Company to host a conference call tomorrow,
March 7, 2024, at 10 A.M. EST
Enhabit, Inc. (NYSE: EHAB), a leading home health and hospice
care provider, today reported its results of operations for the
fourth quarter ended December 31, 2023.
“Persistent focus on our Company’s strategies drove our positive
fourth quarter results,” said Enhabit’s President and Chief
Executive Officer Barb Jacobsmeyer. “Payor innovation success,
including the finalization of another new national contract,
continued success with our people strategy and strong performance
in our quality outcomes are but a few of our high points for the
end of 2023 and our start to 2024. We are excited about our future
and our ability to meet the growing demand for home health and
hospice services.”
SUMMARY PERFORMANCE - CONSOLIDATED
- Net service revenue of $260.6 million
- Net loss attributable to Enhabit, Inc. of $6.4 million
- Adjusted EBITDA of $25.2 million
- Loss per share of $0.13
- Adjusted earnings per share of $0.06
RECENT COMPANY HIGHLIGHTS
- Strong growth in home health Medicare Advantage admissions with
non-episodic admissions up 34.2% driving total admission growth of
3.9% year over year
- Continued payor innovation progress with 11 new Medicare
Advantage agreements negotiated during the fourth quarter
- Added one new national advanced episodic agreement effective
January 1, 2024
- 25% of non-episodic visits now in payor innovation contracts at
improved rates
- Home health cost per visit flat year over year
- 30-day hospitalization readmission rate in home health 20.5%
better than national average
- Sequential growth in hospice average daily census
- Hospice cost per day decreased to $76 after stabilizing at $77
for the prior three quarters
- 53.2% better than the national average for hospice patient
visits in the last days of life
- Continued success in recruitment and retention with a 21.5%
increase in full-time nursing candidate pool year over year
resulting in 119 net new full-time home health nursing hires in the
fourth quarter
- Opened one home health and one hospice de novo location in the
fourth quarter
FINANCIAL RESULTS
Consolidated
($ in millions, except per share
data)
Q4
'23 vs. '22
2023
2022
Home health net service revenue
$
209.5
$
215.8
(2.9
)%
Hospice net service revenue
51.1
47.4
7.8
%
Total net service revenue
$
260.6
$
263.2
(1.0
)%
% of Revenue
% of Revenue
Cost of services
51.2
%
$
133.5
50.6
%
$
133.3
0.2
%
Gross margin
48.8
%
127.1
49.4
%
129.9
(2.2
)%
General and administrative expenses
38.9
%
101.4
38.0
%
100.0
1.4
%
Total operating expenses
90.1
%
$
234.9
88.6
%
$
233.3
0.7
%
Other income
—
0.9
Net income attributable to noncontrolling
interests
0.5
0.5
Adjusted EBITDA
$
25.2
$
30.3
(16.8
)%
Adjusted EBITDA margin
9.7
%
11.5
%
Impairment of goodwill
$
—
$
(109.0
)
N/A
Net loss attributable to Enhabit,
Inc.
$
(6.4
)
$
(95.2
)
93.3
%
Reported diluted EPS
$
(0.13
)
$
(1.91
)
93.2
%
Adjusted EPS
$
0.06
$
0.17
(64.7
)%
The continued shift to more non-episodic admissions in home
health impacted consolidated revenue and Adjusted EBITDA by
approximately $8 million, net of the impact from improved pricing
of payor innovation contracts.
SEGMENT RESULTS
Home Health
($ in millions)
Q4
'23 vs. '22
2023
2022
Net service revenue
$
209.5
$
215.8
(2.9
)%
Cost of services
109.4
109.0
0.4
%
Gross margin
47.8
%
49.5
%
General and administrative expenses
$
59.3
$
60.0
(1.2
)%
Other income
$
—
$
(0.9
)
(100.0
)%
Equity earnings / noncontrolling
interest
$
0.5
$
0.5
—
%
Adjusted EBITDA
$
40.3
$
47.2
(14.6
)%
% Adj. EBITDA margin
19.2
%
21.9
%
Operational metrics (Actual
Amounts)
Starts of care
Episodic admissions
31,243
34,572
(9.6
)%
Non-episodic admissions
20,764
15,476
34.2
%
Total admissions
52,007
50,048
3.9
%
Same-store total admissions growth
3.2
%
Episodic recertifications
22,849
25,279
(9.6
)%
Non-episodic recertifications
9,179
7,104
29.2
%
Total recertifications
32,028
32,383
(1.1
)%
Same-store total recertifications
growth
(1.7
)%
Total starts of care
84,035
82,431
1.9
%
Completed episodes
54,108
60,250
(10.2
)%
Revenue per episode
$
2,924
$
2,958
(1.1
)%
Visits per episode
14.3
14.3
—
%
Total visits
1,162,385
1,159,420
0.3
%
Non-episodic visits
387,055
297,350
30.2
%
Cost per visit
$
92
$
92
—
%
The year-over-year decrease in revenue and Adjusted EBITDA was
due primarily to the continued payor mix shift to more non-episodic
admissions (approximately $8 million).
Non-episodic admissions grew 34.2% in the quarter, driving total
admission growth of 3.9% year over year. Revenue per episode
decreased year over year primarily due to patient mix. Cost per
visit remained flat year over year as the reduction in nursing
contract labor offset the impact of merit and market increases.
Hospice
($ in millions)
Q4
'23 vs. '22
2023
2022
Net service revenue
$
51.1
$
47.4
7.8
%
Cost of services
24.0
24.3
(1.2
)%
Gross margin
53.0
%
48.7
%
General and administrative expenses
$
15.4
$
17.5
(12.0
)%
Equity earnings / noncontrolling
interest
$
—
$
—
Adjusted EBITDA
$
11.7
$
5.6
108.9
%
% Adj. EBITDA margin
22.9
%
11.8
%
Operational metrics (Actual
Amounts)
Total admissions
2,872
2,915
(1.5
)%
Same-store total admissions growth
(3.8
)%
Patient days
315,870
330,102
(4.3
)%
Discharged average length of
stay
102
110
(7.3
)%
Average daily census
3,433
3,588
(4.3
)%
Revenue per day
$
162
$
144
12.5
%
Cost per day
$
76
$
74
2.7
%
Net service revenue increased year over year primarily due to an
increase in revenue per day. Revenue per day increased primarily
due to changes in our estimated recoverability of net service
revenue and increased Medicare reimbursement rates.
Adjusted EBITDA increased year over year primarily due to
increased revenue per day and a reduction in general and
administrative expenses. Cost per day increased year over year
primarily due to increased labor costs resulting from the
implementation of the new case management staffing model, including
costs associated with dedicated on-call and triage nurses. General
and administrative expenses decreased year over year primarily due
to reduced headcount at hospice branch locations resulting from
implementation of the case management staffing model.
GUIDANCE
The Company is providing full-year 2024 guidance as follows:
Full-year 2024
Guidance
Net Service Revenue
between $1,076 and $1,102
million
Adjusted EBITDA
between $98 and $110 million
Adjusted EPS
between $0.12 and $0.43
For additional considerations regarding the Company’s 2024
guidance ranges, see the supplemental information posted on the
Company’s website at http://investors.ehab.com.
CONFERENCE CALL INFORMATION
The Company will host an investor conference call at 10 a.m. EST
on March 7, 2024, to discuss its results for the fourth quarter of
2023. To access the live call by phone, dial toll-free (888)
660-6150 or international (929) 203-0843; the conference ID is
5248158. A simultaneous webcast of the call, along with
supplemental information, may be accessed by visiting
https://events.q4inc.com/attendee/272381846. Following the call, a
replay will be available at Enhabit’s investor website.
ABOUT ENHABIT HOME HEALTH & HOSPICE
Enhabit Home Health & Hospice (Enhabit, Inc.) is a leading
national home health and hospice provider working to expand what’s
possible for patient care in the home. Enhabit’s team of clinicians
supports patients and their families where they are most
comfortable, with a nationwide footprint spanning 255 home health
locations and 110 hospice locations across 34 states. Enhabit
leverages advanced technology and compassionate teams to deliver
extraordinary patient care. For more information, visit
ehab.com.
OTHER INFORMATION
Note regarding presentation and reconciliation of non-GAAP
financial measures
The financial data contained in this press release and
supplemental information includes non-GAAP (generally accepted
accounting principles (GAAP)) financial measures as defined in
Regulation G under the Securities Exchange Act of 1934, including
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EPS, and Adjusted
free cash flow. See “Reconciliations of Non-GAAP Financial
Measures” for reconciliations of the non-GAAP financial measures to
the most directly comparable financial measures calculated and
presented in accordance with GAAP. Such non-GAAP financial measures
exclude significant components in understanding and assessing
financial performance and should therefore not be considered
superior to, as a substitute for or alternative to the GAAP
financial measures presented in this press release. The non-GAAP
financial measures in the press release may differ from similar
measures used by other companies.
The Company is unable to reconcile the guidance for Adjusted
EBITDA and Adjusted EPS to their corresponding GAAP measures
without unreasonable effort due to the inherent difficulty in
predicting, with reasonable certainty, the future impact of items
that are outside the control of the Company or otherwise
non-indicative of its ongoing operating performance. Accordingly,
the Company relies on the exception provided by Item 10(e)(1)(i)(B)
of Regulation S-K. Such items include, but are not limited to,
gains or losses related to hedging instruments; loss on early
extinguishment of debt; adjustments to its income tax provision
(such as valuation allowance adjustments and settlements of income
tax claims); and items related to corporate and facility
restructurings. For the same reasons, the Company is unable to
address the probable significance of the unavailable
information.
Note regarding presentation of same-store comparisons
The Company uses “same-store” comparisons to explain the changes
in certain performance metrics and line items within its financial
statements. Same-store comparisons are calculated based on home
health and hospice locations open throughout both the full current
period and the immediately prior period presented. These
comparisons include the financial results of market consolidation
transactions in existing markets, as it is difficult to determine,
with precision, the incremental impact of these transactions on the
Company’s results of operations.
Enhabit, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Income
(Unaudited)
Three Months Ended December
31,
For the Year Ended December
31,
2023
2022
2023
2022
(In Millions, Except Per Share
Data)
Net service revenue
$
260.6
$
263.2
$
1,046.3
$
1,071.1
Cost of service, excluding depreciation
and amortization
133.5
133.3
535.6
525.6
General and administrative expenses
114.5
104.6
441.6
414.9
Depreciation and amortization
7.7
8.3
30.9
33.0
Impairment of goodwill
—
109.0
85.8
109.0
Operating income (loss)
4.9
(92.0
)
(47.6
)
(11.4
)
Interest expense and amortization of debt
discounts and fees
12.3
8.7
43.0
15.0
Other income
—
(0.9
)
(0.2
)
(0.9
)
Loss before income taxes and
noncontrolling interests
(7.4
)
(99.8
)
(90.4
)
(25.5
)
Income tax (benefit) expense
(1.5
)
(5.1
)
(11.4
)
12.8
Net loss
(5.9
)
(94.7
)
(79.0
)
(38.3
)
Less: Net income attributable to
noncontrolling interests
0.5
0.5
1.5
2.1
Net loss attributable to Enhabit,
Inc.
$
(6.4
)
$
(95.2
)
$
(80.5
)
$
(40.4
)
Weighted average common shares
outstanding:
Basic
50.0
49.7
49.9
49.7
Diluted
50.0
49.8
49.9
49.7
Loss per common share:
Basic loss per share attributable to
Enhabit, Inc. common stockholders
$
(0.13
)
$
(1.92
)
$
(1.61
)
$
(0.81
)
Diluted loss per share attributable to
Enhabit, Inc. common stockholders
$
(0.13
)
$
(1.91
)
$
(1.61
)
$
(0.81
)
Enhabit, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(Unaudited)
December 31,
2023
December 31,
2022
(In Millions)
Assets
Current assets:
Cash and cash equivalents
$
27.4
$
22.9
Restricted cash
2.4
4.3
Accounts receivable, net of allowances
164.7
149.6
Income tax receivable
3.0
11.4
Prepaid expenses and other current
assets
12.6
23.6
Total current assets
210.1
211.8
Property and equipment, net
19.0
20.4
Operating lease right-of-use assets
57.5
42.0
Goodwill
1,061.7
1,144.8
Intangible assets, net
80.0
102.6
Other long-term assets
5.3
5.2
Total assets
$
1,433.6
$
1,526.8
Liabilities and Stockholders’
Equity
Current liabilities:
Current portion of long-term debt
$
22.5
$
23.1
Current portion of operating lease
liabilities
11.8
14.0
Accounts payable
7.6
3.8
Accrued payroll
38.5
35.5
Refunds due patients and other third-party
payors
8.2
8.3
Accrued medical insurance
8.4
7.5
Other current liabilities
40.7
40.7
Total current liabilities
137.7
132.9
Long-term debt, net of current portion
530.1
560.0
Long-term operating lease liabilities, net
of current portion
45.7
28.1
Deferred income tax liabilities
17.1
28.6
Other long-term liabilities
1.3
1.9
731.9
751.5
Commitments and contingencies
Redeemable noncontrolling interests
5.0
5.2
Stockholders’ equity:
Total Enhabit, Inc. stockholders’
equity
669.7
741.7
Noncontrolling interests
27.0
28.4
Total stockholders’ equity
696.7
770.1
Total liabilities and stockholders’
equity
$
1,433.6
$
1,526.8
Enhabit, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows
(Unaudited)
For the Year Ended December
31,
2023
2022
($ in millions)
Cash flows from operating
activities:
Net loss
$
(79.0
)
$
(38.3
)
Adjustments to reconcile net loss to net
cash provided by operating activities—
Depreciation and amortization
30.9
33.0
Amortization of debt related costs
2.1
0.6
Impairment of goodwill
85.8
109.0
Stock-based compensation
8.9
9.2
Deferred tax benefit
(11.6
)
(4.3
)
Other, net
(0.4
)
0.1
Changes in assets and liabilities, net of
acquisitions —
Accounts receivable, net of allowances
(14.6
)
21.6
Prepaid expenses and other assets
19.1
(27.5
)
Accounts payable
3.8
0.2
Accrued payroll
3.0
(31.0
)
Other liabilities
0.4
7.5
Net cash provided by operating
activities
48.4
80.1
Cash flows from investing
activities:
Acquisition of businesses, net of cash
acquired
(2.8
)
(36.3
)
Purchases of property and equipment,
including capitalized software costs
(3.5
)
(7.1
)
Other
1.0
1.1
Net cash used in investing
activities
(5.3
)
(42.3
)
Cash flows from financing
activities:
Principal borrowings on term loan
—
400.0
Principal payments on debt
(20.0
)
(10.0
)
Borrowings on revolving credit
facility
—
190.0
Payments on revolving credit facility
(10.0
)
—
Principal payments under finance lease
obligations
(3.4
)
(5.0
)
Debt issuance costs
(3.2
)
(4.7
)
Distributions paid to noncontrolling
interests of consolidated affiliates
(3.2
)
—
Contributions from Encompass
—
59.8
Distributions to Encompass
—
(654.9
)
Contributions from noncontrolling
interests of consolidated affiliates
—
7.4
Other
(0.7
)
(1.2
)
Net cash used in financing
activities
(40.5
)
(18.6
)
Increase in cash, cash equivalents, and
restricted cash
2.6
19.2
Cash, cash equivalents, and restricted
cash at beginning of year
27.2
8.0
Cash, cash equivalents, and restricted
cash at end of year
$
29.8
$
27.2
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Diluted
Earnings Per Share to
Adjusted Earnings Per
Share
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Diluted earnings per share, as
reported
$
(0.13
)
$
(1.91
)
$
(1.61
)
$
(0.81
)
Adjustments, net of tax:
Impairment of goodwill
—
1.91
1.50
1.91
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
0.18
0.05
0.32
0.14
Income tax adjustments(2)
0.01
0.12
0.02
0.12
Adjusted earnings per share(3)
$
0.06
$
0.17
$
0.22
$
1.36
(1)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities; FY 2023 include costs
associated with nonroutine litigation, restructuring activities,
one-time standalone transition costs, shareholder activism and the
strategic review process; in 2022, these items include one-time
standalone transition costs and costs associated with nonroutine
litigation.
(2)
Income tax adjustments include revisions
to the estimates of tax balances as of the Separation date and the
effect of permanent book-tax differences attributable to
stock-based compensation.
(3)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Adjusted
EBITDA to
Adjusted Earnings Per
Share
Three Months Ended December
31,
2023
Adjustments
As Reported
Unusual or nonrecurring items
that are not typical of ongoing operations
Income Tax
Adjustments(3)
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
25.2
$
—
$
—
$
25.2
Interest expense and amortization of debt
discounts & fees
(12.3
)
—
—
(12.3
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(11.4
)
11.4
—
—
Depreciation and amortization
(7.7
)
—
—
(7.7
)
Stock-based compensation
(1.7
)
—
—
(1.7
)
Net (loss) income before income taxes,
including noncontrolling interests
(7.9
)
11.4
—
3.5
Income tax benefit (expense)
1.5
(2.2
)
0.3
(0.4
)
Net (loss) income attributable to
Enhabit
$
(6.4
)
$
9.2
$
0.3
$
3.1
Diluted earnings per share(4)
$
(0.13
)
$
0.18
$
0.01
$
0.06
Diluted shares
50.0
50.0
(1)
Reconciliation to GAAP provided below.
(2)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities.
(3)
Income tax adjustments include revisions
to the estimates of tax balances as of the Separation date and the
effect of permanent book-tax differences attributable to
stock-based compensation.
(4)
Diluted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Adjusted
EBITDA to
Adjusted Earnings Per
Share
Three Months Ended December
31,
2022
Adjustments
As Reported
Impairment of Goodwill
Unusual or nonrecurring items
that are not typical of ongoing operations
Income Tax
Adjustments(3)
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
30.3
$
—
$
—
$
—
$
30.3
Impairment of goodwill
(109.0
)
109.0
—
—
—
Interest expense and amortization of debt
discounts & fees
(8.7
)
—
—
—
(8.7
)
Depreciation and amortization
(8.3
)
—
—
—
(8.3
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(2.5
)
—
2.5
—
—
Stock-based compensation
(2.1
)
—
—
—
(2.1
)
Net (loss) income before income taxes,
including noncontrolling interests
(100.3
)
109.0
2.5
—
11.2
Income tax benefit (expense)
5.1
(13.7
)
(0.6
)
6.2
(3.0
)
Net (loss) income attributable to
Enhabit
$
(95.2
)
$
95.3
$
1.9
$
6.2
$
8.2
Diluted earnings per share(4)
$
(1.91
)
$
1.91
$
0.05
$
0.12
$
0.17
Diluted shares
49.8
49.8
(1)
Reconciliation to GAAP provided below.
(2)
Unusual or nonrecurring items in Q4 2022
include one-time standalone transition costs and costs associated
with nonroutine litigation.
(3)
Income tax adjustments include revisions
to the estimates of tax balances as of the Separation date and the
effect of permanent book-tax differences attributable to
stock-based compensation.
(4)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Adjusted
EBITDA to
Adjusted Earnings Per
Share
Year Ended December
31,
2023
Adjustments
As Reported
Impairment of Goodwill
Unusual or nonrecurring items
that are not typical of ongoing operations
Income Tax
Adjustments(3)
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
97.6
$
—
$
—
$
—
$
97.6
Impairment of goodwill
(85.8
)
85.8
—
—
—
Interest expense and amortization of debt
discounts & fees
(43.0
)
—
—
—
(43.0
)
Depreciation and amortization
(30.9
)
—
—
—
(30.9
)
Unusual or nonrecurring items that are not
typical of ongoing operations (2)
(21.2
)
—
21.2
—
—
Stock-based compensation
(8.9
)
—
—
—
(8.9
)
Gain on disposal or impairment of
assets
0.3
—
—
—
0.3
Net (loss) income before income taxes,
including noncontrolling interests
(91.9
)
85.8
21.2
—
15.1
Income tax benefit (expense)
11.4
(11.1
)
(5.1
)
0.9
(3.9
)
Net (loss) income attributable to
Enhabit
$
(80.5
)
$
74.7
$
16.1
$
0.9
$
11.2
Diluted earnings per share(4)
$
(1.61
)
$
1.50
$
0.32
$
0.02
$
0.22
Diluted shares
49.9
49.9
(1)
Reconciliation to GAAP provided below.
(2)
Unusual or nonrecurring items in 2023
include costs associated with nonroutine litigation, restructuring
activities, one-time standalone transition costs, shareholder
activism and the strategic review process.
(3)
Income tax adjustments include revisions
to the estimates of tax balances as of the Separation date and the
effect of permanent book-tax differences attributable to
stock-based compensation.
(4)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Adjusted
EBITDA to
Adjusted Earnings Per
Share
Year Ended December
31,
2022
Adjustments
As Reported
Impairment of Goodwill
Unusual or nonrecurring items
that are not typical of ongoing operations
Income Tax
Adjustments(3)
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
149.3
$
—
$
—
$
—
$
149.3
Impairment of goodwill
(109.0
)
109.0
—
—
—
Depreciation and amortization
(33.0
)
—
—
—
(33.0
)
Interest expense and amortization of debt
discounts & fees
(15.0
)
—
—
—
(15.0
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(9.5
)
—
9.5
—
—
Stock-based compensation
(9.2
)
—
—
—
(9.2
)
Stock-based compensation included in
overhead allocation
(1.1
)
—
—
—
(1.1
)
Loss on disposal or impairment of
assets
(0.1
)
—
—
—
(0.1
)
Net (loss) income before income taxes,
including noncontrolling interests
(27.6
)
109.0
9.5
—
90.9
Income tax (expense) benefit
(12.8
)
(13.7
)
(2.4
)
6.2
(22.7
)
Net (loss) income attributable to
Enhabit
$
(40.4
)
$
95.3
$
7.1
$
6.2
$
68.2
Diluted earnings per share(4)
$
(0.81
)
$
1.91
$
0.14
$
0.12
$
1.36
Diluted shares
49.7
49.7
(1)
Reconciliation to GAAP provided below.
(2)
Unusual or nonrecurring items in 2022
include one-time standalone transition costs and costs associated
with nonroutine litigation.
(3)
Income tax adjustments include revisions
to the estimates of tax balances as of the Separation date and the
effect of permanent book-tax differences attributable to
stock-based compensation.
(4)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Net Loss to
Adjusted EBITDA
Three Months Ended
December 31,
For the Year Ended
December 31,
2023
2022
2023
2022
($ in millions)
Net loss
$
(5.9
)
$
(94.7
)
$
(79.0
)
$
(38.3
)
Interest expense
12.3
8.7
43.0
15.0
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
11.4
2.5
21.2
9.5
Depreciation and amortization
7.7
8.3
30.9
33.0
Stock-based compensation
1.7
2.1
8.9
9.2
Income tax (benefit) expense
(1.5
)
(5.1
)
(11.4
)
12.8
Net income attributable to noncontrolling
interests
(0.5
)
(0.5
)
(1.5
)
(2.1
)
Impairment of goodwill
—
109.0
85.8
109.0
(Gain) loss on disposal or impairment of
assets
—
—
(0.3
)
0.1
Stock-based compensation included in
overhead allocation
—
—
—
1.1
Adjusted EBITDA
$
25.2
$
30.3
$
97.6
$
149.3
(1)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities; FY 2023 include costs
associated with nonroutine litigation, restructuring activities,
one-time standalone transition costs, shareholder activism and the
strategic review process; in 2022, these items include one-time
standalone transition costs and costs associated with nonroutine
litigation.
Reconciliation of Net Cash
Provided by Operating Activities to Adjusted EBITDA
Three Months Ended
December 31,
For the Year Ended
December 31,
2023
2022
2023
2022
($ in millions)
Net cash provided by operating
activities
$
2.8
$
4.1
$
48.4
$
80.1
Unusual or nonrecurring items not typical
of ongoing operations(1)
11.4
2.5
21.2
9.5
Interest expense excluding amortization of
debt discounts and fees
11.2
8.7
40.9
15.0
Change in assets and liabilities,
excluding derivative instruments
3.1
19.2
(11.9
)
29.2
Current portion of income tax (benefit)
expense
(3.0
)
(3.3
)
0.2
17.1
Net income attributable to noncontrolling
interests in continuing operations
(0.5
)
(0.5
)
(1.5
)
(2.1
)
Other
0.2
(0.4
)
0.3
(0.6
)
Stock-based compensation included in
overhead allocation
—
—
—
1.1
Adjusted EBITDA
$
25.2
$
30.3
$
97.6
$
149.3
(1)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities; FY 2023 include costs
associated with nonroutine litigation, restructuring activities,
one-time standalone transition costs, shareholder activism and the
strategic review process; in 2022, these items include one-time
standalone transition costs and costs associated with nonroutine
litigation.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Net Cash
Provided by Operating Activities to
Adjusted Free Cash
Flow
Three Months Ended
December 31,
For the Year Ended
December 31,
($ in millions)
2023
2022
2023
2022
Net cash provided by operating
activities
$
2.8
$
4.1
$
48.4
$
80.1
Unusual or nonrecurring items not typical
of ongoing operations(1)
11.4
2.5
21.2
9.5
Other working capital adjustments,
including accrued unusual or nonrecurring items
(2.5
)
(0.7
)
(4.2
)
(0.7
)
Distributions paid to noncontrolling
interests of consolidated affiliates
(0.7
)
(0.3
)
(3.2
)
(1.2
)
Capital expenditures for maintenance
0.2
(1.4
)
(3.4
)
(4.5
)
Stock-based compensation included in
overhead allocation
—
—
—
1.1
Adjusted free cash flow
$
11.2
$
4.2
$
58.8
$
84.3
(1)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities; FY 2023 include costs
associated with nonroutine litigation, restructuring activities,
one-time standalone transition costs, shareholder activism and the
strategic review process; in 2022, these items include one-time
standalone transition costs and costs associated with nonroutine
litigation.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Gross Margin
to Adjusted EBITDA Margin
Three Months Ended
December 31,
For the Year Ended
December 31,
2023
2022
2023
2022
Gross margin as a percentage of
revenue
48.8
%
49.4
%
48.8
%
50.9
%
General and administrative expenses
(43.9
)%
(39.7
)%
(42.2
)%
(38.7
)%
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
4.4
%
0.9
%
2.0
%
0.9
%
Stock-based compensation
0.6
%
0.8
%
0.8
%
1.1
%
Noncontrolling interests
(0.2
)%
(0.2
)%
(0.1
)%
(0.2
)%
Other income
—
%
0.3
%
—
%
(0.1
)%
Adjusted EBITDA Margin
9.7
%
11.5
%
9.3
%
13.9
%
(1)
Unusual or nonrecurring items in Q4 2023
include costs associated with nonroutine litigation, the strategic
review process and restructuring activities; FY 2023 include costs
associated with nonroutine litigation, restructuring activities,
one-time standalone transition costs, shareholder activism and the
strategic review process; in 2022, these items include one-time
standalone transition costs and costs associated with nonroutine
litigation.
FORWARD-LOOKING STATEMENTS
Statements contained in this press release which are not
historical facts, such as those relating to future events,
projections, financial guidance, legislative or regulatory
developments, strategy or growth opportunities, are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. All such estimates, projections, and
forward-looking information speak only as of the date hereof, and
Enhabit undertakes no duty to publicly update or revise such
forward-looking information, whether as a result of new
information, future events, or otherwise. Such forward-looking
statements are necessarily estimates based upon current information
and involve a number of risks and uncertainties, many of which are
beyond our control. Actual events or results may differ materially
from those anticipated in these forward-looking statements as a
result of a variety of factors. While it is impossible to identify
all such factors, factors which could cause actual events or
results to differ materially from those estimated by Enhabit
include, but are not limited to, our ability to execute on our
strategic plans; regulatory and other developments impacting the
markets for our services; changes in reimbursement rates; general
economic conditions; changes in the episodic versus non-episodic
mix of our payors, the case mix of our patients, and payment
methodologies; our ability to attract and retain key management
personnel and healthcare professionals; potential disruptions or
breaches of our or our vendors’, payors’, and other contract
counterparties’ information systems; the outcome of litigation; our
ability to successfully complete and integrate de novo locations,
acquisitions, investments, and joint ventures; our ability to
successfully integrate technology in our operations; our ability to
control costs, particularly labor and employee benefit costs; and
factors that affect the timing and options in our strategic review
and, following our strategic review, consummating a strategic
transaction on attractive terms or at all. Additional information
regarding risks and factors that could cause actual results to
differ materially from those expressed or implied by any
forward-looking statement in this press release are described in
reports filed with the SEC, including our annual report on Form
10-K and subsequent quarterly reports on Form 10-Q, copies of which
are available on the Company’s website at
http://investors.ehab.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240306933740/en/
Investor Relations Contact Crissy Carlisle
InvestorRelations@ehab.com 469-860-6061
Media Contact Erin Volbeda media@ehab.com
972-338-5141
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