Exhibit 99.1
Almost Family Reports Second Quarter Operating Results
Net Income from Continuing Operations up 57% Over Prior Year
Total Revenues Up 14%, VN Segment Revenues Grew 27%
Almost Family today reported its results of operations for the three and six
month periods ended June 30, 2005.
Quarterly Results
Net income from continuing operations grew 57% to a record $668,757 ($0.25 per
diluted share) for the June 2005 quarter as compared to $424,903 ($0.17 per
diluted share) in the June 2004 quarter for an increase of 57%. Revenues grew
14% to $24.8 million in the June 2005 quarter from $21.7 million in the June
2004 quarter.
On August 3, 2005, the Company announced plans to divest its adult day care
(ADC) segment. Because the Company had not committed to that divestiture until
after the end of the quarter, ADC operations are included in continuing
operations in the June 2005 quarter. ADC operations will be reported as
discontinued operations for all subsequent periods. The Company expects to
report an after-tax gain on the sale of between $5 million and $6 million ($1.90
to $2.28 per diluted share) when the transaction closes.
If the ADC divestiture had qualified for discontinued operations accounting
treatment at June 30, 2005 the Company would have reported growth in net income
from continuing operations of 68% to $660,484 ($0.25 per diluted share) for the
June 2005 quarter from $392,710 ($0.15 per diluted share) in the June 2004
quarter. It would have reported continuing operations revenue growth of 17.8% to
$19.3 million in the June 2005 quarter up from $16.4 million in the June 2004
quarter. These results exclude the effect the use of the net proceeds of the
sale of the ADC operations would have had on interest expense (income) net of
income tax effect.
Revenues in the Company's Caretenders Visiting Nurse (VN) segment grew 27% over
the same period last year with about one half of that growth being internally
generated. The April 1, 2005 acquisition of Bradenton, FL-based "Florida Home
Health" VN operations added approximately $1 million in revenues and $111,000 in
net income ($0.04 per diluted share) to operating results in the June 2005
quarter. Net income from continuing operations for the June 2005 quarter
included $88,451 ($0.03 per diluted share) of operating losses related to VN
operations started late in 2004 and first quarter 2005. Related revenues were
approximately $635,000.
Net income (loss) from discontinued operations (not related to the sale of the
ADC segment) for the quarter ended June 30, 2005 was a loss of ($46,119) or
($0.02) per diluted share compared to a loss of ($30,218) or ($0.01) per diluted
share in 2004.
Including discontinued operations, consolidated net income increased 58% to
$622,638 or $0.24 per diluted share in 2005 from $394,685 or $0.15 per diluted
share in 2004.
Results of operations for the quarters ended June 30, 2005 and 2004 are set
forth in the tables below:
June June
2005 2004 Change
--------------------- --------- --------------------- ---------- ----------------- ----------
Amount % Rev Amount % Rev Amount %
--------------------- --------- --------------------- ---------- ----------------- ----------
Net Revenues
Home Health Care
Visiting Nurses $ 10,317,868 41.7% $ 8,108,047 37.4% $ 2,209,821 27.3%
Personal Care 9,005,375 36.4% 8,288,627 38.2% 716,748 8.6%
--------------------- --------------------- -----------------
19,323,243 78.0% 16,396,674 75.6% 2,926,569 17.8%
Adult Day Care 5,449,038 22.0% 5,305,679 24.4% 143,359 2.7%
--------------------- --------------------- -----------------
$ 24,772,281 100.0% $ 21,702,353 100.0% $ 3,069,928 14.1%
===================== ===================== =================
Operating Income
Home Health Care
Visiting Nurses $ 1,468,753 14.2% $ 1,305,639 16.1% $ 163,114 12.5%
Personal Care 941,215 10.5% 689,023 8.3% 252,192 36.6%
--------------------- --------------------- -----------------
2,409,968 12.5% 1,994,662 12.2% 415,306 20.8%
Adult Day Care 355,328 6.5% 357,947 6.7% (2,619) -0.7%
--------------------- --------------------- -----------------
2,765,296 11.2% 2,352,609 10.8% 412,687 17.5%
Unallocated Corp Expenses 1,582,486 6.4% 1,518,755 7.0% 63,731 4.2%
--------------------- --------------------- -----------------
1,182,810 4.8% 833,854 3.8% 348,956 41.8%
Facility gains (losses) (8,317) 0.0% (2,566) 0.0% (5,751) 224.1%
Interest Expense 97,106 0.4% 123,116 0.6% (26,010) -21.1%
--------------------- --------------------- -----------------
Pre-Tax Income 1,077,387 4.3% 708,172 3.3% 369,215 52.1%
Income Taxes 408,630 1.6% 283,269 1.3% 125,361 44.3%
--------------------- --------------------- -----------------
Net Income from Continuing
Operations $ 668,757 2.7% $ 424,903 2.0% $ 243,854 57.4%
Income (loss) from discontinued
operations, net of tax (46,119) (30,218) (15,901) 52.6%
--------------------- --------------------- -----------------
Net Income $ 622,638 $ 394,685 $ 227,953 57.8%
===================== ===================== =================
Diluted Earnings Per Share
Diluted Shares Outstanding 2,627,375 2,552,978 74,397 2.9%
Continuing Operations $ 0.25 $ 0.17 $ 0.08 47.8%
Discontinued Operations (0.02) (0.02) (0.00) NM
--------------------- --------------------- -----------------
$ 0.24 $ 0.15 $ 0.08 53.3%
===================== ===================== =================
Continuing Operations:
EBITDA $ 1,763,648 $ 1,440,223 $ 323,425 22.5%
Effective Tax Rate 38.6% 40.0% (1.4%)
William B. Yarmuth, Chairman and CEO commented on the operating results: "The
fact that we are producing record levels of net income from continuing
operations, whether with or without the ADC operations, clearly says we are on
the right strategic path. We are very pleased with our results for the quarter
which saw accelerated revenue growth rates in all our operating segments. VN
leads the way with 27% revenue growth, half of which came from acquisitions and
half of which was internally generated. However, our in-home personal care (PC)
segment also contributed almost 9% revenue growth all of which was internally
generated."
"While we are pleased with our results for the quarter, as we said last week we
think we can do more. With the divestiture of the ADC segment, all our
management time and talent will be turned toward accelerating our growth in our
home health operations. With the amount of capital now available to us we will
seek to be more aggressive in our approach to acquisitions and startups and we
will redouble our efforts to increase the effectiveness and efficiency of our
sales and marketing activities," Yarmuth concluded.
The Company noted that before considering the purchase price of acquisitions
completed, its cash flows resulted in debt reduction of approximately $2.1
million in the quarter ended June 30, 2005 and about $7.9 million in the twelve
months ended June 30, 2005. Following completion of the sale of its ADC segment,
the Company expects to have about $4 million in cash, no balance then
outstanding on its bank credit facility, and approximately $18 million in
borrowing capacity under that facility.
Year to Date Results
Net income from continuing operations grew 43% to $1,089,421 ($0.42 per diluted
share) for the six months ended June 2005 as compared to $762,607 ($0.30 per
diluted share) in the six months ended June 2004. Revenues grew 12% to $48.3
million in the six months ended June 2005 from $43.2 million in the six months
ended June 2004.
If the ADC divestiture had qualified for discontinued operations accounting
treatment at June 30, 2005 the Company would have reported growth in net income
from continuing operations of 25% to $1,218,043 ($0.46 per diluted share) for
the six months ended June 2005 from $973,873 ($0.38 per diluted share) in the
six months ended June 2004. It would have reported continuing operations
revenues growth of 15% to $37.7 million in the six months ended June 2005 up
from $32.8 million in the six months ended June 2004. These results exclude the
effect the use of the net proceeds of the sale of the ADC operations would have
had on interest expense (income) net of income tax effect.
Revenues in the Company's Caretenders Visiting Nurse (VN) segment grew 21% over
the same period last year with about two-thirds of that growth being internally
generated. The April 1, 2005 acquisition of Bradenton, FL-based "Florida Home
Health" VN operations added approximately $1 million in revenues and $111,000 in
net income ($0.04 per diluted share) to operating results for the six months
ended June 2005. Net income from continuing operations for the six months ended
June 2005 included $226,564 ($0.09 per diluted share) of operating losses
related to VN operations started late in 2004 and first quarter 2005. Related
revenues were approximately $914,000.
Net income (loss) from discontinued operations (not related to the sale of the
ADC segment) for the six months ended June 30, 2005 was a loss of $82,849 ($0.03
per diluted share) compared to a loss of $66,559 ($0.03 per diluted share) in
2004.
Including discontinued operations, consolidated net income increased 45% to
$1,006,572 or $0.38 per diluted share in 2005 from $696,047 or $0.27 per diluted
share in 2004.
Results of operations for the six months ended June 30, 2005 and 2004 are set
forth in the tables below:
June June
2005 2004 Change
--------------------- --------- --------------------- ---------- ----------------- ----------
Amount % Rev Amount % Rev Amount %
--------------------- --------- --------------------- ---------- ----------------- ----------
Net Revenues
Home Health Care
Visiting Nurses $ 19,973,387 41.4% $ 16,449,457 38.1% $ 3,523,930 21.4%
Personal Care 17,761,807 36.8% 16,390,519 38.0% 1,371,288 8.4%
--------------------- --------------------- -----------------
37,735,194 78.1% 32,839,976 76.1% 4,895,218 14.9%
Adult Day Care 10,556,220 21.9% 10,330,793 23.9% 225,427 2.2%
--------------------- --------------------- -----------------
$ 48,291,414 100.0% $ 43,170,769 100.0% $ 5,120,645 11.9%
===================== ===================== =================
Operating Income
Home Health Care
Visiting Nurses $ 3,091,779 15.5% $ 2,813,815 17.1% $ 277,964 9.9%
Personal Care 1,637,358 9.2% 1,395,693 8.5% 241,665 17.3%
--------------------- --------------------- -----------------
4,729,137 12.5% 4,209,508 12.8% 519,629 12.3%
Adult Day Care 603,949 5.7% 217,126 2.1% 386,823 178.2%
--------------------- --------------------- -----------------
5,333,086 11.0% 4,426,634 10.3% 906,452 20.5%
Unallocated Corp Expenses 3,357,962 7.0% 2,891,518 6.7% 466,444 16.1%
--------------------- --------------------- -----------------
1,975,124 4.1% 1,535,116 3.6% 440,008 28.7%
Facility gains (losses) (8,317) 0.0% 3,854 0.0% (12,171) -315.8%
Interest Expense 188,313 0.4% 267,959 0.6% (79,646) -29.7%
--------------------- --------------------- -----------------
Pre-Tax Income 1,778,494 3.7% 1,271,011 2.9% 507,483 39.9%
Income Taxes 689,072 1.4% 508,405 1.2% 180,667 35.5%
--------------------- --------------------- -----------------
Net Income from
Continuing $ 1,089,422 2.3% $ 762,607 1.8% $ 326,816 42.9%
Operations
Income (loss) from discontinued
operations, net of tax $ (82,849) $ (66,559) $ (16,290) 24.5%
--------------------- --------------------- -----------------
Net Income $ 1,006,573 $ 696,047 $ 310,526 44.6%
===================== ===================== =================
Diluted Earnings Per Share
Diluted Shares Outstanding 2,622,501 2,553,915 68,586 2.7%
Continuing Operations $ 0.42 $ 0.30 $ 0.12 40.0%
Discontinued Operations $ (0.03) $ (0.03) $ (0.00) NM
--------------------- --------------------- -----------------
$ 0.38 $ 0.27 $ 0.12 44.4%
===================== ===================== =================
Continuing Operations:
EBITDA $ 3,160,453 $ 2,752,059 $ 408,393 14.8%
Effective Tax Rate 38.7% 40.0% (1.3%)
Non-GAAP Financial Measures
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.
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 measurements of borrowing availability and certain covenants contained
in our credit agreement.
The following table sets forth a reconciliation of net income to EBITDA:
Quarter Ended June 30,
------------------------ ------------------------
2005 2004
------------------------ ------------------------
Net Income from continuing operations $ 668,757 $ 424,903
Add Back:
Interest Expense 97,106 123,116
Income Taxes 408,630 283,269
Depreciation & Amortization 589,155 608,935
------------------------ ------------------------
Earnings Before Interest, Income Taxes,
Depreciation & Amortization (EBITDA) from
continuing operations $ 1,763,648 $ 1,440,223
======================== ========================
Six Months Ended June 30,
-------------------------------------------------
2005 2004
------------------------ ------------------------
Net Income from continuing operations $ 1,089,422 $ 762,607
Add Back:
Interest Expense 188,313 267,959
Income Taxes 689,072 508,405
Depreciation & Amortization 1,193,646 1,213,088
------------------------ ------------------------
Earnings Before Interest, Income Taxes,
Depreciation & Amortization (EBITDA) from
continuing operations $ 3,160,453 $ 2,752,059
======================== ========================
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.
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 future
operating results, the Company's ability to complete the sale of its ADC
segment, the Company's ability to accelerate growth in its home health
operations, the Company's ability to generate VN revenue growth, the Company's
ability to acquire visiting nurse agencies at prices it is willing to pay, the
Company's ability to increase the efficiency and effectiveness of its sales and
marketing efforts, 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 Company to maintain its level of operating
performance and achieve its cost control objectives; 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 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.