-month period ended March 31, 2023, compared to$48.6 million in the same period of 2022[151] - Cash used in financing activities totaled $(56.9) million for the three-month period ended March 31, 2023, compared to$(7.4) million in the same period of 2022, primarily due to repayment of borrowings[153] - Cash, cash equivalents, and restricted cash at the end of the period were $69.1 million as of March 31, 2023, compared to$70.9 million at the end of the same period in 2022[151] - The company had no outstanding borrowings under its $550.0 million Revolving Credit Facility, with availability at$519.2 million[160] - The weighted average interest rate for borrowings under the Amended Term Loan Facility was 6.1% for the three-month period ended March 31, 2023, compared to 1.7% for the same period in 2022[160] - The consolidated leverage ratio as of March 31, 2023, was 1.6, and the consolidated interest coverage ratio was 10.3[160] Strategic Developments - The company announced a proposed merger with Option Care Health, with an exchange ratio of 3.0213 shares of Option Care Health common stock for each share of Amedisys common stock[111] - The company appointed Richard Ashworth as President and CEO effective April 10, 2023, following the departure of Paul B. Kusserow from the CEO position[113] - The company expects capital expenditures and investments in technology assets for 2023 to be approximately $17.0 million to$18.0 million, excluding future acquisitions[154] - The company has authorized a new share repurchase program of up to $100 million through December 31, 2023, with no shares repurchased as of March 31, 2023[161] Operational Metrics - As of March 31, 2023, the company operated 348 Medicare-certified home health care centers and 165 Medicare-certified hospice care centers, with a total of 9 admitting high acuity care joint ventures[109] - Average Medicare revenue per completed episode decreased to$2,974 from $3,013 year over year[125] - Hospice admissions decreased by 5$(6.0) million for the three-month period ended March 31, 2023, compared to $(5.0) million in the same period of 2022[141] - Days revenue outstanding increased to 46.3 days as of March 31, 2023, compared to 46.1 days at December 31, 2022[155] - Total patient accounts receivable was$294.1 million as of March 31, 2023, down from $296.8 million at December 31, 2022[157] Economic Impact - Inflation has materially impacted operations, with higher labor and supply costs, although some impacts have been mitigated by rate increases and clinical optimization initiatives[162] - The total amount of outstanding debt subject to interest rate fluctuations was$383.1 million as of March 31, 2023, with a 1.0% interest rate change potentially affecting annual interest expense by approximately $3.8 million[165]