Exhibit 99.1
FOR IMMEDIATE RELEASE August 3, 2005
Almost Family Signs Definitive Agreement
to Sell Adult Day Care Segment
Will Be Pure Play Home Care Company
Approaching $80 Million Revenue
Louisville, Ky. Almost Family, Inc. (NASDAQ SC:AFAM) announced that it has
entered into a definitive agreement for the sale of its Adult Day Care Segment
operations to Active Services, Inc. (Active Services) in an asset sale.
The purchase price consists of $13.6 million cash plus assumption of
approximately $1.4 million of debt. In return, Active Services will acquire
substantially all the assets and assume certain working capital liabilities
related to Almost Family's 19 medical adult day care centers which generate
approximately $21 million in annual revenues. The transaction, which is subject
to certain conditions including regulatory approvals and third-party consents,
is expected to close by October 1, 2005.
Pure Play Home Health Company Approaching $80 Million Revenue
Following the transaction, Almost Family will be a pure play home health care
company with two operating segments: Caretenders Visiting Nurse (VN)
Medicare-certified operations with a current annual revenue run rate of
approximately $43 million and its Personal Care (PC) home health operations with
a current annual revenue run rate of approximately $35 million. Almost Family
has home health operations in Florida, Kentucky, Ohio, Connecticut,
Massachusetts and Alabama.
$20 Million Capital Available for Home Health Acquisitions
Proceeds of the transaction are expected to be used to repay substantially all
outstanding debt (excluding certain seller financing) and leave approximately $4
million in cash available. Cash on hand, combined with borrowing capacity on its
senior credit facility, will make over $20 million of capital immediately
available to fund the Company's acquisition and development activities. The
Company expects that amount of capital, plus internally generated growth and
free cash flow, to be sufficient to take it to over $100 million in revenues.
Disposition Accretive to EPS
The disposition is expected to be immediately accretive to earnings per share.
Transaction Gain Expected
Subject to final purchase price adjustments, the Company expects to report an
after-tax gain of $5-$6 million ($2.20-$2.60 per basic share) on closing of the
transaction.
Company Commentary
William B. Yarmuth, Almost Family's Chairman and CEO commented on this latest
development: "As stated in our business plan, Almost Family is continuing to
shift its focus to the accelerated development of our home health operations.
This transaction frees all our remaining management time and capital to pursue a
more aggressive, single-minded pursuit of home health development while also
placing our adult day care operations in the hands of a well-capitalized
experienced company with a singular focus on adult day care."
"While we are pleased with the transaction, we have somewhat mixed emotions. We
want to express our sincere gratitude to our ADC segment managers and employees
for their tremendous commitment to quality, their many years of service
dedicated to the care of their members, and for helping us make our ADC segment
what it is today," continued Yarmuth.
Yarmuth concluded: "Our next milestone is to take the Company past the $100
million mark in home health care revenues. This management team will continue to
build momentum in its acquisition and start-up activities fueled by the
availability of some $20 million of available investment capital."
The Company has noted in its previous announcements that it is actively pursuing
a number of potential acquisitions in Florida and other states and expects that
it will be able to complete additional transactions over the course of the next
year. The Company's 2004 Form 10-K includes a description of its business plan
which calls for an increase in emphasis on the Visiting Nurse segment.
Additional Information Next Week
The Company's next Form 10Q, to be filed within the next two weeks, will provide
a more detailed disclosure and discussion of the financial implications of this
transaction.
Almost Family, Inc. TM and subsidiaries (collectively "Almost Family") is a
leading regional provider of home health nursing services and adult day health
services. The Company has service locations in Florida, Kentucky, Ohio,
Maryland, Connecticut, Massachusetts, Alabama and Indiana (in order of revenue
significance).
Contact: William Yarmuth or Steve Guenthner (502) 891-1000.
All statements, other than statements of historical facts, included in this news
release, including the objectives and expectations of management for the
Company's ability to complete the contemplated divestiture of its adult day care
segment, the expectation that the divesture will be accretive to earnings per
share, future operating results of its home health agencies, the Company's
ability to acquire visiting nurse agencies at prices it is willing to pay, the
Company's ability to attract investment of additional capital, the Company's
ability to generate positive cash flows, and the Company's expectations with
regard to market conditions, are forward-looking statements. These
forward-looking statements are based on the Company's current expectations.
Although the Company believes that the expectations expressed or implied in such
forward-looking statements are reasonable, there can be no assurance that such
expectations will prove to be correct.
Because forward-looking statements involve risks and uncertainties, the
Company's actual results could differ materially. The potential risks and
uncertainties which could cause actual results to differ materially could
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 Medicaid reimbursement due to state
budget shortfalls; the ability of the acquired agency to maintain its level of
admissions and operating performance, our ability to integrate acquired agencies
into our 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
potential effect of changes in competition for home health agency admissions.
For a more complete discussion regarding these and other factors which could
affect the Company's financial performance, refer to the Company's Securities
and Exchange Commission filing on Form 10-K for the year ended December 31,
2004, in particular information under the headings "Business" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations." The
Company disclaims any intent or obligation to update its forward-looking
statements.