Summary of Addus HomeCare FY Conference Call (March 03, 2026) Company Overview - **Company**: Addus HomeCare (NasdaqGS:ADUS) - **Industry**: Personal Care and Home Health Services - **Revenue**: Over $1.5 billion with a bottom line margin between 12% and 13% [4][5] Key Points and Arguments Management and Business Strategy - The management team is described as high quality with a strong focus on maintaining a pristine balance sheet [1] - The company has transitioned from a pure play personal care company to a more diversified service provider, including clinical services [4] - The vision was to achieve double-digit margins with the right scale and growth profile, which has been realized over time [4] Medicaid and Pricing Dynamics - Concerns about Medicaid fraud and pricing dynamics were discussed, with a focus on state-specific rate increases [6][8] - Texas provided a nearly 10% rate increase effective September 2025, while Illinois has been consistent with annual increases [8][9] - New Mexico is expected to provide a 4% to 5% rate increase later in the year [10] Compliance and Quality Assurance - The company has invested heavily in compliance, with robust training and supervisory processes for caregivers [17][18] - Despite industry scrutiny, Addus has not seen changes in state audits and welcomes more scrutiny as a high-quality provider [18][21] Labor Market and Demand - The company has not observed significant impacts from immigration or Medicaid cuts on labor availability or customer demand [22][24] - Hiring remains a key focus, with expectations of improved census numbers as the economy shifts [47] Acquisition Strategy - The Gentiva acquisition, closed in December 2024, added $280 million in annualized revenue and positioned Addus as the largest provider in Texas [28][29] - The company is open to smaller tuck-in acquisitions and is monitoring the market for larger personal care assets expected to be available later in the year [66][67] Technology and Operational Improvements - A caregiver app was rolled out to improve fill rates, resulting in an increase from low 80% to upper 80% in Illinois [33][36] - The app allows caregivers to manage their schedules and pick up extra shifts, enhancing operational efficiency [34] Hospice Business Performance - The hospice segment has shown strong growth post-COVID, with consistent admission growth and improved average daily census (ADC) [51][54] - The company has made strategic changes in leadership and sales to enhance performance in hospice services [54] Market Outlook - The company anticipates continued top-line growth and margin expansion, with hospice expected to see upper single-digit organic growth in the long term [71][73] - There is optimism about the potential for positive year-over-year results in census numbers as operational improvements take effect [48] Additional Important Insights - The company is actively engaged in government relations across multiple states to navigate regulatory environments [25][26] - There is a focus on maintaining a clean balance sheet to capitalize on future acquisition opportunities [66] - The management is cautious about the home health market, preferring to focus on personal care and hospice segments due to the current reimbursement environment [60][61] This summary encapsulates the key discussions and insights from the Addus HomeCare FY Conference Call, highlighting the company's strategic direction, market dynamics, and operational performance.

Financial Data and Key Metrics Changes - For Q4 2025, total company revenue was $3.6 billion, representing a 29% increase year-over-year [25] - Full year 2025 total revenue reached $12.9 billion, reflecting a 28% growth from 2024 [28] - Adjusted EBITDA for Q4 was $184 million, a 41% increase compared to Q4 2024, while full year adjusted EBITDA was $618 million, up 34% year-over-year [29][11] - The adjusted EBITDA margin for the company was 4.8%, a 20 basis point increase from 2024 [11] Business Line Data and Key Metrics Changes - Pharmacy Solutions segment revenue for Q4 was $3.2 billion, achieving 32% year-over-year growth, while full year revenue was $11.4 billion, up 31% [25][28] - Provider Services segment revenue in Q4 was $394 million, representing a 13% increase year-over-year, with home healthcare revenue growing 19% to $217 million [27][20] - In the Pharmacy Solutions segment, infusion and specialty revenue was $2.6 billion, growing 43% year-over-year, while home and community pharmacy revenue declined 1% to $593 million [26] Market Data and Key Metrics Changes - The average daily census in home healthcare grew 15% to almost 35,000 in Q4, driven by strong quality metrics and strategic acquisitions [21] - Specialty and infusion script growth was 30% year-over-year in Q4, with total pharmacy script volume at 10.8 million [17] Company Strategy and Development Direction - The company plans to divest the community living business to streamline operations and focus on core patient populations [6] - The acquisition of Amedisys and LHC Home Health Assets is expected to enhance the company's home health capabilities, contributing approximately $30 million to adjusted EBITDA in 2026 [13][35] - The company aims to build a unique and scaled home and community healthcare platform, emphasizing quality outcomes and operational best practices [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future of home health and hospice, anticipating a strong growth trajectory over the next 5 to 10 years [50] - The company expects total revenue growth of approximately 14% year-over-year for 2026, with adjusted EBITDA growth of about 25% [13][34] - Management highlighted the importance of executing sales investments and operational efficiencies to drive volume growth and margin expansion [38][39] Other Important Information - The company achieved a leverage ratio of 2.99 times as of December 31, 2025, down from 4.16 times in 2024, indicating improved financial health [32] - The company is initiating a foundation to support community and patient activities, reflecting its commitment to social responsibility [14] Q&A Session Summary Question: Variability in 2026 Outlook - Management noted consistency in Q1 and emphasized the importance of executing strategies to drive volume growth across businesses [37] Question: LDD Introductions and Landscape - Management confirmed expectations for 16-20 new LDD introductions over the next 12-18 months, with a focus on expanding capabilities [40][41] Question: EBITDA and Margins for Segments - Management indicated broad-based margin expansion is expected due to operational efficiencies and favorable product mix [45][46] Question: Home Health Rate Environment - Management expressed optimism about home health rates, projecting a flat baseline with potential for future increases [50] Question: Specialty Drug Launches and Margins - Management highlighted the multifactorial growth in specialty pharmacy, including brand LDDs and generic conversions, which improve margins [55] Question: Amedisys Asset Margins - Management acknowledged the lower margin profile of the Amedisys assets but expressed confidence in improving margins through integration [61][62] Question: Pharmacy Revenue Guidance Components - Management outlined expected revenue headwinds from IRA impacts and generic conversions but anticipated strong growth across pharmacy businesses [70][71] Question: Infusion Business Update - Management reported double-digit growth in the infusion business and plans for significant investments to enhance capabilities [73][75]

Financial Data and Key Metrics Changes - Total revenue for Q4 2025 was $373.1 million, a 25.6% increase from $297.1 million in Q4 2024 [5] - Adjusted earnings per share for Q4 2025 was $1.77, up 28.3% from $1.38 in Q4 2024 [6] - Adjusted EBITDA for Q4 2025 was $50.3 million, a 33.3% increase from $37.8 million in Q4 2024 [8] - Total revenue for 2025 was approximately $1.4 billion, a 23.2% increase from approximately $1.1 billion in 2024 [7] - Adjusted EBITDA for 2025 was $180 million, compared to $140.3 million in 2024, marking a 28.3% increase [8] Business Line Data and Key Metrics Changes - Personal Care Services revenue was $284.1 million, accounting for 76.5% of total revenue in Q4 2025 [22] - Hospice care revenue was $70 million, representing 18.9% of total revenue [23] - Home Health revenue was $17.1 million, making up 4.6% of total revenue [23] - Same-store revenue growth for Personal Care was 6.3% compared to Q4 2024 [11] - Hospice same-store revenue increased by 16% compared to Q4 2024 [12] Market Data and Key Metrics Changes - Texas and Illinois have recently increased rates for Personal Care Services, with Texas seeing a 9.9% increase effective September 1, 2025, and Illinois a 3.9% increase effective January 1, 2026 [9][18] - The average daily census for Hospice increased to 3,885 in Q4 2025, up from 3,472 in the same period last year, an increase of 11.9% [13] Company Strategy and Development Direction - The company aims to create geographic density and scale while focusing on the full continuum of Home Care [8] - The strategy includes pursuing acquisitions that complement organic growth and align with the company's goals [31] - The company is optimistic about the potential repeal of the 80/20 provision of the Medicaid Access Rule, which could positively impact the industry [10][81] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the value proposition of Personal Care Services and the company's ability to be a cost-effective partner for states and managed Medicaid payers [9] - The company anticipates continued growth opportunities in home-based care due to heightened awareness of its value [16] - Management noted stable hiring trends and a positive outlook for the labor market, with 101 hires per business day in Q4 2025 [10][43] Other Important Information - Cash flow from operations for Q4 2025 was $18.8 million, with cash on hand of approximately $81.6 million [8][30] - The company ended Q4 2025 with bank debt of $124.3 million, resulting in a net leverage of under 1x adjusted EBITDA [8] Q&A Session Summary Question: Rate backdrop in states like New Mexico and Tennessee - Management indicated a potential 4% to 5% rate increase in New Mexico is awaiting the governor's signature, which could benefit the company in the latter half of the year [34][35] Question: Margin flow-through from New Mexico - Management noted that while there isn't a mandatory pass-through rule in New Mexico, some portion of the rate increase will likely be passed through to caregivers [41] Question: Hiring trends and caregiver retention - Management reported stable hiring trends and good progress in hiring, with no significant difficulties noted [44] Question: Acquisition pipeline and opportunities - Management is optimistic about more acquisition opportunities in 2026, focusing on deals that create density in existing markets [47][48] Question: Impact of fraud and abuse focus on business growth - Management views the focus on fraud and abuse as an opportunity for growth, as smaller players may struggle to comply with regulations [61] Question: Update on Addus Connect app and its impact - Management reported positive momentum in service percentage due to the app, with ongoing rollout in New Mexico and Texas [64][65] Question: Home Health and Hospice bridging program - Management highlighted ongoing focus on the bridging program, with positive results expected as they continue to drive growth in key markets [88][92]

Core Viewpoint - Elara Caring has entered into a strategic investment agreement with Ares' Private Equity Group and DaVita to enhance access to personalized, clinically advanced home care for patients with complex and acute needs [1][2]. Company Overview - Elara Caring is a leading national provider of skilled home health, hospice, behavioral health, and personal care services, operating in 18 states and serving over 60,000 patients daily across 200 locations [6]. - The company is committed to quality and a patient-first culture, focusing on delivering care when and where patients need it most [6]. Investment Details - The investment aims to support Elara's growth by expanding its capacity for specialized in-home care and launching innovative care models [2]. - Ares brings experience in growing high-performing healthcare businesses, while DaVita contributes clinical and operational expertise in value-based care, positioning Elara to improve outcomes and address gaps in post-acute care [2][3]. Collaborative Efforts - Elara and DaVita plan to co-develop a kidney-specific home-based care model, leveraging Elara's clinical capabilities and DaVita's insights to reduce preventable hospitalizations and lower total care costs [3][4]. - This collaboration aims to provide patients with tailored support at home and ensure continuity of care [3]. Expected Outcomes - The partnership is expected to enhance patient outcomes by providing timely and personalized care, ultimately improving quality of life and reducing unnecessary hospitalizations [4]. - The transaction is subject to customary closing conditions and regulatory approvals, with an expected closing date later in 2026 [4].

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $362.3 million, a 25% increase from $289.8 million in Q3 2024 [6] - Adjusted earnings per share rose to $1.56, up 20% from $1.30 in the previous year [6] - Adjusted EBITDA increased by 31.6% to $45.1 million compared to $34.3 million in Q3 2024 [6][18] - Operating cash flow exceeded $50 million for the quarter, with cash on hand of approximately $102 million as of September 30, 2025 [6][25] - Net leverage was under one times adjusted EBITDA, providing flexibility for strategic acquisitions [6] Business Line Data and Key Metrics Changes - Personal Care segment revenues were $275.8 million, accounting for 76.1% of total revenue, with same-store revenue growth of 6.6% [21] - Hospice segment revenues increased by 19% year-over-year, with same-store average daily census rising to 3,872, up 9.5% from the previous year [13][20] - Home Health segment revenues were $17.6 million, representing 4.9% of total revenue, with a 2.8% decrease in same-store revenue compared to Q3 2024 [14][22] Market Data and Key Metrics Changes - Texas and Illinois announced rate increases for personal care services, with Texas effective October 1, 2025, and Illinois set for January 1, 2026 [8][19] - The hospice reimbursement rate update effective October 1, 2025, is expected to increase rates by approximately 3.1% [20] - Proposed home health payment rule indicates a 6.4% aggregate reduction in Medicare payments for 2026 [10] Company Strategy and Development Direction - The company continues to pursue strategic acquisitions to enhance geographic coverage and density, with recent acquisitions including Del Cielo Home Care Services [15][21] - Focus on maintaining a balanced approach to organic growth and acquisitions, particularly in overlapping markets for home health and hospice services [16][68] - Emphasis on the value of home-based care and the benefits of personal care services in reducing overall care costs [8][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the growth potential in personal care services due to favorable rate increases and strong hiring trends [19][40] - The company anticipates continued organic growth momentum into 2026, supported by recent rate increases and hiring performance [41] - Management acknowledged challenges in the home health segment but remains focused on improving operational efficiencies and profitability [50][52] Other Important Information - The company reported a gross margin percentage of 32.2%, an increase from 31.8% in Q3 2024 [22] - Adjusted G&A expenses were 19.8%, a decrease from 20% in the prior year [23] - The company maintains a strong balance sheet with total bank debt of $154.3 million, down from the previous quarter [25] Q&A Session Summary Question: About same store volume growth in Personal Care - Management noted improvements in fill rates and billable hours, attributing part of the 6.6% same store revenue growth to these factors [28][33] Question: On cash flow and DSOs - Management indicated that fluctuations in DSOs are typical and attributed the strong cash flow to timing rather than specific changes in payer behavior [34] Question: Organic growth expectations for 2026 - Management expressed confidence in maintaining above 2% year-over-year volume growth, supported by strong hiring and rate increases [40][41] Question: Home health and hospice asset allocation - Management remains interested in home health acquisitions that complement existing personal care and hospice services, despite current market uncertainties [44] Question: Hospice revenue per patient day and Medicare cap dynamics - Management confirmed that the absence of cap liability this quarter positively impacted revenue per patient day, with expectations for similar dynamics in Q4 [104]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $349.4 million, an increase of 21.8% compared to $286.9 million in Q2 2024 [6] - Adjusted earnings per share rose to $1.49, up 10.4% from $1.35 in the previous year [6] - Adjusted EBITDA increased by 24.5% to $43.9 million from $35.3 million in Q2 2024 [6][20] - Cash on hand as of June 30, 2025, was approximately $91 million, with a reduction in bank debt by $30 million to a total of $173 million [6][28] Business Line Data and Key Metrics Changes - Personal Care segment revenues were $269.2 million, accounting for 77% of total revenue, with a same-store revenue growth of 7.4% [25][14] - Hospice segment revenues were $62.2 million, representing 17.8% of total revenue, with a same-store revenue growth of 10% [25][15] - Home Health segment revenues were $18 million, making up 5.2% of total revenue, with a same-store revenue decrease of 6% [25][16] Market Data and Key Metrics Changes - Illinois and Texas have finalized budget increases for personal care services, with Illinois set to increase reimbursement rates by 3.9% effective January 1, 2026, and Texas by 9.9% effective September 1, 2025 [10][22] - The Illinois rate increase is expected to add approximately $17.5 million in annualized revenue, while the Texas increase is projected to add about $17.7 million [10][22] Company Strategy and Development Direction - The company continues to focus on strategic acquisitions to enhance geographic coverage and clinical services, with the recent acquisition of Helping Hands Home Care in Pennsylvania [17][24] - The company aims to maintain a conservative net leverage position to pursue further acquisition opportunities [6][29] - The focus remains on organic growth complemented by acquisitions, particularly in personal care and hospice services [24][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the reimbursement environment, noting strong support for personal care services from state budgets [33] - Concerns were raised about potential reductions in Medicare payments for home health services, which could impact availability and access to care [12][13] - The company believes that the value of home-based care will continue to be recognized, providing growth opportunities [18] Other Important Information - The company has experienced consistent cash collections and a reduction in bank debt, supporting its capital structure for future investments [28][29] - The adjusted net income per diluted share for Q2 2025 was $1.49, reflecting a solid financial performance [27] Q&A Session Summary Question: How is the overall reimbursement environment expected to unfold? - Management noted strong support from larger markets and expressed optimism about future rate increases, despite some states delaying discussions due to budget uncertainties [32][34] Question: What is driving the negative volumes in same-store census? - The decrease was attributed to the inclusion of New York in prior year comparisons, which has since been disposed of, and a sequential increase in same-store census was noted [35][36] Question: How is the caregiver application rollout impacting performance? - The caregiver application has seen good adoption in Illinois, with about 90% of caregivers registered, and is expected to improve fill rates and retention over time [42][45] Question: What is the impact of immigration policy changes on the workforce? - Currently, there is no significant impact observed, as the company has a small number of caregivers affected by immigration policies [51][52] Question: What are the expectations for hospice segment growth? - Long-term growth expectations for the hospice segment are projected to be in the 5% to 7% range, with recent operational improvements contributing to current growth [53][54] Question: What are the public advocacy priorities for the company? - The company is focused on advocating for the value of personal care services and addressing concerns regarding proposed Medicare payment reductions [81][84] Question: How are payer contracts evolving? - Discussions with payers are increasingly focused on driving volume into plans, with ongoing efforts to implement case rate or episodic payment structures in home health [85][86]

Group 1: Company Overview - CP Center is a landmark building in Beijing, recognized as the preferred office space for global enterprises due to its international business appeal and exceptional operations [1][3] - The building features two twin towers standing 238 meters high, with a total gross floor area of 317,000 square meters, including 198,000 square meters of office space and 43,000 square meters of retail facilities [5] Group 2: Business Environment - Beijing CBD is highlighted as one of the world's premier central business districts, providing a dynamic business ecosystem and access to international resources, making it ideal for multinational corporations [3] - CP Center serves as the headquarters for CP Group in China and integrates business, commerce, culture, and community, fostering an international business ecosystem [3][7] Group 3: Occupancy and Tenants - CP Center has an office occupancy rate nearing 90%, hosting notable enterprises in sectors such as "Great Health" and "Great Future," including Roche Pharmaceuticals, IBM, and PayPal [6] - The commercial spaces within CP Center have achieved a 100% occupancy rate, with the dining sector accounting for over 60% of the offerings [8][9] Group 4: Social Responsibility and Innovation - CP Center has implemented innovative technologies for social responsibility, including an AI-powered intelligent fire management platform and energy-efficient systems to enhance ESG performance [10] - The property utilizes a professional team and an ISO management system to create a comfortable, human-centric environment, offering extensive support through a one-stop service system [11] Group 5: Cultural and Culinary Significance - CP Center showcased its brand strength at the Beijing CBD International Cuisine Tasting and Cultural Festival, attracting exceptional enterprises and talents for collaboration [12]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $337.7 million, a 20.3% increase from $280.7 million in Q1 2024 [6] - Adjusted earnings per share rose to $1.42, up 17.4% from $1.21 in Q1 2024 [6] - Adjusted EBITDA increased to $40.6 million, a 25.1% rise from $32.4 million in Q1 2024 [6] - Gross margin percentage improved to 31.9% from 31.4% in Q1 2024 [21] - Adjusted EBITDA margin was 12%, compared to 11.6% in Q1 2024 [22] Business Line Data and Key Metrics Changes - Personal Care segment revenues were $258.3 million, accounting for 76.5% of total revenue, with a same-store revenue growth of 7.4% [20] - Hospice segment revenues were $61.4 million, representing 18.2% of total revenue, with same-store revenue growth of 9.9% [20] - Home Health segment revenues were $18 million, making up 5.3% of total revenue, with a same-store revenue growth of 1.3% [20] Market Data and Key Metrics Changes - Personal Care hiring reached 79 hires per day, an increase from the previous year [7] - Average daily census for hospice increased to 3,515, up 4.6% from 3,359 in Q1 2024 [11] - Same-store hours for Personal Care increased by 2% compared to Q1 2024 [10] Company Strategy and Development Direction - The company aims for a minimum annual revenue growth of 10%, focusing on acquisitions that complement organic growth [13] - The strategy includes expanding personal care services in Texas and evaluating smaller acquisition opportunities [14] - The company is committed to maintaining a conservative approach to valuation and due diligence in acquisitions [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the continued demand for home-based care services, which are seen as cost-effective and safe [15] - The company anticipates stable gross margins and consistent cash flow conversion for the full year 2025 [22][24] - Management noted that the clinical hiring environment remains challenging but is improving overall [8][66] Other Important Information - The company utilized approximately $2.5 million in ARPA funding during Q1 2025, with $8.8 million remaining [25] - As of March 31, 2025, the company had cash on hand of approximately $97 million and reduced bank debt by $20 million [6][25] Q&A Session Summary Question: Commentary on hospice cap limitations - Management indicated that cap limitations have not been material, emphasizing a balanced referral mix [28][30] Question: Growth expectations for personal care services - Management acknowledged weather-related impacts in January but expects growth in hours to remain in the 2% to 2.5% range [38] Question: Hospice revenue growth expectations - Management anticipates hospice revenue growth in the 5% to 7% range, likely at the higher end [40] Question: Margin expansion expectations - Management expects 40 to 50 basis points of margin expansion from Q1 to Q2, consistent with historical patterns [46] Question: Impact of ACA expansion rollback - Management stated that potential changes to ACA expansion would likely have no direct impact on the company [50][52] Question: Same-store revenue growth components - Management attributed strong same-store revenue growth to improved scheduling and caregiver assignment practices [56] Question: Industry-wide workforce retention improvements - Management noted improvements in workforce retention across the industry, particularly in personal care [66] Question: Updates on Gentiva's performance - Management reported that Gentiva's bottom line performance has exceeded expectations, while top-line growth has been slightly lighter [76] Question: State budget and rate increase outlook - Management expressed confidence in state budgets and is closely monitoring potential rate increases, particularly in Texas [79]