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Chemed Reports First-Quarter 2021 Results

Chemed Corporation (Chemed) (NYSE: CHE), which operates VITAS Healthcare Corporation (VITAS), one of the nation’s largest providers of end-of-life care, and Roto-Rooter, the nation’s largest commercial and residential plumbing and drain cleaning services provider, reported financial results for its first quarter ended March 31, 2021, versus the comparable prior-year period, as follows:

Consolidated operating results:

  • Revenue increased 2.2% to $527 million
  • GAAP Diluted Earnings-per-Share (EPS) of $4.01, an increase of 18.6%
  • Adjusted Diluted EPS of $4.44, an increase of 20.7%

VITAS segment operating results:

  • Net Patient Revenue of $316 million, a decline of 6.5%
  • Average Daily Census (ADC) of 18,050, a decline of 6.1%
  • Admissions of 18,135 a decline of 2.5%
  • Net Income, excluding certain discrete items, of $42.1 million, a decline of 1.0%
  • Adjusted EBITDA, excluding Medicare Cap, of $58.3 million, a decline of 3.3%
  • Adjusted EBITDA margin, excluding Medicare Cap, of 18.4%, an increase of 66-basis points

Roto-Rooter segment operating results:

  • Revenue of $212 million, an increase of 18.9%
  • Net Income, excluding certain discrete items, of $39.3 million, an increase of 47.3%
  • Adjusted EBITDA of $56.9 million, an increase of 42.1%
  • Adjusted EBITDA margin of 26.9%, an increase of 439-basis points

VITAS

VITAS net revenue was $316 million in the first quarter of 2021, which is a decline of 6.5%, when compared to the prior-year period. This revenue decline is comprised primarily of a 7.1% decline in days-of-care offset by a geographically weighted average Medicare reimbursement rate increase (including the suspension of sequestration on May 1, 2020) of approximately 2.8%. Acuity mix shift had a net impact of reducing revenue approximately $9.1 million, or 2.7%, in the quarter when compared to the prior year revenue and level-of-care mix. The combination of a lower Medicare Cap and other contra revenue changes offset a portion of the revenue decline by approximately 50-basis points.

In the first quarter of 2021, VITAS accrued $1.5 million in Medicare Cap billing limitations. This compares to a $2.5 million Medicare Cap billing limitation in the first quarter of 2020.

Of VITAS’ 30 Medicare provider numbers, 27 provider numbers currently have a Medicare Cap cushion of 10% or greater, one provider number has a cap cushion between 5% and 10%, one provider number has a cap cushion between 0% and 5% and one provider number currently has a fiscal 2021 Medicare Cap billing limitation liability. This is based on actual Medicare revenue and admissions in the first six months of the Medicare Cap fiscal year.

Average revenue per patient per day in the first quarter of 2021 was $198.95, which, including acuity mix shift, is 2-basis points below the prior-year period. Reimbursement for routine home care and high acuity care averaged $170.14 and $991.77, respectively. During the quarter, high acuity days-of-care were 3.5% of total days of care, 71-basis points less than the prior-year quarter.

The first quarter 2021 gross margin, excluding Medicare Cap, increased costs for personal protection equipment (PPE), disinfecting facilities and other costs related to operating during the pandemic, was 25.3%. This is a 123-basis point margin improvement when compared to the first quarter of 2020.

Selling, general and administrative expense was $22.1 million in the first quarter of 2021 and compares favorably to the $22.3 million incurred in the prior-year quarter. Adjusted EBITDA, excluding Medicare Cap, totaled $58.3 million in the quarter, a decrease of 3.3%. Adjusted EBITDA margin in the quarter, excluding Medicare Cap, was 18.4%, which is a 66-basis point improvement when compared to the prior-year period.

Roto-Rooter

Roto-Rooter generated quarterly revenue of $212 million in the first quarter of 2021, an increase of $33.7 million, or 18.9%, over the prior-year quarter.

Total Roto-Rooter branch commercial revenue in the quarter totaled $46.9 million, a decrease of 8.4% over the prior year. This aggregate commercial revenue decline consisted of drain cleaning revenue declining 5.8%, plumbing declining 5.0% and excavation declining 19.5%. Water restoration increased 8.8%.

Total Roto-Rooter branch residential revenue in the quarter totaled $144 million, an increase of 32.0% over the prior year period. This aggregate residential revenue growth consisted of drain cleaning increasing 29.5%, plumbing expanding 34.9%, excavation increasing 35.8%, and water restoration increasing 28.7%.

Roto-Rooter’s gross margin in the quarter was 51.9%, a 378-basis point increase when compared to the first quarter of 2020. Adjusted EBITDA in the first quarter of 2021 totaled $56.9 million, an increase of 42.1%. The Adjusted EBITDA margin in the quarter was 26.9% which is a 439-basis point increase when compared to the prior year.

Chemed Consolidated

As of March 31, 2021, Chemed had total cash and cash equivalents of $210 million and no long-term debt.

In June 2018, Chemed entered into a five-year Amended and Restated Credit Agreement that consists of a $450 million revolving credit facility. The interest rate on this facility has a floating rate that is currently LIBOR plus 100-basis points. At March 31, 2021, the Company had approximately $412 million of undrawn borrowing capacity under this credit agreement.

During the quarter, the Company repurchased 100,000 shares of Chemed stock for $44.8 million which equates to a cost per share of $447.67. As of March 31, 2021, there was approximately $134 million of remaining share repurchase authorization under this plan.

Chemed restarted its share repurchase program in 2007. Since that time, Chemed has repurchased approximately 14.6 million shares, aggregating approximately $1.4 billion at an average share cost of $98.15. Including dividends over this period, Chemed has returned approximately $1.6 billion to shareholders.

Guidance for 2021

Management anticipates providing updated 2021 earnings guidance in July 2021 as part of the June 30, 2021, earnings press release.

Conference Call

Chemed will host a conference call and webcast at 10 a.m., ET, on Wednesday, April 28, 2021, to discuss the Company's quarterly results and to provide an update on its business. The dial-in number for the conference call is (844) 743-2500 for U.S. and Canadian participants and +1 (661) 378-9533 for international participants. The Conference ID is 9096486. A live webcast of the call can be accessed on Chemed's website at www.chemed.com by clicking on Investor Relations Home.

A taped replay of the conference call will be available beginning approximately 24 hours after the call's conclusion. It can be accessed by dialing (855) 859-2056 for U.S. and Canadian callers and +1 (404) 537-3406 for international callers and will be available for one week following the live call. The replay Conference ID is 9096486. An archived webcast will also be available at www.chemed.com.

Chemed Corporation operates in the healthcare field through its VITAS Healthcare Corporation subsidiary. VITAS provides daily hospice services to approximately 18,000 patients with severe, life-limiting illnesses. This type of care is focused on making the terminally ill patient's final days as comfortable and pain-free as possible.

Chemed operates in the residential and commercial plumbing and drain cleaning industry under the brand name Roto-Rooter. Roto-Rooter provides plumbing, drain cleaning, and water cleanup services through company-owned branches, independent contractors and franchisees in the United States and Canada. Roto-Rooter also has licensed master franchisees in the republics of Indonesia and Singapore, and the Philippines.

This press release contains information about Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS, which are not measures derived in accordance with GAAP and which exclude components that are important to understanding Chemed’s financial performance. In reporting its operating results, Chemed provides EBITDA, Adjusted EBITDA and Adjusted Diluted EPS measures to help investors and others evaluate the Company’s operating results, compare its operating performance with that of similar companies that have different capital structures and evaluate its ability to meet its future debt service, capital expenditures and working capital requirements. Chemed’s management similarly uses EBITDA, Adjusted EBITDA and Adjusted Diluted EPS to assist it in evaluating the performance of the Company across fiscal periods and in assessing how its performance compares to its peer companies. These measures also help Chemed’s management to estimate the resources required to meet Chemed’s future financial obligations and expenditures. Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS should not be considered in isolation or as a substitute for comparable measures calculated and presented in accordance with GAAP. We calculated Adjusted EBITDA Margin by dividing Adjusted EBITDA by service revenue and sales. A reconciliation of Chemed’s net income to its EBITDA, Adjusted EBITDA and Adjusted Diluted EPS is presented in the tables following the text of this press release.

Forward-Looking Statements

Certain statements contained in this press release and the accompanying tables are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "hope," "anticipate," "plan" and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Chemed does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause Chemed's actual results to differ from those expressed in such forward-looking statements.

These risks and uncertainties arise from, among other things, possible changes in regulations governing the hospice care or plumbing and drain cleaning industries; periodic changes in reimbursement levels and procedures under Medicare and Medicaid programs; difficulties predicting patient length of stay and estimating potential Medicare reimbursement obligations; challenges inherent in Chemed's growth strategy; the current shortage of qualified nurses, other healthcare professionals and licensed plumbing and drain cleaning technicians; Chemed’s dependence on patient referral sources; and other factors detailed under the caption "Description of Business by Segment" or "Risk Factors" in Chemed’s most recent report on form 10-Q or 10-K and its other filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on such forward-looking statements and there are no assurances that the matters contained in such statements will be achieved.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)(unaudited)
 

Three Months Ended March 31,

2021

2020

Service revenues and sales $

527,360

 

$

515,798

 

Cost of services provided and goods sold

340,473

 

351,745

 

Selling, general and administrative expenses (aa)

91,599

 

70,583

 

Depreciation

11,715

 

11,388

 

Amortization

2,510

 

2,477

 

Other operating expense

622

 

242

 

Total costs and expenses

446,919

 

436,435

 

Income from operations

80,441

 

79,363

 

Interest expense

(381

)

(975

)

Other income/(expense)--net (bb)

3,602

 

(9,466

)

Income before income taxes

83,662

 

68,922

 

Income taxes

(18,262

)

(13,031

)

Net income $

65,400

 

$

55,891

 

Earnings Per Share
Net income $

4.08

 

$

3.50

 

Average number of shares outstanding

16,010

 

15,991

 

Diluted Earnings Per Share
Net income $

4.01

 

$

3.38

 

Average number of shares outstanding

16,310

 

16,516

 

 
(aa) Selling, general and administrative ("SG&A") expenses comprise (in thousands):
 

Three Months Ended March 31,

2021

2020

SG&A expenses before long-term incentive compensation and the impact of market value adjustments related to deferred compensation plans $

86,668

 

$

78,334

 

Market value adjustments related to deferred compensation trusts

3,038

 

(9,572

)

Long-term incentive compensation

1,893

 

1,821

 

Total SG&A expenses $

91,599

 

$

70,583

 

 
(bb) Other income/(expense)--net comprises (in thousands):

Three Months Ended March 31,

2021

2020

Market value adjustments related to deferred compensation trusts $

3,038

 

$

(9,572

)

Interest income

92

 

109

 

Other

472

 

(3

)

Total other income/(expense)--net $

3,602

 

$

(9,466

)

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)(unaudited)
 

March 31,

2021

2020

Assets
Current assets
Cash and cash equivalents $

210,156

 

$

28,951

 

Accounts receivable less allowances

104,748

 

134,695

 

Inventories

6,777

 

7,313

 

Prepaid income taxes

3,518

 

5,917

 

Prepaid expenses

21,775

 

21,939

 

Total current assets

346,974

 

198,815

 

Investments of deferred compensation plans held in trust

93,705

 

72,296

 

Properties and equipment, at cost less accumulated depreciation

190,154

 

183,729

 

Lease right of use asset

124,104

 

112,302

 

Identifiable intangible assets less accumulated amortization

115,517

 

124,219

 

Goodwill

578,618

 

577,236

 

Other assets

9,061

 

8,962

 

Total Assets $

1,458,133

 

$

1,277,559

 

Liabilities
Current liabilities
Accounts payable $

55,447

 

$

37,838

 

Income taxes

24,774

 

6,133

 

Accrued insurance

57,533

 

56,480

 

Accrued compensation

73,907

 

63,622

 

Accrued legal

2,102

 

7,114

 

Short-term lease liability

37,897

 

36,252

 

Other current liabilities

38,555

 

39,298

 

Total current liabilities

290,215

 

246,737

 

Deferred income taxes

19,733

 

20,681

 

Long-term debt

-

 

160,000

 

Deferred compensation liabilities

93,755

 

70,363

 

Long-term lease liability

98,813

 

88,278

 

Other liabilities

26,733

 

7,899

 

Total Liabilities

529,249

 

593,958

 

Stockholders' Equity
Capital stock

36,345

 

35,912

 

Paid-in capital

982,739

 

878,550

 

Retained earnings

1,783,740

 

1,476,151

 

Treasury stock, at cost

(1,876,315

)

(1,709,390

)

Deferred compensation payable in Company stock

2,375

 

2,378

 

Total Stockholders' Equity

928,884

 

683,601

 

Total Liabilities and Stockholders' Equity $

1,458,133

 

$

1,277,559

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)(unaudited)
 

For the Three Months Ended March 31,

2021

2020

Cash Flows from Operating Activities
Net income $

65,400

 

$

55,891

 

Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization

14,225

 

13,865

 

Payments on previously accrued litigation settlements

(8,490

)

-

 

Stock option expense

6,106

 

5,045

 

Noncash long-term incentive compensation

1,642

 

1,598

 

Deferred payroll taxes

(930

)

2,290

 

Amortization of debt issuance costs

76

 

76

 

Provision for bad debts

-

 

594

 

Changes in operating assets and liabilities, excluding amounts acquired in business combinations:
Decrease in accounts receivable

22,773

 

6,269

 

Decrease in inventories

318

 

149

 

Decrease in prepaid expenses

4,402

 

1,211

 

Decrease in accounts payable and other current liabilities

(18,369

)

(7,037

)

Change in current income taxes

18,395

 

10,159

 

Net change in lease assets and liabilities

(24

)

(153

)

Decrease/(increase) in other assets

(5,274

)

5,048

 

Increase/(decrease) in other liabilities

5,759

 

(6,067

)

Other sources

710

 

388

 

Net cash provided by operating activities

106,719

 

89,326

 

Cash Flows from Investing Activities
Capital expenditures

(17,697

)

(19,897

)

Business combinations

-

 

(1,452

)

Other sources/(uses)

274

 

(144

)

Net cash used by investing activities

(17,423

)

(21,493

)

Cash Flows from Financing Activities
Purchases of treasury stock

(41,107

)

(100,235

)

Proceeds from exercise of stock options

11,026

 

9,241

 

Capital stock surrendered to pay taxes on stock-based compensation

(6,613

)

(7,951

)

Dividends paid

(5,437

)

(5,130

)

Payments on revolving line of credit

-

 

(104,100

)

Proceeds from revolving line of credit

-

 

174,100

 

Change in cash overdrafts payable

-

 

(9,849

)

Other sources/(uses)

316

 

(1,116

)

Net cash used by financing activities

(41,815

)

(45,040

)

Increase in Cash and Cash Equivalents

47,481

 

22,793

 

Cash and cash equivalents at beginning of year

162,675

 

6,158

 

Cash and cash equivalents at end of year $

210,156

 

$

28,951

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020
(in thousands)(unaudited)
Chemed
VITAS Roto-Rooter Corporate Consolidated
2021 (a)
Service revenues and sales $

315,788

 

$

211,572

 

$

-

 

$

527,360

 

Cost of services provided and goods sold

238,667

 

101,806

 

-

 

340,473

 

Selling, general and administrative expenses

22,090

 

53,322

 

16,187

 

91,599

 

Depreciation

5,338

 

6,353

 

24

 

11,715

 

Amortization

18

 

2,492

 

-

 

2,510

 

Other operating expense

502

 

120

 

-

 

622

 

Total costs and expenses

266,615

 

164,093

 

16,211

 

446,919

 

Income/(loss) from operations

49,173

 

47,479

 

(16,211

)

80,441

 

Interest expense

(42

)

(89

)

(250

)

(381

)

Intercompany interest income/(expense)

4,525

 

1,620

 

(6,145

)

-

 

Other income—net

533

 

31

 

3,038

 

3,602

 

Income/(loss) before income taxes

54,189

 

49,041

 

(19,568

)

83,662

 

Income taxes

(13,419

)

(11,864

)

7,021

 

(18,262

)

Net income/(loss) $

40,770

 

$

37,177

 

$

(12,547

)

$

65,400

 

 
2020 (b)
Service revenues and sales $

337,916

 

$

177,882

 

$

-

 

$

515,798

 

Cost of services provided and goods sold

259,429

 

92,316

 

-

 

351,745

 

Selling, general and administrative expenses

22,269

 

46,282

 

2,032

 

70,583

 

Depreciation

5,474

 

5,878

 

36

 

11,388

 

Amortization

18

 

2,459

 

-

 

2,477

 

Other operating expense

114

 

128

 

-

 

242

 

Total costs and expenses

287,304

 

147,063

 

2,068

 

436,435

 

Income/(loss) from operations

50,612

 

30,819

 

(2,068

)

79,363

 

Interest expense

(45

)

(102

)

(828

)

(975

)

Intercompany interest income/(expense)

4,386

 

1,349

 

(5,735

)

-

 

Other income/(expense)—net

65

 

40

 

(9,571

)

(9,466

)

Income/(loss) before income taxes

55,018

 

32,106

 

(18,202

)

68,922

 

Income taxes

(13,739

)

(7,784

)

8,492

 

(13,031

)

Net income/(loss) $

41,279

 

$

24,322

 

$

(9,710

)

$

55,891

 

The "Footnotes to Financial Statements" are integral parts of this financial information.
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING SUMMARIES OF EBITDA
FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020
(in thousands)(unaudited)

Chemed

VITAS

Roto-Rooter

 

Corporate

Consolidated

2021

Net income/(loss) $

40,770

 

$

37,177

 

$

(12,547

)

$

65,400

 

Add/(deduct):
Interest expense

42

 

89

 

250

 

381

 

Income taxes

13,419

 

11,864

 

(7,021

)

18,262

 

Depreciation

5,338

 

6,353

 

24

 

11,715

 

Amortization

18

 

2,492

 

-

 

2,510

 

EBITDA

59,587

 

57,975

 

(19,294

)

98,268

 

Add/(deduct):
Intercompany interest expense/(income)

(4,525

)

(1,620

)

6,145

 

-

 

Interest income

(61

)

(31

)

-

 

(92

)

Stock option expense

-

 

-

 

6,106

 

6,106

 

Direct costs related to COVID-19

1,753

 

553

 

38

 

2,344

 

Long-term incentive compensation

-

 

-

 

1,893

 

1,893

 

Adjusted EBITDA $

56,754

 

$

56,877

 

$

(5,112

)

$

108,519

 

 

2020

Net income/(loss) $

41,279

 

$

24,322

 

$

(9,710

)

$

55,891

 

Add/(deduct):
Interest expense

45

 

102

 

828

 

975

 

Income taxes

13,739

 

7,784

 

(8,492

)

13,031

 

Depreciation

5,474

 

5,878

 

36

 

11,388

 

Amortization

18

 

2,459

 

-

 

2,477

 

EBITDA

60,555

 

40,545

 

(17,338

)

83,762

 

Add/(deduct):
Intercompany interest expense/(income)

(4,386

)

(1,349

)

5,735

 

-

 

Interest income

(68

)

(40

)

-

 

(108

)

Stock option expense

-

 

-

 

5,045

 

5,045

 

Direct costs related to COVID-19

973

 

861

 

-

 

1,834

 

Long-term incentive compensation

-

 

-

 

1,821

 

1,821

 

Medicare cap sequestration adjustment

675

 

-

 

-

 

675

 

Adjusted EBITDA $

57,749

 

$

40,017

 

$

(4,737

)

$

93,029

 

The "Footnotes to Financial Statements" are integral parts of this financial information.
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
RECONCILIATION OF ADJUSTED NET INCOME
(in thousands, except per share data)(unaudited)
 
 

Three Months Ended March 31,

2021

2020

Net income as reported $

65,400

 

$

55,891

 

Add/(deduct) pre-tax cost of:
Stock option expense

6,106

 

5,045

 

Amortization of reacquired franchise agreements

2,352

 

2,352

 

Direct costs related to COVID-19

2,344

 

1,834

 

Long-term incentive compensation

1,893

 

1,821

 

Medicare cap sequestration adjustments

-

 

675

 

Add/(deduct) tax impacts:
Tax impact of the above pre-tax adjustments (1)

(2,487

)

(2,350

)

Excess tax benefits on stock compensation

(3,238

)

(4,553

)

Adjusted net income $

72,370

 

$

60,715

 

 
Diluted Earnings Per Share As Reported
Net income $

4.01

 

$

3.38

 

Average number of shares outstanding

16,310

 

16,516

 

 
Adjusted Diluted Earnings Per Share
Adjusted net income $

4.44

 

$

3.68

 

Average number of shares outstanding

16,310

 

16,516

 

(1) The tax impact of pre-tax adjustments was calculated using the effective tax rate of the operating unit for which each adjustment is associated.
 
The "Footnotes to Financial Statements" are integral parts of this financial information.
OPERATING STATISTICS FOR VITAS SEGMENT
(unaudited)
 

Three Months Ended March 31,

OPERATING STATISTICS

2021

2020

Net revenue ($000) (c)
Homecare $

263,754

 

$

271,762

 

Inpatient

29,156

 

32,482

 

Continuous care

27,349

 

40,555

 

Other

2,938

 

3,147

 

Subtotal $

323,197

 

$

347,946

 

Room and board, net

(2,665

)

(3,381

)

Contractual allowances

(3,244

)

(4,149

)

Medicare cap allowance

(1,500

)

(2,500

)

Net Revenue $

315,788

 

$

337,916

 

Net revenue as a percent of total before Medicare cap allowance
Homecare

81.6

%

78.1

%

Inpatient

9.0

 

9.3

 

Continuous care

8.5

 

11.7

 

Other

0.9

 

0.9

 

Subtotal

100.0

 

100.0

 

Room and board, net

(0.8

)

(1.0

)

Contractual allowances

(1.0

)

(1.2

)

Medicare cap allowance

(0.5

)

(0.7

)

Net Revenue

97.7

%

97.1

%

Days of care
Homecare

1,329,892

 

1,364,746

 

Nursing home

232,783

 

303,374

 

Respite

4,840

 

6,692

 

Subtotal routine homecare and respite

1,567,515

 

1,674,812

 

Inpatient

27,674

 

32,348

 

Continuous care

29,300

 

41,373

 

Total

1,624,489

 

1,748,533

 

 
Number of days in relevant time period

90

 

91

 

Average daily census ("ADC") (days)
Homecare

14,777

 

14,997

 

Nursing home

2,586

 

3,334

 

Respite

54

 

74

 

Subtotal routine homecare and respite

17,417

 

18,405

 

Inpatient

307

 

355

 

Continuous care

326

 

455

 

Total

18,050

 

19,215

 

Total Admissions

18,135

 

18,603

 

Total Discharges

18,516

 

18,196

 

Average length of stay (days)

94.4

 

90.7

 

Median length of stay (days)

12.0

 

14.0

 

ADC by major diagnosis
Cerebro

35.9

%

35.9

%

Neurological

22.1

 

21.4

 

Cancer

12.2

 

12.7

 

Cardio

15.8

 

15.9

 

Respiratory

7.8

 

8.3

 

Other

6.2

 

5.8

 

Total

100.0

%

100.0

%

Admissions by major diagnosis
Cerebro

21.4

%

21.1

%

Neurological

12.3

 

12.5

 

Cancer

25.0

 

28.3

 

Cardio

14.2

 

15.1

 

Respiratory

11.0

 

12.2

 

Other

16.1

 

10.8

 

Total

100.0

%

100.0

%

 
Estimated uncollectible accounts as a percent of revenues

1.0

%

1.2

%

 
Accounts receivable --
Days of revenue outstanding-excluding unapplied Medicare payments

37.8

 

33.9

 

Days of revenue outstanding-including unapplied Medicare payments

26.9

 

26.1

 

The "Footnotes to Financial Statements" are integral parts of this financial information.
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
FOOTNOTES TO FINANCIAL STATEMENTS
FOR THE THREE MONTHS MARCH 31, 2021 AND 2020
(unaudited)
 
(a) Included in the results of operations for 2021 are the following significant credits/(charges) which may not be indicative of ongoing operations
(in thousands):
Three Months Ended March 31, 2021
VITAS Roto-Rooter Corporate Consolidated
 
Stock option expense $

-

 

$

-

 

$

(6,106

)

$

(6,106

)

Amortization of reacquired franchise agreements

-

 

(2,352

)

-

 

(2,352

)

Direct costs related to COVID-19

(1,753

)

(553

)

(38

)

(2,344

)

Long-term incentive compensation

-

 

-

 

(1,893

)

(1,893

)

Pretax impact on earnings

(1,753

)

(2,905

)

(8,037

)

(12,695

)

Excess tax benefits on stock compensation

-

 

-

 

3,238

 

3,238

 

Income tax benefit on the above

445

 

769

 

1,273

 

2,487

 

After-tax impact on earnings $

(1,308

)

$

(2,136

)

$

(3,526

)

$

(6,970

)

 
 
(b) Included in the results of operations for 2020 are the following significant credits/(charges) which may not be indicative of ongoing operations
(in thousands):
Three Months Ended March 31, 2020
VITAS Roto-Rooter Corporate Consolidated
 
Stock option expense $

-

 

$

-

 

$

(5,045

)

$

(5,045

)

Amortization of reacquired franchise agreements

-

 

(2,352

)

-

 

(2,352

)

Direct costs related to COVID-19

(973

)

(861

)

-

 

(1,834

)

Long-term incentive compensation

-

 

-

 

(1,821

)

(1,821

)

Medicare cap sequestration adjustment

(675

)

-

 

-

 

(675

)

Pretax impact on earnings

(1,648

)

(3,213

)

(6,866

)

(11,727

)

Excess tax benefits on stock compensation

-

 

-

 

4,553

 

4,553

 

Income tax benefit on the above

419

 

851

 

1,080

 

2,350

 

After-tax impact on earnings $

(1,229

)

$

(2,362

)

$

(1,233

)

$

(4,824

)

(c) VITAS has 10 large (greater than 450 ADC), 19 medium (greater than 200 but less than 450 ADC) and 20 small (less than 200 ADC) hospice programs. Of Vitas' 30 Medicare provider numbers, for the current cap year, 27 provider numbers have a Medicare cap cushion of 10% or greater, one provider number has a cap cushion between 5% and 10%, one provider number has a cap cushion between 0% and 5%, and one provider number have a Medicare cap liability.

 

Contacts

David P. Williams

(513) 762-6901

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