FRISCO, Texas, Aug. 5, 2019 /PRNewswire/ -- Addus HomeCare Corporation (NASDAQ: ADUS), a provider of comprehensive home care services, today announced its financial results for the second quarter and six months ended June 30, 2019.
Net service revenues were $149.7 million for the second quarter of 2019, up 14.0% from $131.3 million for the second quarter of 2018. Net income was $5.5 million, up 27.8% compared with $4.3 million for the second quarter of 2018, while net income per diluted share was $0.41, compared with $0.36 per diluted share for the prior-year period. Adjusted net income per diluted share grew 12.0% to $0.56 for the second quarter of 2019 from $0.50 for the second quarter of 2018.
Adjusted net income per diluted share for the second quarter of 2019 excludes M&A expenses of $0.04, restructuring, severance and other costs of $0.02, and stock-based compensation expense of $0.09. Adjusted net income per diluted share for the second quarter of 2018 excludes M&A expenses of $0.03, restructuring, severance and other costs of $0.04, and stock-based compensation expense of $0.07. Adjusted EBITDA increased 12.9% to $12.8 million for the second quarter of 2019 from $11.3 million for the second quarter of 2018. (See page 8 for a reconciliation of all non-GAAP and GAAP financial measures in this news release.)
For the first six months of 2019, net service revenues increased 20.0% to $288.9 million from $240.7 million for the prior-year period. Net income increased 12.8% to $10.4 million for the first six months of 2019 compared with $9.2 million for the same period in 2018, and net income per diluted share was $0.77 compared with $0.78 per diluted share. Adjusted net income increased 31.4% to $14.4 million for the first six months of 2019 compared with $11.0 million for the prior-year period, while adjusted net income per diluted share grew 15.1% to $1.07 from $0.93. Adjusted EBITDA increased 17.4% to $23.6 million for the first six months of 2019 from $20.1 million for the first six months of 2018.
Dirk Allison, President and Chief Executive Officer, commented, "We are proud of our solid financial and operating results for the second quarter, reflecting continued growth through the first half of 2019. Our second-quarter revenues reflected a strong increase in same-store revenue of 5.9%, exceeding our target range of 3% to 5%. We continue to see increasing demand for our services, and these favorable trends have supported our organic growth in our current operations. In particular, we saw a higher revenue contribution from our New York market as the state-led narrowing of the provider network has progressed."
At June 30, 2019, the Company had cash of $54.8 million and bank debt of $39.6 million, while availability under its revolving credit facility was $141.9 million. Net cash used in operating activities was $0.9 million for the second quarter of 2019.
Acquisition of Alliance Home Health Care And Assets Of Foremost Home CareOn August 1, Addus acquired Alliance Home Health Care, LLC, and its affiliate, House Calls of New Mexico, LLC, each located in New Mexico. The companies have combined annual revenues of approximately $19.0 million, with 60% of those revenues derived from hospice care and 20% from each of personal care and home health care services. With locations strategically placed across New Mexico, these additions will expand the Company's service area in the state and provide additional market coverage.
Also on August 1, the Company acquired the operating assets of Foremost Home Care, Inc., a New York City-based personal care provider with annual revenues of approximately $6.0 million. The Foremost acquisition will support the Company's growth in the important New York City market area.
The aggregate purchase price of approximately $24.0 million for both Foremost and Alliance acquisitions was funded through a combination of the Company's revolving credit facility and available cash.
Mr. Allison added, "Our latest acquisitions are both excellent strategic fits for Addus and will further extend our market reach in their respective regions. As previously announced, we also completed the acquisition of VIP Health Care Services, a New York City-based personal care services provider, on June 1, 2019, and the integration process is going well. With annual revenues of approximately $50.0 million, we are excited about the added contribution from VIP as we expand coverage in one of our largest markets. Our development team has done an outstanding job identifying acquisition opportunities that we believe will enhance our operations and continue to drive our long-term growth and importantly, we have the financial capability to execute this strategy. Our pipeline remains robust, and, as a leading provider of comprehensive home care services, we believe we are well-positioned for continued growth. We look forward to the opportunities that lie ahead for Addus."
Non-GAAP Financial MeasuresThe information provided in this release includes adjusted net income per diluted share, adjusted EBITDA and adjusted net service revenues, which are non-GAAP financial measures. The Company defines adjusted net income per diluted share as net income per diluted share, adjusted for interest income from the State of Illinois, M&A expenses, stock-based compensation expense, restructure charges, and severance and other costs. The Company defines adjusted EBITDA as net income before interest expense, interest income, other non-operating income, taxes, depreciation, amortization, interest income from the State of Illinois, M&A expenses, stock-based compensation expense, restructure charges, and severance and other costs. The Company defines adjusted net service revenues as net service revenues adjusted for the closure of certain sites. The Company has provided, in the financial statement tables included in this press release, a reconciliation of adjusted net income per diluted share to net income per diluted share, a reconciliation of adjusted EBITDA to net income and a reconciliation of adjusted net service revenues to net service revenues, in each case, the most directly comparable GAAP measure. Management believes that adjusted net income, adjusted net income per diluted share, adjusted EBITDA and adjusted net service revenues are useful to investors, management and others in evaluating the Company's operating performance, to provide investors with insight and consistency in the Company's financial reporting and to present a basis for comparison of the Company's business operations among periods, and to facilitate comparison with the results of the Company's peers.
Conference CallAddus will host a conference call on Tuesday, August 6, 2019, beginning at 9:00 a.m. Eastern time. The toll-free dial-in number is (877) 930-8289 (international dial-in number is (253) 336-8714), pass code 8286444. A telephonic replay of the conference call will be available through midnight on August 20, 2019, by dialing (855) 859-2056 (international dial-in number is (404) 537-3406) and entering pass code 8286444.
A live broadcast of Addus HomeCare's conference call will be available under the Investor Relations section of the Company's website: www.addus.com. An online replay of the conference call will also be available on the Company's website for one month, beginning approximately two hours following the conclusion of the live broadcast.
Forward-Looking StatementsCertain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may be identified by words such as "continue," "expect," and similar expressions. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those expressed or implied by such forward-looking statements, including discretionary determinations by government officials, the consummation and integration of acquisitions, anticipated transition to managed care providers, our ability to successfully execute our growth strategy, unexpected increases in SG&A and other expenses, expected benefits and unexpected costs of acquisitions and dispositions, management plans related to dispositions, the possibility that expected benefits may not materialize as expected, the failure of the business to perform as expected, changes in reimbursement, changes in government regulations, changes in Addus HomeCare's relationships with referral sources, increased competition for Addus HomeCare's services, changes in the interpretation of government regulations, the uncertainty regarding the outcome of discussions with managed care organizations, changes in tax rates, the impact of adverse weather, higher than anticipated costs, lower than anticipated cost savings, estimation inaccuracies in future revenues, margins, earnings and growth, whether any anticipated receipt of payments will materialize and other risks set forth in the Risk Factors section in Addus HomeCare's Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2019, which is available at www.sec.gov. Addus HomeCare undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, these forward-looking statements necessarily depend upon assumptions, estimates and dates that may be incorrect or imprecise and involve known and unknown risks, uncertainties and other factors. Accordingly, any forward-looking statements included in this press release do not purport to be predictions of future events or circumstances and may not be realized. (Unaudited tables and notes follow).
About AddusAddus is a provider of comprehensive home care services that include, primarily, personal care services that assist with activities of daily living, as well as hospice and home health services. Addus' consumers are primarily persons who, without these services, are at risk of hospitalization or institutionalization, such as the elderly, chronically ill and disabled. Addus' payor clients include federal, state and local governmental agencies, managed care organizations, commercial insurers and private individuals. Addus currently provides home care services to approximately 40,000 consumers through 162 locations across 24 states. For more information, please visit www.addus.com.
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SOURCE Addus HomeCare Corporation