Revises Full-Year Guidance
Announces Intent to Launch Strategic
Alternatives Process Subject to Satisfaction of Conditions in Tax
Matters Agreement
Company to host a conference call tomorrow,
August 10, 2023 at 10 AM EDT
Enhabit, Inc. (NYSE: EHAB), a leading home health and hospice
care provider, today reported its results of operations for the
second quarter ended June 30, 2023.
“During the second quarter, we negotiated ten new contracts with
Medicare Advantage payors, increased our clinical staff with 203
net new full-time nursing hires, and continued to outperform the
industry average with a 30-day hospital readmission rate that is
370 basis points better than the national average,” said Enhabit’s
President and Chief Executive Officer, Barb Jacobsmeyer. “While we
continue to make progress with our strategic initiatives, the pace
of the progress has not been fast enough in 2023 to meet our
initial guidance. We remain confident our teams’ relentless efforts
to retain staff, manage costs, and deliver high-quality care will
enhance our value long term.”
QUARTERLY PERFORMANCE - CONSOLIDATED
- Net service revenue of $262.3 million
- Net loss of $74.1 million
- Adjusted EBITDA of $23.9 million
- Loss per diluted share of $1.49
- Adjusted earnings per share of $0.04
RECENT COMPANY HIGHLIGHTS
- Negotiated ten new Medicare Advantage payor contracts in the
second quarter
- Shifted approximately 5% of previous non-episodic visits into
non-episodic payor innovation contracts at improved per visit
rates
- Continued strong growth in home health Medicare Advantage
admissions with non-episodic admissions up 38.0% driving total
admission growth of 3.2% year over year
- Continued recruiting success adding 203 net new full-time
nursing hires in the second quarter
- Opened two de novo home health locations in Montana in April
and one hospice de novo location in Texas in May
- Hospice cost per day stabilized sequentially
- 30-day hospitalization readmission rate is 370 basis points
better than the national average
FINANCIAL RESULTS
Consolidated
($ in millions, except per share
data)
Q2
'23 vs. '22
2023
2022
Home health net service revenue
$
213.8
$
220.2
(2.9)%
Hospice net service revenue
48.5
47.8
1.5%
Total net service revenue
$
262.3
$
268.0
(2.1)%
% of Revenue
% of Revenue
Cost of services
51.7%
$
(135.5)
48.6%
$
(130.3)
4.0%
Gross margin
48.3%
126.8
51.4%
137.7
(7.9)%
General & administrative expenses
39.2%
(102.7)
36.1%
(96.7)
6.2%
Operating expenses
90.8%
(238.2)
84.7%
(227.0)
4.9%
Other income
(0.1)
—
Equity earnings / noncontrolling
interest
0.3
0.7
Adjusted EBITDA
$
23.9
$
40.3
(40.7)%
Adjusted EBITDA margin
9.1%
15.0%
Reported Diluted EPS
$
(1.49)
$
0.41
(467.7)%
Adjusted EPS
$
0.04
$
0.47
(91.5)%
The continued shift to more non-episodic admissions in home
health and the resumption of sequestration reduced consolidated net
service revenue and Adjusted EBITDA $10.5 million year over
year.
Adjusted EBITDA decreased year over year primarily due to the
continued shift to more non-episodic admissions in home health,
incremental costs associated with being a stand-alone company, and
the resumption of sequestration.
SEGMENT RESULTS
Home health
($ in millions)
Q2
'23 vs. '22
2023
2022
Net service revenue
$
213.8
$
220.2
(2.9)%
Cost of services
111.4
108.8
2.4%
Gross margin
47.9 %
50.6 %
General & administrative expenses
$
59.4
$
57.8
2.8%
Other income
$
(0.1)
$
—
Equity earnings / noncontrolling
interest
$
0.3
$
0.6
(50.0)%
Adjusted EBITDA
$
42.8
$
53.0
(19.2)%
% Adj. EBITDA margin
20.0 %
24.1 %
Operational metrics (Actual
Amounts)
Starts of care
Episodic admissions
32,628
36,106
(9.6)%
Non-episodic admissions
18,347
13,293
38.0%
Total admissions
50,975
49,399
3.2%
Same-store total admissions growth
1.7%
Episodic recertifications
23,788
25,993
(8.5)%
Non-episodic recertifications
9,554
6,447
48.2%
Total recertifications
33,342
32,440
2.8%
Same-store total recertifications
growth
2.2%
Total starts of care
84,317
81,839
3.0%
Completed episodes
56,808
62,691
(9.4)%
Revenue per episode
$
2,913
$
2,972
(2.0)%
Visits per episode
14.6
15.0
(2.7)%
Total visits
1,205,865
1,217,447
(1.0)%
Non-episodic visits
377,214
275,679
36.8%
Cost per visit
$
91
$
88
3.4%
The year-over-year decrease in revenue was due primarily to the
continued payor mix shift to more non-episodic admissions and the
resumption of sequestration. Revenue per episode decreased year
over year primarily due to the resumption of sequestration and
patient mix.
Adjusted EBITDA decreased year over year primarily due to the
continued payor mix shift to more non-episodic admissions, the
resumption of sequestration, and increased general and
administrative expenses associated with new stores. Cost per visit
increased year-over-year primarily due to increased contract labor,
merit and market rate increases for clinical staff, and increased
costs associated with employee group medical claims partially
offset by improved clinical productivity.
Hospice
($ in millions)
Q2
'23 vs. '22
2023
2022
Net service revenue
$
48.5
$
47.8
1.5 %
Cost of services
24.1
21.5
12.1 %
Gross margin
50.3 %
55.0 %
General & administrative expenses
$
16.1
$
15.5
3.9 %
Equity earnings / noncontrolling
interest
$
—
$
0.1
Adjusted EBITDA
$
8.3
$
10.7
(22.4) %
% Adj. EBITDA margin
17.1 %
22.4 %
Operational metrics (Actual
Amounts)
Total admissions
2,837
2,835
0.1 %
Same-store total admissions growth
(4.1) %
Patient days
311,465
313,718
(0.7) %
Discharged average length of
stay
108
109
(0.9) %
Average daily census
3,423
3,447
(0.7) %
Revenue per day
$
156
$
152
2.6 %
Cost per day
$
77
$
69
11.6 %
Net service revenue increased year over year primarily due to
increased Medicare reimbursement rates.
Adjusted EBITDA decreased year over year primarily due to higher
cost of services resulting from increased labor costs. Cost per day
increased year over year primarily due to increased labor costs
resulting from the implementation of the new case management model,
including costs associated with dedicated on-call and triage
nurses.
TAX MATTERS AGREEMENT
Enhabit also announced today that it is undertaking steps to
attempt to satisfy the conditions in its Tax Matters Agreement
(“TMA”), dated June 30, 2022, with Encompass Health Corporation
relating to certain transactions involving the Company. The
conditions in the TMA include securing a tax opinion of legal
counsel, satisfactory to Encompass Health in its sole and absolute
discretion, that the actions taken by Enhabit would not jeopardize
the tax-free treatment of the spin-off of Enhabit.
Upon satisfaction of these conditions, the Enhabit board, with
the assistance of independent advisors, intends to launch a
strategic alternatives process. As part of any such process, the
board expects it would consider a wide range of options for the
company including, among other things, a potential sale, merger or
other strategic transaction. There can be no assurance that the
conditions in the TMA will be satisfied, that Enhabit will initiate
such a process, or if launched, that a process would result in
Enhabit pursuing a particular transaction or other strategic
outcome.
GUIDANCE
The Company revised its full-year 2023 guidance as follows:
($ in millions, except per share
data)
Full-Year 2023
2023 Original Guidance
2023 Revised Guidance
Net Service Revenue
$1,110 to $1,140
$1,057 to $1,065
Adjusted EBITDA
$125 to $140
$100 to $107
Adjusted EPS
$0.50 to $0.89
$0.28 to $0.46
For additional considerations regarding the Company’s 2023
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 AM
Eastern Time on August 10, 2023 to discuss its results for the
second 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/923162031. 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 108 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 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, leverage ratios, 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.
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 reconciliations of non-GAAP financial
measures
This press release contains the reconciliations of 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.
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 June
30,
Six Months Ended June
30,
2023
2022
2023
2022
($ in millions, except per
share data)
Net service revenue
$
262.3
$
268.0
$
527.4
$
542.3
Cost of service, excluding depreciation
and amortization
135.5
130.3
268.1
260.0
General and administrative expenses
107.8
102.2
218.3
202.9
Depreciation and amortization
7.7
8.2
15.5
16.7
Impairment of goodwill
85.8
—
85.8
—
Operating income
(74.5
)
27.3
(60.3
)
62.7
Interest expense and amortization of debt
discounts and fees
10.3
0.1
19.8
0.1
Other income
(0.1
)
—
(0.1
)
—
(Loss) income before income taxes and
noncontrolling interests
(84.7
)
27.2
(80.0
)
62.6
Income tax (benefit) expense
(10.6
)
6.4
(9.1
)
15.1
Net (loss) income
(74.1
)
20.8
(70.9
)
47.5
Less: Net income attributable to
noncontrolling interests
0.3
0.7
0.8
1.3
Net (loss) income attributable to
Enhabit, Inc.
$
(74.4
)
$
20.1
$
(71.7
)
$
46.2
Weighted average common shares
outstanding:
Basic
49.8
49.6
49.8
49.6
Diluted
49.8
49.6
49.8
49.6
(Loss) earnings per common
share:
Basic (loss) earnings per share
attributable to Enhabit, Inc. common stockholders
$
(1.49
)
$
0.41
$
(1.44
)
$
0.93
Diluted (loss) earnings per share
attributable to Enhabit, Inc. common stockholders
$
(1.49
)
$
0.41
$
(1.44
)
$
0.93
Enhabit, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(Unaudited)
June 30, 2023
December 31,
2022
($ in millions)
Assets
Current assets:
Cash and cash equivalents
$
34.4
$
22.9
Restricted cash
2.1
4.3
Accounts receivable
147.6
149.6
Income tax receivable
3.9
11.4
Prepaid expenses and other current
assets
11.6
23.6
Total current assets
199.6
211.8
Property and equipment, net
18.5
20.4
Operating lease right-of-use assets
49.3
42.0
Goodwill
1,061.7
1,144.8
Intangible assets, net
91.2
102.6
Other long-term assets
5.9
5.2
Total assets
$
1,426.2
$
1,526.8
Liabilities and Stockholders’
Equity
Current liabilities:
Current portion of long-term debt
$
22.5
$
23.1
Current operating lease liabilities
11.7
14.0
Accounts payable
5.4
3.8
Accrued payroll
32.8
35.5
Refunds due patients and other third-party
payors
7.1
8.3
Accrued medical insurance
8.2
7.5
Other current liabilities
35.8
40.7
Total current liabilities
123.5
132.9
Long-term debt, net of current portion
539.3
560.0
Long-term operating lease liabilities
37.5
28.1
Deferred income tax liabilities
18.1
28.6
Other long-term liabilities
0.6
1.9
719.0
751.5
Commitments and contingencies
Redeemable noncontrolling interests
5.1
5.2
Stockholders’ equity:
Enhabit, Inc. stockholders’ equity:
675.2
741.7
Noncontrolling interests
26.9
28.4
Total stockholders’ equity
702.1
770.1
Total liabilities and stockholders’
equity
$
1,426.2
$
1,526.8
Enhabit, Inc. and
Subsidiaries
Condensed Consolidated Cash
Flows
(Unaudited)
Six Months Ended June
30,
2023
2022
($ in millions)
Cash flows from operating
activities:
Net (loss) income
$
(70.9
)
$
47.5
Adjustments to reconcile net (loss) income
to net cash provided by operating activities—
Depreciation and amortization
15.5
16.7
Amortization of debt related costs
0.5
—
Impairment of goodwill
85.8
—
Stock-based compensation
4.1
2.5
Deferred tax benefit
(11.0
)
(1.4
)
Other, net
0.9
(0.6
)
Changes in assets and liabilities, net of
acquisitions—
Accounts receivable
1.9
13.4
Prepaid expenses and other assets
19.2
(2.7
)
Accounts payable
1.5
(0.8
)
Accrued payroll
(2.6
)
6.2
Other liabilities
(5.7
)
(5.8
)
Net cash provided by operating
activities
39.2
75.0
Cash flows from investing
activities:
Acquisition of businesses, net of cash
acquired
(2.8
)
—
Purchases of property and equipment
(1.7
)
(4.5
)
Other, net
0.5
1.0
Net cash used in investing
activities
(4.0
)
(3.5
)
Cash flows from financing
activities:
Principal borrowings on term loan
—
400.0
Principal payments on term loan
(10.0
)
—
Principal payments on debt
—
(0.4
)
Borrowings on revolving credit
facility
—
170.0
Payments on revolving credit facility
(10.0
)
—
Principal payments under finance lease
obligations
(1.8
)
(2.6
)
Debt issuance costs
(1.1
)
(4.4
)
Distributions paid to noncontrolling
interests of consolidated affiliates
(2.5
)
(0.7
)
Contributions from Encompass
—
59.8
Distributions to Encompass
—
(654.9
)
Contributions from noncontrolling
interests of consolidated affiliates
—
7.4
Other
(0.5
)
—
Net cash used in financing
activities
(25.9
)
(25.8
)
Increase in cash, cash equivalents, and
restricted cash
9.3
45.7
Cash, cash equivalents, and restricted
cash at beginning of year
27.2
8.0
Cash, cash equivalents, and restricted
cash at end of period
$
36.5
$
53.7
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Adjusted Earnings Per
Share
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Earnings per share, as reported
$
(1.49
)
$
0.41
$
(1.44
)
$
0.93
Adjustments, net of tax:
Impairment of goodwill
1.50
—
1.50
—
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
0.03
0.06
0.07
0.09
Income tax adjustments(2)
—
—
0.01
—
Adjusted earnings per share(3)
$
0.04
$
0.47
$
0.14
$
1.02
(1)
Unusual or nonrecurring items in 2023
include costs associated with nonroutine litigation and shareholder
activism defense; in 2022, they include costs associated with the
strategic alternatives review.
(2)
Income tax adjustments include 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
Adjusted Earnings Per
Share
Q2 QTD
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)
$
23.9
$
—
$
—
$
—
$
23.9
Impairment of goodwill
(85.8
)
85.8
—
—
—
Interest expense and amortization of debt
discounts and fees
(10.3
)
—
—
(10.3
)
Depreciation and amortization
(7.7
)
—
—
—
(7.7
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(2.6
)
—
2.6
—
—
Stock-based compensation
(2.6
)
—
—
—
(2.6
)
Gain on disposal or impairment of
assets
0.1
—
—
—
0.1
Net loss before income tax expense,
including noncontrolling interests
(85.0
)
85.8
2.6
—
3.4
Income tax benefit (expense)
10.6
(11.1
)
(1.0
)
0.1
(1.4
)
Net (loss) income attributable to
Enhabit
$
(74.4
)
$
74.7
$
1.6
$
0.1
$
2.0
Diluted earnings per share(4)
$
(1.49
)
$
1.50
$
0.03
$
—
$
0.04
Diluted shares
49.8
49.8
(1)
See reconciliation of net income to
Adjusted EBITDA below.
(2)
Unusual or nonrecurring items in 2023
include costs associated with non-routine litigation and
shareholder activism defense.
(3)
Income tax adjustments include 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
Adjusted Earnings Per
Share
Q2 QTD
2022
Adjustments
As Reported
Unusual or nonrecurring items
that are not typical of ongoing operations
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
40.3
$
—
$
40.3
Depreciation and amortization
(8.2
)
—
(8.2
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(4.1
)
4.1
—
Stock-based compensation
(1.2
)
—
(1.2
)
Stock-based compensation included in
overhead allocation
(0.6
)
—
(0.6
)
Gain on disposal or impairment of
assets
0.4
—
0.4
Interest expense and amortization of debt
discounts and fees
(0.1
)
—
(0.1
)
Income before income tax
expense
26.5
4.1
30.6
Provision for income tax expense
(6.4
)
(1.0
)
(7.4
)
Net income attributable to
Enhabit
$
20.1
$
3.1
$
23.2
Diluted earnings per share(3)
$
0.41
$
0.06
$
0.47
Diluted shares used in
calculation
49.6
49.6
(1)
See reconciliation of net income to
Adjusted EBITDA below.
(2)
Unusual or nonrecurring items in 2022
include costs associated with the strategic alternatives
review.
(3)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Adjusted Earnings Per
Share
YTD
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)
$
49.2
$
—
$
—
$
—
$
49.2
Impairment of goodwill
(85.8
)
85.8
—
—
—
Interest expense and amortization of debt
discounts and fees
(19.8
)
—
—
—
(19.8
)
Depreciation and amortization
(15.5
)
—
—
—
(15.5
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(4.9
)
—
4.9
—
—
Stock-based compensation
(4.1
)
—
—
—
(4.1
)
Gain on disposal or impairment of
assets
0.1
—
—
—
0.1
Net loss before income taxes, including
noncontrolling interests
(80.8
)
85.8
4.9
—
9.9
Income tax benefit (expense)
9.1
(11.1
)
(1.6
)
0.5
(3.1
)
Net (loss) income attributable to
Enhabit
$
(71.7
)
$
74.7
$
3.3
$
0.5
$
6.8
Diluted earnings per share(4)
$
(1.44
)
$
1.50
$
0.07
$
0.01
$
0.14
Diluted shares
49.8
49.8
(1)
See reconciliation of net income to
Adjusted EBITDA below.
(2)
Unusual or nonrecurring items in 2023
include costs associated with non-routine litigation and
shareholder activism defense.
(3)
Income tax adjustments include 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
Adjusted Earnings Per
Share
YTD
2022
Adjustments
As Reported
Unusual or nonrecurring items
that are not typical of ongoing operations
As Adjusted
($ in millions, except per
share data)
Adjusted EBITDA(1)
$
87.3
$
—
$
87.3
Depreciation and amortization
(16.7
)
—
(16.7
)
Unusual or nonrecurring items that are not
typical of ongoing operations(2)
(6.1
)
6.1
—
Stock-based compensation
(2.5
)
—
(2.5
)
Stock-based compensation included in
overhead allocation
(1.1
)
—
(1.1
)
Gain on disposal or impairment of
assets
0.5
—
0.5
Interest expense and amortization of debt
discounts and fees
(0.1
)
—
(0.1
)
Income before income tax
expense
61.3
6.1
67.4
Provision for income tax expense
(15.1
)
(1.5
)
(16.6
)
Net income attributable to
Enhabit
$
46.2
$
4.6
$
50.8
Diluted earnings per share(3)
$
0.93
$
0.09
$
1.02
Diluted shares used in
calculation
49.6
49.6
(1)
See reconciliation of net income to
Adjusted EBITDA below.
(2)
Unusual or nonrecurring items in 2022
include costs associated with the strategic alternatives
review.
(3)
Adjusted EPS may not sum due to
rounding.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Net Income
to Adjusted EBITDA
Three Months Ended
June 30,
Six Months Ended
June 30,
2023
2022
2023
2022
($ in millions)
Net (loss) income
$
(74.1
)
$
20.8
$
(70.9
)
$
47.5
Impairment of goodwill
85.8
—
85.8
—
Income tax (benefit) expense
(10.6
)
6.4
(9.1
)
15.1
Interest expense and amortization of debt
discounts and fees
10.3
0.1
19.8
0.1
Depreciation and amortization
7.7
8.2
15.5
16.7
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
2.6
4.1
4.9
6.1
Stock-based compensation
2.6
1.2
4.1
2.5
Net income attributable to noncontrolling
interests
(0.3
)
(0.7
)
(0.8
)
(1.3
)
Gain on disposal or impairment of
assets
(0.1
)
(0.4
)
(0.1
)
(0.5
)
Stock-based compensation included in
overhead allocation
—
0.6
—
1.1
Adjusted EBITDA
$
23.9
$
40.3
$
49.2
$
87.3
(1)
Unusual or nonrecurring items in 2023
include costs associated with nonroutine litigation and shareholder
activism defense; in 2022, they include costs associated with the
strategic alternatives review.
Reconciliation of Net Cash
Provided by Operating Activities to Adjusted EBITDA
Three Months Ended
June 30,
Six Months Ended
June 30,
2023
2022
2023
2022
($ in millions)
Net cash provided by operating
activities
$
9.6
$
33.6
$
39.2
$
75.0
Interest expense, excluding amortization
of debt discounts and fees
10.1
0.1
19.3
0.1
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
2.6
4.1
4.9
6.1
Change in assets and liabilities,
excluding derivative instruments
1.2
(5.0
)
(15.0
)
(10.3
)
Current portion of income tax expense
0.7
7.6
1.9
16.5
Net income attributable to noncontrolling
interests in continuing operations
(0.3
)
(0.7
)
(0.8
)
(1.3
)
Stock-based compensation included in
overhead allocation
—
0.6
—
1.1
Other
—
—
(0.3
)
0.1
Adjusted EBITDA
$
23.9
$
40.3
$
49.2
$
87.3
(1)
Unusual or nonrecurring items in 2023
include costs associated with nonroutine litigation and shareholder
activism defense; in 2022, they include costs associated with the
strategic alternatives review.
Enhabit, Inc. and
Subsidiaries
Supplemental
Information
Reconciliation of Net Cash
Provided by Operating Activities to Adjusted Free Cash Flow
Three Months Ended
June 30,
Six Months Ended
June 30,
2023
2022
2023
2022
($ in millions)
Net cash provided by operating
activities
$
9.6
$
33.6
$
39.2
$
75.0
Capital expenditures for maintenance
(1.1
)
(0.3
)
(1.7
)
(2.6
)
Other working capital adjustments
(0.5
)
(0.4
)
(1.0
)
(0.9
)
Distributions paid to noncontrolling
interests of consolidated affiliates
—
(0.2
)
(2.5
)
(0.7
)
Items non-indicative of ongoing
operating performance:
Unusual or nonrecurring items that are not
typical of ongoing operations(1)
2.6
4.1
4.9
6.1
Stock-based compensation included in
overhead allocation
—
0.6
—
1.1
Adjusted free cash flow
$
10.6
$
37.4
$
38.9
$
78.0
(1)
Unusual or nonrecurring items in 2023
include costs associated with nonroutine litigation and shareholder
activism defense; in 2022, they include costs associated with the
strategic alternatives review.
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. 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, our ability to
attract and retain key management personnel and healthcare
professionals, potential disruptions or breaches of our or our
vendors’ information systems, the outcome of litigation, our
ability to successfully complete and integrate de novo
developments, acquisitions, investments, and joint ventures, and
our ability to control costs, particularly labor and employee
benefit costs. In addition, with respect to the Tax Matters
Agreement (TMA) and the potential launch of a strategic alternative
process, these factors include, our ability to receive Encompass
Health Corporation’s approval to pursue a strategic transaction as
required under the TMA and our ability to successfully pursue and
complete a strategic transaction, as discussed above. Our Form 10-K
and subsequent quarterly reports on Form 10-Q, each of which can be
found on the Company’s website at http://investors.ehab.com and the
SEC’s website at www.sec.gov, discuss other 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. We urge you to consider all of the risks, uncertainties
and factors identified above or discussed in such reports carefully
in evaluating the forward-looking statements in this press
release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230809036551/en/
Investor Relations Contact Jordan Loyd
InvestorRelations@ehab.com 469-860-6061
Media Contact Erin Volbeda Media@ehab.com
972-338-5141
Enhabit (NYSE:EHAB)
Historical Stock Chart
Von Apr 2024 bis Mai 2024
Enhabit (NYSE:EHAB)
Historical Stock Chart
Von Mai 2023 bis Mai 2024