Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 19, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 0-12015 | |
Entity Registrant Name | HEALTHCARE SERVICES GROUP, INC. | |
Entity Incorporation, State Code | PA | |
I.R.S. Employer Identification No. | 23-2018365 | |
Entity Address, Address Line One | 3220 Tillman Drive | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | Bensalem | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19020 | |
City Area Code | 215 | |
Local Phone Number | 639-4274 | |
Title of 12(b) Security | Common Stock, $.01 par value | |
Trading Symbol | HCSG | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 74,088,000 | |
Entity Central Index Key | 0000731012 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 19,633 | $ 70,794 |
Marketable securities, at fair value | 93,748 | 114,396 |
Accounts and notes receivable, less allowance for doubtful accounts of $68,099 and $59,271 as of September 30, 2022 and December 31, 2021, respectively | 347,494 | 293,388 |
Inventories and supplies | 22,712 | 26,015 |
Taxes receivable | 5,430 | 8,813 |
Prepaid expenses and other assets | 23,676 | 32,976 |
Total current assets | 512,693 | 546,382 |
Property and equipment, net | 24,244 | 28,102 |
Goodwill | 75,529 | 74,755 |
Other intangible assets, less accumulated amortization of $31,530 and $27,879 as of September 30, 2022 and December 31, 2021, respectively | 17,154 | 20,805 |
Notes receivable — long–term portion, less allowance for doubtful accounts of $2,376 and $6,312 as of September 30, 2022 and December 31, 2021, respectively | 26,854 | 29,259 |
Deferred compensation funding, at fair value | 31,627 | 46,691 |
Deferred tax asset | 34,063 | 31,535 |
Total assets | 722,164 | 777,529 |
Current liabilities: | ||
Accounts payable | 67,474 | 64,419 |
Accrued payroll and related taxes | 45,853 | 68,664 |
Other accrued expenses | 16,033 | 26,741 |
Borrowings under line of credit | 25,000 | 0 |
Deferred compensation liability — short-term | 1,220 | 6,991 |
Accrued insurance claims | 26,242 | 24,310 |
Total current liabilities | 181,822 | 191,125 |
Accrued insurance claims — long-term | 69,707 | 65,084 |
Deferred compensation liability — long-term | 31,807 | 46,888 |
Lease liability — long-term | 8,748 | 11,299 |
Other long-term liabilities | 8,004 | 10,456 |
Commitments and contingencies (Note 14) | ||
STOCKHOLDERS’ EQUITY: | ||
Common stock, $0.01 par value; 100,000 shares authorized; 76,160 and 76,009 shares issued, and 74,088 and 73,769 shares outstanding as of September 30, 2022 and December 31, 2021, respectively | 762 | 760 |
Additional paid-in capital | 300,241 | 294,124 |
Retained earnings | 154,501 | 183,957 |
Accumulated other comprehensive (loss) income, net of taxes | (5,507) | 4,000 |
Common stock in treasury, at cost, 2,072 and 2,240 shares as of September 30, 2022 and December 31, 2021, respectively | (27,921) | (30,164) |
Total stockholders’ equity | 422,076 | 452,677 |
Total liabilities and stockholders’ equity | $ 722,164 | $ 777,529 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts, current | $ 68,099 | $ 59,271 |
Accumulated amortization of other intangible assets | 31,530 | 27,879 |
Allowance for doubtful accounts, noncurrent | $ 2,376 | $ 6,312 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock issued (in shares) | 76,160,000 | 76,009,000 |
Common stock outstanding (in shares) | 74,088,000 | 73,769,000 |
Common stock in treasury (in shares) | 2,072,000 | 2,240,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenues | $ 414,488 | $ 415,590 | $ 1,266,156 | $ 1,221,512 |
Operating costs and expenses: | ||||
Costs of services provided | 376,894 | 364,822 | 1,129,526 | 1,037,852 |
Selling, general and administrative expense | 35,803 | 38,780 | 100,820 | 128,818 |
Other (expense) income: | ||||
Investment and other income (loss), net | 1 | 462 | (9,034) | 6,311 |
Interest expense | (799) | (329) | (1,752) | (1,017) |
Income before income taxes | 993 | 12,121 | 25,024 | 60,136 |
Income tax provision | 671 | 2,581 | 6,553 | 16,378 |
Net income | $ 322 | $ 9,540 | $ 18,471 | $ 43,758 |
Per share data: | ||||
Basic earnings per share (in dollars per share) | $ 0 | $ 0.13 | $ 0.25 | $ 0.58 |
Diluted earnings per share (in dollars per share) | $ 0 | $ 0.13 | $ 0.25 | $ 0.58 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 74,340 | 74,943 | 74,334 | 74,983 |
Diluted (in shares) | 74,348 | 75,076 | 74,346 | 75,170 |
Comprehensive income: | ||||
Net income | $ 322 | $ 9,540 | $ 18,471 | $ 43,758 |
Other comprehensive loss: | ||||
Unrealized loss on available-for-sale marketable securities, net of taxes | (2,293) | (1,014) | (9,507) | (1,582) |
Total comprehensive (loss) income | $ (1,971) | $ 8,526 | $ 8,964 | $ 42,176 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 18,471 | $ 43,758 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 11,560 | 10,961 |
Bad debt provision | 23,342 | 10,790 |
Deferred income tax (expense) benefit | 0 | 198 |
Share-based compensation expense | 7,156 | 6,968 |
Amortization of premium on marketable securities | 1,673 | 1,740 |
Unrealized loss (gain) on deferred compensation fund investments | 11,445 | (3,958) |
Changes in contingent consideration | (2,408) | 0 |
Net loss on disposals of fixed assets | 942 | 1,157 |
Changes in operating assets and liabilities: | ||
Accounts and notes receivable | (75,042) | (41,275) |
Inventories and supplies | 3,303 | 4,872 |
Prepaid expenses and other assets | 6,180 | (23,459) |
Deferred compensation funding | 7,093 | 72 |
Accounts payable and other accrued expenses | (13,134) | 10,694 |
Accrued payroll, accrued and withheld payroll taxes | (21,240) | (26,085) |
Taxes receivable | 3,383 | 0 |
Accrued insurance claims | 6,555 | 4,871 |
Deferred compensation liability | (20,339) | 4,427 |
Net cash (used in) provided by operating activities | (31,060) | 5,731 |
Cash flows from investing activities: | ||
Disposals of fixed assets | 187 | 201 |
Additions to property and equipment | (4,142) | (4,202) |
Purchases of marketable securities | (2,875) | (16,683) |
Sales of marketable securities | 9,816 | 12,368 |
Cash paid for acquisitions | (114) | (6,000) |
Net cash provided by (used in) investing activities | 2,872 | (14,316) |
Cash flows from financing activities: | ||
Dividends paid | (47,389) | (46,672) |
Reissuance of treasury stock pursuant to Dividend Reinvestment Plan | 77 | 69 |
Proceeds from the exercise of stock options | 410 | 2,238 |
Purchases of treasury stock | 0 | (5,397) |
Proceeds from short-term borrowings | 25,000 | 0 |
Payments of statutory withholding on net issuance of restricted stock units | (1,071) | (1,401) |
Net cash used in financing activities | (22,973) | (51,163) |
Net change in cash and cash equivalents | (51,161) | (59,748) |
Cash and cash equivalents at beginning of the period | 70,794 | 139,330 |
Cash and cash equivalents at end of the period | 19,633 | 79,582 |
Supplemental disclosure of non-cash investing activities | ||
Accrued variable consideration from acquisition of a business | $ 0 | $ 10,562 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income, net of taxes | Retained Earnings | Treasury Stock |
Beginning balance (in shares) at Dec. 31, 2020 | 75,798 | |||||
Beginning balance at Dec. 31, 2020 | $ 480,461 | $ 758 | $ 282,206 | $ 5,563 | $ 200,893 | $ (8,959) |
Comprehensive income (loss) | ||||||
Net income | 24,653 | 24,653 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (1,271) | (1,271) | ||||
Total comprehensive (loss) income | 23,382 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment (in shares) | 156 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment | 1,475 | $ 2 | 1,473 | |||
Payment of statutory withholding on issuance of restricted stock units | (1,501) | (1,501) | ||||
Share-based compensation expense | 2,104 | 2,104 | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | 509 | 545 | (36) | |||
Shares issued pursuant to Employee Stock Plan | 2,052 | 1,554 | 498 | |||
Dividends paid and accrued | (15,526) | (15,526) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | 23 | 18 | 5 | |||
Other (in shares) | 4 | |||||
Other | 123 | 123 | ||||
Ending balance (in shares) at Mar. 31, 2021 | 75,958 | |||||
Ending balance at Mar. 31, 2021 | $ 493,102 | $ 760 | 286,522 | 4,292 | 210,020 | (8,492) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | |||||
Beginning balance (in shares) at Dec. 31, 2020 | 75,798 | |||||
Beginning balance at Dec. 31, 2020 | $ 480,461 | $ 758 | 282,206 | 5,563 | 200,893 | (8,959) |
Comprehensive income (loss) | ||||||
Net income | 43,758 | |||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (1,582) | |||||
Total comprehensive (loss) income | 42,176 | |||||
Ending balance (in shares) at Sep. 30, 2021 | 75,997 | |||||
Ending balance at Sep. 30, 2021 | 480,205 | $ 760 | 291,899 | 3,981 | 197,550 | (13,985) |
Beginning balance (in shares) at Mar. 31, 2021 | 75,958 | |||||
Beginning balance at Mar. 31, 2021 | 493,102 | $ 760 | 286,522 | 4,292 | 210,020 | (8,492) |
Comprehensive income (loss) | ||||||
Net income | 9,565 | 9,565 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | 703 | 703 | ||||
Total comprehensive (loss) income | 10,268 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment (in shares) | 11 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment | 380 | 380 | ||||
Share-based compensation expense | 2,159 | 2,159 | ||||
Purchases of Treasury Stock | (1,835) | (1,835) | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | (1) | 60 | (61) | |||
Dividends paid and accrued | (15,792) | (15,792) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | 23 | 17 | 6 | |||
Ending balance (in shares) at Jun. 30, 2021 | 75,969 | |||||
Ending balance at Jun. 30, 2021 | $ 488,304 | $ 760 | 289,138 | 4,995 | 203,793 | (10,382) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | |||||
Net income | $ 9,540 | 9,540 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (1,014) | (1,014) | ||||
Total comprehensive (loss) income | 8,526 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment (in shares) | 28 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment | 383 | 383 | ||||
Payment of statutory withholding on issuance of restricted stock units | 100 | 100 | ||||
Share-based compensation expense | 2,214 | 2,214 | ||||
Purchases of Treasury Stock | (3,562) | (3,562) | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | 0 | 50 | (50) | |||
Dividends paid and accrued | (15,783) | (15,783) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | 23 | 14 | 9 | |||
Ending balance (in shares) at Sep. 30, 2021 | 75,997 | |||||
Ending balance at Sep. 30, 2021 | $ 480,205 | $ 760 | 291,899 | 3,981 | 197,550 | (13,985) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | |||||
Beginning balance (in shares) at Dec. 31, 2021 | 73,769 | 76,009 | ||||
Beginning balance at Dec. 31, 2021 | $ 452,677 | $ 760 | 294,124 | 4,000 | 183,957 | (30,164) |
Comprehensive income (loss) | ||||||
Net income | 11,329 | 11,329 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (5,269) | (5,269) | ||||
Total comprehensive (loss) income | 6,060 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment (in shares) | 145 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment | 410 | $ 2 | 408 | |||
Payment of statutory withholding on issuance of restricted stock units | (1,069) | (1,069) | ||||
Share-based compensation expense | 2,298 | 2,298 | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | 524 | 110 | 414 | |||
Shares issued pursuant to Employee Stock Plan | 1,512 | 368 | 1,144 | |||
Dividends paid and accrued | (15,859) | (15,859) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | 25 | 6 | 19 | |||
Other (in shares) | 4 | |||||
Other | 59 | 59 | ||||
Ending balance (in shares) at Mar. 31, 2022 | 76,158 | |||||
Ending balance at Mar. 31, 2022 | $ 446,637 | $ 762 | 296,304 | (1,269) | 179,427 | (28,587) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | |||||
Beginning balance (in shares) at Dec. 31, 2021 | 73,769 | 76,009 | ||||
Beginning balance at Dec. 31, 2021 | $ 452,677 | $ 760 | 294,124 | 4,000 | 183,957 | (30,164) |
Comprehensive income (loss) | ||||||
Net income | 18,471 | |||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (9,507) | |||||
Total comprehensive (loss) income | $ 8,964 | |||||
Ending balance (in shares) at Sep. 30, 2022 | 74,088 | 76,160 | ||||
Ending balance at Sep. 30, 2022 | $ 422,076 | $ 762 | 300,241 | (5,507) | 154,501 | (27,921) |
Beginning balance (in shares) at Mar. 31, 2022 | 76,158 | |||||
Beginning balance at Mar. 31, 2022 | 446,637 | $ 762 | 296,304 | (1,269) | 179,427 | (28,587) |
Comprehensive income (loss) | ||||||
Net income | 6,820 | 6,820 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (1,945) | (1,945) | ||||
Total comprehensive (loss) income | 4,875 | |||||
Exercise of stock options and other share-based compensation, net of shares tendered for payment (in shares) | 2 | |||||
Share-based compensation expense | 2,292 | 2,292 | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | (5) | (196) | 191 | |||
Dividends paid and accrued | (15,980) | (15,980) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | 26 | 5 | 21 | |||
Ending balance (in shares) at Jun. 30, 2022 | 76,160 | |||||
Ending balance at Jun. 30, 2022 | $ 437,845 | $ 762 | 298,405 | (3,214) | 170,267 | (28,375) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | |||||
Net income | $ 322 | 322 | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of taxes | (2,293) | (2,293) | ||||
Total comprehensive (loss) income | (1,971) | |||||
Payment of statutory withholding on issuance of restricted stock units | (2) | (2) | ||||
Share-based compensation expense | 2,271 | 2,271 | ||||
Treasury shares issued for Deferred Compensation Plan funding and redemptions | (6) | (432) | 426 | |||
Dividends paid and accrued | (16,088) | (16,088) | ||||
Shares issued pursuant to Dividend Reinvestment Plan | $ 27 | (1) | 28 | |||
Ending balance (in shares) at Sep. 30, 2022 | 74,088 | 76,160 | ||||
Ending balance at Sep. 30, 2022 | $ 422,076 | $ 762 | $ 300,241 | $ (5,507) | $ 154,501 | $ (27,921) |
Comprehensive income (loss) | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Cash dividend paid per common share (in dollars per share) | $ 0.21 | $ 0.21 | $ 0.21 | $ 0.21 | $ 0.21 | $ 0.21 |
Description of Business and Sig
Description of Business and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Description of Business and Significant Accounting Policies | Note 1—Description of Business and Significant Accounting Policies Nature of Operations Healthcare Services Group, Inc. (the “Company”) provides management, administrative and operating expertise and services to the housekeeping, laundry, linen, facility maintenance and dietary service departments of the healthcare industry, including nursing homes, retirement complexes, rehabilitation centers and hospitals located throughout the United States. Although the Company does not directly participate in any government reimbursement programs, the Company’s customers receive government reimbursements related to Medicare and Medicaid. Therefore, they are directly affected by any legislation relating to Medicare and Medicaid reimbursement programs. The Company provides services primarily pursuant to full service agreements with its customers. In such agreements, the Company is responsible for the day-to-day management of employees located at the customers’ facilities, as well as for the provision of certain supplies. The Company also provides services on the basis of management-only agreements for a limited number of customers. In a management-only agreement, the Company provides management and supervisory services while the customer facility retains payroll responsibility for the non-supervisory staff. The agreements with customers typically provide for a renewable one year service term, cancellable by either party upon 30 to 90 days’ notice after an initial period of 60 to 120 days. The Company is organized into two reportable segments: housekeeping, laundry, linen and other services (“Housekeeping”), and dietary department services (“Dietary”). Housekeeping consists of managing the customers’ housekeeping departments, which are principally responsible for the cleaning, disinfecting and sanitizing of resident rooms and common areas of a customer’s facility, as well as the laundering and processing of the bed linens, uniforms, resident personal clothing and other assorted linen items utilized at a customer facility. Dietary consists of managing the customers’ dietary departments, which are principally responsible for food purchasing, meal preparation and dietitian professional services, which includes the development of menus that meet residents’ dietary needs. Unaudited Interim Financial Data The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, these consolidated financial statements do not include all of the information and footnotes necessary for a complete presentation of financial position, results of operations and cash flows. However, in the Company’s opinion, all adjustments which are of a normal recurring nature and are necessary for a fair presentation have been reflected in these consolidated financial statements. The balance sheet shown in this report as of December 31, 2021 has been derived from the audited financial statements for the year ended December 31, 2021. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for any future period. Use of Estimates in Financial Statements In preparing financial statements in conformity with U.S. GAAP, estimates and assumptions are made that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant estimates are used in determining, but are not limited to, the Company’s allowance for doubtful accounts, accrued insurance claims, valuations, deferred taxes and reviews for potential impairment. The estimates are based upon various factors including current and historical trends, as well as other pertinent industry and regulatory authority information, including the potential future effects of COVID-19. Management regularly evaluates this information to determine if it is necessary to update the basis for its estimates and to adjust for known changes. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Healthcare Services Group, Inc. and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Cash and Cash Equivalents Cash and cash equivalents are held in U.S. financial institutions or in custodial accounts with U.S. financial institutions. Cash equivalents are defined as short-term, highly liquid investments with a maturity of three months or less at time of purchase that are readily convertible into cash and have insignificant interest rate risk. Accounts and Notes Receivable Accounts and notes receivable consist of Housekeeping and Dietary segment trade receivables from contracts with customers. The Company’s payment terms with customers for services provided are defined within each customer’s service agreement. All accounts receivables are considered short term assets as the Company does not grant payment terms greater than one year. Accounts receivable initially are recorded at the transaction amount, and are recorded after the Company has an unconditional right to payment where only the passage of time is required before payment is received. Each reporting period, the Company evaluates the collectability of outstanding receivable balances and records an allowance for doubtful accounts representing an estimate of future expected credit loss. Additions to the allowance for doubtful accounts are made by recording a charge to bad debt expense reported in costs of services provided. Notes receivable are initially recorded when accounts receivable are transferred into a promissory note and are recorded as an alternative to accounts receivable to memorialize an unqualified promise to pay a specific sum, typically with interest, in accordance with a defined payment schedule. The Company’s payment terms with customers on promissory notes can vary based on several factors and the circumstances of each promissory note, however typically promissory notes mature over a 1 to 3 year period. Similar to accounts receivable, each reporting period the Company evaluates the collectability of outstanding notes receivable balances and records an allowance for doubtful accounts representing an estimate of future expected credit loss. Refer to Note 3—Accounts and Notes Receivable herein for further information. Allowance for Doubtful Accounts In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification subtopic 326 Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”), Management utilizes financial modeling to determine an allowance that reflects its best estimate of the lifetime expected credit losses on accounts and notes receivable which is recorded as a liability to offset the receivables. Modeling is prepared after considering historical experience, current conditions, and reasonable and supportable economic forecasts to estimate lifetime expected credit losses. Accounts and notes receivables are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded as a reduction of bad debt expense when received. Refer to Note 4—Allowance for Doubtful Accounts herein for further information. Inventories and Supplies Inventories and supplies include housekeeping, linen and laundry supplies, as well as food provisions and supplies. Non-linen inventories and supplies are stated on a first-in, first-out (FIFO) basis, and reduced as deemed necessary to approximate the lower of cost or net realizable value. Linen supplies are amortized on a straight-line basis over their estimated useful life of 24 months. Revenue Recognition The Company recognizes revenue from contracts with customers when or as the promised goods and services are provided to customers. Revenues are reported net of sales taxes that are collected from customers and remitted to taxing authorities. The amount of revenue recognized by the Company is based on the consideration to which the Company is entitled in exchange for providing the contracted goods and services. Refer to Note 2—Revenue herein for further information. Leases The Company records assets and liabilities on the balance sheet to recognize the rights and obligations arising from leasing arrangements with contractual terms greater than 12 months, in accordance with FASB Accounting Standards Codification subtopic 842 Leases (“ASC 842”). A leasing arrangement includes any contract which entitles the Company to the right of use of an identified tangible asset where there are no restrictions as to the direct of use of the asset, and the Company obtains substantially all of the economic benefits from the right of use. As of September 30, 2022 and December 31, 2021, the Company was only the lessee of operating lease arrangements. Refer to Note 7—Leases herein for further information. Income Taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, income tax expense or benefits are recognized for the amount of taxes payable or refundable for the current period. The Company accrues for probable tax obligations as required, based on facts and circumstances in various regulatory environments. In addition, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. When appropriate, valuation allowances are recorded to reduce deferred tax assets to amounts for which realization is more likely than not. Uncertain income tax positions taken or expected to be taken in tax returns are reflected within the Company’s financial statements based on a recognition and measurement process. Earnings per Common Share Basic earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is computed using the weighted-average number of common shares outstanding and dilutive common shares, such as those issuable upon exercise of stock options and upon the vesting of restricted stock units. Share-Based Compensation The Company estimates the fair value of share-based awards on the date of grant using the Black-Scholes valuation model for stock options, using a Monte Carlo simulation for performance stock units and using the share price on the date of grant for restricted stock units and deferred stock units. The value of the award is recognized ratably as an expense in the Company’s Consolidated Statements of Comprehensive Income over the requisite service periods, with adjustments made for forfeitures as they occur. Identifiable Intangible Assets and Goodwill Identifiable intangible assets are amortized on a straight-line basis over their respective lives. Goodwill represents the excess of cost over the fair value of net assets of acquired businesses. Management reviews the carrying value of goodwill annually during the fourth quarter to assess for impairment, or more often if events or circumstances indicate that the carrying value may exceed its estimated fair value. No impairment loss was recognized on the Company's intangible assets or goodwill during the nine months ended September 30, 2022 or 2021. Concentrations of Credit Risk The Company’s financial instruments that are subject to credit risk are cash and cash equivalents, marketable securities, deferred compensation funding and accounts and notes receivable. At September 30, 2022 and December 31, 2021, substantially all of the Company’s cash and cash equivalents and marketable securities were held in one large financial institution located in the United States. The Company’s marketable securities are fixed income investments which are highly liquid and can be readily purchased or sold through established markets. The Company’s customers are primarily concentrated in the healthcare industry and are primarily providers of long-term care. The revenues of many of the Company’s customers are highly reliant on Medicare, Medicaid and third party payors’ reimbursement funding rates. New legislation or changes in existing regulations could directly impact the governmental reimbursement programs in which the customers participate. As a result, the Company may not realize the full effects of such programs until these laws are fully implemented and governmental agencies issue applicable regulations or guidance. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 2—Revenue The Company presents its consolidated revenues disaggregated by reportable segment, as Management evaluates the nature, amount, timing and uncertainty of the Company’s revenues by segment. Refer to Note 12—Segment Information herein as well as the information below regarding the Company’s reportable segments. Housekeeping Housekeeping accounted for $597.7 million and $621.3 million of the Company’s consolidated revenues for the nine months ended September 30, 2022 and 2021, respectively, which represented approximately 47.2% and 50.9% of the Company’s revenues in each respective period. Housekeeping services include managing customers’ housekeeping departments, which are principally responsible for the cleaning, disinfecting and sanitizing of resident rooms and common areas of the customers’ facilities, as well as the laundering and processing of the bed linens, uniforms, resident personal clothing and other assorted linen items utilized at the customers’ facilities. Upon beginning service with a customer facility, the Company will typically hire and train the employees previously employed by such facility and assign an on-site manager to supervise and train the front-line personnel and coordinate housekeeping services with other facility support functions in accordance with customer requests. Such management personnel also oversee the execution of various cost and quality-control procedures including continuous training and employee evaluation. Dietary Dietary services accounted for $668.4 million and $600.2 million of the Company’s consolidated revenues for the nine months ended September 30, 2022 and 2021, respectively, which represented approximately 52.8% and 49.1% of the Company’s revenues in each respective period. Dietary services consist of managing customers’ dietary departments which are principally responsible for food purchasing, meal preparation and professional dietitian services, which include the development of menus that meet the dietary needs of residents. On-site management is responsible for all daily dietary department activities, with regular support provided by a District Manager specializing in dietary services. The Company also offers clinical consulting services to facilities which if contracted is a service bundled within the monthly service provided to customers. Upon beginning service with a customer facility, the Company will typically hire and train the employees previously employed by such facility and assign an on-site manager to supervise and train the front-line personnel and coordinate dietitian services with other facility support functions in accordance with customer requests. Such management personnel also oversee the execution of various cost and quality control procedures including continuous training and employee evaluation. Revenue Recognition The Company’s revenues are derived from contracts with customers. The Company accounts for revenue from contracts with customers in accordance with FASB Accounting Standards Codification subtopic 606 Revenue from Contracts with Customers (“ASC 606”), and as such, the Company recognizes revenue to depict the transfer of promised goods and services to customers in amounts that reflect the consideration to which the Company is entitled in exchange for those goods and services. The Company’s costs of obtaining contracts are not material. The Company performs services and provides goods in accordance with its customers’ contracts. Such contracts typically provide for a renewable one year service term, cancellable by either party upon 30 to 90 days’ notice, after an initial period of 60 to 120 days. A performance obligation is the unit of account under ASC 606 and is defined as a promise in a contract to transfer a distinct good or service to the customer. The Company’s Housekeeping and Dietary contracts relate to the provision of bundles of goods, services or both which represent a series of distinct goods and services that are substantially the same and that have the same pattern of transfer to the customer. The Company accounts for the series as a single performance obligation satisfied over time, as the customer simultaneously receives and consumes the benefits of the goods and services provided. Revenue is recognized using the output method, which is based upon the delivery of goods and services to the customers’ facilities. In limited cases, the Company provides goods, services or both, before the execution of a written contract. In these cases, the Company defers the recognition of revenue until a contract is executed. The amount of such deferred revenue was $1.7 million and $0.1 million as of September 30, 2022 and December 31, 2021, respectively. Additionally, substantially all such revenue amounts deferred as of December 31, 2021 were subsequently recognized as revenue during the nine months ended September 30, 2022. The transaction price is the amount of consideration to which the Company is entitled in exchange for transferring promised goods or services to its customers. The transaction price does not include taxes assessed or collected. The Company’s contracts detail the fees that the Company charges for the goods and services it provides. For certain contracts which contain a variable component to the transaction price, the Company is required to make estimates of the amount of consideration to which the Company will be entitled, based on variability in resident and patient populations serviced, product usage or quantities consumed. The Company recognizes revenue related to such estimates only when the Company determines that there will not be a significant reversal in the amount of revenue recognized. In instances where the transaction prices are modified with existing customers, the Company accounts for such transactions as reductions to revenue under the variable consideration framework within ASC 606. During the three and nine months ended September 30, 2022 the Company recognized a $10.0 million reduction to revenues related to a resolution of a variable consideration with an existing customer. The Company’s contracts generally do not contain significant financing components, as payment terms are less than one year. The Company allocates the transaction price to each performance obligation, noting that the bundle of goods, services or goods and services provided under each Housekeeping and Dietary contract represent a single performance obligation satisfied over time. The Company recognizes the related revenue when it satisfies the performance obligation by transferring a bundle of promised goods, services or both to a customer. Such recognition is on a monthly or weekly basis, as goods are provided and services are performed. In some cases, the Company requires customers to pay in advance for goods and services to be provided. As of September 30, 2022 and December 31, 2021, the value of the contract liabilities associated with customer prepayments was $0.2 million and $2.5 million, respectively. Additionally, substantially all such revenue amounts deferred as of December 31, 2021 were subsequently recognized as revenue during the nine months ended September 30, 2022. Transaction Price Allocated to Remaining Performance Obligations The Company recognizes revenue as it satisfies the performance obligations associated with contracts with customers, which due to the nature of the goods and services provided by the Company, are satisfied over time. Contracts may contain transaction prices that are fixed, variable or both. The Company’s contracts with customers typically provide for an initial term of one year, with renewable one year service terms, cancellable by either party upon 30 to 90 days’ notice after an initial period of 60 to 120 days. At September 30, 2022, the Company had $150.6 million related to performance obligations that were unsatisfied or partially unsatisfied for which the Company expects to recognize revenue. The Company expects to recognize revenue on approximately 70.6% of the remaining performance obligations over the next 12 months, with the balance to be recognized thereafter. These amounts exclude variable consideration primarily related to performance obligations that consist of a series of distinct service periods with revenues based on future performance that cannot be estimated at contract inception. The Company also has elected to apply the practical expedient that permits exclusion of information about the remaining performance obligations with original expected durations of one year or less. |
Accounts and Notes Receivable
Accounts and Notes Receivable | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Accounts and Notes Receivable | Note 3—Accounts and Notes Receivable The Company’s accounts and notes receivable balances consisted of the following as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Short-term Accounts and notes receivable - gross $ 415,593 $ 352,659 Accounts and notes receivable - allowance (68,099) (59,271) Total net short-term accounts and notes receivable $ 347,494 $ 293,388 Long-term Notes receivable $ 29,230 $ 35,571 Allowance for doubtful accounts (2,376) (6,312) Total net long-term notes receivable $ 26,854 $ 29,259 Total net accounts and notes receivable $ 374,348 $ 322,647 The Company makes credit decisions on a case-by-case basis after reviewing a number of qualitative and quantitative factors related to the specific customer as well as current industry variables that may impact that customer. There are a variety of factors that impact a customer’s ability to pay in accordance with the Company’s contracts. These factors include, but are not limited to, fluctuating census numbers, litigation costs and the customer’s participation in programs funded by federal and state governmental agencies. Deviations in the timing or amounts of reimbursements under those programs can impact the customer’s cash flows and its ability to make timely payments. However, the customer’s obligation to pay the Company in accordance with the contracts is not contingent upon the customer’s cash flow. Notwithstanding the Company’s efforts to minimize its credit risk exposure, the aforementioned factors, as well as other factors that impact customer cash flows or ability to make timely payments, could have an indirect, yet material adverse effect on the Company’s results of operations and financial condition. Fluctuations in net accounts and notes receivable are generally attributable to a variety of factors including, but not limited to, the timing of cash receipts from customers, the quarterly analysis of the Company's internally developed credit quality indicators and the inception, transition, modification or termination of customer relationships. The Company deploys significant resources and has invested in tools and processes to optimize Management’s credit and collections efforts. When appropriate, the Company utilizes interest-bearing promissory notes to enhance the collectability of amounts due, by instituting definitive repayment plans and providing a means by which to further evidence the amounts owed. In addition, the Company may amend contracts from full service to management-only arrangements, or adjust contractual payment terms, to accommodate customers who have in good faith established clearly-defined plans for addressing cash flow issues. These efforts are intended to minimize the Company’s collections risk. |
Allowance for Doubtful Accounts
Allowance for Doubtful Accounts | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Allowance for Doubtful Accounts | Note 4—Allowance for Doubtful Accounts In making the Company’s credit evaluations, management considers the general collection risk associated with trends in the long-term care industry. The Company establishes credit limits through payment terms with customers, performs ongoing credit evaluations and monitors accounts on an aging schedule basis to minimize the risk of loss. Despite the Company’s efforts to minimize credit risk exposure, customers could be adversely affected if future industry trends, including those related to COVID-19, change in such a manner as to negatively impact their cash flows. The full effects of COVID-19 on the Company’s customers are highly uncertain and cannot be predicted. As a result, the Company’s future collection experience can differ significantly from historical collection trends. If the Company’s customers experience a negative impact on their cash flows, it could have a material adverse effect on the Company’s results of operations and financial condition. The Company evaluates its accounts and notes receivable for expected credit losses quarterly. Accounts receivables are evaluated based on internally developed credit quality indicators derived from the aging of receivables. Notes receivable are evaluated based on internally developed credit quality indicators derived from Management’s assessment of collection risk. The Company manages note receivable portfolios using a two tiered approach by disaggregating standard notes receivables, which are promissory notes in good standing, from those who have been identified by Management as having an elevated credit risk profile due to a triggering event such as bankruptcy. At the end of each period, the Company sets a reserve for expected credit losses on standard notes receivable based on the Company’s historical loss rate. Notes receivable with an elevated risk profile, which are from customers who have filed bankruptcy, are subject to collections activity or are slow payers that are experiencing financial difficulties, are aggregated and evaluated to determine the total reserve for the class of receivable. The guidance in ASC 326 permits entities to make an accounting policy election not to measure an estimate for credit losses on accrued interest if those entities write-off accrued interest deemed uncollectible in a timely manner. The Company follows an income recognition policy on all interest earned on notes receivable. Under such policy the Company accounts for all notes receivable on a non-accrual basis and defers the recognition of any interest income until receipt of cash payments. This policy was established, recognizing the environment of the long-term care industry, and not because such notes receivable are necessarily impaired. Accordingly, the Company does not record a credit loss adjustment for accrued interest. Interest income from notes receivable for the three months ended September 30, 2022 and 2021 was $0.2 million and $0.3 million, respectively. Interest income from notes receivable for both the nine months ended September 30, 2022 and 2021 was $1.0 million. The following table presents the Company’s two tiers of notes receivable further disaggregated by year of origination, as well as write-off activity for the nine months ended September 30, 2022. Notes Receivable Amortized Cost Basis by Origination Year 2022 2021 2020 2019 2018 Prior Total (in thousands) Notes Receivable Standard notes receivable $ 17,508 $ 11,917 $ 1,972 $ 206 $ 13 $ 21,991 $ 53,607 Elevated risk notes receivable $ — $ — $ — $ — $ — $ 1,223 $ 1,223 Current-period gross write-offs $ 1 $ — $ 49 $ 54 $ — $ 483 $ 587 Current-period recoveries — — — — — — — Current-period net write-offs $ 1 $ — $ 49 $ 54 $ — $ 483 $ 587 The following table provides information as to the status of payment on the Company’s notes receivable which were past due as of September 30, 2022: Age Analysis of Past-Due Notes Receivable as of September 30, 2022 0 - 90 Days 91 - 180 Days Greater than 181 Days Total (in thousands) Notes Receivable Standard notes receivable $ 469 $ 162 $ 3,205 $ 3,836 Elevated risk notes receivable — — 1,223 1,223 $ 469 $ 162 $ 4,428 $ 5,059 The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the three months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 62,603 $ (5,145) $ 7,863 $ 65,321 Notes Receivables Standard notes receivable $ 12,606 $ (6,718) $ (1,545) $ 4,343 Elevated risk notes receivable 811 — — 811 Total notes receivable $ 13,417 $ (6,718) $ (1,545) $ 5,154 Total $ 76,020 $ (11,863) $ 6,318 $ 70,475 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2022, the Company collected less than $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the three months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,243 $ (427) $ 4,230 $ 54,046 Notes Receivables Standard notes receivable $ 12,534 $ — $ (149) $ 12,385 Elevated risk notes receivable 1,583 — — 1,583 Total notes receivable $ 14,117 $ — $ (149) $ 13,968 Total $ 64,360 $ (427) $ 4,081 $ 68,014 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2021, the Company collected an immaterial amount of accounts receivables which had previously been written-off as uncollectible. The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the nine months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,794 $ (11,195) $ 25,722 $ 65,321 Notes Receivables Standard notes receivable $ 13,607 $ (6,773) $ (2,491) $ 4,343 Elevated risk notes receivable 1,183 (483) 111 811 Total notes receivable $ 14,790 $ (7,256) $ (2,380) $ 5,154 Total $ 65,584 $ (18,451) $ 23,342 $ 70,475 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2022, the Company collected $0.2 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the nine months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 51,052 $ (7,807) $ 10,801 $ 54,046 Notes Receivables Standard notes receivable $ 13,258 $ (9) $ (864) $ 12,385 Elevated risk notes receivable 3,491 (2,761) 853 1,583 Total notes receivable $ 16,749 $ (2,770) $ (11) $ 13,968 Total $ 67,801 $ (10,577) $ 10,790 $ 68,014 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2021, the Company collected $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income by Component | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Income by Component | Note 5—Changes in Accumulated Other Comprehensive Income by Component The Company’s accumulated other comprehensive income consists of unrealized gains and losses from the Company’s available-for-sale marketable securities. The following table provides a summary of the changes in accumulated other comprehensive income for the nine months ended September 30, 2022 and 2021: Unrealized Gains and Losses on Available-for-Sale Securities 1 Nine Months Ended September 30, 2022 2021 (in thousands) Accumulated other comprehensive income — beginning balance $ 4,000 $ 5,563 Other comprehensive loss before reclassifications (9,530) (1,421) Losses (gains) reclassified from other comprehensive income 2 23 (161) Net current period other comprehensive loss 3 (9,507) (1,582) Accumulated other comprehensive (loss) income — ending balance $ (5,507) $ 3,981 1. All amounts are net of tax. 2. Realized gains and losses were recorded pre-tax under “Investment and other income” in the Consolidated Statements of Comprehensive Income. For the nine months ended September 30, 2022, the Company recorded less than $0.1 million of realized losses from the sale of available-for-sale securities. For the nine months ended September 30, 2021, the Company recorded $0.2 million of realized gains from the sale of available-for-sale securities. Refer to Note 9—Fair Value Measurements herein for further information. 3. For the nine months ended September 30, 2022 and 2021, the changes in other comprehensive income were net of a tax benefit of $2.5 million and $0.4 million, respectively. Amounts Reclassified from Accumulated Other Comprehensive Income 2022 2021 (in thousands) Three Months Ended September 30, Losses from the sale of available-for-sale securities $ (5) $ (7) Tax benefit 2 5 Net loss reclassified from accumulated other comprehensive income $ (3) $ (2) Nine Months Ended September 30, (Losses) gains from the sale of available-for-sale securities $ (31) $ 221 Tax benefit (expense) 8 (60) Net (loss) gain reclassified from accumulated other comprehensive income $ (23) $ 161 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 6—Property and Equipment Property and equipment are recorded at cost. Depreciation is recorded over the estimated useful life of each class of depreciable asset, and is computed using the straight-line method. Leasehold improvements are amortized over the shorter of the estimated asset life or term of the lease. Repairs and maintenance costs are charged to expense as incurred. The following table sets forth the amounts of property and equipment by each class of depreciable asset as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Housekeeping and dietary equipment $ 13,461 $ 13,468 Computer hardware and software 6,089 5,880 Operating lease — right-of-use assets 33,974 33,217 Other 1 1,026 1,736 Total property and equipment, at cost 54,550 54,301 Less accumulated depreciation 30,306 26,199 Total property and equipment, net $ 24,244 $ 28,102 1. Includes furniture and fixtures, leasehold improvements and autos and trucks including auto leases. Depreciation expense for the three months ended September 30, 2022 and 2021 was $2.6 million and $2.5 million, respectively. Depreciation expense for the nine months ended September 30, 2022 and 2021 was $7.9 million and $7.7 million, respectively. Of the depreciation expense recorded for the three and nine months ended September 30, 2022, $1.5 million and $4.6 million related to the depreciation of the Company’s operating lease - right-of-use assets (“ROU Assets”), respectively. Of the depreciation expense recorded for the three and nine months ended September 30, 2021, $1.6 million and $4.7 million related to the depreciation of the Company’s ROU Assets, respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Leases | Note 7—Leases The Company recognizes ROU Assets and lease liabilities (“Lease Liabilities”) for automobiles, office buildings, IT equipment, and small storage units for the temporary storage of operational equipment. The Company’s leases have remaining lease terms ranging from less than 1 year to 7 years, and have extension options ranging from 1 year to 5 years. Most leases include the option to terminate the lease within 1 year. Upon adopting ASC 842, the Company made accounting policy elections using practical expedients offered under the guidance to combine lease and non-lease components within leasing arrangements and to recognize the payments associated with short-term leases in earnings on a straight-line basis over the lease term, with the cost associated with variable lease payments recognized when incurred. These accounting policy elections impact the value of the Company’s ROU Assets and Lease Liabilities. The value of the Company’s ROU Assets is determined as the non-depreciated fair value of its leasing arrangements and is recorded to “Property and equipment, net” on the Company’s Consolidated Balance Sheets. The value of the Company’s Lease Liabilities is the present value of fixed lease payments not yet paid, discounted using either the rate implicit in the lease contract if that rate can be determined, or the Company’s incremental borrowing rate ( “ IBR”) and is recorded in “Other accrued expenses” and “Lease liability — long-term portion” on the Company’s Consolidated Balance Sheets. The Company’s IBR is determined as the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. Any future lease payments that are not fixed based on the terms of the lease contract, or fluctuate based on a factor other than an index or rate, are considered variable lease payments and are not included in the value of the Company’s ROU Assets or Lease Liabilities. The Company's variable lease payments are mostly incurred from automobile leases and relate to miscellaneous transportation costs including repair costs, insurance, and terminal rental adjustments payments due at lease settlement. Such rental adjustment payments can result in a reduction to the Company's total variable lease payments. Components of lease expense required by ASC 842 are presented below for the three and nine months ended September 30, 2022 and 2021. Three Months Ended September 30, 2022 2021 (in thousands) Lease cost Operating lease cost $ 1,449 $ 1,629 Short-term lease cost 283 122 Variable lease cost 230 73 Total lease cost $ 1,962 $ 1,824 Nine Months Ended September 30, 2022 2021 (in thousands) Lease cost Operating lease cost $ 4,364 $ 4,547 Short-term lease cost 863 558 Variable lease cost 557 (458) Total lease cost $ 5,784 $ 4,647 Supplemental information required by ASC 842 is presented below for the nine months ended September 30, 2022 and 2021. Nine Months Ended September 30, 2022 2021 (dollar amounts in thousands) Other information Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,853 $ 4,902 Weighted-average remaining lease term — operating leases 4.2 years 4.8 years Weighted-average discount rate — operating leases 4.3 % 4.2 % During the three and nine months ended September 30, 2022, the Company’s ROU Assets and Lease Liabilities were reduced by $0.3 million and $1.6 million, respectively, due to lease cancellations. During the three and nine months ended September 30, 2021, the Company's ROU Assets and Lease Liabilities were reduced by $0.3 million and $0.6 million, respectively, due to lease cancellations. The following is a schedule by calendar year of future minimum lease payments under operating leases that have remaining terms as of September 30, 2022: Period/Year Operating Leases (in thousands) October 1 to December 31, 2022 $ 1,511 2023 5,107 2024 3,323 2025 1,461 2026 1,337 2027 1,363 Thereafter 1,505 Total minimum lease payments $ 15,607 Less: imputed lease payments 1,417 Present value of lease liabilities $ 14,190 |
Other Intangible Assets
Other Intangible Assets | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | Note 8—Other Intangible Assets Goodwill During the nine months ended September 30, 2022, the Company’s goodwill increased $0.7 million due to a measurement period adjustment pertaining to the prior year acquisition of a regional dining operator. The Company finalized the acquisition accounting for this transaction as of March 31, 2022. Intangible Assets The Company’s other intangible assets consist of customer relationships, trade names, patents, and non-compete agreements which were obtained through acquisitions and are recorded at their fair values at the date of acquisition. Intangible assets with determinable lives are amortized on a straight-line basis over their estimated useful lives. The weighted-average amortization period of customer relationships, trade names, patents, and non-compete agreements are approximately 10 years, 13 years, 8 years, and 4 years, respectively. The following table sets forth the estimated amortization expense for intangibles subject to amortization for the remainder of 2022, the following five fiscal years and thereafter: Period/Year Total Amortization Expense (in thousands) October 1 to December 31, 2022 $ 1,209 2023 $ 3,819 2024 $ 2,685 2025 $ 2,685 2026 $ 2,666 2027 $ 1,196 Thereafter $ 2,894 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 9—Fair Value Measurements The Company’s current assets and current liabilities are financial instruments and most of these items (other than marketable securities, inventories and the short-term portion of deferred compensation funding) are recorded at cost in the Consolidated Balance Sheets. The estimated fair value of these financial instruments approximates their carrying value due to their short-term nature. The carrying value of the Company’s line of credit represents the outstanding amount of the borrowings, which approximates fair value. The Company’s financial assets that are measured at fair value on a recurring basis are its marketable securities and deferred compensation funding. The recorded values of all of the financial instruments approximate their current fair values because of their nature, stated interest rates and respective maturity dates or durations. The Company’s marketable securities are held by the Company’s captive insurance company to satisfy capital requirements of the state regulator related to captive insurance companies. Such securities primarily consist of tax-exempt municipal bonds, which are classified as available-for-sale and are reported at fair value. Unrealized gains and losses associated with these investments are included “Unrealized loss on available-for-sale marketable securities, net of taxes” within the Consolidated Statements of Comprehensive Income. The fair value of these marketable securities is classified within Level 2 of the fair value hierarchy, as these securities are measured using quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable. Such valuations are determined by a third-party pricing service. For the three and nine months ended September 30, 2022, the Company recorded unrealized losses, net of taxes of $2.3 million and $9.5 million on marketable securities, respectively. For the three and nine months ended September 30, 2021, the Company recorded unrealized losses, net of taxes of $1.0 million and $1.6 million on marketable securities, respectively. As part of the Company’s completed acquisition of a manufacturer of prepackaged meals in 2021, the Company used an analysis of the discounted weighted-average cost of capital attributable to the acquired company’s revenue (an income approach) to value the contingent consideration liability. The inputs utilized in estimating the fair value of the contingent consideration have been classified as Level 3 in the fair value hierarchy levels and are subject to risk and uncertainty in accordance with FASB Accounting Standards Codification subtopic 820 Fair Value Measurement (“ASC 820”). The discounted weighted-average cost of capital attributable to the acquired company’s revenue analysis is dependent on several subjective factors including future earnings, volatility and the discount rate. If assumptions vary from what was expected, the fair value of the contingent consideration liability may materially change. As of September 30, 2022 and December 31, 2021, the fair value of the contingent consideration liability was $2.5 million an d $4.8 million, respectively, and were presented in “Other long-term liabilities” on the Company’s Consolidated Balance Sheets. For the three and nine months ended September 30, 2022, the Company recorded gains of $0.4 million and $2.3 million, respectively, from the fair value adjustment in the Consolidated Statements of Comprehensive Income. No such gain or loss was recorded during the three and nine months ended September 30, 2021. For both the three months ended September 30, 2022 and 2021, the Company received total proceeds, less the amount of interest received, of $0.3 million, from sales of available-for-sale municipal bonds resulting in realized losses of less than $0.1 million. For the nine months ended September 30, 2022 and 2021, the Company received total proceeds, less the amount of interest received, of $9.8 million and $12.4 million, respectively, from sales of available-for-sale municipal bonds. For the nine months ended September 30, 2022 and 2021, these sales resulted in realized losses of less than $0.1 million and realized gains of $0.2 million, respectively, which were recorded in “Other income – Investment and other income, net” in the Consolidated Statements of Comprehensive Income. The basis for the sale of these securities was the specific identification of each bond sold during the period. The investments under the funded deferred compensation plan are classified as trading securities and unrealized gains or losses are recorded in “Investment and other income, net” in the Consolidated Statements of Comprehensive Income. The fair value of these investments are determined based on quoted market prices (Level 1). For the three months ended September 30, 2022 and 2021, the Company recognized unrealized losses of $0.8 million and $0.1 million, respectively, related to equity securities still held at the respective reporting dates. For the nine months ended September 30, 2022 and 2021, the Company recognized unrealized losses of $11.4 million and unrealized gains of $4.0 million, respectively, related to equity securities still held at the respective reporting dates. The following tables provide fair value measurement information for the Company’s marketable securities and deferred compensation fund investments as of September 30, 2022 and December 31, 2021: As of September 30, 2022 Fair Value Measurement Using: Carrying Amount Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Financial Assets: Marketable securities Municipal bonds — available-for-sale $ 93,748 $ 93,748 $ — $ 93,748 $ — Deferred compensation fund Money Market 1 $ 2,450 $ 2,450 $ — $ 2,450 $ — Commodities 149 149 149 — — Fixed Income 2,928 2,928 2,928 — — International 3,993 3,993 3,993 — — Large Cap Blend 1,073 1,073 1,073 — — Large Cap Growth 10,823 10,823 10,823 — — Large Cap Value 5,413 5,413 5,413 — — Mid Cap Blend 2,466 2,466 2,466 — — Real Estate 367 367 367 — — Small Cap Blend 3,185 3,185 3,185 — — Deferred compensation fund 2 $ 32,847 $ 32,847 $ 30,397 $ 2,450 $ — As of December 31, 2021 Fair Value Measurement Using: Carrying Amount Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Financial Assets: Marketable securities Municipal bonds — available-for-sale $ 114,396 $ 114,396 $ — $ 114,396 $ — Deferred compensation fund Money Market 1 2,882 2,882 — 2,882 — Balanced and Lifestyle 12,578 12,578 12,578 — — Large Cap Growth 20,358 20,358 20,358 — — Small Cap Growth 6,561 6,561 6,561 — — Fixed Income 4,826 4,826 4,826 — — International 2,299 2,299 2,299 — — Mid Cap Growth 4,179 4,179 4,179 — — Deferred compensation fund 2 $ 53,683 $ 53,683 $ 50,801 $ 2,882 $ — 1. The fair value of the money market fund is based on the net asset value (“NAV”) of the shares held by the plan at the end of the period. The money market fund includes short-term United States dollar denominated money market instruments and the NAV is determined by the custodian of the fund. The money market fund can be redeemed at its NAV at the measurement date as there are no significant restrictions on the ability to sell this investment. 2. As of September 30, 2022 and December 31, 2021, $1.2 million and $7.0 million of short-term deferred compensation funding is included in the “Prepaid expenses and other assets” caption on the Company's Consolidated Balance Sheets, respectively. Such amounts of short-term deferred compensation funding represent investments expected to be liquidated and paid to former employees within 12 months of September 30, 2022. Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Credit Impairment Losses 1 (in thousands) September 30, 2022 Type of security: Municipal bonds — available-for-sale $ 100,719 $ 4 $ (6,975) $ 93,748 $ — Total debt securities $ 100,719 $ 4 $ (6,975) $ 93,748 $ — December 31, 2021 Type of security: Municipal bonds — available-for-sale $ 109,331 $ 5,219 $ (154) $ 114,396 $ — Total debt securities $ 109,331 $ 5,219 $ (154) $ 114,396 $ — 1. The Company performs a quarterly credit impairment loss assessment quarterly on an individual security basis. As of September 30, 2022 and December 31, 2021, no allowance for credit loss impairment has been recognized as the issuers of these securities have not established a cause for default and various rating agencies have reaffirmed each security's investment grade status. The fair value of these securities have fluctuated since the purchase date as market interest rates fluctuate. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell before the recovery of the securities' amortized cost basis. The following table summarizes the contractual maturities of debt securities held at September 30, 2022 and December 31, 2021, which are classified as “Marketable securities, at fair value” in the Consolidated Balance Sheets: Municipal Bonds — Available-for-Sale Contractual maturity: September 30, 2022 December 31, 2021 (in thousands) Maturing in one year or less $ 3,207 $ 5,606 Maturing in second year through fifth year 28,942 23,054 Maturing in sixth year through tenth year 43,487 52,180 Maturing after ten years 18,112 33,556 Total debt securities $ 93,748 $ 114,396 |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Note 10—Share-Based Compensation The components of the Company’s share-based compensation expense for the nine months ended September 30, 2022 and 2021 are as follows: Nine Months Ended September 30, 2022 2021 (in thousands) Stock options $ 939 $ 1,381 Restricted stock and restricted stock units 5,310 4,797 Performance stock units 612 299 Employee stock purchase plan 295 491 Total pre-tax share-based compensation expense charged against income 1 $ 7,156 $ 6,968 1. Share-based compensation expense is recorded in “C ost of services provided ” and “S elling, general and administrative expense ” in the Company’s Consolidated Statements of Comprehensive Income. At September 30, 2022, the unrecognized compensation cost related to unvested stock options and awards was $18.3 million. The weighted average period over which these awards will vest is approximately 3.0 years. 2020 Omnibus Incentive Plan On May 26, 2020, the Company adopted the 2020 Omnibus Incentive Plan (the “ 2020 Plan ” ) after approval by the Company's Shareholders at the Annual Meeting of Shareholders. The 2020 Plan provides that current or prospective officers, employees, non-employee directors and advisors can receive share-based awards such as stock options, performance stock units, restricted stock units and other stock awards. The 2020 Plan seeks to encourage profitability and growth of the Company through short-term and long-term incentives that are consistent with the Company's operating objectives. As of September 30, 2022, there were 4.7 million shares of common stock reserved for issuance under the 2020 Plan, of which, 1.4 million are available for future grant. The amount of shares available for issuance under the 2020 Plan will increase when outstanding awards under the Company's Second Amended and Restated 2012 Equity Incentive Plan (the “2012 Plan”) are subsequently forfeited, terminated, lapsed, or satisfied thereunder in cash or property other than shares. No stock award will have a term in excess of 10 years. The Nominating, Compensation and Stock Option Committee (the “NCSO”) of the Board of Directors is responsible for determining the terms of the grants in accordance with the 2020 Plan. Stock Options A summary of stock options outstanding under the 2020 Plan and the 2012 Plan as of December 31, 2021 and changes during the nine months ended September 30, 2022 are as follows: Stock Options Outstanding Number of Shares Weighted Average Exercise Price (in thousands) December 31, 2021 2,181 $ 33.42 Granted 352 $ 18.10 Exercised (23) $ 17.50 Forfeited — $ — Expired (123) $ 28.32 September 30, 2022 2,387 $ 31.58 The weighted average grant-date fair value of stock options granted during the nine months ended September 30, 2022 and 2021 was $4.06 and $7.01 per common share, respectively. The total intrinsic value of stock options exercised during the nine months ended September 30, 2022 and 2021 was $0.1 million and $0.6 million, respectively. The fair value of stock option awards granted in 2022 and 2021 was estimated on the date of grant using the Black-Scholes option valuation model with the following assumptions: Nine Months Ended September 30, 2022 2021 Risk-free interest rate 1.5 % 0.6 % Weighted average expected life 6.7 years 6.6 years Expected volatility 36.6 % 34.7 % Dividend yield 4.6 % 2.9 % The following table summarizes other information about the stock options at September 30, 2022: September 30, 2022 (amounts in thousands, except per share data) Outstanding: Aggregate intrinsic value $ — Weighted average remaining contractual life 5.1 years Exercisable: Number of options 1,631 Weighted average exercise price $ 34.53 Aggregate intrinsic value $ — Weighted average remaining contractual life 3.6 years Restricted Stock Units The fair value of outstanding restricted stock units was determined based on the market price of the shares on the date of grant. During the nine months ended September 30, 2022, the Company granted 0.4 million restricted stock units to its employees with a weighted average grant date fair value of $18.06 per unit. During the nine months ended September 30, 2021, the Company granted 0.3 million restricted stock units with a weighted average grant date fair value of $28.53 per unit. A summary of the outstanding restricted stock units as of December 31, 2021 and changes during the nine months ended September 30, 2022 is as follows: Restricted Stock Units Number Weighted Average Grant Date Fair Value (in thousands) December 31, 2021 652 $ 31.03 Granted 410 $ 18.06 Vested (184) $ 33.68 Forfeited (39) $ 25.68 September 30, 2022 839 $ 24.37 Performance Stock Units On January 4, 2022, the NCSO granted 60,000 Performance Stock Units (“PSUs”) to the Company's executive officers. Such PSUs are contingent upon the achievement of certain total shareholder return (“TSR”) targets as compared to the TSR of the S&P 400 MidCap Index and the participant's continued employment with the Company for the three year period ending December 31, 2024, the date at which such PSUs vest. The unrecognized share-based compensation cost of the TSR-based PSU awards at September 30, 2022 is $1.5 million and is expected to be recognized over a weighted-average period of 2.0 years. A summary of the outstanding PSUs as of December 31, 2021 and changes during the nine months ended September 30, 2022 is as follows: Performance Stock Units Number Weighted Average Grant Date Fair Value (in thousands) December 31, 2021 35 $ 34.52 Granted 60 $ 21.00 Vested — $ — Forfeited — $ — September 30, 2022 95 $ 26.01 Deferred Stock Units During the nine months ended September 30, 2022 , the NCSO granted 20,000 Deferred Stock Units ( “ DSUs ” ) to the Company's non-employee directors. Each DSU award vests in one year. Once vested, the recipient shall be entitled to receive a lump sum payment of a number of shares equal to the total number of DSUs issued to such recipient upon the first to occur of (i) the five years anniversary of the date of grant, (ii) the recipient's death, disability or separation of service from the Board, or (iii) a change of control (as defined by the 2020 Plan). The unrecognized share-based compensation cost of outstanding DSU awards at September 30, 2022 is $0.2 million and is expected to be recognized over a weighted-average period of 0.7 years. Employee Stock Purchase Plan The Company’s Employee Stock Purchase Plan (“ESPP”) is currently available through 2026 to all eligible employees. All full-time and part-time employees who work an average of 20 hours per week and have completed two years of continuous service with the Company are eligible to participate. Annual offerings commence and terminate on the respective year’s first and last calendar day. Under the ESPP, the Company is authorized to issue up to 4.1 million shares of its common stock to its employees. Pursuant to such authorization, there are 2.0 million shares available for future grant at September 30, 2022. The expense associated with the options granted under the ESPP during the nine months ended September 30, 2022 and 2021 was estimated on the date of grant using the Black-Scholes option valuation model with the following assumptions: Nine Months Ended September 30, 2022 2021 Risk-free interest rate 0.4% 0.1% Weighted average expected life (years) 1.0 1.0 Expected volatility 36.9% 61.7% Dividend yield 4.7% 2.9% Deferred Compensation Plan The Company offers a Supplemental Executive Retirement Plan (“SERP”) for executives and certain key employees. The SERP allows participants to defer a portion of their earned income on a pre-tax basis and as of the last day of each plan year, each participant will be credited with a match of a portion of their deferral in the form of the Company’s common stock based on the then-current market value. Under the SERP, the Company is authorized to issue 1.0 million shares of its common stock to its employees. Pursuant to such authorization, the Company has 0.3 million shares available for future grant at September 30, 2022. At the time of issuance, such shares are accounted for at cost as treasury stock. The following table summarizes information about the SERP during the nine months ended September 30, 2022 and 2021: Nine Months Ended September 30, 2022 2021 (in thousands) SERP expense 1 $ 416 $ 458 Unrealized (loss) gain recorded in SERP liability account $ (11,324) $ 3,990 1. Both the SERP match and the deferrals are included in the “ selling, general and administrative ” |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 11—Income Taxes The Company’s income tax expense during interim periods are based on the estimated annual effective income tax rate plus any discrete items that are recorded in the period in which they occur. The impact on the Company’s income tax provision through the nine months ended September 30, 2022 for such discrete items was approximately $1.1 million. Differences between the effective tax rate and the applicable U.S. federal statutory rate arise primarily from the effect of state and local income taxes, share-based compensation and tax credits available to the Company. The actual 2022 effective tax rate will likely vary from the estimate depending on the actual operating income earned with availability of tax credits and the exercise of stock options and vesting of share-based awards. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Note 12—Segment Information The Company manages and evaluates its operations in two reportable segments: Housekeeping (housekeeping, laundry, linen and other services) and Dietary (dietary department services). Although both segments serve a similar customer base and share many operational similarities, they are managed separately due to distinct differences in the type of services provided, as well as the specialized expertise required of the professional management personnel responsible for delivering each segment’s services. Such services are rendered pursuant to discrete contracts, specific to each reportable segment. The Company’s accounting policies for the segments are generally the same as described in the Company’s significant accounting policies. Differences between the reportable segments’ operating results and other disclosed data and the information in the consolidated financial statements relate primarily to corporate level transactions and recording of transactions at the reportable segment level using other than generally accepted accounting principles. There are certain inventories and supplies that are primarily expensed when incurred within the operating segments, while they are capitalized in the consolidated financial statements. In addition, most corporate expenses such as corporate salary and benefit costs, certain legal costs, debt expense, information technology costs, depreciation, amortization of finite-lived intangible assets, share based compensation costs and other corporate-specific costs, are not fully allocated to the operating segments. There are also allocations for workers’ compensation and general liability expense within the operating segments that differ from the actual expense recorded by the Company under U.S. GAAP. Segment amounts disclosed are prior to elimination entries made in consolidation. Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Revenues Housekeeping $ 196,941 $ 203,379 $ 597,710 $ 621,278 Dietary 217,547 212,211 668,446 600,234 Total $ 414,488 $ 415,590 $ 1,266,156 $ 1,221,512 Income before income taxes Housekeeping $ 17,540 $ 17,237 $ 55,784 $ 68,025 Dietary (365) 7,259 19,320 41,075 Corporate and eliminations 1 (16,182) (12,375) (50,080) (48,964) Total $ 993 $ 12,121 $ 25,024 $ 60,136 1. Primarily represents corporate office costs and related overhead, recording of certain inventories and supplies and workers compensation costs at the reportable segment level which use accounting methods that differ from those used at the corporate level, as well as consolidated subsidiaries’ operating expenses that are not allocated to the reportable segments, net of investment and other income and interest expense. |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Note 13—Earnings Per Common Share Basic and diluted earnings per common share are computed by dividing net income by the weighted-average number of basic and diluted common shares outstanding, respectively. The weighted-average number of diluted common shares includes the impact of dilutive securities, including outstanding stock options, restricted stock units, and performance stock units. The table below reconciles the weighted-average basic and diluted common shares outstanding: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Numerator for basic and diluted earnings per share: Net income $ 322 $ 9,540 $ 18,471 $ 43,758 Denominator Weighted average number of common shares outstanding - basic 74,340 74,943 74,334 74,983 Effect of dilutive securities 1 8 133 12 187 Weighted average number of common shares outstanding - diluted 74,348 75,076 74,346 75,170 Basic earnings per share: $ 0.00 $ 0.13 $ 0.25 $ 0.58 Diluted earnings per share: $ 0.00 $ 0.13 $ 0.25 $ 0.58 1. Certain outstanding equity awards are anti-dilutive and therefore excluded from the calculation of the weighted average number of diluted common shares outstanding. Anti-dilutive outstanding equity awards under share-based compensation plans were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Anti-dilutive 3,287 2,184 3,201 1,788 |
Other Contingencies
Other Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Other Contingencies | Note 14—Other Contingencies Line of Credit At September 30, 2022, the Company had a $475 million bank line of credit on which to draw for general corporate purposes. Amounts drawn under the line of credit are payable upon demand and generally bear interest at a floating rate, based on the Company’s leverage ratio, and starting at LIBOR plus 115 basis points (or if LIBOR becomes unavailable, the higher of the Overnight Bank Funding Rate, plus 50 basis points and the Prime Rate). As of September 30, 2022, there were $25 million in borrowings under the line of credit. As of December 31, 2021, there were no borrowings under the line of credit. The line of credit requires the Company to satisfy two financial covenants, with which the Company is in compliance as of September 30, 2022. The line of credit expires on December 21, 2023. At September 30, 2022, the Company also had outstanding $81.0 million in irrevocable standby letters of credit, which relate to payment obligations under the Company’s insurance programs. In connection with the issuance of the letters of credit, the amount available under the line of credit was reduced by $81.0 million to $369.0 million at September 30, 2022. The letters of credit expire on January 4, 2023. Tax Jurisdictions and Matters The Company provides services throughout the continental United States and is subject to numerous state and local taxing jurisdictions. In the ordinary course of business, a jurisdiction may contest the Company’s reporting positions with respect to the application of its tax code to the Company’s services, which could result in additional tax liabilities. The Company has tax matters with various taxing authorities. Because of the uncertainties related to both the probable outcomes and amount of probable assessments due, the Company is unable to make a reasonable estimate of a liability. The Company does not expect the resolution of any of these matters, taken individually or in the aggregate, to have a material adverse effect on the consolidated financial position or results of operations based on the Company’s best estimate of the outcomes of such matters. Legal Proceedings The Company is subject to various claims and legal actions in the ordinary course of business. Some of these matters include payroll and employee-related matters and examinations by governmental agencies. As the Company becomes aware of such claims and legal actions, the Company records accruals for any exposures that are probable and estimable. If adverse outcomes of such claims and legal actions are reasonably possible, Management assesses materiality and provides financial disclosure, as appropriate. At this time, the Company is unable to reasonably estimate possible losses or form a judgment that an unfavorable outcome is either probable or remote with respect to certain pending litigation claims asserted and it is not currently possible to assess whether or not the outcome of these proceedings may have a material adverse effect on the Company. Government Regulations |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15—Subsequent Events The Company evaluated all subsequent events through the filing date of this Form 10-Q. There were no events or transactions occurring during this subsequent reporting period which require recognition or additional disclosure in these financial statements. |
Description of Business and S_2
Description of Business and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Nature of Operations | Healthcare Services Group, Inc. (the “Company”) provides management, administrative and operating expertise and services to the housekeeping, laundry, linen, facility maintenance and dietary service departments of the healthcare industry, including nursing homes, retirement complexes, rehabilitation centers and hospitals located throughout the United States. Although the Company does not directly participate in any government reimbursement programs, the Company’s customers receive government reimbursements related to Medicare and Medicaid. Therefore, they are directly affected by any legislation relating to Medicare and Medicaid reimbursement programs. The Company provides services primarily pursuant to full service agreements with its customers. In such agreements, the Company is responsible for the day-to-day management of employees located at the customers’ facilities, as well as for the provision of certain supplies. The Company also provides services on the basis of management-only agreements for a limited number of customers. In a management-only agreement, the Company provides management and supervisory services while the customer facility retains payroll responsibility for the non-supervisory staff. The agreements with customers typically provide for a renewable one year service term, cancellable by either party upon 30 to 90 days’ notice after an initial period of 60 to 120 days. The Company is organized into two reportable segments: housekeeping, laundry, linen and other services (“Housekeeping”), and dietary department services (“Dietary”). Housekeeping consists of managing the customers’ housekeeping departments, which are principally responsible for the cleaning, disinfecting and sanitizing of resident rooms and common areas of a customer’s facility, as well as the laundering and processing of the bed linens, uniforms, resident personal clothing and other assorted linen items utilized at a customer facility. Dietary consists of managing the customers’ dietary departments, which are principally responsible for food purchasing, meal preparation and dietitian professional services, which includes the development of menus that meet residents’ dietary needs. |
Unaudited Interim Financial Data | The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, these consolidated financial statements do not include all of the information and footnotes necessary for a complete presentation of financial position, results of operations and cash flows. However, in the Company’s opinion, all adjustments which are of a normal recurring nature and are necessary for a fair presentation have been reflected in these consolidated financial statements. The balance sheet shown in this report as of December 31, 2021 has been derived from the audited financial statements for the year ended December 31, 2021. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for any future period. |
Use of Estimates in Financial Statements | In preparing financial statements in conformity with U.S. GAAP, estimates and assumptions are made that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant estimates are used in determining, but are not limited to, the Company’s allowance for doubtful accounts, accrued insurance claims, valuations, deferred taxes and reviews for potential impairment. The estimates are based upon various factors including current and historical trends, as well as other pertinent industry and regulatory authority information, including the potential future effects of COVID-19. Management regularly evaluates this information to determine if it is necessary to update the basis for its estimates and to adjust for known changes. |
Principles of Consolidation | The accompanying consolidated financial statements include the accounts of Healthcare Services Group, Inc. and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and cash equivalents are held in U.S. financial institutions or in custodial accounts with U.S. financial institutions. Cash equivalents are defined as short-term, highly liquid investments with a maturity of three months or less at time of purchase that are readily convertible into cash and have insignificant interest rate risk. |
Accounts and Notes Receivable | Accounts and notes receivable consist of Housekeeping and Dietary segment trade receivables from contracts with customers. The Company’s payment terms with customers for services provided are defined within each customer’s service agreement. All accounts receivables are considered short term assets as the Company does not grant payment terms greater than one year. Accounts receivable initially are recorded at the transaction amount, and are recorded after the Company has an unconditional right to payment where only the passage of time is required before payment is received. Each reporting period, the Company evaluates the collectability of outstanding receivable balances and records an allowance for doubtful accounts representing an estimate of future expected credit loss. Additions to the allowance for doubtful accounts are made by recording a charge to bad debt expense reported in costs of services provided. Notes receivable are initially recorded when accounts receivable are transferred into a promissory note and are recorded as an alternative to accounts receivable to memorialize an unqualified promise to pay a specific sum, typically with interest, in accordance with a defined payment schedule. The Company’s payment terms with customers on promissory notes can vary based on several factors and the circumstances of each promissory note, however typically promissory notes mature over a 1 to 3 year period. Similar to accounts receivable, each reporting period the Company evaluates the collectability of outstanding notes receivable balances and records an allowance for doubtful accounts representing an estimate of future expected credit loss. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification subtopic 326 Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”), Management utilizes financial modeling to determine an allowance that reflects its best estimate of the lifetime expected credit losses on accounts and notes receivable which is recorded as a liability to offset the receivables. Modeling is prepared after considering historical experience, current conditions, and reasonable and supportable economic forecasts to estimate lifetime expected credit losses. Accounts and notes receivables are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded as a reduction of bad debt expense when received. |
Inventories and Supplies | Inventories and supplies include housekeeping, linen and laundry supplies, as well as food provisions and supplies. Non-linen inventories and supplies are stated on a first-in, first-out (FIFO) basis, and reduced as deemed necessary to approximate the lower of cost or net realizable value. Linen supplies are amortized on a straight-line basis over their estimated useful life of 24 months. |
Revenue Recognition | The Company recognizes revenue from contracts with customers when or as the promised goods and services are provided to customers. Revenues are reported net of sales taxes that are collected from customers and remitted to taxing authorities. The amount of revenue recognized by the Company is based on the consideration to which the Company is entitled in exchange for providing the contracted goods and services. |
Leases | The Company records assets and liabilities on the balance sheet to recognize the rights and obligations arising from leasing arrangements with contractual terms greater than 12 months, in accordance with FASB Accounting Standards Codification subtopic 842 Leases (“ASC 842”). A leasing arrangement includes any contract which entitles the Company to the right of use of an identified tangible asset where there are no restrictions as to the direct of use of the asset, and the Company obtains substantially all of the economic benefits from the right of use. As of September 30, 2022 and December 31, 2021, the Company was only the lessee of operating lease arrangements. |
Income Taxes | The Company uses the asset and liability method of accounting for income taxes. Under this method, income tax expense or benefits are recognized for the amount of taxes payable or refundable for the current period. The Company accrues for probable tax obligations as required, based on facts and circumstances in various regulatory environments. In addition, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. When appropriate, valuation allowances are recorded to reduce deferred tax assets to amounts for which realization is more likely than not. Uncertain income tax positions taken or expected to be taken in tax returns are reflected within the Company’s financial statements based on a recognition and measurement process. |
Earnings per Common Share | Basic earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is computed using the weighted-average number of common shares outstanding and dilutive common shares, such as those issuable upon exercise of stock options and upon the vesting of restricted stock units. |
Share-Based Compensation | The Company estimates the fair value of share-based awards on the date of grant using the Black-Scholes valuation model for stock options, using a Monte Carlo simulation for performance stock units and using the share price on the date of grant for restricted stock units and deferred stock units. The value of the award is recognized ratably as an expense in the Company’s Consolidated Statements of Comprehensive Income over the requisite service periods, with adjustments made for forfeitures as they occur. |
Identifiable Intangible Assets and Goodwill | Identifiable intangible assets are amortized on a straight-line basis over their respective lives. Goodwill represents the excess of cost over the fair value of net assets of acquired businesses. Management reviews the carrying value of goodwill annually during the fourth quarter to assess for impairment, or more often if events or circumstances indicate that the carrying value may exceed its estimated fair value. |
Concentrations of Credit Risk | The Company’s financial instruments that are subject to credit risk are cash and cash equivalents, marketable securities, deferred compensation funding and accounts and notes receivable. At September 30, 2022 and December 31, 2021, substantially all of the Company’s cash and cash equivalents and marketable securities were held in one large financial institution located in the United States. The Company’s marketable securities are fixed income investments which are highly liquid and can be readily purchased or sold through established markets. The Company’s customers are primarily concentrated in the healthcare industry and are primarily providers of long-term care. The revenues of many of the Company’s customers are highly reliant on Medicare, Medicaid and third party payors’ reimbursement funding rates. New legislation or changes in existing regulations could directly impact the governmental reimbursement programs in which the customers participate. As a result, the Company may not realize the full effects of such programs until these laws are fully implemented and governmental agencies issue applicable regulations or guidance. |
Segments | The Company’s accounting policies for the segments are generally the same as described in the Company’s significant accounting policies. Differences between the reportable segments’ operating results and other disclosed data and the information in the consolidated financial statements relate primarily to corporate level transactions and recording of transactions at the reportable segment level using other than generally accepted accounting principles. There are certain inventories and supplies that are primarily expensed when incurred within the operating segments, while they are capitalized in the consolidated financial statements. In addition, most corporate expenses such as corporate salary and benefit costs, certain legal costs, debt expense, information technology costs, depreciation, amortization of finite-lived intangible assets, share based compensation costs and other corporate-specific costs, are not fully allocated to the operating segments. There are also allocations for workers’ compensation and general liability expense within the operating segments that differ from the actual expense recorded by the Company under U.S. GAAP. Segment amounts disclosed are prior to elimination entries made in consolidation. |
Accounts and Notes Receivable (
Accounts and Notes Receivable (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Schedule of Accounts and Notes Receivable | The Company’s accounts and notes receivable balances consisted of the following as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Short-term Accounts and notes receivable - gross $ 415,593 $ 352,659 Accounts and notes receivable - allowance (68,099) (59,271) Total net short-term accounts and notes receivable $ 347,494 $ 293,388 Long-term Notes receivable $ 29,230 $ 35,571 Allowance for doubtful accounts (2,376) (6,312) Total net long-term notes receivable $ 26,854 $ 29,259 Total net accounts and notes receivable $ 374,348 $ 322,647 |
Allowance for Doubtful Accoun_2
Allowance for Doubtful Accounts (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Notes Receivable Disaggregated by Vintage Year | The following table presents the Company’s two tiers of notes receivable further disaggregated by year of origination, as well as write-off activity for the nine months ended September 30, 2022. Notes Receivable Amortized Cost Basis by Origination Year 2022 2021 2020 2019 2018 Prior Total (in thousands) Notes Receivable Standard notes receivable $ 17,508 $ 11,917 $ 1,972 $ 206 $ 13 $ 21,991 $ 53,607 Elevated risk notes receivable $ — $ — $ — $ — $ — $ 1,223 $ 1,223 Current-period gross write-offs $ 1 $ — $ 49 $ 54 $ — $ 483 $ 587 Current-period recoveries — — — — — — — Current-period net write-offs $ 1 $ — $ 49 $ 54 $ — $ 483 $ 587 |
Age Analysis of Past-Due Note Receivable | The following table provides information as to the status of payment on the Company’s notes receivable which were past due as of September 30, 2022: Age Analysis of Past-Due Notes Receivable as of September 30, 2022 0 - 90 Days 91 - 180 Days Greater than 181 Days Total (in thousands) Notes Receivable Standard notes receivable $ 469 $ 162 $ 3,205 $ 3,836 Elevated risk notes receivable — — 1,223 1,223 $ 469 $ 162 $ 4,428 $ 5,059 |
Schedule of Changes in Allowance for Doubtful Accounts | The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the three months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 62,603 $ (5,145) $ 7,863 $ 65,321 Notes Receivables Standard notes receivable $ 12,606 $ (6,718) $ (1,545) $ 4,343 Elevated risk notes receivable 811 — — 811 Total notes receivable $ 13,417 $ (6,718) $ (1,545) $ 5,154 Total $ 76,020 $ (11,863) $ 6,318 $ 70,475 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2022, the Company collected less than $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the three months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,243 $ (427) $ 4,230 $ 54,046 Notes Receivables Standard notes receivable $ 12,534 $ — $ (149) $ 12,385 Elevated risk notes receivable 1,583 — — 1,583 Total notes receivable $ 14,117 $ — $ (149) $ 13,968 Total $ 64,360 $ (427) $ 4,081 $ 68,014 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2021, the Company collected an immaterial amount of accounts receivables which had previously been written-off as uncollectible. The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the nine months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,794 $ (11,195) $ 25,722 $ 65,321 Notes Receivables Standard notes receivable $ 13,607 $ (6,773) $ (2,491) $ 4,343 Elevated risk notes receivable 1,183 (483) 111 811 Total notes receivable $ 14,790 $ (7,256) $ (2,380) $ 5,154 Total $ 65,584 $ (18,451) $ 23,342 $ 70,475 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2022, the Company collected $0.2 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the nine months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 51,052 $ (7,807) $ 10,801 $ 54,046 Notes Receivables Standard notes receivable $ 13,258 $ (9) $ (864) $ 12,385 Elevated risk notes receivable 3,491 (2,761) 853 1,583 Total notes receivable $ 16,749 $ (2,770) $ (11) $ 13,968 Total $ 67,801 $ (10,577) $ 10,790 $ 68,014 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2021, the Company collected $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. |
Schedule of Changes in Allowance for Notes Receivable | The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the three months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 62,603 $ (5,145) $ 7,863 $ 65,321 Notes Receivables Standard notes receivable $ 12,606 $ (6,718) $ (1,545) $ 4,343 Elevated risk notes receivable 811 — — 811 Total notes receivable $ 13,417 $ (6,718) $ (1,545) $ 5,154 Total $ 76,020 $ (11,863) $ 6,318 $ 70,475 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2022, the Company collected less than $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the three months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: June 30, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,243 $ (427) $ 4,230 $ 54,046 Notes Receivables Standard notes receivable $ 12,534 $ — $ (149) $ 12,385 Elevated risk notes receivable 1,583 — — 1,583 Total notes receivable $ 14,117 $ — $ (149) $ 13,968 Total $ 64,360 $ (427) $ 4,081 $ 68,014 1. Write-offs are shown net of recoveries. During the three months ended September 30, 2021, the Company collected an immaterial amount of accounts receivables which had previously been written-off as uncollectible. The following tables provide a summary of the changes in the Company’s allowance for doubtful accounts on a portfolio segment basis for the nine months ended September 30, 2022 and 2021. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs/Adjustments 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 50,794 $ (11,195) $ 25,722 $ 65,321 Notes Receivables Standard notes receivable $ 13,607 $ (6,773) $ (2,491) $ 4,343 Elevated risk notes receivable 1,183 (483) 111 811 Total notes receivable $ 14,790 $ (7,256) $ (2,380) $ 5,154 Total $ 65,584 $ (18,451) $ 23,342 $ 70,475 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2022, the Company collected $0.2 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. Adjustments include a reduction of $8.0 million of allowance for doubtful accounts which related to a customer concession granted during the nine months ended September 30, 2022. Allowance for doubtful accounts Portfolio Segment: December 31, Write-Offs 1 Bad Debt Expense September 30, (in thousands) Accounts Receivables $ 51,052 $ (7,807) $ 10,801 $ 54,046 Notes Receivables Standard notes receivable $ 13,258 $ (9) $ (864) $ 12,385 Elevated risk notes receivable 3,491 (2,761) 853 1,583 Total notes receivable $ 16,749 $ (2,770) $ (11) $ 13,968 Total $ 67,801 $ (10,577) $ 10,790 $ 68,014 1. Write-offs are shown net of recoveries. During the nine months ended September 30, 2021, the Company collected $0.1 million of accounts receivables and notes receivables which had previously been written-off as uncollectible. |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Income by Component (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income | The following table provides a summary of the changes in accumulated other comprehensive income for the nine months ended September 30, 2022 and 2021: Unrealized Gains and Losses on Available-for-Sale Securities 1 Nine Months Ended September 30, 2022 2021 (in thousands) Accumulated other comprehensive income — beginning balance $ 4,000 $ 5,563 Other comprehensive loss before reclassifications (9,530) (1,421) Losses (gains) reclassified from other comprehensive income 2 23 (161) Net current period other comprehensive loss 3 (9,507) (1,582) Accumulated other comprehensive (loss) income — ending balance $ (5,507) $ 3,981 1. All amounts are net of tax. 2. Realized gains and losses were recorded pre-tax under “Investment and other income” in the Consolidated Statements of Comprehensive Income. For the nine months ended September 30, 2022, the Company recorded less than $0.1 million of realized losses from the sale of available-for-sale securities. For the nine months ended September 30, 2021, the Company recorded $0.2 million of realized gains from the sale of available-for-sale securities. Refer to Note 9—Fair Value Measurements herein for further information. 3. For the nine months ended September 30, 2022 and 2021, the changes in other comprehensive income were net of a tax benefit of $2.5 million and $0.4 million, respectively. |
Schedule of Reclassification out of Accumulated Other Comprehensive Income | Amounts Reclassified from Accumulated Other Comprehensive Income 2022 2021 (in thousands) Three Months Ended September 30, Losses from the sale of available-for-sale securities $ (5) $ (7) Tax benefit 2 5 Net loss reclassified from accumulated other comprehensive income $ (3) $ (2) Nine Months Ended September 30, (Losses) gains from the sale of available-for-sale securities $ (31) $ 221 Tax benefit (expense) 8 (60) Net (loss) gain reclassified from accumulated other comprehensive income $ (23) $ 161 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | The following table sets forth the amounts of property and equipment by each class of depreciable asset as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (in thousands) Housekeeping and dietary equipment $ 13,461 $ 13,468 Computer hardware and software 6,089 5,880 Operating lease — right-of-use assets 33,974 33,217 Other 1 1,026 1,736 Total property and equipment, at cost 54,550 54,301 Less accumulated depreciation 30,306 26,199 Total property and equipment, net $ 24,244 $ 28,102 1. Includes furniture and fixtures, leasehold improvements and autos and trucks including auto leases. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense | Components of lease expense required by ASC 842 are presented below for the three and nine months ended September 30, 2022 and 2021. Three Months Ended September 30, 2022 2021 (in thousands) Lease cost Operating lease cost $ 1,449 $ 1,629 Short-term lease cost 283 122 Variable lease cost 230 73 Total lease cost $ 1,962 $ 1,824 Nine Months Ended September 30, 2022 2021 (in thousands) Lease cost Operating lease cost $ 4,364 $ 4,547 Short-term lease cost 863 558 Variable lease cost 557 (458) Total lease cost $ 5,784 $ 4,647 |
Schedule of Supplemental Information Required by ASC 842 | Supplemental information required by ASC 842 is presented below for the nine months ended September 30, 2022 and 2021. Nine Months Ended September 30, 2022 2021 (dollar amounts in thousands) Other information Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,853 $ 4,902 Weighted-average remaining lease term — operating leases 4.2 years 4.8 years Weighted-average discount rate — operating leases 4.3 % 4.2 % |
Schedule of Future Minimum Lease Payments | The following is a schedule by calendar year of future minimum lease payments under operating leases that have remaining terms as of September 30, 2022: Period/Year Operating Leases (in thousands) October 1 to December 31, 2022 $ 1,511 2023 5,107 2024 3,323 2025 1,461 2026 1,337 2027 1,363 Thereafter 1,505 Total minimum lease payments $ 15,607 Less: imputed lease payments 1,417 Present value of lease liabilities $ 14,190 |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Estimated Amortization Expense For Intangibles Subject To Amortization | The following table sets forth the estimated amortization expense for intangibles subject to amortization for the remainder of 2022, the following five fiscal years and thereafter: Period/Year Total Amortization Expense (in thousands) October 1 to December 31, 2022 $ 1,209 2023 $ 3,819 2024 $ 2,685 2025 $ 2,685 2026 $ 2,666 2027 $ 1,196 Thereafter $ 2,894 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Measurements | The following tables provide fair value measurement information for the Company’s marketable securities and deferred compensation fund investments as of September 30, 2022 and December 31, 2021: As of September 30, 2022 Fair Value Measurement Using: Carrying Amount Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Financial Assets: Marketable securities Municipal bonds — available-for-sale $ 93,748 $ 93,748 $ — $ 93,748 $ — Deferred compensation fund Money Market 1 $ 2,450 $ 2,450 $ — $ 2,450 $ — Commodities 149 149 149 — — Fixed Income 2,928 2,928 2,928 — — International 3,993 3,993 3,993 — — Large Cap Blend 1,073 1,073 1,073 — — Large Cap Growth 10,823 10,823 10,823 — — Large Cap Value 5,413 5,413 5,413 — — Mid Cap Blend 2,466 2,466 2,466 — — Real Estate 367 367 367 — — Small Cap Blend 3,185 3,185 3,185 — — Deferred compensation fund 2 $ 32,847 $ 32,847 $ 30,397 $ 2,450 $ — As of December 31, 2021 Fair Value Measurement Using: Carrying Amount Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Financial Assets: Marketable securities Municipal bonds — available-for-sale $ 114,396 $ 114,396 $ — $ 114,396 $ — Deferred compensation fund Money Market 1 2,882 2,882 — 2,882 — Balanced and Lifestyle 12,578 12,578 12,578 — — Large Cap Growth 20,358 20,358 20,358 — — Small Cap Growth 6,561 6,561 6,561 — — Fixed Income 4,826 4,826 4,826 — — International 2,299 2,299 2,299 — — Mid Cap Growth 4,179 4,179 4,179 — — Deferred compensation fund 2 $ 53,683 $ 53,683 $ 50,801 $ 2,882 $ — 1. The fair value of the money market fund is based on the net asset value (“NAV”) of the shares held by the plan at the end of the period. The money market fund includes short-term United States dollar denominated money market instruments and the NAV is determined by the custodian of the fund. The money market fund can be redeemed at its NAV at the measurement date as there are no significant restrictions on the ability to sell this investment. |
Schedule of Marketable Debt Securities | Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Credit Impairment Losses 1 (in thousands) September 30, 2022 Type of security: Municipal bonds — available-for-sale $ 100,719 $ 4 $ (6,975) $ 93,748 $ — Total debt securities $ 100,719 $ 4 $ (6,975) $ 93,748 $ — December 31, 2021 Type of security: Municipal bonds — available-for-sale $ 109,331 $ 5,219 $ (154) $ 114,396 $ — Total debt securities $ 109,331 $ 5,219 $ (154) $ 114,396 $ — 1. The Company performs a quarterly credit impairment loss assessment quarterly on an individual security basis. As of September 30, 2022 and December 31, 2021, no allowance for credit loss impairment has been recognized as the issuers of these securities have not established a cause for default and various rating agencies have reaffirmed each security's investment grade status. The fair value of these securities have fluctuated since the purchase date as market interest rates fluctuate. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell before the recovery of the securities' amortized cost basis. |
Schedule of Contractual Maturities of Available for Sale Investments | The following table summarizes the contractual maturities of debt securities held at September 30, 2022 and December 31, 2021, which are classified as “Marketable securities, at fair value” in the Consolidated Balance Sheets: Municipal Bonds — Available-for-Sale Contractual maturity: September 30, 2022 December 31, 2021 (in thousands) Maturing in one year or less $ 3,207 $ 5,606 Maturing in second year through fifth year 28,942 23,054 Maturing in sixth year through tenth year 43,487 52,180 Maturing after ten years 18,112 33,556 Total debt securities $ 93,748 $ 114,396 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-based Compensation Expense | The components of the Company’s share-based compensation expense for the nine months ended September 30, 2022 and 2021 are as follows: Nine Months Ended September 30, 2022 2021 (in thousands) Stock options $ 939 $ 1,381 Restricted stock and restricted stock units 5,310 4,797 Performance stock units 612 299 Employee stock purchase plan 295 491 Total pre-tax share-based compensation expense charged against income 1 $ 7,156 $ 6,968 1. Share-based compensation expense is recorded in “C ost of services provided ” and “S elling, general and administrative expense ” |
Schedule of Other Information of Stock Option Plans | A summary of stock options outstanding under the 2020 Plan and the 2012 Plan as of December 31, 2021 and changes during the nine months ended September 30, 2022 are as follows: Stock Options Outstanding Number of Shares Weighted Average Exercise Price (in thousands) December 31, 2021 2,181 $ 33.42 Granted 352 $ 18.10 Exercised (23) $ 17.50 Forfeited — $ — Expired (123) $ 28.32 September 30, 2022 2,387 $ 31.58 |
Schedule of Assumption For Fair Value of Options Granted | The fair value of stock option awards granted in 2022 and 2021 was estimated on the date of grant using the Black-Scholes option valuation model with the following assumptions: Nine Months Ended September 30, 2022 2021 Risk-free interest rate 1.5 % 0.6 % Weighted average expected life 6.7 years 6.6 years Expected volatility 36.6 % 34.7 % Dividend yield 4.6 % 2.9 % |
Schedule of Summarized Information of Stock Options Outstanding | The following table summarizes other information about the stock options at September 30, 2022: September 30, 2022 (amounts in thousands, except per share data) Outstanding: Aggregate intrinsic value $ — Weighted average remaining contractual life 5.1 years Exercisable: Number of options 1,631 Weighted average exercise price $ 34.53 Aggregate intrinsic value $ — Weighted average remaining contractual life 3.6 years |
Schedule of Outstanding Restricted Stock Units | A summary of the outstanding restricted stock units as of December 31, 2021 and changes during the nine months ended September 30, 2022 is as follows: Restricted Stock Units Number Weighted Average Grant Date Fair Value (in thousands) December 31, 2021 652 $ 31.03 Granted 410 $ 18.06 Vested (184) $ 33.68 Forfeited (39) $ 25.68 September 30, 2022 839 $ 24.37 |
Schedule of Outstanding Performance Stock Units | A summary of the outstanding PSUs as of December 31, 2021 and changes during the nine months ended September 30, 2022 is as follows: Performance Stock Units Number Weighted Average Grant Date Fair Value (in thousands) December 31, 2021 35 $ 34.52 Granted 60 $ 21.00 Vested — $ — Forfeited — $ — September 30, 2022 95 $ 26.01 |
Schedule of Options Granted Estimated Expense Valuation Assumptions | The expense associated with the options granted under the ESPP during the nine months ended September 30, 2022 and 2021 was estimated on the date of grant using the Black-Scholes option valuation model with the following assumptions: Nine Months Ended September 30, 2022 2021 Risk-free interest rate 0.4% 0.1% Weighted average expected life (years) 1.0 1.0 Expected volatility 36.9% 61.7% Dividend yield 4.7% 2.9% |
Schedule of ESPP Annual Offerings | The following table summarizes information about the SERP during the nine months ended September 30, 2022 and 2021: Nine Months Ended September 30, 2022 2021 (in thousands) SERP expense 1 $ 416 $ 458 Unrealized (loss) gain recorded in SERP liability account $ (11,324) $ 3,990 1. Both the SERP match and the deferrals are included in the “ selling, general and administrative ” |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Information of Reportable Segments | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Revenues Housekeeping $ 196,941 $ 203,379 $ 597,710 $ 621,278 Dietary 217,547 212,211 668,446 600,234 Total $ 414,488 $ 415,590 $ 1,266,156 $ 1,221,512 Income before income taxes Housekeeping $ 17,540 $ 17,237 $ 55,784 $ 68,025 Dietary (365) 7,259 19,320 41,075 Corporate and eliminations 1 (16,182) (12,375) (50,080) (48,964) Total $ 993 $ 12,121 $ 25,024 $ 60,136 1. Primarily represents corporate office costs and related overhead, recording of certain inventories and supplies and workers compensation costs at the reportable segment level which use accounting methods that differ from those used at the corporate level, as well as consolidated subsidiaries’ operating expenses that are not allocated to the reportable segments, net of investment and other income and interest expense. |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares | The table below reconciles the weighted-average basic and diluted common shares outstanding: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Numerator for basic and diluted earnings per share: Net income $ 322 $ 9,540 $ 18,471 $ 43,758 Denominator Weighted average number of common shares outstanding - basic 74,340 74,943 74,334 74,983 Effect of dilutive securities 1 8 133 12 187 Weighted average number of common shares outstanding - diluted 74,348 75,076 74,346 75,170 Basic earnings per share: $ 0.00 $ 0.13 $ 0.25 $ 0.58 Diluted earnings per share: $ 0.00 $ 0.13 $ 0.25 $ 0.58 |
Schedule Anti-dilutive Outstanding Equity Awards Under Share Based Compensation Plans | Anti-dilutive outstanding equity awards under share-based compensation plans were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (in thousands) Anti-dilutive 3,287 2,184 3,201 1,788 |
Description of Business and S_3
Description of Business and Significant Accounting Policies (Details) | 9 Months Ended | ||
Sep. 30, 2022 USD ($) segment financial_institution | Sep. 30, 2021 USD ($) | Dec. 31, 2021 financial_institution | |
Schedule of Accounting Policies [Line Items] | |||
Renewal term | 1 year | ||
Number of reportable segments | segment | 2 | ||
Amortization period of inventories and supplies | 24 months | ||
Goodwill and intangible asset impairment | $ | $ 0 | $ 0 | |
Number of financial institutions holding cash and cash equivalents and marketable securities | financial_institution | 1 | 1 | |
Minimum | |||
Schedule of Accounting Policies [Line Items] | |||
Cancellation notice period | 30 days | ||
Initial period preceding cancellation notice | 60 days | ||
Typically promissory notes maturity | 1 year | ||
Maximum | |||
Schedule of Accounting Policies [Line Items] | |||
Cancellation notice period | 90 days | ||
Initial period preceding cancellation notice | 120 days | ||
Typically promissory notes maturity | 3 years |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||||
Revenue | $ 414,488 | $ 415,590 | $ 1,266,156 | $ 1,221,512 | |
Renewal term | 1 year | ||||
Reduction in revenue | 10,000 | $ 10,000 | |||
Description of timing | The Company’s contracts with customers typically provide for an initial term of one year, with renewable one year service terms, cancellable by either party upon 30 to 90 days’ notice after an initial period of 60 to 120 days.At September 30, 2022, the Company had $150.6 million related to performance obligations that were unsatisfied or partially unsatisfied for which the Company expects to recognize revenue. The Company expects to recognize revenue on approximately 70.6% of the remaining performance obligations over the next 12 months, with the balance to be recognized thereafter. These amounts exclude variable consideration primarily related to performance obligations that consist of a series of distinct service periods with revenues based on future performance that cannot be estimated at contract inception. The Company also has elected to apply the practical expedient that permits exclusion of information about the remaining performance obligations with original expected durations of one year or less. | ||||
Transferred at point in time | |||||
Disaggregation of Revenue [Line Items] | |||||
Contract liabilities | 1,700 | $ 1,700 | $ 100 | ||
Transferred over time | |||||
Disaggregation of Revenue [Line Items] | |||||
Contract liabilities | 200 | $ 200 | $ 2,500 | ||
Minimum | |||||
Disaggregation of Revenue [Line Items] | |||||
Cancellation notice period | 30 days | ||||
Initial period preceding cancellation notice | 60 days | ||||
Maximum | |||||
Disaggregation of Revenue [Line Items] | |||||
Cancellation notice period | 90 days | ||||
Initial period preceding cancellation notice | 120 days | ||||
Housekeeping | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 196,941 | 203,379 | $ 597,710 | $ 621,278 | |
Percent of revenue (as a percent) | 47.20% | 50.90% | |||
Dietary | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | $ 217,547 | $ 212,211 | $ 668,446 | $ 600,234 | |
Percent of revenue (as a percent) | 52.80% | 49.10% |
Revenue - Transaction Price All
Revenue - Transaction Price Allocated to Remaining Performance Obligations (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 150.6 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | 70.60% |
Remaining performance obligation period | 12 months |
Accounts and Notes Receivable -
Accounts and Notes Receivable - Schedule of Accounts and Notes Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Short-term | ||
Accounts and notes receivable - gross | $ 415,593 | $ 352,659 |
Accounts and notes receivable - allowance | (68,099) | (59,271) |
Total net short-term accounts and notes receivable | 347,494 | 293,388 |
Long-term | ||
Notes receivable | 29,230 | 35,571 |
Allowance for doubtful accounts | (2,376) | (6,312) |
Total net long-term notes receivable | 26,854 | 29,259 |
Total net accounts and notes receivable | $ 374,348 | $ 322,647 |
Allowance for Doubtful Accoun_3
Allowance for Doubtful Accounts - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Receivables [Abstract] | ||||
Interest income | $ 0.2 | $ 0.3 | $ 1 | $ 1 |
Allowance for Doubtful Accoun_4
Allowance for Doubtful Accounts - Notes Receivable Disaggregated by Vintage Year (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Current-period gross write-offs | ||||
2022 | $ 1 | |||
2021 | 0 | |||
2020 | 49 | |||
2019 | 54 | |||
2018 | 0 | |||
Prior | 483 | |||
Total | 587 | |||
Current-period recoveries | ||||
2022 | 0 | |||
2021 | 0 | |||
2020 | 0 | |||
2019 | 0 | |||
2018 | 0 | |||
Prior | 0 | |||
Total | 0 | |||
Current-period net write-offs | ||||
2022 | 1 | |||
2021 | 0 | |||
2020 | 49 | |||
2019 | 54 | |||
2018 | 0 | |||
Prior | 483 | |||
Total | $ 6,718 | $ 0 | 587 | $ 2,770 |
Standard notes receivable | ||||
Financing Receivable, Credit Quality Indicator [Line Items] | ||||
2022 | 17,508 | 17,508 | ||
2021 | 11,917 | 11,917 | ||
2020 | 1,972 | 1,972 | ||
2019 | 206 | 206 | ||
2018 | 13 | 13 | ||
Prior | 21,991 | 21,991 | ||
Total | 53,607 | 53,607 | ||
Current-period net write-offs | ||||
Total | 6,718 | 0 | 9 | |
Elevated risk notes receivable | ||||
Financing Receivable, Credit Quality Indicator [Line Items] | ||||
2022 | 0 | 0 | ||
2021 | 0 | 0 | ||
2020 | 0 | 0 | ||
2019 | 0 | 0 | ||
2018 | 0 | 0 | ||
Prior | 1,223 | 1,223 | ||
Total | 1,223 | $ 1,223 | ||
Current-period net write-offs | ||||
Total | $ 0 | $ 0 | $ 2,761 |
Allowance for Doubtful Accoun_5
Allowance for Doubtful Accounts - Age Analysis of Past-Due Note Receivable (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Total | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | $ 5,059 |
0 - 90 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 469 |
91 - 180 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 162 |
Greater than 181 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 4,428 |
Standard notes receivable | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 53,607 |
Standard notes receivable | Total | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 3,836 |
Standard notes receivable | 0 - 90 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 469 |
Standard notes receivable | 91 - 180 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 162 |
Standard notes receivable | Greater than 181 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 3,205 |
Elevated risk notes receivable | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 1,223 |
Elevated risk notes receivable | Total | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 1,223 |
Elevated risk notes receivable | 0 - 90 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 0 |
Elevated risk notes receivable | 91 - 180 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | 0 |
Elevated risk notes receivable | Greater than 181 Days | |
Financing Receivable, Past Due [Line Items] | |
Notes Receivable | $ 1,223 |
Allowance for Doubtful Accoun_6
Allowance for Doubtful Accounts - Schedule of Changes in Allowance for Notes Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accounts Receivables | ||||
Accounts receivable, Allowance for doubtful accounts, beginning balance | $ 62,603 | $ 50,243 | $ 50,794 | $ 51,052 |
Write-Offs/Adjustments | (5,145) | (427) | (11,195) | (7,807) |
Bad Debt Expense | 7,863 | 4,230 | 25,722 | 10,801 |
Accounts receivable, Allowance for doubtful accounts, ending balance | 65,321 | 54,046 | 65,321 | 54,046 |
Notes Receivables | ||||
Notes receivable, Allowance for doubtful accounts, beginning balance | 13,417 | 14,117 | 14,790 | 16,749 |
Write-Offs | (6,718) | 0 | (587) | (2,770) |
Write-Offs/Adjustments | (7,256) | |||
Bad Debt Expense | (1,545) | (149) | (2,380) | (11) |
Notes receivable, Allowance for doubtful accounts, ending balance | 5,154 | 13,968 | 5,154 | 13,968 |
Accounts and Financing Receivable | ||||
Allowance for doubtful accounts, beginning balance | 76,020 | 64,360 | 65,584 | 67,801 |
Write-Offs/Adjustments | (11,863) | (427) | (18,451) | (10,577) |
Bad Debt Expense | 6,318 | 4,081 | 23,342 | 10,790 |
Allowance for doubtful accounts, ending balance | 70,475 | 68,014 | 70,475 | 68,014 |
Accounts receivable recovered after write off | 100 | 0 | 200 | 100 |
Standard notes receivable | ||||
Notes Receivables | ||||
Notes receivable, Allowance for doubtful accounts, beginning balance | 12,606 | 12,534 | 13,607 | 13,258 |
Write-Offs | (6,718) | 0 | (9) | |
Write-Offs/Adjustments | (6,773) | |||
Bad Debt Expense | (1,545) | (149) | (2,491) | (864) |
Notes receivable, Allowance for doubtful accounts, ending balance | 4,343 | 12,385 | 4,343 | 12,385 |
Customer concession | ||||
Notes Receivables | ||||
Write-Offs | (8,000) | (8,000) | ||
Elevated risk notes receivable | ||||
Notes Receivables | ||||
Notes receivable, Allowance for doubtful accounts, beginning balance | 811 | 1,583 | 1,183 | 3,491 |
Write-Offs | 0 | 0 | (2,761) | |
Write-Offs/Adjustments | (483) | |||
Bad Debt Expense | 0 | 0 | 111 | 853 |
Notes receivable, Allowance for doubtful accounts, ending balance | $ 811 | $ 1,583 | $ 811 | $ 1,583 |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Income by Component - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accumulated other comprehensive income | ||||
Beginning balance | $ 437,845 | $ 488,304 | $ 452,677 | $ 480,461 |
Other comprehensive loss before reclassifications | (9,530) | (1,421) | ||
Losses (gains) reclassified from other comprehensive income | 23 | (161) | ||
Net current period other comprehensive loss | (9,507) | (1,582) | ||
Ending balance | 422,076 | 480,205 | 422,076 | 480,205 |
Realized loss (less then) | 100 | |||
Realized gain | 200 | |||
Changes in other comprehensive (loss) income, tax benefit | 2,500 | 400 | ||
Accumulated Other Comprehensive Income, net of taxes | ||||
Accumulated other comprehensive income | ||||
Beginning balance | (3,214) | 4,995 | 4,000 | 5,563 |
Ending balance | $ (5,507) | $ 3,981 | $ (5,507) | $ 3,981 |
Changes in Accumulated Other _4
Changes in Accumulated Other Comprehensive Income by Component - Reclassification Adjustments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Tax benefit (expense) | $ (671) | $ (2,581) | $ (6,553) | $ (16,378) | ||||
Net income | 322 | $ 6,820 | $ 11,329 | 9,540 | $ 9,565 | $ 24,653 | 18,471 | 43,758 |
Realized Gains (Losses) on Sale of Available-for-sale Securities | Amounts Reclassified from Accumulated Other Comprehensive Income | ||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||
(Losses) gains from the sale of available-for-sale securities | (5) | (7) | (31) | 221 | ||||
Tax benefit (expense) | 2 | 5 | 8 | (60) | ||||
Net income | $ (3) | $ (2) | $ (23) | $ 161 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Total property and equipment, net | Total property and equipment, net | Total property and equipment, net | ||
Operating lease — right-of-use assets | $ 33,974 | $ 33,974 | $ 33,217 | ||
Total property and equipment, at cost | 54,550 | 54,550 | 54,301 | ||
Less accumulated depreciation | 30,306 | 30,306 | 26,199 | ||
Total property and equipment, net | 24,244 | 24,244 | 28,102 | ||
Depreciation | 2,600 | $ 2,500 | 7,900 | $ 7,700 | |
ROU Assets depreciation | 1,500 | $ 1,600 | 4,600 | $ 4,700 | |
Housekeeping and dietary equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 13,461 | 13,461 | 13,468 | ||
Computer hardware and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 6,089 | 6,089 | 5,880 | ||
Other | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 1,026 | $ 1,026 | $ 1,736 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lessee, Lease, Description [Line Items] | ||||
Termination option | 1 year | |||
ROU Assets and Lease Liabilities reduction due to cancellation | $ 0.3 | $ 0.3 | $ 1.6 | $ 0.6 |
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 1 year | 1 year | ||
Extension option | 1 year | 1 year | ||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 7 years | 7 years | ||
Extension option | 5 years | 5 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lease, Cost [Abstract] | ||||
Operating lease cost | $ 1,449 | $ 1,629 | $ 4,364 | $ 4,547 |
Short-term lease cost | 283 | 122 | 863 | 558 |
Variable lease cost | 230 | 73 | 557 | (458) |
Total lease cost | $ 1,962 | $ 1,824 | 5,784 | 4,647 |
Weighted-average remaining lease term — operating leases | ||||
Operating cash flows from operating leases | $ 4,853 | $ 4,902 | ||
Weighted-average remaining lease term — operating leases | 4 years 2 months 12 days | 4 years 9 months 18 days | 4 years 2 months 12 days | 4 years 9 months 18 days |
Weighted-average discount rate — operating leases (as a percent) | 4.30% | 4.20% | 4.30% | 4.20% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Leases [Abstract] | |
October 1 to December 31, 2022 | $ 1,511 |
2023 | 5,107 |
2024 | 3,323 |
2025 | 1,461 |
2026 | 1,337 |
2027 | 1,363 |
Thereafter | 1,505 |
Total minimum lease payments | 15,607 |
Less: imputed lease payments | 1,417 |
Present value of lease liabilities | $ 14,190 |
Other Intangible Assets - Addit
Other Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Measurement period adjustment | $ 0.7 | |||
Amortization of intangible assets | $ 1.2 | $ 1.1 | $ 3.7 | $ 3.3 |
Customer Relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life (in years) | 10 years | |||
Trade Names | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life (in years) | 13 years | |||
Patents | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life (in years) | 8 years | |||
Noncompete Agreements | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life (in years) | 4 years |
Other Intangible Assets - Estim
Other Intangible Assets - Estimated Amortization Expense For Intangibles Subject To Amortization (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
October 1 to December 31, 2022 | $ 1,209 |
2023 | 3,819 |
2024 | 2,685 |
2025 | 2,685 |
2026 | 2,666 |
2027 | 1,196 |
Thereafter | $ 2,894 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |||||
Unrealized gains (losses) on available-for-sale marketable securities, net of taxes | $ (2,300,000) | $ (1,000,000) | $ (9,500,000) | $ (1,600,000) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Gain on fair value adjustment | 2,408,000 | 0 | |||
Proceeds from available for sale municipal bonds | 9,816,000 | 12,368,000 | |||
Realized loss (less then) | 100,000 | ||||
Realized gain | 200,000 | ||||
Unrealized losses related to equity securities | 800,000 | 100,000 | 11,400,000 | ||
Unrealized gains related to equity securities | 4,000,000 | ||||
Municipal bonds — available-for-sale | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Proceeds from available for sale municipal bonds | 300,000 | 300,000 | 9,800,000 | 12,400,000 | |
Realized loss (less then) | 100,000 | 100,000 | 100,000 | ||
Realized gain | 200,000 | ||||
Manufacturer of prepackaged meals | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Gain on fair value adjustment | 400,000 | $ 0 | 2,300,000 | $ 0 | |
Significant Unobservable Inputs (Level 3) | Manufacturer of prepackaged meals | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Deferred purchase payable (up to) | $ 2,500,000 | $ 2,500,000 | $ 4,800,000 |
Fair Value Measurements - Marke
Fair Value Measurements - Marketable Securities and Deferred Compensation Fund Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 93,748 | $ 114,396 |
Deferred compensation fund | 31,627 | 46,691 |
Prepaid deferred compensation fund | 1,200 | 7,000 |
Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 30,397 | 50,801 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,450 | 2,882 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 32,847 | 53,683 |
Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 32,847 | 53,683 |
Municipal bonds — available-for-sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 93,748 | 114,396 |
Municipal bonds — available-for-sale | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Municipal bonds — available-for-sale | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 93,748 | 114,396 |
Municipal bonds — available-for-sale | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Municipal bonds — available-for-sale | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 93,748 | 114,396 |
Municipal bonds — available-for-sale | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 93,748 | 114,396 |
Money Market | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Money Market | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,450 | 2,882 |
Money Market | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Money Market | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,450 | 2,882 |
Money Market | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,450 | 2,882 |
Commodities | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 149 | |
Commodities | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Commodities | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Commodities | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 149 | |
Commodities | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 149 | |
Fixed Income | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,928 | 4,826 |
Fixed Income | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Fixed Income | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Fixed Income | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,928 | 4,826 |
Fixed Income | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,928 | 4,826 |
International | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 3,993 | 2,299 |
International | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
International | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
International | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 3,993 | 2,299 |
International | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 3,993 | 2,299 |
Large Cap Blend | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 1,073 | |
Large Cap Blend | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Large Cap Blend | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Large Cap Blend | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 1,073 | |
Large Cap Blend | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 1,073 | |
Large Cap Growth | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 10,823 | 20,358 |
Large Cap Growth | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Large Cap Growth | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | 0 |
Large Cap Growth | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 10,823 | 20,358 |
Large Cap Growth | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 10,823 | 20,358 |
Large Cap Value | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 5,413 | |
Large Cap Value | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Large Cap Value | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Large Cap Value | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 5,413 | |
Large Cap Value | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 5,413 | |
Mid Cap Blend | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,466 | |
Mid Cap Blend | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Mid Cap Blend | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Mid Cap Blend | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,466 | |
Mid Cap Blend | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 2,466 | |
Real Estate | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 367 | |
Real Estate | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Real Estate | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Real Estate | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 367 | |
Real Estate | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 367 | |
Small Cap Blend | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 3,185 | |
Small Cap Blend | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Small Cap Blend | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Small Cap Blend | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 3,185 | |
Small Cap Blend | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | $ 3,185 | |
Balanced and Lifestyle | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 12,578 | |
Balanced and Lifestyle | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Balanced and Lifestyle | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Balanced and Lifestyle | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 12,578 | |
Balanced and Lifestyle | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 12,578 | |
Small Cap Growth | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 6,561 | |
Small Cap Growth | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Small Cap Growth | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Small Cap Growth | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 6,561 | |
Small Cap Growth | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 6,561 | |
Mid Cap Growth | Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 4,179 | |
Mid Cap Growth | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Mid Cap Growth | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 0 | |
Mid Cap Growth | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | 4,179 | |
Mid Cap Growth | Total Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation fund | $ 4,179 |
Fair Value Measurements - Mar_2
Fair Value Measurements - Marketable Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Amortized Cost | $ 100,719 | $ 109,331 |
Gross Unrealized Gains | 4 | 5,219 |
Gross Unrealized Losses | (6,975) | (154) |
Estimated Fair Value | 93,748 | 114,396 |
Credit Impairment Losses | 0 | 0 |
Municipal bonds — available-for-sale | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Amortized Cost | 100,719 | 109,331 |
Gross Unrealized Gains | 4 | 5,219 |
Gross Unrealized Losses | (6,975) | (154) |
Estimated Fair Value | 93,748 | 114,396 |
Credit Impairment Losses | $ 0 | $ 0 |
Fair Value Measurements - Contr
Fair Value Measurements - Contractual Maturities of Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value Disclosures [Abstract] | ||
Maturing in one year or less | $ 3,207 | $ 5,606 |
Maturing in second year through fifth year | 28,942 | 23,054 |
Maturing in sixth year through tenth year | 43,487 | 52,180 |
Maturing after ten years | 18,112 | 33,556 |
Total debt securities | $ 93,748 | $ 114,396 |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total pre-tax stock-based compensation expense charged against income | $ 7,156 | $ 6,968 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total pre-tax stock-based compensation expense charged against income | 939 | 1,381 |
Restricted stock and restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total pre-tax stock-based compensation expense charged against income | 5,310 | 4,797 |
Performance stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total pre-tax stock-based compensation expense charged against income | 612 | 299 |
Employee stock purchase plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total pre-tax stock-based compensation expense charged against income | $ 295 | $ 491 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | ||
Jan. 04, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 18.3 | ||
Period of expense of unrecognized compensation cost (in years) | 3 years | ||
Weighted average grant-date fair value of stock options granted (in dollars per share) | $ 4.06 | $ 7.01 | |
Aggregate intrinsic value of stock options exercised | $ 0.1 | $ 0.6 | |
SERP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized for issuance (in shares) | 1,000,000 | ||
Remaining shares authorized for issuance (in shares) | 300,000 | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 410,000 | 300,000 | |
Weighted average grant date fair value of stock granted (in dollars per share) | $ 18.06 | $ 28.53 | |
PSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 1.5 | ||
Period of expense of unrecognized compensation cost (in years) | 2 years | ||
Granted (in shares) | 60,000 | 60,000 | |
Weighted average grant date fair value of stock granted (in dollars per share) | $ 21 | ||
Vesting period (in years) | 3 years | ||
DSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period (in years) | 1 year | ||
DSUs | Non-employee member of the Board of Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 0.2 | ||
Period of expense of unrecognized compensation cost (in years) | 8 months 12 days | ||
Granted (in shares) | 20,000 | ||
Payout period (in years) | 5 years | ||
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for future grant (in shares) | 2,000,000 | ||
Average weekly hours of work | 20 hours | ||
Requisite service period for plan participation eligibility | 2 years | ||
Stock options authorized to issue to employees (in shares) | 4,100,000 | ||
2020 Omnibus Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for future issuance (in shares) | 4,700,000 | ||
Shares available for future grant (in shares) | 1,400,000 | ||
Maximum term of grants | 10 years |
Share-Based Compensation - Sc_2
Share-Based Compensation - Schedule of Stock Options Outstanding (Details) shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Number of Shares | |
Beginning of period (in shares) | shares | 2,181 |
Granted (in shares) | shares | 352 |
Exercised (in shares) | shares | (23) |
Forfeited (in shares) | shares | 0 |
Expired (in shares) | shares | (123) |
End of period (in shares) | shares | 2,387 |
Weighted Average Exercise Price | |
Beginning of period (in dollars per share) | $ / shares | $ 33.42 |
Granted (in dollars per share) | $ / shares | 18.10 |
Exercised (in dollars per share) | $ / shares | 17.50 |
Forfeited (in dollars per share) | $ / shares | 0 |
Expired (in dollars per share) | $ / shares | 28.32 |
End of period (in dollars per share) | $ / shares | $ 31.58 |
Share-Based Compensation - Assu
Share-Based Compensation - Assumptions for Fair Value of Options Granted (Details) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Payment Arrangement [Abstract] | ||
Risk-free interest rate | 1.50% | 0.60% |
Weighted average expected life | 6 years 8 months 12 days | 6 years 7 months 6 days |
Expected volatility | 36.60% | 34.70% |
Dividend yield | 4.60% | 2.90% |
Share-Based Compensation - Summ
Share-Based Compensation - Summarized Information About Stock Awards (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | |
Outstanding: | |
Aggregate intrinsic value | $ 0 |
Weighted average remaining contractual life | 5 years 1 month 6 days |
Exercisable: | |
Number of options (in shares) | shares | 1,631 |
Weighted average exercise price (in dollars per share) | $ / shares | $ 34.53 |
Aggregate intrinsic value | $ 0 |
Weighted average remaining contractual life | 3 years 7 months 6 days |
Share-Based Compensation - Sc_3
Share-Based Compensation - Schedule of Restricted Stock Units (Details) - RSUs - $ / shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Number | ||
Beginning balance (in shares) | 652 | |
Granted (in shares) | 410 | 300 |
Vested (in shares) | (184) | |
Forfeited (in shares) | (39) | |
Ending balance (in shares) | 839 | |
Weighted Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | $ 31.03 | |
Granted (in dollars per share) | 18.06 | $ 28.53 |
Vested (in dollars per share) | 33.68 | |
Forfeited (in dollars per share) | 25.68 | |
Ending balance (in dollars per share) | $ 24.37 |
Share-Based Compensation - Sc_4
Share-Based Compensation - Schedule of Outstanding Performance Stock Units (Details) - PSUs - $ / shares | 9 Months Ended | |
Jan. 04, 2022 | Sep. 30, 2022 | |
Number | ||
Beginning balance (in shares) | 35,000 | |
Granted (in shares) | 60,000 | 60,000 |
Vested (in shares) | 0 | |
Forfeited (in shares) | 0 | |
Ending balance (in shares) | 95,000 | |
Weighted Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | $ 34.52 | |
Granted (in dollars per share) | 21 | |
Vested (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 0 | |
Ending balance (in dollars per share) | $ 26.01 |
Share-Based Compensation - As_2
Share-Based Compensation - Assumptions For Employee Stock Purchase Plan (Details) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 1.50% | 0.60% |
Weighted average expected life (years) | 6 years 8 months 12 days | 6 years 7 months 6 days |
Expected volatility | 36.60% | 34.70% |
Dividend yield | 4.60% | 2.90% |
ESPP | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 0.40% | 0.10% |
Weighted average expected life (years) | 1 year | 1 year |
Expected volatility | 36.90% | 61.70% |
Dividend yield | 4.70% | 2.90% |
Share-Based Compensation - Defe
Share-Based Compensation - Deferred Compensation Plan (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
SERP expense | $ 7,156 | $ 6,968 |
SERP | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
SERP expense | 416 | 458 |
Unrealized (loss) gain recorded in SERP liability account | $ (11,324) | $ 3,990 |
Income Taxes (Details)
Income Taxes (Details) | Sep. 30, 2022 USD ($) |
Income Tax Disclosure [Abstract] | |
Impact of discrete tax items | $ 1,100,000 |
Unrecognized tax benefits | $ 0 |
Segment Information - Schedule
Segment Information - Schedule of Information of Reportable Segments (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 2 | |||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 414,488 | $ 415,590 | $ 1,266,156 | $ 1,221,512 |
Income before income taxes | 993 | 12,121 | 25,024 | 60,136 |
Corporate and eliminations | ||||
Segment Reporting Information [Line Items] | ||||
Income before income taxes | (16,182) | (12,375) | (50,080) | (48,964) |
Housekeeping | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 196,941 | 203,379 | 597,710 | 621,278 |
Housekeeping | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Income before income taxes | 17,540 | 17,237 | 55,784 | 68,025 |
Dietary | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 217,547 | 212,211 | 668,446 | 600,234 |
Dietary | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Income before income taxes | $ (365) | $ 7,259 | $ 19,320 | $ 41,075 |
Earnings Per Common Share - Sch
Earnings Per Common Share - Schedule of Weighted Average Basic and Diluted Common Shares (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator for basic and diluted earnings per share: | ||||||||
Net income | $ 322 | $ 6,820 | $ 11,329 | $ 9,540 | $ 9,565 | $ 24,653 | $ 18,471 | $ 43,758 |
Denominator | ||||||||
Weighted average number of common shares outstanding - basic (in shares) | 74,340 | 74,943 | 74,334 | 74,983 | ||||
Effect of dilutive securities (in shares) | 8 | 133 | 12 | 187 | ||||
Weighted average number of common shares outstanding - diluted (in shares) | 74,348 | 75,076 | 74,346 | 75,170 | ||||
Basic earnings per share (in dollars per share) | $ 0 | $ 0.13 | $ 0.25 | $ 0.58 | ||||
Diluted earnings per share (in dollars per share) | $ 0 | $ 0.13 | $ 0.25 | $ 0.58 |
Earnings Per Common Share - S_2
Earnings Per Common Share - Schedule Anti-dilutive Outstanding Equity Awards Under Share Based Compensation Plans (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Anti-dilutive (in shares) | 3,287 | 2,184 | 3,201 | 1,788 |
Other Contingencies (Details)
Other Contingencies (Details) | 9 Months Ended | |
Sep. 30, 2022 USD ($) covenant | Dec. 31, 2021 USD ($) | |
Short-term Debt [Line Items] | ||
Bank line of credit | $ 475,000,000 | |
Long-term line of credit | $ 25,000,000 | $ 0 |
Financial covenants | covenant | 2 | |
Reduction of bank line of credit | $ 81,000,000 | |
Amount available under line of credit | 369,000,000 | |
Irrevocable standby letters of credit | ||
Short-term Debt [Line Items] | ||
Irrevocable standby letter of credit, outstanding | $ 81,000,000 | |
LIBOR | ||
Short-term Debt [Line Items] | ||
Basis spread on variable rate | 1.15% | |
Overnight Bank Funding Rate | ||
Short-term Debt [Line Items] | ||
Basis spread on variable rate | 0.50% |