LHC 8K Group Announces Second Quarter 2009 Results | LHCG 4 Aug 09

Exhibit 99.1

LHC Group Announces Second Quarter 2009 Results

Company Reaffirms Guidance for Full-Year 2009

LAFAYETTE, La.--(BUSINESS WIRE)--August 4, 2009--LHC Group, Inc. (NASDAQ: LHCG):

Second Quarter Highlights:

Net service revenue increases 47.1% to $132.6 million;
Net income attributable to LHC Group increases 62.0% to $10.3 million; and
Diluted earnings per share increases 62.9% to $0.57.

LHC Group, Inc. (NASDAQ: LHCG), one of the largest providers of home health services in the United States, announced today its financial results for the second quarter and six months ended June 30, 2009.

Financial Results for the Second Quarter

Net service revenue for the second quarter of 2009 increased 47.1% to $132.6 million compared with $90.1 million for the same period in 2008.
Home-based net service revenue for the second quarter of 2009 increased 53.9% to $117.6 million compared with $76.4 million for the same period in 2008.
Net income attributable to LHC Group for the second quarter of 2009 totaled $10.3 million, or $0.57 per diluted share, compared with net income of $6.3 million, or $0.35 per diluted share, for the second quarter of 2008.
Days sales outstanding, or DSO, for the three months ended June 30, 2009, was 45 days as compared with 60 days for the same three-month period in 2008.

In commenting on the results, Keith G. Myers, Chief Executive Officer of LHC Group, said, “We are pleased to report another fundamentally strong quarter. All credit goes to the hard working, caring and dedicated employees of the LHC Group family. We remain focused on our long-term goals and objectives and are constantly reevaluating and reinventing ourselves by making the necessary investments in people and technology to become even more efficient and deliver even higher quality outcomes to every patient we serve. Our long-term commitment to delivering cost-effective, high-quality healthcare services to the patients, families and communities we serve is at the heart of everything we do and every decision we make.”

Financial Results for the Six Months

Net service revenue for the six months ended June 30, 2009, increased 48.2% to $257.2 million compared with $173.6 million for the same period in 2008.
Home-based net service revenue for the six months ended June 30, 2009, increased 56.8% to $227.0 million compared with $144.8 million for the same period in 2008.
Net income attributable to LHC Group for the six months ended June 30, 2009, totaled $21.3 million, or $1.19 per diluted share, compared with net income of $11.7 million, or $0.65 per diluted share, for the same period in 2008.

Guidance

The Company is reaffirming its guidance issued on May 6, 2009, of full-year net service revenue in the range of $500 million to $510 million and fully diluted earnings per share in the range of $2.15 to $2.25. This guidance does not take into account the impact of any future acquisitions, if made, or de novo locations, if opened.

Conference Call

LHC Group will conduct a conference call on Wednesday, August 5, 2009, beginning at 10:00 a.m. Eastern time. Speakers on the call will include key members of the LHC Group senior management team. The toll-free number to call for this interactive teleconference is (877) 681-3378 (international callers should call 719-325-4816). A telephonic replay of the conference call will be available through midnight on Wednesday, August 12, 2009, by dialing (888) 203-1112 (international callers should call 719-457-0820) and entering confirmation number 3146340.

A live broadcast of LHC Group’s conference call will be available under the Investor Relations section of the Company’s website, www.lhcgroup.com, or at www.opencompany.info. An online replay of the conference call will also be available on the Company’s website for one year, beginning approximately an hour following the conclusion of the live broadcast.

About LHC Group, Inc.

LHC Group, Inc. (www.LHCGroup.com) is one of the largest providers of home health services in the United States providing quality cost effective healthcare services to patients within the comfort and privacy of their home or place of residence.

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements about the Company’s future financial performance and the strength of the Company’s operations. Such forward-looking statements may be identified by words such as “continue,” “expect,” and similar expressions. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those expressed or implied by such forward-looking statements, including changes in reimbursement, changes in government regulations, changes in LHC Group’s relationships with referral sources, increased competition for LHC Group’s services, increased competition for joint venture and acquisition candidates, changes in the interpretation of government regulations, and other risks set forth in Item 1A. Risk Factors in LHC Group’s Annual Report on Form 10-K for the year ended December 31, 2008, filed with the Securities and Exchange Commission. LHC Group undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.


LHC GROUP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (dollars in thousands, except share data)

	June 30, 2009			Dec. 31, 2008
	(Unaudited)
ASSETS

Current assets:
Cash	$	1,223		$	3,511
Receivables:
Patient accounts receivable, less allowance for uncollectible accounts of $10,386 and $9,976, respectively		65,753			61,524
Other receivables		3,657			2,317
Amounts due from governmental entities		1,432			2,434
Total receivables, net		70,842			66,275
Deferred income taxes		5,360			4,959
Assets held for sale		450			–
Prepaid income taxes		3,522			–
Prepaid expenses and other current assets		6,608			6,464
Total current assets		88,005			81,209
Property, building and equipment, net		18,338			16,348
Goodwill		124,141			112,572
Intangible assets, net		35,958			29,975
Other assets		3,155			3,296
Total assets	$	269,597		$	243,400

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable and other accrued liabilities	$	20,499		$	15,422
Salaries, wages and benefits payable		19,815			16,400
Amounts due to governmental entities		3,219			6,023
Income taxes payable		–			10,682
Current portion of long-term debt and capital lease obligations		463			583
Total current liabilities		43,996			49,110
Deferred income taxes		8,125			5,718
Long-term debt, less current portion		4,314			4,483
Other long-term obligations		77			145
Stockholders’ equity:
LHC Group, Inc. stockholders’ equity:
Common stock – $0.01 par value: 40,000,000 shares authorized; 20,933,407 and 20,853,463 shares issued and 17,961,857 and 17,895,832 shares outstanding, respectively		179			179
Treasury stock – 2,971,550 and 2,957,631 shares at cost, respectively		(3,364	)		(3,072	)
Additional paid-in capital		86,982			85,404
Retained earnings		115,702			94,310
Total LHC Group, Inc. stockholders’ equity		199,499			176,821
Noncontrolling interest		13,586			7,123
Total equity		213,085			183,944
Total liabilities and stockholders’ equity	$	269,597		$	243,400


LHC GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except share and per share data) (unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
		2009			2008			2009			2008
Net service revenue	$	132,593		$	90,115		$	257,215		$	173,588
Cost of service revenue		66,588			44,935			128,809			86,207
Gross margin		66,005			45,180			128,406			87,381
Provision for bad debts		1,807			3,623			2,990			7,309
General and administrative expenses		43,520			29,347			82,417			56,844
Operating income		20,678			12,210			42,999			23,228
Interest expense		(39	)		(80	)		(98	)		(228	)
Non-operating (loss) income		84			407			(376	)		808
Income from continuing operations before income taxes and noncontrolling interests		20,723			12,537			42,525			23,808
Income tax expense		6,415			3,907			13,153			7,270
Income from continuing operations		14,308			8,630			29,372			16,538
Loss from discontinued operations (net of income tax benefit of $50, $24, $50 and $108, respectively)		80			37			80			167
Net income		14,228			8,593			29,292			16,371
Less net income attributable to noncontrolling interests		3,966			2,259			7,948			4,698
Net income attributable to LHC Group, Inc.		10,262			6,334			21,344			11,673
Redeemable noncontrolling interest		20			(36	)		48			65
Net income available to LHC Group, Inc.’s common stockholders	$	10,282		$	6,298		$	21,392		$	11,738

Earnings per share - basic and diluted:
Income from continuing operations attributable to LHC Group, Inc.	$	0.57		$	0.35		$	1.19		$	0.66
Loss from discontinued operations attributable to LHC Group, Inc.		–			–			–			(0.01	)
Net income attributable to LHC Group, Inc.		0.57			0.35			1.19			0.65
Redeemable noncontrolling interest		–			–			–			0.01
Net income available to LHC Group, Inc.’s common stockholders	$	0.57		$	0.35		$	1.19		$	0.66

Weighted average shares outstanding:
Basic		17,959,823			17,849,820			17,942,119			17,824,895
Diluted		18,030,373			17,883,964			17,992,331			17,875,527


LHC GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in thousands) (unaudited)

	Six Months Ended June 30,
	2009			2008
Operating activities
Net income	$	29,292		$	16,218
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense		2,286			1,757
Provision for bad debts		3,035			7,663
Stock-based compensation expense		1,101			816
Deferred income taxes		1,256			829
Loss on impairment of intangible assets		542			–
Gain on sale of assets		–			(339	)
Changes in operating assets and liabilities, net of acquisitions:
Receivables		(8,605	)		1,240
Prepaid expenses, income taxes and other assets		(3,255	)		(728	)
Accounts payable and accrued expenses		(2,847	)		4,282
Net amounts due to/from governmental entities		(1,802	)		210
Net cash provided by operating activities		21,003			31,948

Investing activities
Purchases of property, building, and equipment		(3,741	)		(6,467	)
Proceeds from sale of assets		–			3,090
Cash paid for acquisitions, primarily goodwill and intangible assets		(12,176	)		(32,855	)
Net cash used in investing activities		(15,917	)		(36,232	)

Financing activities
Proceeds from line of credit		18,134			30,057
Payments on line of credit		(18,134	)		(21,976	)
Payment of deferred financing fees		(260	)		–
Proceeds from debt issuance		–			5,050
Principal payments on debt		(240	)		(3,050	)
Payments on capital leases		(65	)		(49	)
Excess tax benefits from vesting of restricted stock		95			33
Proceeds from employee stock purchase plan		275			253
Noncontrolling interest distributions		(7,179	)		(4,309	)
Net cash (used in) provided by financing activities		(7,374	)		6,009
Change in cash		(2,288	)		1,725
Cash at beginning of period		3,511			1,155
Cash at end of period	$	1,223		$	2,880

Supplemental disclosures of cash flow information
Interest paid	$	98		$	228
Income taxes paid	$	26,040		$	8,485


LHC GROUP, INC. AND SUBSIDIARIES SEGMENT INFORMATION (dollars in thousands) (unaudited)

	Three Months Ended June 30, 2009									Six Months Ended June 30, 2009
	Home- Based Services			Facility- Based Services			Total			Home- Based Services			Facility- Based Services			Total
Net service revenue	$	117,608		$	14,985		$	132,593		$	226,956		$	30,259		$	257,215
Cost of service revenue		57,376			9,212			66,588			110,962			17,847			128,809
Provision for bad debts		1,807			–			1,807			2,836			154			2,990
General and administrative expenses		39,954			3,566			43,520			74,866			7,551			82,417
Operating income		18,471			2,207			20,678			38,292			4,707			42,999
Interest expense		(34	)		(5	)		(39	)		(86	)		(12	)		(98	)
Non-operating (loss) income		64			20			84			(410	)		34			(376	)
Income from continuing operations before income taxes and noncontrolling interest		18,501			2,222			20,723			37,796			4,729			42,525
Noncontrolling interest		3,603			363			3,966			7,101			847			7,948
Income from continuing operations before income taxes		14,898			1,859			16,757			30,695			3,882			34,577
Total assets	$	245,503		$	24,094		$	269,597		$	245,503		$	24,094		$	269,597

	Three Months Ended June 30, 2008									Six Months Ended June 30, 2008
	Home- Based Services			Facility- Based Services			Total			Home- Based Services			Facility- Based Services			Total
Net service revenue	$	76,419		$	13,696		$	90,115		$	144,782		$	28,806		$	173,588
Cost of service revenue		36,912			8,023			44,935			69,760			16,447			86,207
Provision for bad debts		3,085			538			3,623			6,331			978			7,309
General and administrative expenses		25,589			3,758			29,347			49,281			7,563			56,844
Operating income		10,833			1,377			12,210			19,410			3,818			23,228
Interest expense		(62	)		(18	)		(80	)		(163	)		(65	)		(228	)
Non-operating (loss) income		360			47			407			645			163			808
Income from continuing operations before income taxes and noncontrolling interest		11,131			1,406			12,537			19,892			3,916			23,808
Noncontrolling interest		1,978			281			2,259			3,717			981			4,698
Income from continuing operations before income taxes		9,153			1,125			10,278			16,175			2,935			19,110
Total assets	$	181,362		$	22,781		$	204,143		$	181,362		$	22,781		$	204,143


	LHC GROUP, INC. AND SUBSIDIARIES SELECT CONSOLIDATED KEY STATISTICAL AND FINANCIAL DATA (unaudited)

		Three Months Ended June 30,						Six Months Ended June 30,
		2009			2008			2009			2008

	Key Data:
	Home Health locations		220			167			220			167
	Hospice locations		21			10			21			10
	Acquired ⁽¹⁾		6			18			9			21
	De novo ⁽¹⁾		7			3			9			8
	Home Nursing:
	Total new admissions		19,779			13,688			37,883			27,055
	Medicare new admissions		14,721			10,053			26,963			19,827
	Average weekly census		29,182			20,469			28,508			19,714
	Average Medicare weekly census		23,592			16,544			22,978			15,710
	Medicare completed episodes		41,413			29,304			78,370			55,097
	Average Medicare case mix for completed Medicare episodes		1.26			1.25			1.26			1.25
	Average reimbursement per completed Medicare episodes	$	2,244		$	2,091		$	2,287		$	2,098
	Total visits		733,777			529,869			1,412,471			1,008,893
	Total Medicare visits		581,669			408,943			1,115,889			768,023
	Average visits per completed Medicare episodes		14.0			14.0			14.2			13.9
	Organic growth ^(2):
	Net revenue		24.5	%		11.0	%		27.7	%		9.0	%
	Net Medicare revenue		26.7	%		13.1	%		29.9	%		10.9	%
	Total new admissions		5.0	%		-0.4	%		5.8	%		-0.9	%
	Medicare new admissions		8.6	%		2.5	%		2.7	%		5.5	%
	Average weekly census		18.4	%		2.4	%		20.4	%		0.3	%
	Average Medicare weekly census		20.7	%		8.5	%		24.4	%		5.5	%
	Medicare completed episodes		19.9	%		24.2	%		22.0	%		26.7	%

	Facility-based Services:
	Long-term Acute Care Hospital locations		8			7			8			7
	Acquired ⁽¹⁾		1			–			1			–
	Patient days		12,880			11,298			24,861			23,332
	Patient acuity mix		0.9919			0.9759			0.9987			0.9803

⁽¹⁾	Inclusive of both home health and hospice agencies.
⁽²⁾	Organic growth is calculated as the sum of same store plus de novo for the period divided by total from the same period in the prior year.

LHCG-E

CONTACT:
LHC Group, Inc.
Eric Elliott, Vice President of Investor Relations
337-233-1307
eric.elliott@lhcgroup.com

LHC (LHCG) 8-KLHC Group Announces Second Quarter 2009 Results