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CST: 22/11/2019 10:45:23   

Amedisys Reports Third Quarter 2019 Financial Results and Updates 2019 Guidance

23 Days ago

BATON ROUGE, La., Oct. 29, 2019 (GLOBE NEWSWIRE) -- Amedisys, Inc. (NASDAQ: AMED) today reported its financial results for the three and nine-month periods ended September 30, 2019.

Three Month Periods Ended September 30, 2019 and 2018

  • Net service revenue increased $77.3 million to $494.6 million compared to $417.3 million in 2018.
  • Net income attributable to Amedisys, Inc. of $34.1 million compared to $31.4 million in 2018.
  • Net income attributable to Amedisys, Inc. per diluted share of $1.03 compared to $0.96 in 2018.

Adjusted Quarterly Results*

  • Adjusted EBITDA of $56.8 million compared to $45.3 million in 2018.
  • Adjusted net service revenue of $494.6 million compared to $417.3 million in 2018.
  • Adjusted net income attributable to Amedisys, Inc. of $37.9 million compared to $30.9 million in 2018.
  • Adjusted net income attributable to Amedisys, Inc. per diluted share of $1.15 compared to $0.95 in 2018.

Nine Month Periods Ended September 30, 2019 and 2018

  • Net service revenue increased $226.7 million to $1,454.9 million compared to $1,228.2 million in 2018.
  • Net income attributable to Amedisys, Inc. of $99.2 million compared to $91.9 million in 2018.
  • Net income attributable to Amedisys, Inc. per diluted share of $3.01 compared to $2.71 in 2018.

Adjusted Year to Date Results*

  • Adjusted EBITDA of $173.0 million compared to $136.7 million in 2018.
  • Adjusted net service revenue of $1,460.9 million compared to $1,229.9 million in 2018.
  • Adjusted net income attributable to Amedisys, Inc. of $114.2 million compared to $92.3 million in 2018.
  • Adjusted net income attributable to Amedisys, Inc. per diluted share of $3.47 compared to $2.73 in 2018.

*   See pages 11 and 12 for the definition and reconciliations of non-GAAP financial measures to GAAP measures.

Paul B. Kusserow, President and Chief Executive Officer stated, “I am very proud of our third quarter results and our continued outperformance this year. All three of our lines of business continue to grow; we have made great progress integrating the Compassionate Care acquisition; and most importantly, we are once again near the top of the industry in quality for both Home Health and Hospice. We could not achieve such results without the unwavering efforts of all of our 21,000 employees and I want to thank each of you for your continued dedication to our mission of providing clinically excellent care to all of our patients, wherever they call home.”

Updated 2019 Guidance

  • Net service revenue is anticipated to be in the range of $1.94 billion to $1.98 billion.
  • Adjusted EBITDA is anticipated to be in the range of $220 million to $223 million.
  • Adjusted diluted earnings per share is anticipated to be in the range of $4.32 to $4.39 based on an estimated 33.1 million shares outstanding.

This guidance excludes the effects of any future acquisitions, if any are made.

We urge caution in considering the current trends and 2019 guidance disclosed in this press release. The home health and hospice industry is highly competitive and subject to intensive regulations, and trends are subject to numerous factors, risks, and uncertainties, some of which are referenced in the cautionary language below and others that are described more fully in our reports filed with the Securities and Exchange Commission (“SEC”) including our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, and subsequent Quarterly Reports on Form 10-Q, and current reports on Form 8-K which can be found on the SEC’s internet website, http://www.sec.gov, and our internet website, http://www.amedisys.com.

Earnings Call and Webcast Information

Amedisys will host a conference call on Wednesday, October 30, 2019, at 11:00 a.m. ET to discuss its third quarter results. To participate on the conference call, please call before 11:00 a.m. ET to either (877) 524-8416 (Toll-Free) or (412) 902-1028 (Toll). A replay of the conference call will be available through November 30, 2019 by dialing (877) 660-6853 (Toll-Free) or (201) 612-7415 (Toll) and entering conference ID #13695473.

A live webcast of the call will be accessible through our website on our Investor Relations section at the following web address: http://investors.amedisys.com.

Non-GAAP Financial Measures

This press release includes reconciliations of the most comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”) to non-GAAP financial measures. The non-GAAP financial measures as defined under SEC rules are as follows: (1) adjusted EBITDA, defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, excluding certain items; (2) adjusted net service revenue, defined as net service revenue excluding certain items; (3) adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. excluding certain items; and (4) adjusted net income attributable to Amedisys, Inc. per diluted share, defined as net income attributable to Amedisys, Inc. common stockholders per diluted share excluding certain items. Management believes that these non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, are useful gauges of our current performance and are also included in internal management reporting. These non-GAAP financial measures should be considered in addition to, and not more meaningful than or as an alternative to the GAAP financial measures presented in this earnings release and the company’s financial statements. Non-GAAP measures as presented herein may not be comparable to similarly titled measures reported by other companies since not all companies calculate these non-GAAP measures consistently.

Additional information

Amedisys, Inc. (the “Company”) is a leading healthcare at home company delivering personalized home health, hospice and personal care. Amedisys is focused on delivering the care that is best for our patients, whether that is home-based personal care; recovery and rehabilitation after an operation or injury; care focused on empowering them to manage a chronic disease; or hospice care at the end of life. More than 3,000 hospitals and 65,000 physicians nationwide have chosen Amedisys as a partner in post-acute care. Founded in 1982, headquartered in Baton Rouge, LA with an executive office in Nashville, TN, Amedisys is a publicly held company. With more than 21,000 employees in 470 care centers within 38 states and the District of Columbia, Amedisys is dedicated to delivering the highest quality of care to the doorsteps of more than 376,000 patients and clients in need every year. For more information about the Company, please visit: www.amedisys.com.

We use our website as a channel of distribution for important company information. Important information, including press releases, investor presentations and financial information regarding our company, is routinely posted on and accessible on the Investor Relations subpage of our website, which is accessible by clicking on the tab labeled “Investors” on our website home page. Visitors to our website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations subpage of our website.

Forward-Looking Statements

When included in this press release, words like “believes,” “belief,” “expects,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “would,” “should” and similar expressions are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. These risks and uncertainties include, but are not limited to the following: changes in or our failure to comply with existing federal and state laws or regulations or the inability to comply with new government regulations on a timely basis, changes in Medicare and other medical payment levels, our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively, competition in the healthcare industry, changes in the case mix of patients and payment methodologies, changes in estimates and judgments associated with critical accounting policies, our ability to maintain or establish new patient referral sources, our ability to consistently provide high-quality care, our ability to attract and retain qualified personnel, changes in payments and covered services by federal and state governments, future cost containment initiatives undertaken by third-party payors, our access to financing, our ability to meet debt service requirements and comply with covenants in debt agreements, business disruptions due to natural disasters or acts of terrorism, our ability to integrate, manage and keep our information systems secure, our ability to realize the anticipated benefits of the acquisition of Compassionate Care Hospice (“CCH”), our ability to comply with requirements stipulated in the CCH corporate integrity agreement, and changes in law or developments with respect to any litigation relating to the Company, including various other matters, many of which are beyond our control.

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law.

     
Contact: Investor Contact: Media Contact:
  Amedisys, Inc. Amedisys, Inc.
  Nick Muscato Kendra Kimmons
  Vice President, Strategic Finance Vice President, Marketing & Communications
  (855) 259-2046 (225) 299-3720
  IR@amedisys.com kendra.kimmons@amedisys.com
     


 
AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
(Unaudited)
     
  For the Three-Month
Periods Ended September 30

  For the Nine-Month
Periods Ended September 30
  2019   2018   2019   2018
Net service revenue $ 494,631     $ 417,335     $ 1,454,955     $ 1,228,200  
Cost of service, excluding depreciation and amortization   288,708       249,739       854,734       730,612  
General and administrative expenses:        
Salaries and benefits   99,941       79,367       293,127       232,213  
Non-cash compensation   6,298       4,842       18,451       12,653  
Other   48,474       40,335       140,284       124,119  
Depreciation and amortization   4,366       3,164       12,440       9,882  
Operating expenses   447,787       377,447       1,319,036       1,109,479  
Operating income   46,844       39,888       135,919       118,721  
Other income (expense):        
Interest income   15       29       59       263  
Interest expense   (3,778 )     (1,991 )     (11,459 )     (5,834 )
Equity in (losses) earnings from equity method investments   (812 )     1,625       4,120       6,461  
Miscellaneous, net   1,975       1,822       2,404       2,782  
Total other (expense) income, net   (2,600 )     1,485       (4,876 )     3,672  
Income before income taxes   44,244       41,373       131,043       122,393  
Income tax expense   (9,919 )     (9,825 )     (31,105 )     (29,984 )
Net income   34,325       31,548       99,938       92,409  
Net income attributable to noncontrolling interests   (193 )     (171 )     (760 )     (524 )
Net income attributable to Amedisys, Inc. $ 34,132     $ 31,377     $ 99,178     $ 91,885  
                               
Basic earnings per common share:        
Net income attributable to Amedisys, Inc. common stockholders $ 1.06     $ 0.99     $ 3.09     $ 2.78  
Weighted average shares outstanding   32,211       31,815       32,096       33,075  
Diluted earnings per common share:        
Net income attributable to Amedisys, Inc. common stockholders $ 1.03     $ 0.96     $ 3.01     $ 2.71  
Weighted average shares outstanding   33,002       32,691       32,944       33,852  
                               


 
AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)
       
  September 30,
2019
(unaudited)
 
  December 31,
2018
ASSETS    
Current assets:    
Cash and cash equivalents $ 20,757     $ 20,229  
Patient accounts receivable   254,703       188,972  
Prepaid expenses   10,601       7,568  
Other current assets   13,458       7,349  
Total current assets   299,519       224,118  
Property and equipment, net of accumulated depreciation of $101,446 and $95,472   29,969       29,449  
Operating lease right of use assets   84,124        
Goodwill   660,472       329,480  
Intangible assets, net of accumulated amortization of $36,799 and $33,050   66,468       44,132  
Deferred income taxes   17,568       35,794  
Other assets   54,260       54,145  
Total assets $ 1,212,380     $ 717,118  
               
LIABILITIES AND EQUITY    
Current liabilities:    
Accounts payable $ 35,901     $ 28,531  
Payroll and employee benefits   115,899       92,858  
Accrued expenses   127,111       99,475  
Current portion of long-term obligations   8,959       1,612  
Current portion of operating lease liabilities   26,783        
Total current liabilities   314,653       222,476  
Long-term obligations, less current portion   231,641       5,775  
Operating lease liabilities, less current portion   56,619        
Other long-term obligations   6,002       6,234  
Total liabilities   608,915       234,485  
               
Equity:    
Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued or outstanding          
Common stock, $0.001 par value, 60,000,000 shares authorized; 36,599,273 and 36,252,280 shares issued; and 32,246,575 and 31,973,505 shares outstanding   37       36  
Additional paid-in capital   634,854       603,666  
Treasury stock, at cost 4,352,698 and 4,278,775 shares of common stock   (251,070 )     (241,685 )
Accumulated other comprehensive income   15       15  
Retained earnings   218,728       119,550  
Total Amedisys, Inc. stockholders’ equity   602,564       481,582  
Noncontrolling interests   901       1,051  
Total equity   603,465       482,633  
Total liabilities and equity $ 1,212,380     $ 717,118  
               


 
AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND DAYS REVENUE OUTSTANDING
(Amounts in thousands, except statistical information)
(Unaudited)
       
  For the Three-Month
Periods Ended
September 30
 
  For the Nine-Month
Periods Ended
September 30
  2019   2018   2019   2018
Cash Flows from Operating Activities:                              
Net income $ 34,325     $ 31,548     $ 99,938     $ 92,409  
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization   4,366       3,164       12,440       9,882  
Non-cash compensation   6,298       4,842       18,451       12,653  
401(k) employer match   2,859       2,040       7,545       6,934  
Amortization and impairment of operating lease right of use assets   9,519             27,014        
Loss on disposal of property and equipment   8       88       6       738  
Deferred income taxes   11,923       5,771       17,798       14,916  
Equity in losses (earnings) from equity method investments   812       (1,625 )     (4,120 )     (6,461 )
Amortization of deferred debt issuance costs/debt discount   220       203       653       596  
Return on equity investment   2,885       2,169       3,727       4,373  
Changes in operating assets and liabilities, net of impact of acquisitions:        
Patient accounts receivable   (15,304 )     2,562       (39,469 )     6,166  
Other current assets   (1,851 )     11,648       (10,194 )     (32 )
Other assets   258       38       202       726  
Accounts payable   1,330       (4,293 )     (8,145 )     (670 )
Accrued expenses   (1,359 )     10,210       27,903       14,758  
Other long-term obligations   (50 )     115       (231 )     2,462  
Operating lease liabilities   (7,916 )           (24,116 )      
Operating lease right of use assets   (868 )           (2,622 )      
Net cash provided by operating activities   47,455       68,480       126,780       159,450  
                               
Cash Flows from Investing Activities:        
Proceeds from sale of deferred compensation plan assets   74       92       287       563  
Proceeds from the sale of property and equipment   12       40       158       51  
Investments in equity method investees         (3,477 )     (210 )     (3,477 )
Purchases of property and equipment   (3,644 )     (4,073 )     (6,337 )     (5,684 )
Acquisitions of businesses, net of cash acquired   (46 )           (345,460 )     (4,074 )
Net cash used in investing activities   (3,604 )     (7,418 )     (351,562 )     (12,621 )
                               
Cash Flows from Financing Activities:        
Proceeds from issuance of stock upon exercise of stock options   2,045       140       3,388       2,749  
Proceeds from issuance of stock to employee stock purchase plan   850       630       2,384       1,787  
Shares withheld upon stock vesting   (4,895 )     (2,589 )     (9,385 )     (5,421 )
Noncontrolling interest distribution   (453 )     (180 )     (910 )     (530 )
Proceeds from borrowings under term loan               175,000        
Proceeds from borrowings under revolving line of credit   8,000             192,500       127,500  
Repayments of borrowings under revolving line of credit   (41,000 )     (70,000 )     (133,000 )     (70,000 )
Principal payments of long-term obligations   (1,543 )     (596 )     (3,820 )     (91,071 )
Debt issuance costs               (847 )     (2,433 )
Purchase of company stock                     (181,402 )
Repurchase of noncontrolling interest         (361 )           (361 )
Net cash (used in) provided by financing activities   (36,996 )     (72,956 )     225,310       (219,182 )
Net increase (decrease) in cash and cash equivalents   6,855       (11,894 )     528       (72,353 )
Cash and cash equivalents at beginning of period   13,902       25,904       20,229       86,363  
Cash and cash equivalents at end of period $ 20,757     $ 14,010     $ 20,757     $ 14,010  
                               
Supplemental Disclosures of Cash Flow Information:        
Cash paid for interest $ 3,569     $ 909     $ 7,756     $ 2,989  
Cash paid for income taxes, net of refunds received $ 9,807     $ 4,868     $ 17,656     $ 11,017  
Days revenue outstanding (1)   44.5       40.6       44.5       40.6  
                               

(1) Our calculation of days revenue outstanding at September 30, 2019 and 2018 is derived by dividing our ending patient accounts receivable by our average daily patient revenue for the three month periods ended September 30, 2019 and 2018, respectively.

 
AMEDISYS, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Amounts in millions, except statistical information)
(Unaudited)
 
Segment Information - Home Health
   
  For the
Three-Month Periods
Ended September 30,
  2019   2018
Financial Information (in millions):              
Medicare $ 211.5     $ 208.0  
Non-Medicare   100.0       86.9  
Net service revenue   311.5       294.9  
Cost of service   188.9       181.8  
Gross margin   122.6       113.1  
Other operating expenses   76.5       69.6  
Operating income $ 46.1     $ 43.5  
Same Store Growth (1):    
Medicare revenue   2 %     10 %
Non-Medicare revenue   16 %     20 %
Total admissions   9 %     4 %
Total volume (2)   6 %     6 %
Total Episodic admissions (3)   8 %     3 %
Total Episodic volume (4)   5 %     5 %
Key Statistical Data - Total (5):    
Medicare:    
Admissions   48,295       46,371  
Recertifications   27,662       28,551  
Total volume   75,957       74,922  
Completed episodes   74,355       73,114  
Visits   1,281,380       1,301,090  
Average revenue per completed episode (6) $ 2,909     $ 2,855  
Visits per completed episode (7)   17.1       17.6  
Non-Medicare:    
Admissions   33,642       29,325  
Recertifications   15,678       14,539  
Total volume   49,320       43,864  
Visits   775,804       698,181  
Total (5):    
Visiting Clinician Cost per Visit $ 83.68     $ 82.78  
Clinical Manager Cost per Visit   8.09       8.18  
Total Cost per Visit $ 91.77     $ 90.96  
Visits   2,057,184       1,999,271  
               


   
  For the
Nine-Month Periods
Ended September 30,
  2019   2018
Financial Information (in millions):              
Medicare $ 644.0     $ 619.3  
Non-Medicare   296.2       251.2  
Net service revenue   940.2       870.5  
Cost of service   562.4       532.7  
Gross margin   377.8       337.8  
Other operating expenses   224.0       207.6  
Operating income $ 153.8     $ 130.2  
               
Same Store Growth (1):    
Medicare revenue   4 %     7 %
Non-Medicare revenue   18 %     18 %
Total admissions   7 %     4 %
Total volume (2)   6 %     7 %
Total Episodic admissions (3)   6 %     3 %
Total Episodic volume (4)   4 %     6 %
Key Statistical Data - Total (5):    
Medicare:    
Admissions   147,485       142,884  
Recertifications   82,551       84,218  
Total volume   230,036       227,102  
Completed episodes   224,635       220,726  
Visits   3,935,182       3,933,290  
Average revenue per completed episode (6) $ 2,922     $ 2,841  
Visits per completed episode (7)   17.4       17.5  
Non-Medicare:    
Admissions   100,184       88,485  
Recertifications   45,945       40,862  
Total volume   146,129       129,347  
Visits   2,303,576       2,049,662  
Total (5):    
Visiting Clinician Cost per Visit $ 82.23     $ 81.06  
Clinical Manager Cost per Visit   7.91       7.98  
Total Cost per Visit $ 90.14     $ 89.04  
Visits   6,238,758       5,982,952  
               

(1) Same store information represents the percent change in our Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume for the period as a percent of the Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume of the prior period. Effective July 1, 2019, same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center.
(2) Total volume includes all admissions and recertifications.
(3) Total Episodic admissions includes admissions for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis.
(4) Total Episodic volume includes admissions and recertifications for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis.
(5) Total includes acquisitions and denovos.
(6) Average Medicare revenue per completed episode is the average Medicare revenue earned for each Medicare completed episode of care.
(7) Medicare visits per completed episode are the home health Medicare visits on completed episodes divided by the home health Medicare episodes completed during the period.

 
Segment Information - Hospice
   
  For the
Three-Month Periods
Ended September 30,
  2019   2018
Financial Information (in millions):              
Medicare $ 153.5     $ 98.0  
Non-Medicare   8.9       5.4  
Net service revenue   162.4       103.4  
Cost of service   84.5       53.4  
Gross margin   77.9       50.0  
Other operating expenses   36.2       21.7  
Operating income $ 41.7     $ 28.3  
               
Same Store Growth (1):    
Medicare revenue   10 %     7 %
Hospice admissions   4 %     8 %
Average daily census   5 %     11 %
Key Statistical Data - Total (2):    
Hospice admissions   9,914       6,765  
Average daily census   11,565       7,768  
Revenue per day, net $ 152.67     $ 144.71  
Cost of service per day $ 79.51     $ 74.72  
Average discharge length of stay   98       101  
   
  For the
Nine-Month Periods
Ended September 30,
  2019   2018
Financial Information (in millions):              
Medicare $ 430.0     $ 286.7  
Non-Medicare   22.6       15.4  
Net service revenue   452.6       302.1  
Cost of service   245.9       155.2  
Gross margin   206.7       146.9  
Other operating expenses   100.9       62.5  
Operating income $ 105.8     $ 84.4  
               
Same Store Growth (1):    
Medicare revenue   6 %     11 %
Hospice admissions   5 %     7 %
Average daily census   6 %     12 %
Key Statistical Data - Total (2):    
Hospice admissions   30,055       20,444  
Average daily census   10,997       7,514  
Revenue per day, net $ 150.77     $ 147.28  
Cost of service per day $ 81.92     $ 75.65  
Average discharge length of stay   98       98  
               

(1) Same store information represents the percent change in our Medicare revenue, Hospice admissions or average daily census for the period as a percent of the Medicare revenue, Hospice admissions or average daily census of the prior period. Effective July 1, 2019, same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center.
(2) Total includes acquisitions and denovos.

 
Segment Information - Personal Care
   
  For the
Three-Month Periods
Ended September 30,
  2019
  2018
Financial Information (in millions):              
Medicare $     $  
Non-Medicare   20.7       19.0  
Net service revenue   20.7       19.0  
Cost of service   15.3       14.5  
Gross margin   5.4       4.5  
Other operating expenses   3.1       3.1  
Operating income $ 2.3     $ 1.4  
               
Key Statistical Data - Total (1):    
Billable hours   824,251       810,427  
Clients served   12,687       12,380  
Shifts   370,451       357,382  
Revenue per hour $ 25.12     $ 23.40  
Revenue per shift $ 55.90     $ 53.06  
Hours per shift   2.2       2.3  
   
  For the
Nine-Month Periods
Ended September 30,
  2019
  2018
Financial Information (in millions):              
Medicare $     $  
Non-Medicare   62.1       55.6  
Net service revenue   62.1       55.6  
Cost of service   46.4       42.7  
Gross margin   15.7       12.9  
Other operating expenses   9.5       9.7  
Operating income $ 6.2     $ 3.2  
               
Key Statistical Data - Total (1):    
Billable hours   2,506,113       2,357,608  
Clients served   16,134       15,731  
Shifts   1,128,920       1,062,422  
Revenue per hour $ 24.77     $ 23.57  
Revenue per shift $ 55.00     $ 52.30  
Hours per shift   2.2       2.2  
               

(1) Total includes acquisitions.

 
Segment Information - Corporate
   
  For the
Three-Month Periods
Ended September 30,
  2019
  2018
Financial Information (in millions):              
Other operating expenses $ 40.4     $ 31.3  
Depreciation and amortization   2.9       2.0  
Total operating expenses $ 43.3     $ 33.3  
               
   
  For the
Nine-Month Periods
Ended September 30,
  2019
  2018
Financial Information (in millions):              
Other operating expenses $ 122.0     $ 92.6  
Depreciation and amortization   7.9       6.5  
Total operating expenses $ 129.9     $ 99.1  
               

AMEDISYS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES
(Amounts in thousands)
(Unaudited)

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”):

  For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
  2019   2018   2019   2018
Net income attributable to Amedisys, Inc. $ 34,132     $ 31,377     $ 99,178     $ 91,885  
Add:        
Income tax expense   9,919       9,825       31,105       29,984  
Interest expense, net   3,763       1,962       11,400       5,571  
Depreciation and amortization   4,366       3,164       12,440       9,882  
Certain items (1)   5,088       (609 )     20,259       615  
Interest component of certain items (1)   (451 )     (451 )     (1,338 )     (1,280 )
Adjusted EBITDA (2) (6) $ 56,817     $ 45,268     $ 173,044     $ 136,657  
                               

Adjusted Net Service Revenue Reconciliation:

  For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
  2019  
  2018  
  2019  
  2018  
Net service revenue $ 494,631     $ 417,335     $ 1,454,955     $ 1,228,200  
Add:        
Certain items (1)               5,993       1,687  
Adjusted net service revenue (3) (6) $ 494,631     $ 417,335     $ 1,460,948     $ 1,229,887  
                               

Adjusted Net Income Attributable to Amedisys, Inc Reconciliation:

  For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
  2019  
  2018   2019  
  2018  
Net income attributable to Amedisys, Inc. $ 34,132     $ 31,377     $ 99,178     $ 91,885  
Add:        
Certain items (1)   3,765       (450 )     14,992       455  
Adjusted net income attributable to Amedisys, Inc. (4) (6) $ 37,897     $ 30,927     $ 114,170     $ 92,340  
                               

Adjusted Net Income Attributable to Amedisys, Inc. per Diluted Share:

  For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
  2019  
  2018   2019  
  2018  
Net income attributable to Amedisys, Inc. common stockholders per diluted share $ 1.03     $ 0.96     $ 3.01     $ 2.71  
Add:        
Certain items (1)   0.11       (0.01 )     0.46       0.01  
Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share (5) (6) $ 1.15     $ 0.95     $ 3.47     $ 2.73  
                               

(1) The following details the certain items for the three and nine-month periods ended September 30, 2019 and 2018:

 
Certain Items:
       
  For the Three-Month Period
Ended September 30, 2019
  For the Nine-Month Period
Ended September 30, 2019
  (Income) Expense
  (Income) Expense
Certain Items Impacting Net Service Revenue:    
Contingency accrual $     $ 6,541  
Planned closures (7)         (548 )
Certain Items Impacting Cost of Service:    
Planned closures (7)   15       1,172  
Certain Items Impacting Operating Expenses:    
Planned closures (7)   28       185  
Acquisition and integration costs   4,141       14,393  
Legal fees - non-routine   397       373  
Certain Items Impacting Total Other Income (Expense):    
Legal settlements   (1,437 )     (1,437 )
Miscellaneous, other (income) expense, net   1,944       (420 )
Total $ 5,088     $ 20,259  
Net of tax $ 3,765     $ 14,992  
Diluted EPS $ 0.11     $ 0.46  
               
     
  For the Three-Month Period
Ended September 30, 2018
  For the Nine-Month Period
Ended September 30, 2018
  (Income) Expense
  (Income) Expense
Certain Items Impacting Net Service Revenue:    
Florida self-audit (pre-acquisition) $     $ 1,687  
Certain Items Impacting Operating Expenses:    
Acquisition costs   857       1,732  
Legal fees - non-routine   304       1,409  
Certain Items Impacting Total Other Income (Expense):    
Legal settlements   (1,437 )     (1,437 )
Miscellaneous, other (income) expense, net   (333 )     (2,776 )
Total $ (609 )   $ 615  
Net of tax $ (450 )   $ 455  
Diluted EPS $ (0.01 )   $ 0.01  
               

(2) Adjusted EBITDA is defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, excluding certain items as described in footnote 1.
(3) Adjusted net service revenue is defined as net service revenue plus certain items as described in footnote 1.
(4) Adjusted net income attributable to Amedisys, Inc. is defined as net income attributable to Amedisys, Inc. calculated in accordance with GAAP excluding certain items as described in footnote 1.
(5) Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share is defined as diluted income per share calculated in accordance with GAAP excluding the earnings per share effect of certain items as described in footnote 1.
(6) Adjusted EBITDA, adjusted net service revenue, adjusted net income attributable to Amedisys, Inc. and adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share should not be considered as an alternative to, or more meaningful than, income before income taxes or other measures calculated in accordance with GAAP. These calculations may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate these non-GAAP financial measures in the same manner.
(7) Planned closures consist of in-patient units acquired from Compassionate Care Hospice whose operations ceased in April 2019.

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