LOUISVILLE, Ky., May 04, 2016 (GLOBE NEWSWIRE) -- Almost Family, Inc. (Nasdaq:AFAM), a leading regional provider of home health nursing and personal care services, announced today its financial results for the quarter ended April 1, 2016.

First Quarter Highlights:

  • Record net service revenues of approximately $153.7 million with record revenues in all three segments
  • Adjusted earnings from home health operations(1) of $6.0 million, $0.59 per diluted share versus $0.51 in the first quarter of 2015 an increase of 16% despite an 8% increase in diluted shares outstanding
  • Adjusted EBITDA from home health operations(1) of $13.2 million
  • GAAP Net income, including deal and transition costs, attributable to Almost Family, Inc. of $3.9 million, $0.38 per diluted share versus $0.46 in the first quarter of 2015
  • Healthcare Innovations segment performed nearly 16,000 in home assessments and has nearly 122,000 ACO beneficiaries through 15 Accountable Care Organizations under contract
  • Operating cash flow of $5.6 million

__________________

(1)   See Non-GAAP Financial Measures starting on page 8

Management Comments
William Yarmuth, Chairman and Chief Executive Officer, commented:  “As we continue through the integration process of a very prolific acquisition pace in late 2015 and early 2016, we are very pleased with the overall performance of our business and the execution of our strategic development and growth plans.  We are happy to be reporting record revenues in all three of our business segments and we’re extremely excited and optimistic about our prospects for future growth.”

Steve Guenthner, President added:  “During this period of relative regulatory stability, we have been, and are, able to make key investments in all our segments for growth, innovation and improvement in patient care.  Both our access to capital and the M&A environment remain positive and we are continuing to work diligently to find, make and carefully integrate acquisitions that meet our stringent investment criteria.”

Yarmuth concluded:  “Once again, we welcome the newest members of our growing family of healthcare providers joining us with the Long Term Solutions and Bayonne VNA acquisitions completed during the quarter.  We also thank our over 13,000 dedicated employees for their unwavering commitment and intense focus on providing high quality patient care, particularly those dealing with transition and integration of recent acquisitions.”

First Quarter Financial Results
VN segment net revenues increased $10.1 million to a record $109.6 million from $99.5 million in the prior year and total Medicare admissions grew by 6.3% to 25,205 from 23,722 primarily due to home health agencies acquired in late 2015 and early 2016.  VN segment contribution increased $2.6 million, or 20.8%, to $15.0 million, from $12.4 million in the prior year period.  Contribution margin as a percentage of revenue thus increased to 13.7% from 12.5%.  On a same-store basis, Medicare admissions outside of Florida grew organically by 2.5%.  Within Florida, same store Medicare admissions in Florida in the first quarter of 2016 were 7.2% below the first quarter of 2015 which was was the Company’s all-time high-water mark for Florida Medicare admissions. Florida Medicare admissions in the first quarter of 2016 were 7.1% higher than the fourth quarter of 2015.  Florida accounted for approximately one-fourth of the Company’s Medicare admissions in the first quarter of 2016.

PC segment net revenues increased $10.9 million, or 38.0%, to a record $39.7 million in 2016 from $28.8 million in 2015 primarily due to acquisitions.  PC segment contribution increased 29.0% or $0.8 million as compared to the same period of last year.

Healthcare Innovations (HCI) segment net revenues increased $4.3 million to a record $4.4 million, in 2016 from $0.1 million in 2015, as acquired LTS and Ingenios revenues were $4.2 million.  The first quarter of the year has historically been seasonally lower than the other three quarters in these assessment businesses.  LTS was acquired in January 2016 and Ingenios was acquired in July 2015.  The Company continues to expect the HCI segment to be profitable for 2016.

Corporate expenses as a percentage of revenue declined to 5.0%, from 5.4% in the prior year period, while deal, transition and other costs grew to $2.6 million for 2016, primarily as a result of costs related to 2016 and 2015 acquisitions.  Borrowings related to acquisition activity in late 2015 and early 2016 also increased interest expense to $1.3 million, from $0.4 million in the prior year period.

Net cash from operating activities of $5.6 million was generated in the first quarter of 2016.  Home Health accounts receivable days sales outstanding were 56 at the end of the first quarter of 2016 as compared to 62 at the end of the first quarter of 2015.

The effective tax rate for the first quarter of 2016 and 2015 was 40.5%. 

The Company noted that it will continue to pursue quality acquisitions of in-home health care service providers consistent with its stated strategy and the types of services its segments currently provide.

 

 
ALMOST FAMILY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(UNAUDITED)
     
  Three month period ended
  April 1, 2016 April 3, 2015
Net service revenues $153,698  $128,399 
Cost of service revenues (excluding depreciation & amortization)  82,232   68,327 
Gross margin  71,466   60,072 
General and administrative expenses:    
Salaries and benefits  41,676   36,393 
Other  19,445   15,810 
Deal and transition costs  2,609   406 
Total general and administrative expenses  63,730   52,609 
Operating income  7,736   7,463 
Interest expense, net  (1,332)  (447)
Income before income taxes  6,404   7,016 
Income tax expense  (2,677)  (2,987)
Net income  3,727   4,029 
Net loss (income) - noncontrolling interests  190   365 
Net income attributable to Almost Family, Inc. $3,917  $4,394 
     
Per share amounts-basic:    
Average shares outstanding  10,089   9,353 
     
Net income attributable to Almost Family, Inc. $0.39  $0.47 
     
Per share amounts-diluted:    
Average shares outstanding  10,260   9,521 
     
Net income attributable to Almost Family, Inc. $0.38  $0.46 
 


ALMOST FAMILY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
       
  April 1, 2016   
  (UNAUDITED) January 1, 2016
ASSETS      
CURRENT ASSETS:      
Cash and cash equivalents $7,135  $7,522 
Accounts receivable - net  94,008   92,909 
Prepaid expenses and other current assets  9,515   9,033 
TOTAL CURRENT ASSETS  110,658   109,464 
PROPERTY AND EQUIPMENT - NET  10,649   10,000 
GOODWILL  315,360   277,061 
OTHER INTANGIBLE ASSETS  66,106   64,629 
OTHER ASSETS  3,885   3,615 
TOTAL ASSETS $506,658  $464,769 
       
LIABILITIES AND STOCKHOLDERS’ EQUITY       
 CURRENT LIABILITIES:      
Accounts payable $10,128  $12,297 
Accrued other liabilities  43,735   42,524 
TOTAL CURRENT LIABILITIES  53,863   54,821 
       
LONG-TERM LIABILITIES:      
Revolving credit facility   133,211    113,790 
Deferred tax liabilities   15,260    13,094 
Seller notes   12,520    6,556 
Other liabilities   2,968    2,608 
TOTAL LONG-TERM LIABILITIES   163,959    136,048 
TOTAL LIABILITIES   217,822    190,869 
       
NONCONTROLLING INTEREST - REDEEMABLE -      
HEALTHCARE INNOVATIONS   3,639    3,639 
       
STOCKHOLDERS’ EQUITY:      
Preferred stock, par value $0.05; authorized 2,000 shares; none issued or outstanding  —   — 
Common stock, par value $0.10; authorized 25,000; 10,490 and 10,125 issued and outstanding   1,049    1,013 
Treasury stock, at cost, 114 and 103 shares   (3,126)   (2,731)
Additional paid-in capital   138,822    127,253 
Noncontrolling interest - nonredeemable   (770)   (730)
Retained earnings   149,222    145,456 
TOTAL STOCKHOLDERS’ EQUITY   285,197    270,261 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 506,658  $ 464,769 
         


ALMOST FAMILY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
     
  April 1, 2016 April 3, 2015
Cash flows of operating activities:    
Net income $3,727  $4,029 
Adjustments to reconcile net income to net cash provided by
operating activities:		    
Depreciation and amortization   1,050    918 
Provision for uncollectible accounts   3,845    1,865 
Stock-based compensation   717    520 
Deferred income taxes   2,166    1,031 
    11,505    8,363 
Change in certain net assets and liabilities, net of the effects of acquisitions:    
Accounts receivable   (3,571)   (11,961)
Prepaid expenses and other current assets   (257)   3,653 
Other assets   (334)   17 
Accounts payable and accrued expenses   (1,735)   (3,853)
Net cash provided by operating activities   5,608    (3,781)
     
Cash flows of investing activities:    
Capital expenditures   (969)   (401)
Cost basis investment   -    (1,000)
Acquisitions, net of cash acquired   (24,229)   (3,000)
Net cash used in investing activities   (25,198)   (4,401)
     
Cash flows of financing activities:    
Credit facility borrowings   78,011    47,813 
Credit facility repayments   (58,590)   (39,161)
Debt issuance fees   -    (1,158)
Proceeds from stock option exercises   -    23 
Purchase of common stock in connection with share awards   (396)   (276)
Tax impact of share awards   214    88 
Payment of special dividend in connection with share awards   -    (50)
Principal payments on notes payable and capital leases   (36)   (23)
Net cash provided by (used in) financing activities   19,203    7,256 
     
Net change in cash and cash equivalents   (387)   (926)
Cash and cash equivalents at beginning of period   7,522    6,886 
Cash and cash equivalents at end of period $7,135  $5,960 
 


 
ALMOST FAMILY, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
(UNAUDITED)
(In thousands)
                
  Three months ended     
  April 1, 2016 April 3, 2015 Change
  Amount % Rev Amount % Rev Amount %
Home Health Operations               
Net service revenues:               
Visiting Nurse $ 109,613   73.4% $ 99,535   77.6% $ 10,078   10.1%
Personal Care   39,693   26.6%   28,761   22.4%   10,932   38.0%
    149,306   100.0%   128,296   100.0%   21,010   16.4%
Operating income before corporate expenses:               
Visiting Nurse   14,975   13.7%   12,400   12.5%   2,575   20.8%
Personal Care   3,737   9.4%   2,898   10.1%   839   29.0%
    18,712   12.5%   15,298   11.9%   3,414   22.3%
Healthcare Innovations Operations               
Revenue   4,392   100.0%   103   100.0%   4,289   4164.1%
Operating loss before noncontrolling interest   (673)  -15.3%   (517)  -501.9%   (156)  30.2%
                
Corporate expenses   7,694   5.0%   6,912   5.4%   782   11.3%
Deal, transition and other costs   2,609   1.7%   406   0.3%   2,203   542.6%
Operating income   7,736   5.0%   7,463   5.8%   273   3.7%
Interest expense, net   (1,332)  -0.9%   (447)  -0.3%   (885)  198.0%
Income tax expense   (2,677)  -1.7%   (2,987)  -2.3%   310   -10.4%
Net income $ 3,727   2.4% $ 4,029   3.1% $ (302)  -7.5%
                
Adjusted EBITDA from home health operations (1) $ 13,151   8.8% $ 10,203   8.0% $ 2,948   28.9%
Adjusted earnings from home health operations (1) $ 6,032   4.0% $ 4,825   3.8% $ 1,208   25.0%
                            

(1) See Non-GAAP Financial Measures starting on page 8.

 
VISITING NURSE SEGMENT OPERATING METRICS
                
  Three months ended     
  April 1, 2016 April 3, 2015 Change
  Amount % Amount % Amount %
Average number of locations   164      160      4   2.5%
                
All payors:               
Patient months   91,881      80,982      10,899   13.5%
Admissions   28,455      26,279      2,176   8.3%
Billable visits   737,871      642,592      95,279   14.8%
                
Medicare:               
Admissions   25,205   89%   23,722   90%   1,483   6.3%
Revenue (in thousands) $ 103,158   94% $ 95,122   96% $ 8,036   8.4%
Revenue per admission $ 4,093    $ 4,010    $ 83   2.1%
Billable visits   652,118   88%   584,438   91%   67,680   11.6%
Recertifications   12,273      11,927      346   2.9%
Payor mix % of Admissions               
Traditional Medicare Episodic   82.0%     84.1%     -2.1%  
Replacement Plans Paid Episodically   4.6%     4.0%     0.6%  
Replacement Plans Paid Per Visit   13.4%     11.9%     1.5%  
                
Non-Medicare:               
Admissions   3,250   11%   2,557   10%   693   27.1%
Revenue (in thousands) $ 6,455   6% $ 4,413   4% $ 2,042   46.3%
Revenue per admission $ 1,986    $ 1,726    $ 260   15.1%
Billable visits   85,753   12%   58,154   9%   27,599   47.5%
Recertifications   1,131      427      704   164.9%
Payor mix % of Admissions               
Medicaid & other governmental   32.6%     30.8%     1.8%  
Private payors   67.4%     69.2%     -1.8%  
                      
PERSONAL CARE SEGMENT OPERATING METRICS
                      
  Three months ended
         
  April 1, 2016 April 3, 2015 Change
  Amount   Amount   Amount %
Average number of locations   71      61      10   16.4%
                        
Admissions   2,446      1,427      1,019   71.4%
Patient months of care   39,060      22,766      16,294   71.6%
Billable hours   1,821,539      1,286,884      534,655   41.5%
Revenue per billable hour $ 21.79    $ 22.35    $ (0.56)  -2.5%
                        


HEALTHCARE INNOVATIONS SUPPLEMENTAL DATA
         
  Three months ended    
  April 1, 2016 April 3, 2015 Change
  Amount Amount Amount %
In-home Assessments  15,575   -   15,575 NM
         
Medicare ACO enrollees under management  121,881   83,133   38,748  46.6%
ACOs under contract  15   11   4  36.4%
Assets  61,768   9,820   51,948 NM
Liabilities  5,695   246   5,449 NM
Non-controlling interest - redeemable  3,639   3,639   -  0.0%
Non-controlling interest - nonredeemable  (151)  (199)  48  -24.1%
             

Non-GAAP Financial Measures

The information provided in some of the tables in this release includes certain non-GAAP financial measures as defined under SEC rules.  In accordance with SEC rules, the Company has provided, in the supplemental information, a reconciliation of those measures to the most directly comparable GAAP measures.

Adjusted Earnings from Home Health Operations
Adjusted earnings from home health operations is not a measure of financial performance under accounting principles generally accepted in the United States of America.  It should not be considered in isolation or as a substitute for net income, operating income, cash flows from operating, investing or financing activities, or any other measure calculated in accordance with generally accepted accounting principles. The presentation of adjusted earnings from home health operations provides investors with pertinent information to enable comparison of financial performance between periods by excluding certain items that the Company believes are not representative of its ongoing home health operations due to the nature of the items. 

The following tables set forth a reconciliation of net income attributable to Almost Family, Inc. to adjusted earnings from home health operations:      

 
ALMOST FAMILY, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EARNINGS
FROM HOME HEALTH OPERATIONS
(In thousands)
       
  Three month period ended
(in thousands) April 1, 2016 April 3, 2015
Net income attributable to Almost Family, Inc. $3,917 $4,394
       
Addbacks:      
Deal, transition and other, net of tax  1,552  242
Adjusted earnings  5,469  4,636
Healthcare Innovations operating loss after NCI, net of tax  563  189
Adjusted earnings from home health operations $6,032 $4,825
       
Per share amounts-diluted:      
Average shares outstanding  10,260  9,521
       
Net income attributable to Almost Family, Inc. $0.38 $0.46
       
Addbacks:      
Deal, transition and other, net of tax  0.15  0.03
Adjusted earnings  0.53  0.49
Healthcare Innovations operating loss after NCI, net of tax  0.05  0.02
Adjusted earnings from home health operations $0.59 $0.51
       

Adjusted EBITDA from Home Health Operations
Adjusted earnings before interest, income tax, depreciation and amortization, amortization of stock-based compensation, deal, transition and other and Healthcare Innovations operating loss (Adjusted EBTIDA from Home Health Operations) is not a measure of financial performance under accounting principles generally accepted in the United States of America.  It should not be considered in isolation or as a substitute for net income, operating income, cash flows from operating, investing or financing activities, or any other measure calculated in accordance with generally accepted accounting principles.  The items excluded from Adjusted EBITDA from Home Health Operations are significant components in understanding and evaluating financial performance and liquidity.  Management routinely calculates and communicates Adjusted EBITDA from Home Health Operations and believes that it is useful to investors because it provides a common analytical indicator within our industry to evaluate performance, measure leverage capacity and debt service ability, and to estimate current or prospective enterprise value.  Adjusted EBITDA is also used in certain covenants contained in our credit agreement.

The following tables set forth a reconciliation of net income from continuing operations to Adjusted EBITDA from Home Health Operations:

 
ALMOST FAMILY, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA
FROM HOME HEALTH OPERATIONS
(In thousands)
       
  Three month period ended
(in thousands) April 1, 2016 April 3, 2015
Net income $ 3,917 $ 4,394
Add back:      
Interest expense   1,332   447
Income tax expense   2,677   2,987
Depreciation and amortization   985   831
Stock-based compensation from home health operations   717   520
Deal and transition costs   2,609   406
Adjusted EBITDA   12,237   9,585
Healthcare Innovations operating loss   914   618
Adjusted EBITDA from home health operations $ 13,151 $ 10,203
       

About Almost Family, Inc.
Almost Family, Inc., founded in 1976, is a leading regional provider of home health nursing services, with branch locations in Florida, Ohio, Tennessee, New York, Connecticut, Kentucky, New Jersey, Massachusetts, Georgia, Pennsylvania, Indiana, Missouri, Illinois, Mississippi and Alabama (in order of revenue significance).  Almost Family, Inc. and its subsidiaries operate a Medicare-certified segment, a personal care segment and a healthcare innovations segment.  Almost Family operates over 230 branch locations in fifteen U.S. states.

Forward Looking Statements
All statements, other than statements of historical facts, included in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “believe,” “estimate,” “project,” “anticipate,” “continue,” or similar terms, variations of those terms or the negative of those terms. These forward-looking statements are based on the Company's current plans, expectations and projections about future events.

Because forward-looking statements involve risks and uncertainties, the Company's actual results could differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. The potential risks and uncertainties which could cause actual results to differ materially include: regulatory approvals or third party consents may not be obtained; the impact of further changes in healthcare reimbursement systems, including the ultimate outcome of potential changes to Medicare reimbursement for home health services and to Medicaid reimbursement due to state budget shortfalls; the ability of the Company to maintain its level of operating performance and achieve its cost control objectives; changes in our relationships with referral sources; the ability of the Company to integrate acquired operations including obtaining synergies, integration objectives and anticipated timelines; government regulation; health care reform; pricing pressures from Medicare, Medicaid and other third-party payers; changes in laws and interpretations of laws relating to the healthcare industry; the ability of the Company to integrate, manage and keep secure our information systems; changes in the marketplace and regulatory environment for Health Risk Assessments and the Company’s self-insurance risks.  For a more complete discussion regarding these and other factors which could affect the Company's financial performance, refer to the Company's various filings with the Securities and Exchange Commission, including its filing on Form 10-K for the fiscal year ended January 1, 2016, in particular information under the headings "Special Caution Regarding Forward-Looking Statements" and “Risk Factors.” With regard to the Company’s investment in development-stage enterprises in its Healthcare Innovations segment, there can be no assurance that its operational and developmental objectives will be realized or that the Company’s investments will result in future returns.  The Company undertakes no obligation to update or revise its forward-looking statements.

Almost Family, Inc.
Steve Guenthner
(502) 891-1000

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