Business
Healthcare Services Group, Inc. Reports Q3 2020 Results
BENSALEM, PA--(BUSINESS WIRE)-- Healthcare Services Group, Inc. (NASDAQ:HCSG) (the “Company”) reported for the three months ended September 30, 2020 revenue
About this update from Healthcare Services Group, Inc.
[{"type":"text","content":" BENSALEM, PA--(BUSINESS WIRE)--\nHealthcare Services Group, Inc. (NASDAQ:HCSG) (the “Company”) reported for the three months ended September 30, 2020 revenue of $435.9 million, net income of $27.6 million, or $0.37 per basic and diluted common share, and cash flow from operations of $49.2 million. Additionally, the Company’s Board of Directors declared a quarterly cash dividend of $0.205 per common share, the 69th consecutive increase since the initiation of dividend payments in 2003.\n\nTed Wahl, Chief Executive Officer, stated, “During the quarter, our customers and their caregivers continued to meet the challenges of the pandemic with innovation, resolve and compassion. Our HCSG heroes have been right there with them on the frontlines since the beginning, tirelessly supporting our customers and helping to ensure the well-being of America’s most vulnerable. The health and safety of our employees and the communities we serve will remain our highest priority.”\n\nMr. Wahl continued, “Our strong financial results underscore our ability to thrive in even the most challenging environments. We were particularly pleased with our service execution during the quarter, as our relentless focus on customer satisfaction, systems adherence and regulatory compliance delivered extraordinary operational outcomes.”\n\nThird Quarter Results\n\nRevenue for the quarter was $435.9 million, with housekeeping & laundry and dining & nutrition segment revenues of $223.4 million and $212.5 million, respectively. Revenue included $9.1 million of COVID-19 supplemental billings, primarily related to employee pay premiums passed through to customers.\n\nDirect cost of services was reported at $365.4 million, or 83.8%. Overall, the Company’s near-term goal remains to manage direct cost at or below 86.0%.\n\nHousekeeping & laundry and dining & nutrition segment margins were 11.1% and 9.2%, respectively.\n\nSelling, general and administrative (“SG&A”) was reported at $37.3 million, or 8.6%; after adjusting for the $3.2 million increase in deferred compensation, actual SG&A was $34.1 million, or 7.8%. The Company continues to target SG&A of 7.5%.\n\nThe Company reported an effective tax rate of 25.6% and expects a 2020 tax rate of 24% to 26%.\n\nCash flow from operations for the quarter was $49.2 million. This includes an $18.7 million decrease in accrued payr...