Exhibit 99.1
LHC Group Announces First Quarter 2007 Results
LAFAYETTE, La.--(BUSINESS WIRE)--April 30, 2007--LHC Group, Inc.
(NASDAQ: LHCG):
Highlights:
-- Net service revenue increases 50.7% to $70.0 million for the
first quarter;
-- Net income increases 51.4% to $6.3 million for the first
quarter; and
-- Earnings per share increases 34.6% to $0.35 for the first
quarter.
LHC Group, Inc. (NASDAQ: LHCG), a provider of post-acute
healthcare services primarily in rural markets in the southern United
States, announced today its financial results for the first quarter
ended March 31, 2007.
Financial Results for the First Quarter
Net service revenue for the first quarter ended March 31, 2007,
increased 50.7% to $70.0 million compared with $46.5 million in 2006.
For the three months ended March 31, 2007 and 2006, 80.8% and 86.1%,
respectively, of net service revenue was derived from Medicare. For
the first quarter, home-based services accounted for 78.6% of revenue
and facility-based services was 21.4% of revenue compared with 69.8%
and 30.2%, respectively, for the comparable prior year quarter.
Net income for the first quarter of 2007 totaled $6.3 million, or
$0.35 per diluted share, compared with net income of $4.1 million, or
$0.26 per diluted share, for the first quarter of 2006.
Home-Based Services
Net service revenue for home-based services for the three months
ended March 31, 2007, increased 69.8% to $55.1 million compared with
$32.4 million for the three months ended March 31, 2006. Organic
growth in this service sector was approximately $17.6 million, or
66.3% during the period. Total admissions increased 69.3% to 9,431
during the period, versus 5,570 for the same period in 2006. Organic
growth in admissions was 61.7%. The Company also monitors patient
census as a key performance indicator within its home-based services.
LHC Group's average home-based patient census for the three months
ended March 31, 2007, increased 71.9% to 15,712 patients as compared
with 9,138 patients for the three months ended March 31, 2006. Organic
growth in home-based patient census was 62.2%.
Facility-Based Services
Net service revenue for facility-based services for the three
months ended March 31, 2007, increased 6.6% to $15.0 million compared
with $14.0 million for the three months ended March 31, 2006. The
increase in facility-based net service revenue is due primarily to an
increase in patient days. Patient days were 11,674 in the three months
ended March 31, 2007, as compared with 11,699 in the three months
ended March 31, 2006. The 11,699 patient days in the first quarter of
2006 includes 669 patient days for a discontinued entity which is not
included in the net service revenue. Patient days, less discontinued
operations, increased 5.8% to 11,674 in the three months ended March
31, 2007, from 11,030 in the three months ended March 31, 2006.
Outpatient visits decreased 70.2% to 2,615 at March 31, 2007, compared
with 8,775 for the three months ended March 31, 2006, due to the sale
of one of the Company's clinics and the closure of another clinic on
April 1, 2006.
DSO
Days sales outstanding, or DSO, for the three months ended March
31, 2007, was 78 days compared with 72 days for the same three-month
period in 2006. DSO, when adjusted for acquisitions and unbilled
accounts receivables, was 68 days. The adjustment takes into account
$8.1 million of unbilled receivables that the Company is delayed in
billing at this time due to the lag time in receiving the change of
ownership after acquiring companies. For the comparable period in
2006, adjusted DSO was 62 days, taking into account $2.7 million in
unbilled accounts receivable as well as an additional $2.6 million of
accounts receivable that was acquired during the later part of 2005
and the first quarter of 2006 which did not generate revenue for the
Company.
In commenting on the results, Keith G. Myers, president and chief
executive officer of LHC Group, said, "We are very pleased with the
performance of our clinical operations team. Our growth in the
home-based services group has been stellar. Not to be overlooked,
however, is the performance of the facility-based services group,
which has worked diligently within a difficult environment to control
costs while providing a high level of service to the many acutely ill
patients they serve. Our continued success acknowledges the commitment
to excellence that is ingrained in every member of the LHC Group
Family."
Myers continued, "Our most valued accomplishment in the first
quarter of 2007 was the growth in the number of elderly and disabled
entrusted to our care. For the first time in our history, our
caregivers provided quality nursing services to over 15,000 patients
each and every day. Our mission is the same today as it was in the
beginning - to provide the highest quality healthcare services
possible to the elderly and disabled we serve, in the least
restrictive and most cost-effective manner possible. We are humbled
and honored by the opportunity to serve a growing number of patients,
families and communities."
In commenting on the Centers for Medicare & Medicaid Services
(CMS) proposed rule, Myers said, "We received a copy of the proposed
rule published late Friday, April 27, and are currently evaluating the
impact the proposed rule will have on the Company. However, due to the
multiple components of the proposed rule, we have not yet completed
our analysis. We are already working diligently with the National
Association for Home Care, outside consultants, other homecare
providers and patient advocacy groups to ensure that our comments and
recommended changes are effectively communicated to CMS and members of
Congress during the comment period for this proposed rule. Our goal is
to work with CMS and members of Congress to develop a final rule that
promotes full access to quality home health services for elderly and
disabled patients."
The live broadcast of LHC Group's conference call will begin at
10:00 a.m. Eastern time on Tuesday, May 1, 2007. Speakers on the call
will include Keith Myers, president and chief executive officer; Barry
Stewart, executive vice president and chief financial officer; and
John Indest, executive vice president and chief operating officer. A
link to the webcast can be found under the investor relations section
of the Company's website, www.lhcgroup.com, or at www.earnings.com. A
replay of the webcast will also be archived on LHC Group's website. A
telephone replay will be available for one week by dialing (888)
286-8010 (US) or (617) 801-6888 (international) and entering the pass
code #16532808.
About LHC Group, Inc.
LHC Group is a provider of post-acute healthcare services
primarily in rural markets in the southern United States. LHC Group
provides home-based services through its home nursing agencies and
hospices and facility-based services through its long-term acute care
hospitals and rehabilitation facilities.
Certain matters discussed in this press release constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements may be identified by words such as "believe," "expect,"
"anticipate," "intend," "estimate" or similar expressions.
Forward-looking statements involve a number of risks and uncertainties
and there can be no assurance that any forward-looking statements will
prove to be accurate. Important factors that could cause actual
results to differ materially from those anticipated in the
forward-looking statements include: changes in reimbursement, changes
in government regulations, changes in our relationships with referral
sources, increased competition for our services, increased competition
for joint venture and acquisition candidates and changes in the
interpretation of government regulations. LHC Group undertakes no
obligation to update or revise any forward-looking statements. Further
information regarding risks, uncertainties and other factors that
could adversely affect LHC Group or cause actual results to differ
materially from those anticipated in forward-looking statements are
included in LHC Group's Form 10K for the year ended December 31, 2006,
filed with the Securities and Exchange Commission.
LHC GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
March 31 Dec. 31,
2007 2006
---------- --------
(unaudited)
Cash $ 20,856 $ 26,877
Total assets 164,804 152,694
Total debt 3,732 3,837
Total stockholders' equity 128,553 121,889
LHC GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share data)
Three Months Ended
March 31,
---------------------------
2007 2006
------------- -----------
Net service revenue $ 70,034 $ 46,468
Cost of service revenue 35,194 24,860
------------- -----------
Gross margin 34,840 21,608
General and administrative expenses 23,038 15,247
------------- -----------
Operating income 11,802 6,361
Interest expense 83 86
Non-operating income, including (gain)
loss on sales of assets (293) (166)
------------- -----------
Income from continuing operations before
income taxes and minority interest and
cooperative endeavor allocations 12,012 6,441
Income tax expense 3,939 1,697
Minority interest and cooperative endeavor
allocations 1,807 995
------------- -----------
Income from continuing operations 6,266 3,749
Loss from discontinued operations (net of
income tax benefit of $2 and $129 in the
three months ended March 31, 2007 and
2006, respectively) (3) (210)
Gain on sale of discontinued operations
(net of income taxes of $366 for the
three months ended March 31, 2006) - 597
-------------- -----------
Net income 6,263 4,136
Gain (loss) on redeemable minority
interests 35 843
------------- -----------
Net income available to common
stockholders $ 6,298 $ 4,979
============= ===========
Basic and diluted earnings per share:
Income from continuing operations $ 0.35 $ 0.23
Loss from discontinued operations, net - (0.01)
-------------- -----------
Gain on sale of discontinued
operations, net - 0.04
-------------- -----------
Net income 0.35 0.26
Gain (loss) on redeemable minority
interests - 0.05
-------------- -----------
Net income available to common
shareholders $ 0.35 $ 0.31
============= ===========
Weighted average shares outstanding:
Basic 17,748,369 16,557,828
Diluted 17,807,338 16,563,368
LHC GROUP, INC. AND SUBSIDIARIES
UNAUDITED SEGMENT INFORMATION
(in thousands)
Three Months Ended
March 31, 2007
------------------------------------
Home- Facility-
Based Based
Services Services Total
-------- --------------- -----------
Net service revenue $55,066 $ 14,968 $ 70,034
Cost of service revenue 26,028 9,166 35,194
General and administrative
expenses 17,835 5,203 23,038
Operating income 11,203 599 11,802
Three Months Ended
March 31, 2006
------------------------------------
Home- Facility-
Based Based
Services Services Total
-------- --------------- -----------
Net service revenue $32,421 $ 14,047 $ 46,468
Cost of service revenue 16,233 8,627 24,860
General and administrative
expenses 11,321 3,926 15,247
Operating income 4,867 1,494 6,361
CONTACT: LHC Group, Inc.
Barry Stewart, 337-233-1307
Executive Vice President and Chief Financial Officer