LAFAYETTE, La.--(BUSINESS WIRE)--April 30, 2008--LHC Group, Inc. (NASDAQ: LHCG):
First Quarter Highlights:
-- Net service revenue of $83.5 million;
-- Income from continuing operations of $5.5 million; and
-- Earnings per share from continuing operations of $0.31.
LHC Group, Inc. (NASDAQ: LHCG), a premier provider of post-acute healthcare services primarily in non-urban markets in the United States, announced today its financial results for the first quarter ended March 31, 2008.
Financial Results for the First Quarter
-- Net service revenue for the first quarter ended March 31,
2008, increased 21.5% to $83.5 million compared with $68.7
million in 2007.
-- Income from continuing operations for the first quarter of
2008 totaled $5.5 million, or $0.31 per diluted share,
compared with income from continuing operations of $6.1
million, or $0.34 per diluted share, for the first quarter of
2007. Income from continuing operations for the first quarter
of 2008 includes a one-time charge of $225,000, or $0.01 per
diluted share, for the termination of the credit line with
GMAC.
-- Net income for the first quarter of 2008 totaled $5.3 million,
or $0.30 per diluted share, compared with net income of $5.8
million, or $0.33 per diluted share, for the first quarter of
2007. Net income for the first quarter of 2008 includes an
after tax loss from discontinued operations of $131,000, or
$0.01 per diluted share.
-- For the three months ended March 31, 2008, completed Medicare
episodes increased 46.4% to 25,415 compared with 17,365 in
2007.
-- Medicare admissions increased 34.0% to 9,828 compared with
7,333 in 2007.
-- Commercial and Managed Care admissions decreased 18.8% to
2,170 compared with 2,673 in 2007. Although Commercial and
Managed Care admissions decreased, Commercial and Managed Care
revenue increased 17% to $7.4 million in the first quarter of
2008 compared with $6.3 million in the same period of 2007.
-- Days sales outstanding, or DSO, for the three months ended
March 31, 2008, was 74 days as compared with 79 days for the
same three-month period in 2007.
-- DSO, when adjusted for unbilled accounts receivables from
acquisitions on hold pending change of ownership processing by
fiscal intermediaries, decreased to 56 days as compared with
68 days for the comparable period in 2007.
In commenting on the results, Keith G. Myers, chief executive officer of LHC Group, said, "We are very pleased with our financial results in the first quarter of 2008. Our performance is a tribute to the hard working and dedicated employees of LHC Group who faced the adversity of the new reimbursement environment head-on. The depth and experience of our management team has once again proven to be the competitive edge that enables us to transform challenges into opportunities. Our continued success acknowledges the long-term commitment to excellence that is ingrained in our culture and in every member of the LHC Group family. Our commitment to the patients, families and communities we serve is at the heart of everything we do."
Conference Call
The live broadcast of LHC Group's conference call will begin at 11:00 a.m. Eastern time on Thursday, May 1, 2008. Speakers on the call will include Keith Myers, chief executive officer; John Indest, president and chief operating officer, and Pete Roman, senior vice president and chief financial officer. A link to the webcast can be found under the investor relations section of the Company's website, www.lhcgroup.com, or at www.earnings.com. A replay of the webcast will also be archived on LHC Group's website. A telephone replay will be available for one week by dialing (888) 286-8010 (US) or (617) 801-6888 (international) and entering the pass code 57604221.
About LHC Group, Inc.
LHC Group is a premier provider of post-acute healthcare services primarily in non-urban markets in the United States. LHC Group provides home-based services through its home nursing agencies and hospices and facility-based services through its long-term acute care hospitals and rehabilitation facilities.
Certain 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 "believe," "expect," "anticipate," "intend," "estimate" or similar expressions. These forward-looking statements include, among other things, statements regarding our financial performance for 2008 and the impact that recent changes in reimbursement and our operations will have on our future results. Forward-looking statements involve a number of risks and uncertainties and there can be no assurance that any forward-looking statements will prove to be accurate. Important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements include: changes in reimbursement, changes in government regulations, changes in our relationships with referral sources, increased competition for our services, increased competition for joint venture and acquisition candidates and changes in the interpretation of government regulations. LHC Group undertakes no obligation to update or revise any forward-looking statements. Further information regarding risks, uncertainties and other factors that could adversely affect LHC Group or cause actual results to differ materially from those anticipated in forward-looking statements are included in LHC Group's Form 10K for the year ended December 31, 2007, filed with the Securities and Exchange Commission.
LHC GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share data)
March 31, Dec. 31,
2008 2007
----------- -----------
(unaudited)
ASSETS
Current assets:
Cash $ 1,072 $ 1,155
Receivables:
Patient accounts receivable, less
allowance for uncollectible accounts of
$7,027 and $8,953 at March 31, 2008 and
December 31, 2007, respectively 68,165 70,033
Other receivables 2,998 2,425
Amounts due from governmental entities 1,249 1,459
----------- -----------
72,412 73,917
Deferred income taxes 2,331 2,946
Prepaid expenses and other current assets 3,830 4,423
Assets held for sale 556 556
----------- -----------
Total current assets 80,201 82,997
Property, building and equipment, net 14,440 12,523
Goodwill 66,985 62,227
Intangible assets, net 14,167 14,055
Prepaid acquisition costs 8,300 -
Other assets 4,067 3,183
----------- -----------
Total assets $ 188,160 $ 174,985
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and other accrued
liabilities $ 7,938 $ 6,103
Salaries, wages and benefits payable 14,085 11,303
Amounts due to governmental entities 3,162 3,162
Income taxes payable 1,691 863
Current portion of capital lease
obligations 105 88
Current portion of long-term debt 527 433
----------- -----------
Total current liabilities 27,508 21,952
Deferred income taxes, less current portion 3,284 3,243
Capital lease obligations, less current
portion 23 63
Long-term debt, less current portion 4,871 2,847
Minority interests subject to exchange
contracts and/or put options 20 121
Other minority interests 3,288 3,388
Stockholders' equity:
Common stock -- $0.01 par value: 40,000,000
shares authorized; 20,770,254 and
20,725,713 shares issued and 17,816,466
and 17,775,284 shares outstanding at March
31, 2008, and December 31, 2007,
respectively 178 177
Treasury stock -- 2,953,788 and 2,950,429
shares at cost, respectively (2,939) (2,866)
Additional paid-in capital 82,411 81,983
Retained earnings 69,516 64,077
----------- -----------
Total stockholders' equity 149,166 143,371
----------- -----------
Total liabilities and stockholders' equity $ 188,160 $ 174,985
=========== ===========
LHC GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except share and per share data)
(unaudited)
Three Months Ended
March 31,
-------------------------
2008 2007
------------ ------------
Net service revenue $ 83,473 $ 68,727
Cost of service revenue 41,896 34,617
------------ ------------
Gross margin 41,577 34,110
Provision for bad debts 3,686 1,741
General and administrative expenses 26,873 20,927
------------ ------------
Operating income 11,018 11,442
Interest expense 148 83
Non-operating income, including (gain) on
sales of assets (402) (293)
------------ ------------
Income from continuing operations before
income taxes
and minority interest allocations 11,272 11,652
Income tax expense 3,363 3,794
Minority interest 2,440 1,807
------------ ------------
Income from continuing operations 5,469 6,051
Loss from discontinued operations (net of
income tax benefit of $84 and $162 in the
three months ended March 31, 2008 and 2007,
respectively) (131) (266)
Net income 5,338 5,785
Redeemable minority interests 101 35
------------ ------------
Net income available to common
stockholders $ 5,439 $ 5,820
============ ============
Earnings per share -- basic:
Income from continuing operations $ 0.31 $ 0.34
Loss from discontinued operations, net (0.01) (0.01)
------------ ------------
Net income 0.30 0.33
Redeemable minority interests 0.01 --
------------ ------------
Net income available to common
shareholders $ 0.31 $ 0.33
============ ============
Earnings per share -- diluted:
Income from continuing operations $ 0.31 $ 0.34
Loss from discontinued operations, net (0.01) (0.01)
------------ ------------
Net income 0.30 0.33
Redeemable minority interests 0.01 --
------------ ------------
Net income available to common
shareholders $ 0.31 $ 0.33
============ ============
Weighted average shares outstanding:
Basic 17,800,066 17,748,369
Diluted 17,813,967 17,807,338
LHC GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(unaudited)
Three Months Ended
March 31,
-------------------
2008 2007
--------- ---------
Operating activities
Net income $ 5,338 $ 5,785
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization expense 877 710
Provision for bad debts 4,040 1,816
Stock-based compensation expense 385 227
Minority interest in earnings of subsidiaries 2,330 1,756
Deferred income taxes (86) (596)
Gain on sale of assets (346) -
Changes in operating assets and liabilities,
net of acquisitions:
Receivables (2,817) (12,801)
Prepaid expenses, other assets 472 526
Accounts payable and accrued expenses 6,112 4,573
Net amounts due governmental entities 210 (61)
--------- ---------
Net cash provided by operating activities 16,515 1,935
--------- ---------
Investing activities
Purchases of property, building, and equipment (5,527) (716)
Proceeds from sale of entities 3,081 -
Cash paid for acquisitions, primarily goodwill,
intangible assets and prepaid acquisition costs (14,031) (5,865)
--------- ---------
Net cash used in investing activities (16,477) (6,581)
--------- ---------
Financing activities
Proceeds from line of credit 5,442 -
Payment on line of credit (5,442) -
Proceeds on debt issuance 5,050 -
Principal payments on debt (2,932) (39)
Payments on capital leases (23) (66)
Excess tax benefits from vesting of restricted
stock 33 46
Proceeds from employee stock purchase plan 134 88
Minority interest distributions, net (2,383) (1,404)
--------- ---------
Net cash used in financing activities (121) (1,375)
--------- ---------
Change in cash (83) (6,021)
Cash at beginning of period 1,155 26,877
--------- ---------
Cash at end of period $ 1,072 $ 20,856
========= =========
Supplemental disclosures of cash flow information
Interest paid $ 148 $ 83
========= =========
Income taxes paid $ 1,885 $ 1,240
========= =========
LHC GROUP, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(in thousands)
Three Months Ended March 31, 2008
---------------------------------
Home- Facility-
Based Based
Services Services Total
----------- ----------- ---------
Net service revenue $ 68,363 $ 15,110 $ 83,473
Cost of service revenue 33,379 8,517 41,896
Provision for bad debts 3,246 440 3,686
General and administrative expenses 23,161 3,712 26,873
Operating income 8,577 2,441 11,018
Interest expense 101 47 148
Non-operating income, including gain
on sale of assets (285) (117) (402)
Income from continuing operations
before income taxes and minority
interest 8,761 2,511 11,272
Minority interest 1,740 700 2,440
Income from continuing operations
before income taxes 7,021 1,811 8,832
Total assets $ 161,891 $ 26,269 $188,160
LHC GROUP, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(in thousands)
Three Months Ended March 31, 2007
---------------------------------
Home- Facility-
Based Based
Services Services Total
----------- ----------- ---------
Net service revenue $ 55,066 $ 13,661 $ 68,727
Cost of service revenue 26,028 8,589 34,617
Provision for bad debts 1,224 517 1,741
General and administrative expenses 16,612 4,315 20,927
Operating income 11,202 240 11,442
Interest expense 54 29 83
Non-operating income, including gain
on sale of assets (204) (89) (293)
Income from continuing operations
before income taxes and minority
interest 11,352 300 11,652
Minority interest 1,421 386 1,807
Income from continuing operations
before income taxes 9,931 (86) 9,845
Total assets $ 128,165 $ 35,856 $164,021
CONTACT: LHC Group, Inc.
Eric Elliott, 337-233-1307
Vice President of Investor Relations
eric.elliott@lhcgroup.com
SOURCE: LHC Group, Inc.
