Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $28.3 million, an increase of 8.4% compared to $26.2 million in Q1 2024 [16] - Consolidated adjusted EBITDA declined by $800,000 year over year, reflecting lower profitability in the extended warranty segment and higher holdcoat costs [16] - Trailing twelve month adjusted run rate EBITDA for the businesses stood at approximately $18 million to $19 million [15] Business Line Data and Key Metrics Changes - In the Kingsway Search Accelerator (KSX) segment, revenue was $11.7 million, up 23.3% from $9.5 million in the same period last year, with adjusted EBITDA also increasing by 23.3% [17] - The extended warranty segment's revenue was flat at $16.7 million compared to Q1 2024, but cash sales increased by 3.7% year over year [21] - Adjusted EBITDA for the extended warranty segment was $800,000, down from $1.4 million in the prior year quarter [22] Market Data and Key Metrics Changes - Cash sales in the extended warranty segment showed a sequential increase of 9.3% from year-end [21] - Trailing twelve month modified cash EBITDA for the extended warranty segment was up 11.7% year over year [22] Company Strategy and Development Direction - The company aims to capitalize on the search fund model at scale within a tax-efficient public company framework [5] - Recent acquisitions, including Bud's Plumbing and Viewpoint, are expected to enhance the KSX platform and provide additional growth levers [10][11] - The company is focused on driving growth and profitability while maintaining a robust deal pipeline [29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory in the KSX segment, indicating that many businesses are nearing an inflection point for accelerated growth [13] - The extended warranty segment is entering a more favorable phase of recovery after two challenging years, with signs of returning cash sales growth [14] - The company is excited about the progress made and the potential for future growth in 2025 [30] Other Important Information - The company appointed two new independent directors to strengthen corporate governance [11] - A $6 million private placement was completed to fund the Bud's Plumbing acquisition, increasing cash and cash equivalents to $6.4 million [26][28] Q&A Session Summary Question: Can you provide any color on the Viewpoint acquisition and its strategic fit? - The acquisition was sourced by Drew at SPI and strategically fits by providing a cloud-native software solution for smaller customers in North America while expanding geographic reach [33] Question: Can you explain the J curve with search acquisitions? - The J curve represents the initial negative impact on profitability due to investments in talent and technology, followed by a period of growth as these investments pay off [36] Question: Can you share more about the robust deal pipeline? - The company has experienced operators building their M&A pipelines and is excited about potential tuck-in acquisitions across various platforms [40] Question: Why is the owner of Bud's staying on for a one-year transition? - This is typical in search acquisitions to ensure a smooth transition of customer relationships and institutional knowledge [42] Question: Are there other industries targeted for platforms? - The company evaluates industries based on growth potential and operator fit, considering sectors like insurance brokerage and wealth management for future platforms [46]

Financial Data and Key Metrics Changes - VITAS net revenue was $407.4 million in Q1 2025, an increase of 15.1% compared to the prior year period [18] - Adjusted EBITDA, excluding Medicare cap, totaled $70.3 million in Q1 2025, an increase of 15.9% [20] - Adjusted EBITDA margin in Q1 2025, excluding Medicare cap, was 17.2%, which is 13 basis points above the prior year period [20] - Roto Rooter generated total revenue increase of 1.8% in Q1 2025 compared to the prior year quarter [13] - Adjusted EBITDA at Roto Rooter in Q1 2025 totaled $59.2 million, a decrease of 2.4% compared to the prior year quarter [25] Business Line Data and Key Metrics Changes - VITAS admissions totaled 18,139 in Q1 2025, a 7.3% improvement compared to the same period of 2024 [8] - Average daily census (ADC) for VITAS expanded to 22,244, an increase of 13.1% compared to the prior year quarter [8] - Roto Rooter branch residential revenue increased by 1.7% to $167.2 million, driven by a 3% increase in excavation revenue and a 12.5% increase in water restoration [21][22] - Roto Rooter branch commercial revenue increased by 7.3% to $57.7 million, driven by a 38% increase in excavation and a 14% increase in water restoration [23] Market Data and Key Metrics Changes - Hospital-based admissions represented 49% of overall admissions for VITAS, the highest level since the pandemic [36] - Hospital-directed admissions increased by 12% compared to Q1 2024 [32] - The average revenue per patient day for VITAS in Q1 2025 was $207.58, which is 221 basis points above the prior year period [19] Company Strategy and Development Direction - VITAS management is focusing on increasing hospital-based admissions to navigate Medicare cap issues [11][34] - The company is expanding its operating scope within Florida and other states with certificate of need restrictions [16] - Roto Rooter management is refining its excavation pricing model to balance revenue growth and EBITDA margin [28] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in VITAS's ability to maintain above-average growth both organically and through acquisitions in 2025 and beyond [39] - The company anticipates providing updated earnings guidance as part of the June 30, 2025 earnings press release [29] - Management acknowledged that the growth path seen in 2023 and 2024 was likely higher than what is sustainable due to the Medicare cap [53] Other Important Information - The Covington Health acquisition positively impacted revenue, adjusted net income, and EBITDA by 3 to 4% [21] - The company experienced a $48 million increase in receivables due to the return of funds from a previous audit [56][58] Q&A Session Summary Question: Details on long-term cap management strategy - Management discussed the importance of managing cap cushion and the impact of hospital admissions on average length of stay [44][45] - The focus is on ensuring long-term sustainable growth while navigating regulatory changes [50][51] Question: Cash flow dynamics and working capital - Management explained that cash flow was affected by the timing of receivables and a PIP payment [55][58] - They clarified that the increase in receivables was not indicative of cash flow collection problems [60]

Financial Data and Key Metrics Changes - VITAS net revenue was $407.4 million in Q1 2025, a 15.1% increase compared to the prior year period, driven by an 11.9% increase in days of care and a 3.2% increase in Medicare reimbursement rates [12] - Adjusted EBITDA for VITAS, excluding Medicare Cap, totaled $70.3 million, reflecting a 15.9% increase, with an adjusted EBITDA margin of 17.2%, up 13 basis points from the prior year [13] - Roto Rooter generated a total revenue increase of 1.8% in Q1 2025 compared to the prior year, with gross branch revenue increasing by 3.1% [8][15] Business Line Data and Key Metrics Changes - VITAS admissions totaled 18,139 in Q1 2025, a 7.3% increase from the same period in 2024, with average daily census (ADC) expanding to 22,244, a 13.1% increase [6][21] - Roto Rooter branch residential revenue increased by 1.7% to $167.2 million, driven by a 3% increase in excavation revenue and a 12.5% increase in water restoration [15] - Roto Rooter branch commercial revenue increased by 7.3% to $57.7 million, supported by a 38% increase in excavation and a 14% increase in water restoration [15] Market Data and Key Metrics Changes - Hospital-based admissions represented 49% of overall admissions for VITAS in Q1 2025, the highest level since the pandemic, with a 12% increase compared to Q1 2024 [24] - The average length of stay for VITAS patients increased to 118.7 days in Q1 2025 from 103.9 days in Q1 2024, reflecting the impact of community access initiatives [22] Company Strategy and Development Direction - The company is focusing on increasing hospital-based admissions to manage Medicare cap exposure, which is expected to provide a cushion for revenue growth [7][24] - VITAS is expanding its operating scope in Florida, with new locations in Pasco and Marion Counties, which are anticipated to enhance growth potential [10][25] - Roto Rooter management is refining its excavation pricing model to balance revenue growth and EBITDA margin, particularly in the commercial sector [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in VITAS's ability to maintain above-average growth both organically and through acquisitions in 2025 and beyond [26] - The company acknowledged that the growth path observed in 2023 and 2024 may not be sustainable in the mid to long term due to Medicare cap constraints [36] Other Important Information - The financial results for Q1 2025 were within expectations and guidance, with plans to provide updated earnings guidance in the upcoming earnings press release [20] - The company experienced a significant increase in accounts receivable due to the timing of cash flow related to a previous audit refund [39][40] Q&A Session Summary Question: Details on long-term cap management strategy - Management discussed the importance of managing Medicare cap exposure and the impact of regulatory changes on revenue growth [30][31] Question: Insights on cash flow dynamics and working capital - Management explained that cash flow dynamics were affected by the timing of receivables and a significant refund related to an audit, clarifying that these do not indicate collection problems [37][39]