Addus HomeCare Corporation (Nasdaq: ADUS), a provider of home-based social and medical services focused primarily on the elderly dual eligible population, announced today its financial results for the three months ended March 31, 2012.
First Quarter Review
Total net service revenues for the first quarter of 2012 were $67.9 million, a 1.6% increase compared to $66.8 million in the prior year quarter. Net income for the first quarter was $0.6 million, or $0.06 per diluted share, compared to $0.9 million or $0.08 per diluted share, in the prior year quarter.
Mark Heaney, President and Chief Executive Officer of Addus HomeCare, stated, "We are pleased with the continued positive performance of the Home & Community segment but are disappointed with the operating performance of the Home Health segment."
Net income for the first quarter of 2012 included several one-time items: a pre-tax gain of $0.5 million relating to the sale of an agency from the Home Health division; $0.1 million received from the State of Illinois as an interest payment for delays in payments of invoices (prompt payment interest); and an adjustment to estimates of accrued Medicare revenues totaling $0.9 million, which reduced profitability by $0.8 million. The net effect of these three one-time items is a reduction of approximately $0.01 per diluted share.
Home & Community segment net service revenues for the first quarter of 2012 were $56.9 million, a 5.1% increase from the prior year quarter. Home & Community operating income, including depreciation and amortization but excluding corporate expenses, increased 20.6% to $6.4 million, or 11.3% of revenue, in the first quarter, compared to $5.3 million, or 9.8% of revenue, in the prior year quarter. This improvement was primarily due to an increase in average census and related billable hours, lower bad debt expense as a result of improved accounts receivable collections as well as a continued focus on cost control.
Home Health segment net service revenues for the first quarter of 2012 were $11.0 million, a 13.4% decrease over the prior year quarter. Home Health had an operating loss, including depreciation and amortization but excluding corporate expenses, of $1.2 million, or 10.6% of revenues, compared to operating income of $0.7 million, or 5.5% of revenues, in the prior year quarter.
Excluding the impact of the previously discussed one-time items, current quarter Home Health revenues declined $0.8 million on a year-over-year basis as a result of lower admissions in ongoing operations totaling $0.5 million, Medicare rate reductions of $0.2 million and revenues lost from agencies sold / closed in December and January totaling $0.1 million. Gross profit excluding the one-time items was $5.1 million with a corresponding reduction in gross margin from 44.8 percent to 43.1 percent. Our sales and administrative expenses have increased over the same period by $0.6 million.
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