Addus HomeCare Corp Q1 FY2025 earnings call

• Total revenue for Q1 2025 was $337.7 million, up 20.3% from Q1 2024. Adjusted earnings per share were $1.42, up 17.4%, and adjusted EBITDA was $40.6 million, up 25.1%.
• Strong caregiver hiring in Personal Care, with 79 hires per day in Q1 2025. Utilized over $2.5 million of ARPA funds for caregiver recruitment and retention.
• Illinois enacted a 5.5% rate increase for Personal Care services effective Jan 1, 2025, raising the rate per hour to $29.63.
• Personal Care same-store revenue growth was 7.4%, with same-store hours up 2%. Hospice same-store revenue growth was 9.9%, and average daily census up 4.6%. Home Health organic revenue growth was 1.3%.
• Gentiva acquisition added ~$280 million in annualized revenue, focusing on accretive acquisitions to expand market reach.

Personal Care: Revenue was $258.3 million, accounting for 76.5% of total revenue. Same-store revenue growth was 7.4% compared to Q1 2024, and same-store hours increased by 2%. Hospice: Revenue was $61.4 million, 18.2% of total revenue. Same-store revenue growth was 9.9%, and average daily census increased by 4.6% compared to Q1 2024. Home Health: Revenue was $18 million, 5.3% of total revenue. Organic revenue growth was 1.3% compared to Q1 2024.

• Targeted minimum annual revenue growth of 10% remains. Adjusted EBITDA margin expected to remain above 12% for the full year.
• Continue to selectively pursue acquisitions complementing organic growth and aligning with strategy. Expect normal margin expansion cadence with Q1 as low watermark, Q2-Q3 level, Q4 step up.

• Clinical hiring remains more challenging and geographically variable.
• Potential impact of Medicaid changes, ACA expansion rollback, etc., but no direct material impact expected.
• Uncertainty around home health M&A due to CMS administration handling of rate setting and revenue clawback.

Q: Ben Hendrix with RBC Capital Markets asked about hospice capital limitations and wage index regions.

A: Brad Bickham said hospice cap was very immaterial, and wage index regions didn't impact.

Q: Joanna Gajuk with Bank of America asked about Personal Care hours growth and hospice growth.

A: Brad Bickham said weather events impacted early Jan but rebounded, and hospice revenue expected to be 5%-7% growth.

Q: Tao Qiu with Macquarie asked about margin expansion and Medicaid.

A: Brian Poff said normal margin cadence, and Dirk Allison said ACA expansion rollback unlikely to impact directly.

Q: Unidentified Analyst asked about Personal Care same-store revenue growth and census.

A: Brad Bickham said better scheduling and fill rate improved.

Q: Jared Haase with William Blair asked about workforce retention industry-wide and home health volume.

A: Brad Bickham said industry workforce retention improved, and home health volume stable.

Q: Matthew Gillmor with Barclays asked about Gentiva performance and state budgets.

A: Brad Bickham said Gentiva financials stronger than expected, and Brian Poff said watching Texas rate increase.

Q: Meghan Holtz with Jefferies asked about hospice revenue per day.

A: Brian Poff said rate increase and implicit price concession played roles.

Q: Constantine Davides with Jefferies asked about Personal Care locations and technology.

A: Brad Bickham said small acquisition in Michigan and technology initiatives with good adoption.

Q: Ryan Langston with TD Cowen asked about turnover and Tennessee Quality Care.

A: Dirk Allison and Brad Bickham discussed turnover rates and positive progress with Journey Care and Tennessee Quality Care.

Q: John Ransom with Raymond James asked about hospice turnaround and home health M&A.

A: Brad Bickham and Brian Poff discussed hospice turnaround factors and home health M&A uncertainty.