Almost Family (AFAM) 8-K Almost Family Reports Fourth Quarter and Full Year 2009 Results

Exhibit 99.1

Almost Family, Inc. Steve Guenthner (502) 891-1000 The Ruth Group Investor Relations Nick Laudico/Zack Kubow (646) 536-7030/7020 nlaudico@theruthgroup.com zkubow@theruthgroup.com

Almost Family Reports Fourth Quarter and Full Year 2009 Results

Fourth Quarter Highlights:

·Net service revenues increased 18% to $78.0 million

·Visiting Nurse (VN) segment net revenues rose 22% to $67.6 million

·Net income increased 31% to $6.8 million

·Diluted EPS increased 18% to $0.73 per share on 11% more shares outstanding

·One-time acquisition transaction costs lowered diluted EPS by $0.03

·Quarterly operating cash flow of $10.5 million — strongest in the Company’s history

·Approximately $90 million in cash plus credit facility available to fund acquisitions

Louisville, KY, February 24, 2010 — Almost Family, Inc. (Nasdaq: AFAM), a leading regional provider of home health nursing services, announced today its financial results for the three months and full year ended December 31, 2009.

William Yarmuth, Chief Executive Officer, commented, “Our fourth quarter results serve to top off another milestone year in the development of our Company.  During 2009, we, along with other home health industry leaders, devoted substantial time and attention to national health care reform activities.  We feel we made great strides in improving the perception of home health care in the minds of legislators and other policy makers.  Against this backdrop, our management team and over 6,000 caregivers continued their uncompromising focus on providing high quality home care to our patients and quality returns for our shareholders.  Our fourth quarter and full year results demonstrate our continued ability to generate organic revenue and earnings growth.  With our strong balance sheet and our position as one of the nation’s larger providers we believe we are well positioned for continued growth both organically and as a consolidator in our industry.”

Fourth Quarter Financial Results

Almost Family reported fourth quarter 2009 net service revenues of $78.0 million, an 18.4% increase from $65.9 million in the fourth quarter of 2008.

Net income for the fourth quarter of 2009 was $6.8 million, or $0.73 per diluted share, compared to $5.2 million, or $0.62 per diluted share, in the fourth quarter of 2008.  The weighted average shares outstanding for purposes of calculating diluted earnings per share increased 11% between periods.  Results for the quarter included costs of $238,000 or $0.03 per diluted share related to a terminated acquisition.

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Fourth Quarter Segment Results

Net revenues in the Visiting Nurse segment for the fourth quarter of 2009 were $67.6 million, a 22% increase from $55.7 million in the fourth quarter of 2008.  The total revenue growth of $12.0 million came from a 19% organic growth rate plus $1.3 million from acquired operations.  Organic Medicare admissions growth was 13% and organic Medicare Episodic growth was 18%.  Operating income before corporate expense in the VN segment for the fourth quarter of 2009 was $14.9 million, an 18% increase from $12.6 million in the fourth quarter of 2008.

Net revenues in the Personal Care (PC) segment for the fourth quarter of 2009 were $10.4 million, a 2% increase from $10.2 million in the fourth quarter of 2008.  Operating income before unallocated corporate expense in the PC segment for the fourth quarter of 2009 was $1.5 million, a 14% increase from $1.3 million in the fourth quarter of 2008.

Full Year Financial Results

Almost Family reported net service revenues for the twelve month period ended December 31, 2009 of $297.8 million, a 41% increase from $211.5 million in the same period of 2008.

Net income for the twelve month period of 2009 was $24.6 million, or $2.86 per diluted share, compared to $16.3 million, or $2.16 per diluted share, in the twelve month period of 2008.  Results for the twelve month period of 2009 included acquisition transactions costs of $463,000 or $0.06 per diluted share.

Full Year Segment Results

Net revenues in the Visiting Nurse segment for the twelve month period of 2009 were $256.1 million, a 48% increase from $173.0 million in the twelve month period of 2008.  The total revenue growth of $83.1 million came from a 29% organic growth rate plus $43.8 million from acquired operations.  Operating income before corporate expense in the VN segment for the twelve month period of 2009 was $53.8 million, a 47% increase from $36.6 million in the same period of 2008.

Net revenues in the Personal Care (PC) segment for the twelve month period of 2009 were $41.8 million, an 8% increase from $38.5 million in the twelve month period of 2008.  Operating income before unallocated corporate expense in the PC segment for the twelve month period of 2009 was $5.2 million, a 37% increase from $3.8 million in the twelve month period of 2008.

Conference Call

A conference call to review the results will begin at 11:00 a.m. ET on February 24, 2010, and will be hosted by William Yarmuth, Chief Executive Officer, and Steve Guenthner, Chief Financial Officer. To participate in the conference call, please dial 1-877-407-0789 (USA) or 1-201-689-8562 (International).  In addition, a dial-up replay of the conference call will be available beginning February 24, 2010 at 2:00 p.m. ET and ending on March 10, 2009. The replay telephone number is 1-877-660-6853 (USA) or 1-201-612-7415 (International). Account Number: 3055 and Passcode: 344574.

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A live Web cast of the call will also be available from the Investor Relations section of the corporate Web site at http://www.almostfamily.com. A Web cast replay can be accessed on the corporate Web site beginning February 24, 2010 at approximately 2:00 p.m. ET and will remain available until March 24, 2010.

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 ALMOST FAMILY, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

 (In thousands, except per share data)

	Three months ended December 31,
	2009			2008
Net service revenues	$	78,020		$	65,895
Cost of service revenues	36,072			30,251
Gross margin	41,948			35,644
General and administrative expenses:
Salaries and benefits	21,118			18,190
Other	8,778			8,200
Total general and administrative expenses	29,896			26,390
Operating income	12,052			9,254
Interest expense, net	(129		)	(414		)
Income from continuing operations before income taxes	11,923			8,840
Income tax expense	(5,070		)	(3,658		)
Net income from continuing operations	6,853			5,182
Discontinued operations, net of tax benefits of $29 and $6	(45		)	15
Net income	$	6,808		$	5,197
Per share amounts-basic:
Average shares outstanding	9,058			8,137
Income from continued operations	$	0.76		$	0.64
Loss from discontinued operations	(0.01		)	0.00
Net income	$	0.75		$	0.64
Per share amounts-diluted:
Average shares outstanding	9,308			8,368
Income from continued operations	$	0.74		$	0.62
Loss from discontinued operations	(0.01		)	0.00
Net income	$	0.73		$	0.62

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ALMOST FAMILY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(In thousands, except per share data)

	Year Ended December 31,
	2009			2008
Net service revenues	$	297,849		$	211,517
Cost of service revenues	138,565			98,246
Gross margin	159,284			113,271
General and administrative expenses:
Salaries and benefits	81,589			57,996
Other	35,620			27,076
Total general and administrative expenses	117,209			85,072
Operating income	42,075			28,199
Interest expense, net	(803		)	(1,147		)
Income from continuing operations before income taxes	41,272			27,052
Income tax expense	(16,583		)	(10,655		)
Net income from continuing operations	24,689			16,397
Discontinued operations, net of tax benefits of $81and $70	(125		)	(104		)
Net income	$	24,564		$	16,293
Per share amounts-basic:
Average shares outstanding	8,372			7,369
Income from continued operations	$	2.95		$	2.23
Loss from discontinued operations	(0.02		)	(0.02		)
Net income	$	2.93		$	2.21
Per share amounts-diluted:
Average shares outstanding	8,589			7,572
Income from continued operations	$	2.87		$	2.17
Loss from discontinued operations	(0.01		)	(0.01		)
Net income	$	2.86		$	2.16

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ALMOST FAMILY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(In thousands)

	As of December 31,
	2009		2008
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	19,389	$	1,182
Accounts receivable - net	35,121		34,760
Prepaid expenses and other current assets	2,544		3,114
Deferred tax assets	7,786		4,438
TOTAL CURRENT ASSETS	64,840		43,494
PROPERTY AND EQUIPMENT - NET	4,291		4,199
GOODWILL	99,133		92,170
OTHER INTANGIBLE ASSETS	14,538		16,715
OTHER ASSETS	587		519
	$	183,389	$	157,097
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	3,360	$	5,321
Accrued other liabilities	20,076		22,317
Current portion - capital leases and notes payable	1,836		4,774
TOTAL CURRENT LIABILITIES	25,272		32,412
LONG-TERM LIABILITIES:
Revolving credit facility	—		23,998
Capital lease obligations	40		111
Notes payable	2,800		3,100
Deferred tax liabilities	5,258		1,216
Other liabilities	1,042		1,477
TOTAL LONG-TERM LIABILITIES	9,140		29,902
TOTAL LIABILITIES	34,412		62,314
STOCKHOLDERS’ EQUITY:
Preferred stock, par value $0.05; authorized 2,000 shares; none issued or outstanding	—		—
Common stock, par value $0.10; authorized 25,000; 9,151 and 8,137 issued and outstanding	915		814
Additional paid-in capital	94,465		64,936
Retained earnings	53,597		29,033
TOTAL STOCKHOLDERS’ EQUITY	148,977		94,783
	$	183,389	$	157,097

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ALMOST FAMILY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(In thousands)

	Year Ended December 31,
	2009			2008
Cash flows from operating activities:
Net income	$	24,564		$	16,293
Loss from discontinued operations	(125		)	(104		)
Income from continuing operations	24,689			16,397
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation and amortization	2,385			1,330
Provision for uncollectible accounts	3,762			2,963
Stock-based compensation	1,371			688
Deferred income taxes	695			1,364
	32,902			22,742
Change in certain net assets and liabilities, net of the effects of acquisitions:
(Increase) decrease in:
Accounts receivable	(3,958		)	(14,282		)
Prepaid expenses and other current assets	570			(993		)
Other assets	(69		)	(34		)
Increase (decrease) in:
Accounts payable and accrued expenses	(2,221		)	2,026
Net cash provided by operating activities	27,224			9,459
Cash flows from investing activities:
Capital expenditures	(2,134		)	(1,476		)
Acquisitions, net of cash acquired	(6,510		)	(59,797		)
Net cash used in investing activities	(8,644		)	(61,273		)
Cash flows from financing activities:
Net revolving credit facility (repayments) borrowings	(23,998		)	11,611
Proceeds from stock option exercises	100			53
Purchase of common stock in connection with stock options	—			—
Tax benefit from non-qualified stock option exercises	203			86
Proceeds from stock offering, net	27,957			41,821
Principal payments on capital leases and notes payable	(4,510		)	(944		)
Net cash (used in) provided by financing activities	(248		)	52,627
Cash flows from discontinued operations:
Operating activities	(125		)	(104		)
Investing activities	—			—
Financing activities	—			—
Net cash used in discontinued operations	(125		)	(104		)
Net increase in cash and cash equivalents	18,207			709
Cash and cash equivalents at beginning of period	1,182			473
Cash and cash equivalents at end of period	$	19,389		$	1,182
Summary of non-cash investing and financing activities:
Capital expenditures financed under capital leases	$	—		$	967
Acquisitions funded by notes payable	$	1,200		$	3,100
Acquisitions funded by stock	$	—		$	1,000
Value of stock withheld in lieu of payroll taxes on option exercises	$	14		$	7

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ALMOST FAMILY, INC. AND SUBSIDIARIES

RESULTS OF OPERATIONS

(UNAUDITED)

(In thousands)

	Three months ended December 31,
	2009					2008					Change
	Amount			% Rev		Amount			% Rev		Amount			%
Net service revenues:
Visiting Nurse	$	67,616		86.7	%	$	55,660		84.5	%	$	11,956		21.5	%
Personal Care	10,404			13.3	%	10,235			15.5	%	169			1.7	%
	78,020			100.0	%	65,895			100.0	%	12,125			18.4	%
Operating income:
Visiting Nurse	14,886			22.0	%		12,608		22.7	%	2,278			18.1	%
Personal Care	1,536			14.8	%	1,344			13.1	%	192			14.3	%
	16,422			21.0	%	13,952			21.2	%	2,470			17.7	%
Corporate expenses	4,370			5.6	%	4,698			7.1	%	(328		)	-7.0	%
Operating income	12,052			15.4	%	9,254			14.0	%	2,798			30.2	%
Interest expense, net	(129		)	0.2	%	(414		)	0.6	%	285			-68.8	%
Income tax expense	(5,070		)	6.5	%	(3,658		)	5.6	%	(1,412		)	38.6	%
Net income from continuing operations	$	6,853		8.8	%	$	5,182		7.9	%	$	1,671		32.2	%
EBITDA from continuing operations	$	12,836		16.5	%	$	9,593		14.6	%	$	3,243		33.8	%

ALMOST FAMILY, INC. AND SUBSIDIARIES

RESULTS OF OPERATIONS

(UNAUDITED)

(In thousands)

	Year ended December 31,
	2009					2008					Change
	Amount			% Rev		Amount			% Rev		Amount			%
Net service revenues:
Visiting Nurse	$	256,060		86.0	%	$	172,977		81.8	%	$	83,083		48.0	%
Personal Care	41,789			14.0	%	38,540			18.2	%	3,249			8.4	%
	297,849			100.0	%	211,517			100.0	%	86,332			40.8	%
Operating income:
Visiting Nurse	53,755			21.0	%		36,645		21.2	%	17,110			46.7	%
Personal Care	5,166			12.4	%	3,770			9.8	%	1,396			37.0	%
Operating income before unallocated corporate expenses	58,921			19.8	%	40,415			19.1	%	18,506			45.8	%
Corporate expenses	16,846			5.7	%	12,216			5.8	%	4,630			37.9	%
Operating income	42,075			14.1	%	28,199			13.3	%	13,876			49.2	%
Interest expense, net	(803		)	0.3	%	(1,147		)	0.5	%	344			-30.0	%
Income taxes	(16,583		)	5.6	%	(10,655		)	5.0	%	(5,928		)	55.6	%
Net income from continuing operations	$	24,689		8.3	%	$	16,397		7.8	%	$	8,292		50.6	%
EBITDA from continuing operations	$	45,831		15.4	%	$	30,217		14.3	%	$	15,614		51.7	%

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 ALMOST FAMILY, INC. AND SUBSIDIARIES

 VISITING NURSE SEGMENT OPERATING METRICS

	Three months ended December 31,
	2009			2008			Change
	Amount			Amount			Amount		%
Average number of locations	85			74			11		14.9	%
All payors:
Admissions	13,497			11,542			1,955		16.9	%
Billable visits	449,979			351,021			98,958		28.2	%
Medicare statistics:
Revenue (in thousands)	$	61,284		$	49,120		$	12,164	24.8	%
Percentage of total revenues	90.6		%	88.2		%
Billable visits	369,791			297,649			72,142		24.2	%
Admissions	12,142			10,498			1,644		15.7	%
Episodes started	19,733			16,291			3,442		21.1	%
Revenue per completed episode	$	3,077		$	2,985		$	92	3.1	%
Visits per episode	18.3			17.7			0.6		3.4	%

ALMOST FAMILY, INC. AND SUBSIDIARIES

PERSONAL CARE SEGMENT OPERATING METRICS

	Three months ended December 31,
	2009		2008		Change
	Amount		Amount		Amount			%
Average number of locations	23		22		1			4.5	%
Admissions	754		840		(86		)	-10.2	%
Patient days of care	155,385		145,835		9,550			6.5	%
Billable hours	568,368		549,742		18,626			3.4	%
Revenue per billable hours	$	18.31	$	18.62	$	(0.31	)	-1.7	%

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ALMOST FAMILY, INC. AND SUBSIDIARIES

VISITING NURSE SEGMENT OPERATING METRICS

	Year ended December 31,
	2009			2008			Change
	Amount			Amount			Amount		%
Average number of locations	78			62			16		25.8	%
All payors:
Admissions	52,029			39,691			12,338		31.1	%
Billable visits	1,712,480			1,088,339			624,141		57.3	%
Medicare statistics:
Revenue (in thousands)	$	230,383		$	156,892		$	73,491	46.8	%
Percentage of total revenues	90.0		%	90.7		%
Billable visits	1,395,001			952,191			442,810		46.5	%
Admissions	47,110			36,200			10,910		30.1	%
Episodes started	76,436			53,692			22,744		42.4	%
Revenue per completed episode	$	2,974		$	2,855		$	119	4.2	%
Visits per episode	17.7			17.3			0.4		2.3	%

ALMOST FAMILY, INC. AND SUBSIDIARIES

PERSONAL CARE SEGMENT OPERATING METRICS

	Year ended December 31,
	2009		2008		Change
	Amount		Amount		Amount			%
Average number of locations	22		22		—			0.0	%
Admissions	3,219		3,457		(238		)	-6.9	%
Patient days of care	607,760		550,208		57,552			10.5	%
Billable hours	2,282,560		2,074,229		208,331			10.0	%
Revenue per billable hours	$	18.31	$	18.58	$	(0.27	)	-1.5	%

Non-GAAP Financial Measure

The information provided in the tables in this release includes certain non-GAAP financial measures as defined under Securities and Exchange Commission (SEC) rules.  In accordance with SEC rules, the Company has provided, in the supplemental information and the footnotes to the tables, a reconciliation of those measures to the most directly comparable GAAP measures.

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EBITDA:

EBITDA is defined as income before depreciation and amortization, net interest expense and income taxes. EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America. It should not be considered in isolation or as a substitute for net income, operating income, cash flows from operating, investing or financing activities, or any other measure calculated in accordance with generally accepted accounting principles. The items excluded from EBITDA are significant components in understanding and evaluating financial performance and liquidity. Management routinely calculates and communicates EBITDA and believes that it is useful to investors because it is commonly used as an analytical indicator within our industry to evaluate performance, measure leverage capacity and debt service ability, and to estimate current or prospective enterprise value. EBITDA is also used in certain covenants contained in our credit agreement.

The following tables set forth a reconciliation of Continuing Operations Net Income to EBITDA:

ALMOST FAMILY, INC. AND SUBSIDIARIES

RECONCILIATION OF EBITDA

(In thousands)

	Three months ended December 31,
	2009		2008
Net income from continuing operations	$	6,853	$	5,182
Add back:
Interest expense	129		414
Income tax expense	5,070		3,658
Depreciation and amortization	632		179
Amortization of stock-based compensation	152		160
Earnings before interest, income taxes, depreciation and amortization (EBITDA) from continuing operations	$	12,836	$	9,593

ALMOST FAMILY, INC. AND SUBSIDIARIES

RECONCILIATION OF EBITDA

(In thousands)

	Year Ended December 31,
	2009		2008
Net income from continuing operations	$	24,689	$	16,397
Add back:
Interest expense	803		1,147
Income tax expense	16,583		10,655
Depreciation and amortization	2,385		1,330
Amortization of stock-based compensation	1,371		688
Earnings before interest, income taxes, depreciation and amortization (EBITDA) from continuing operations	$	45,831	$	30,217

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About Almost Family

Almost Family, Inc., founded in 1976, is a leading regional provider of home health nursing services, with branch locations in Florida, Kentucky, Connecticut, New Jersey, Ohio, Massachusetts, Alabama, Missouri, Illinois, Pennsylvania, and Indiana (in order of revenue significance). Almost Family, Inc. and its subsidiaries operate a Medicare-certified segment and a personal care segment. Altogether, Almost Family operates over 100 branch locations in 11 U.S. states.

Forward Looking Statements

All statements, other than statements of historical facts, included in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “believe,” “estimate,” “project,” “anticipate,” “continue,” or similar terms, variations of those terms or the negative of those terms. These forward-looking statements are based on the Company’s current plans, expectations and projections about future events.

Because forward-looking statements involve risks and uncertainties, the Company’s actual results could differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. The potential risks and uncertainties which could cause actual results to differ materially include: regulatory approvals or third party consents may not be obtained, the impact of further changes in healthcare reimbursement systems, including the ultimate outcome of potential changes to Medicare reimbursement for home health services and to Medicaid reimbursement due to state budget shortfalls; the ability of the Company to maintain its level of operating performance and achieve its cost control objectives; changes in our relationships with referral sources; the ability of the Company to integrate acquired operations; government regulation; health care reform; pricing pressures from Medicare, Medicaid and other third-party payers; changes in laws and interpretations of laws relating to the healthcare industry; and the Company’s self-insurance risks.  For a more complete discussion regarding these and other factors which could affect the Company’s financial performance, refer to the Company’s various filings with the Securities and Exchange Commission, including its filing on Form 10-K for the year ended December 31, 2008, in particular information under the headings “Special Caution Regarding Forward-Looking Statements” and “Risk Factors.” The Company undertakes no obligation to update or revise its forward-looking statements.

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