Enhabit(US:EHAB)2025-11-05 21:17Financial Performance - Net service revenue for Q3 2025 was $263.6 million, representing a 3.9% increase from $253.6 million in Q3 2024[4] - Adjusted EBITDA for Q3 2025 was $27.0 million, up 10.2% from $24.5 million in Q3 2024[4] - Net income attributable to Enhabit, Inc. was $11.1 million, a significant recovery from a net loss of $110.2 million in Q3 2024, marking a 110.1% improvement[5] - Operating income for Q3 2025 was $16.8 million, compared to an operating loss of $98.0 million in Q3 2024[20] - Net income attributable to Enhabit, Inc. for the nine months ended September 30, 2025, was $34.1 million, a significant recovery from a net loss of $110.2 million in the same period of 2024[20] - Adjusted EBITDA for the nine months ended September 30, 2025, was $80.5 million, up from $75.0 million in the same period of 2024[27] - Basic earnings per share for Q3 2025 was $0.22, recovering from a loss of $2.20 per share in Q3 2024[25] Revenue Growth - Hospice net service revenue reached $63.1 million, a 20.0% increase from $52.6 million in Q3 2024, with Adjusted EBITDA for hospice rising 72.0% year-over-year[10] - Home health average daily census (ADC) grew by 3.7% year-over-year, while hospice ADC increased by 12.6%[4] - Home health admissions grew by 3.6% year-over-year, with non-Medicare admissions increasing by 10.4%[4] - The updated guidance for 2025 projects net service revenue between $1,058 million and $1,063 million, with Adjusted EBITDA expected to be between $106 million and $109 million[11] Cash Flow and Debt Management - The company reported a net cash provided by operating activities of $66.3 million for the nine months ended September 30, 2025, compared to $55.3 million in 2024[24] - Cash and cash equivalents increased to $56.9 million as of September 30, 2025, compared to $28.4 million at the end of 2024[22] - The company reduced total bank debt by $100.0 million since Q4 2023, resulting in annualized cash interest savings of $19.2 million[7] - The net cash provided by operating activities for the nine months ended September 30, 2025, was $66.3 million, an increase from $55.3 million in 2024[33] Expenses and Margins - General and administrative expenses as a percentage of revenue remained stable at 38.1% for both Q3 2025 and Q3 2024[5] - General and administrative expenses as a percentage of revenue decreased to 40.0% in Q3 2025 from 40.9% in Q3 2024[35] - The gross margin as a percentage of revenue for the three months ended September 30, 2025, was 48.5%, compared to 48.1% in 2024[35] Strategic Developments - The company opened two new hospice de novo locations during the quarter[4] - The company anticipates continued growth opportunities despite potential risks related to regulatory changes and market conditions[36] - The company incurred $19.3 million in gains from the sale of investments during the nine months ended September 30, 2025[24] - The company plans to exclude the cash impact of unusual and nonrecurring items from future adjusted free cash flow calculations[33] Segment Performance - Total Segment Adjusted EBITDA for the nine months ended September 30, 2025, was $157.7 million, compared to $152.1 million in 2024[30] - Segment Adjusted EBITDA for the three months ended September 30, 2025, was $33.9 million, compared to $36.5 million in 2024, reflecting a margin of 16.9% versus 18.2%[30] - For the three months ended September 30, 2025, the company reported a net service revenue of $200.5 million, a slight decrease from $201.0 million in the same period of 2024[30] Unusual Items - The company incurred $2.0 million in unusual or nonrecurring items for the three months ended September 30, 2025, related to restructuring and legal fees[33]