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Section 1: 8-K (8-K)

8-K

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): October 29, 2018

Commission File Number: 0-24260

 

LOGO

 

 

 

AMEDISYS, INC.

(Exact Name of Registrant as specified in its Charter)

 

 

 

Delaware   11-3131700

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

3854 American Way, Suite A, Baton Rouge, LA 70816

(Address of principal executive offices, including zip code)

(225) 292-2031 or (800) 467-2662

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

    ☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

    ☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

    ☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


    ☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐    

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐    

 

 

SECTION 2 — FINANCIAL INFORMATION

ITEM 2.02.    RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On October 29, 2018, Amedisys, Inc. (“we,” “us,” “our” or the “Company”) issued a press release announcing our financial results for the three and nine-month periods ended September 30, 2018. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information presented in Item 2.02 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, unless we specifically state that the information is to be considered “filed” under the Exchange Act or specifically incorporate it by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.

SECTION 7 – REGULATION FD

ITEM 7.01. REGULATION FD DISCLOSURE

Item 2.02 of this Current Report on Form 8-K is incorporated herein by reference.

In addition, a copy of the supplemental slides which will be discussed during the Company’s earnings call at 11:00 a.m. ET on Tuesday, October 30, 2018 is attached to this report as Exhibit 99.2 and incorporated herein by reference.

The information presented in Item 7.01 of this Current Report on Form 8-K and Exhibit 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, unless we specifically state that the information is to be considered “filed” under the Exchange Act or specifically incorporate it by reference in any filing under the Securities Act or the Exchange Act.

SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits.

 

99.1

  

Press release dated October  29, 2018 announcing the Company’s financial results for the three and nine-month periods ended September 30, 2018 (furnished only)

99.2

  

Supplemental slides provided in connection with the third quarter 2018 earnings call of the Company (furnished only)


Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

AMEDISYS, INC.

(Registrant)

 

By:   /s/ Scott G. Ginn
  Scott G. Ginn
  Chief Financial Officer
  (Principal Financial Officer)

 

DATE: October 29, 2018

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

EX-99.1

Exhibit 99.1

 

LOGO

AMEDISYS REPORTS THIRD QUARTER 2018 FINANCIAL RESULTS

AND UPDATES 2018 GUIDANCE

BATON ROUGE, Louisiana (October 29, 2018) — Amedisys, Inc. (NASDAQ: AMED) today reported its financial results for the three and nine-month period ended September 30, 2018.

Three Month Periods Ended September 30, 2018 and 2017

 

   

Net service revenue increased $43.6 million to $417.3 million compared to $373.7 million in 2017 (1).

 

   

Net income attributable to Amedisys, Inc. of $31.4 million compared to $14.6 million in 2017.

 

   

Net income attributable to Amedisys, Inc. per diluted share of $0.96 per diluted share compared to $0.42 in 2017.

Adjusted Quarterly Results*

 

   

Adjusted EBITDA of $45.3 million compared to $36.9 million in 2017.

 

   

Adjusted net service revenue of $417.3 million compared to $380.2 million in 2017.

 

   

Adjusted net income attributable to Amedisys, Inc. of $30.9 million compared to $19.2 million in 2017.

 

   

Adjusted net income attributable to Amedisys, Inc. per diluted share of $0.95 compared to $0.56 in 2017.

Nine Month Periods Ended September 30, 2018 and 2017

 

   

Net service revenue increased $114.9 million to $1,228.2 million compared to $1,113.3 million in 2017 (1).

 

   

Net income attributable to Amedisys, Inc. of $91.9 million compared to $34.1 million in 2017.

 

   

Net income attributable to Amedisys, Inc. per diluted share of $2.71 per diluted share compared to $1.00 in 2017.

Adjusted Year to Date Results*

 

   

Adjusted EBITDA of $136.7 million compared to $105.0 million in 2017.

 

   

Adjusted net service revenue of $1,229.9 million compared to $1,119.8 million in 2017.

 

   

Adjusted net income attributable to Amedisys, Inc. of $92.3 million compared to $56.5 million in 2017.

 

   

Adjusted net income attributable to Amedisys, Inc. per diluted share of $2.73 compared to $1.65 in 2017.

* See pages 12 and 13 for the definition and reconciliations of non-GAAP financial measures to GAAP measures.

(1) Subsequent to our adoption of Accounting Standards Updates 2014-09 and 2015-14 on January 1, 2018, using the full retrospective method, amounts previously classified as provision for doubtful accounts are now classified as price concessions in determining the transaction price of our net service revenue.

 

1


Paul B. Kusserow, President and Chief Executive Officer stated, “I am proud of our third quarter results and the strong execution of our team. We are pleased with the growth trends we continue to see in home health. Our performance in home health helped drive our significant results this quarter and I am delighted with the progress the home health segment has made this year. Our hospice segment continues its stellar performance, with another quarter of double digit ADC growth. We look forward to welcoming all of our new Compassionate Care Hospice team members to the Amedisys family once our deal closes early next year and are excited about the continued growth potential within our hospice segment. Our personal care segment continues with their impressive integration engine and has built out a platform for growth within Massachusetts and beyond. Above all else, our clinical quality metrics continue to be at, or near, the top of the industry in both home health and hospice. Providing our clinically distinct care to as many patients wherever they call home is and will always be our first priority. Finally, thanks to our team of over 18,500 employees for continuing to do all that you do to drive such impressive results and provide such incredible care.”

Updated 2018 Guidance

 

   

Net service revenue is anticipated to be in the range of $1.65 billion to $1.67 billion.

 

   

Adjusted EBITDA is anticipated to be in the range of $177 million to $180 million.

 

   

Adjusted diluted earnings per share is anticipated to be in the range of $3.54 to $3.60 based on an estimated 33.50 million shares outstanding.

This guidance excludes the effects of any future acquisitions, if any are made.

We urge caution in considering the current trends and 2018 guidance disclosed in this press release. The home health and hospice industry is highly competitive and subject to intensive regulations, and trends are subject to numerous factors, risks, and uncertainties, some of which are referenced in the cautionary language below and others that are described more fully in our reports filed with the Securities and Exchange Commission (“SEC”) including our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and subsequent Quarterly Reports on Form 10-Q, and current reports on Form 8-K which can be found on the SEC’s internet website, http://www.sec.gov, and our internet website, http://www.amedisys.com.

Earnings Call and Webcast Information

Amedisys will host a conference call on Tuesday, October 30, 2018, at 11:00 a.m. ET to discuss its third quarter results. To participate on the conference call, please call before 11:00 a.m. ET to either (877) 524-8416 (Toll-Free) or (412) 902-1028 (Toll). A replay of the conference call will be available through November 30, 2018 by dialing (877) 660-6853 (Toll-Free) or (201) 612-7415 (Toll) and entering conference ID #13684177.

A live webcast of the call will be accessible through our website on our Investor Relations section at the following web address: http://investors.amedisys.com.

Non-GAAP Financial Measures

This press release includes reconciliations of the most comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”) to non-GAAP financial measures. The non-GAAP financial measures as defined under SEC rules are as follows: (1) adjusted EBITDA, defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, excluding certain items; (2) adjusted net service revenue, defined as net service revenue excluding certain items; (3) adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. excluding certain items; and (4) adjusted net income attributable to Amedisys, Inc. per diluted share, defined as net income attributable to Amedisys, Inc. common stockholders per diluted share excluding certain items. Management believes that these non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, are useful gauges of our current performance and are also included in internal management reporting. These non-GAAP financial measures should be considered in addition to, and not more meaningful than or as an alternative to the GAAP financial measures presented in this earnings release and the company’s financial statements. Non-GAAP measures as presented herein may not be comparable to similarly titled measures reported by other companies since not all companies calculate these non-GAAP measures consistently.

 

2


Additional information

Amedisys, Inc. (the “Company”) is a leading healthcare at home Company delivering personalized home health, hospice and personal care. Amedisys is focused on delivering the care that is best for our patients, whether that is home-based personal care; recovery and rehabilitation after an operation or injury; care focused on empowering them to manage a chronic disease; or hospice care at the end of life. More than 3,000 hospitals and 59,000 physicians nationwide have chosen Amedisys as a partner in post-acute care. Founded in 1982, headquartered in Baton Rouge, LA with an executive office in Nashville, TN, Amedisys is a publicly held company. With 18,500 employees, in 421 care centers within 34 states and the District of Columbia, Amedisys is dedicated to delivering the highest quality of care to the doorsteps of more than 369,000 patients and clients in need every year. For more information about the Company, please visit: www.amedisys.com.

We use our website as a channel of distribution for important company information. Important information, including press releases, investor presentations and financial information regarding our company, is routinely posted on and accessible on the Investor Relations subpage of our website, which is accessible by clicking on the tab labeled “Investors” on our website home page. Visitors to our website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations subpage of our website.

Forward-Looking Statements

When included in this press release, words like “believes,” “belief,” “expects,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “would,” “should” and similar expressions are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. These risks and uncertainties include, but are not limited to the following: changes in Medicare and other medical payment levels, our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively, changes in or our failure to comply with existing federal and state laws or regulations or the inability to comply with new government regulations on a timely basis, competition in the healthcare industry, our ability to integrate our personal care segment into our business efficiently, changes in the case mix of patients and payment methodologies, changes in estimates and judgments associated with critical accounting policies, our ability to maintain or establish new patient referral sources, our ability to attract and retain qualified personnel, changes in payments and covered services by federal and state governments, future cost containment initiatives undertaken by third-party payors, our access to financing, our ability to meet debt service requirements and comply with covenants in debt agreements, business disruptions due to natural disasters or acts of terrorism, our ability to integrate, manage and keep our information systems secure, our ability to comply with requirements stipulated in our corporate integrity agreement and changes in law or developments with respect to any litigation relating to the Company, including various other matters, many of which are beyond our control.

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law.

 

Contact:                Investor Contact:      Media Contact:   
   Amedisys, Inc.      Amedisys, Inc.   
   Nick Muscato      Kendra Kimmons   
   Vice President, Strategic Finance      Vice President, Marketing & Communications   
   (855) 259-2046      (225) 299-3720   
   [email protected]      [email protected]   

 

3


AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share data)

(Unaudited)

 

     For the Three-Month
Periods Ended September 30
  For the Nine-Month
Periods Ended September 30
     2018   2017   2018   2017

Net service revenue

   $     417,335     $     373,704     $   1,228,200     $   1,113,311  

Cost of service, excluding depreciation and amortization

     249,739       227,269       730,612       664,139  

General and administrative expenses:

        

Salaries and benefits

     79,367       77,130       232,213       226,532  

Non-cash compensation

     4,842       3,558       12,653       11,788  

Other

     40,335       38,189       124,119       120,223  

Depreciation and amortization

     3,164       4,185       9,882       13,139  

Securities Class Action Lawsuit settlement, net

                       28,712  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

     377,447       350,331       1,109,479       1,064,533  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

     39,888       23,373       118,721       48,778  

Other income (expense):

        

Interest income

     29       44       263       104  

Interest expense

     (1,991     (1,335     (5,834     (3,600

Equity in earnings from equity method investments

     1,625       900       6,461       3,149  

Miscellaneous, net

     1,822       1,043       2,782       3,282  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total other income, net

     1,485       652       3,672       2,935  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

     41,373       24,025       122,393       51,713  

Income tax expense

     (9,825     (9,364     (29,984     (17,324
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

     31,548       14,661       92,409       34,389  

Net income attributable to noncontrolling interests

     (171     (103     (524     (240
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Amedisys, Inc.

   $ 31,377     $ 14,558     $ 91,885     $ 34,149  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share:

        

Net income attributable to Amedisys, Inc. common stockholders

   $ 0.99     $ 0.43     $ 2.78     $ 1.02  

Weighted average shares outstanding

     31,815       33,838       33,075       33,640  

Diluted earnings per common share:

        

Net income attributable to Amedisys, Inc. common stockholders

   $ 0.96     $ 0.42     $ 2.71     $ 1.00  

Weighted average shares outstanding

     32,691       34,363       33,852       34,255  

 

4


AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

 

     September 30,
2018
(unaudited)
  December 31,
2017

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $           14,010     $           86,363  

Patient accounts receivable

     195,030       201,196  

Prepaid expenses

     11,679       7,329  

Other current assets

     11,949       16,268  
  

 

 

 

 

 

 

 

Total current assets

     232,668       311,156  

Property and equipment, net of accumulated depreciation of $93,432 and $146,814

     30,215       31,122  

Goodwill

     324,145       319,949  

Intangible assets, net of accumulated amortization of $32,443 and $30,610

     44,309       46,061  

Deferred income taxes

     41,149       56,064  

Other assets

     53,406       49,130  
  

 

 

 

 

 

 

 

Total assets

   $ 725,892     $ 813,482  
  

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

    

Current liabilities:

    

Accounts payable

   $ 24,519     $ 25,384  

Payroll and employee benefits

     92,385       89,936  

Accrued expenses

     101,177       89,104  

Current portion of long-term obligations

     1,209       10,638  
  

 

 

 

 

 

 

 

Total current liabilities

     219,290       215,062  

Long-term obligations, less current portion

     54,853       78,203  

Other long-term obligations

     6,253       3,791  
  

 

 

 

 

 

 

 

Total liabilities

     280,396       297,056  
  

 

 

 

 

 

 

 

Equity:

    

Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued or outstanding

            

Common stock, $0.001 par value, 60,000,000 shares authorized; 36,146,649 and 35,747,134 shares issued; and 31,877,278 and 33,964,767 shares outstanding

     36       35  

Additional paid-in capital

     592,539       568,780  

Treasury stock, at cost 4,269,371 and 1,782,367 shares of common stock

     (240,536     (53,713

Accumulated other comprehensive income

     15       15  

Retained earnings

     92,089       204  
  

 

 

 

 

 

 

 

Total Amedisys, Inc. stockholders’ equity

     444,143       515,321  

Noncontrolling interests

     1,353       1,105  
  

 

 

 

 

 

 

 

Total equity

     445,496       516,426  
  

 

 

 

 

 

 

 

Total liabilities and equity

   $ 725,892     $ 813,482  
  

 

 

 

 

 

 

 

 

5


AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND DAYS REVENUE OUTSTANDING

(Amounts in thousands, except statistical information)

(Unaudited)

 

     For the Three-Month
Periods Ended September 30
  For the Nine-Month
Periods Ended September 30
     2018   2017   2018   2017

Cash Flows from Operating Activities:

        

Net income

   $ 31,548     $ 14,661     $ 92,409     $ 34,389  

Adjustments to reconcile net income to net cash provided by operating activities:

        

Depreciation and amortization

     3,164       4,185       9,882       13,139  

Non-cash compensation

     4,842       3,558       12,653       11,788  

401(k) employer match

     2,040       2,180       6,934       6,547  

Loss (gain) on disposal of property and equipment

     88       (169     738       (22

Deferred income taxes

     5,771       9,646       14,916       17,228  

Equity in earnings from equity method investments

     (1,625     (900     (6,461     (3,149

Amortization of deferred debt issuance costs/debt discount

     203       185       596       555  

Return on equity investment

     2,169       1,240       4,373       4,656  

Changes in operating assets and liabilities, net of impact of acquisitions:

        

Patient accounts receivable

     2,562       (4,013     6,166       (10,846

Other current assets

     11,648       996       (32     (5,896

Other assets

     38       (11,054     726       (12,202

Accounts payable

     (4,293     (6,523     (670     (5,430

Securities Class Action Lawsuit settlement accrual, net

           (28,712            

Accrued expenses

     10,210       25,327       14,758       22,584  

Other long-term obligations

     115       (406     2,462       201  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

     68,480       10,201       159,450       73,542  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Flows from Investing Activities:

        

Proceeds from sale of deferred compensation plan assets

     92       57       563       622  

Proceeds from the sale of property and equipment

     40       118       51       118  

Investments in equity method investees

     (3,477           (3,477     (436

Purchases of property and equipment

     (4,073     (1,625     (5,684     (9,074

Acquisitions of businesses, net of cash acquired

                 (4,074     (24,128
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

     (7,418     (1,450     (12,621     (32,898
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Flows from Financing Activities:

        

Proceeds from issuance of stock upon exercise of stock options and warrants

     140       11       2,749       4,214  

Proceeds from issuance of stock to employee stock purchase plan

     630       611       1,787       1,798  

Shares withheld upon stock vesting

     (2,589     (728     (5,421     (6,454

Noncontrolling interest distribution

     (180     (126     (530     (216

Proceeds from borrowings under revolving line of credit

                 127,500        

Repayments of borrowings under revolving line of credit

     (70,000           (70,000      

Principal payments of long-term obligations

     (596     (1,569     (91,071     (4,069

Debt issuance costs

                 (2,433      

Purchase of company stock

                 (181,402      

Repurchase of noncontrolling interest

     (361           (361      
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in financing activities

     (72,956     (1,801     (219,182     (4,727
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (decrease) increase in cash and cash equivalents

     (11,894     6,950       (72,353     35,917  

Cash and cash equivalents at beginning of period

     25,904       59,164       86,363       30,197  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

   $       14,010     $       66,114     $       14,010     $       66,114  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Disclosures of Cash Flow Information:

        

Cash paid for interest

   $ 909     $ 1,016     $ 2,989     $ 2,188  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid for income taxes, net of refunds received

   $ 4,868     $ 31     $ 11,017     $ 315  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Days revenue outstanding (1)

     40.6       40.7       40.6       40.7  

 

  (1)

Our calculation of days revenue outstanding at September 30, 2018 and 2017 is derived by dividing our ending patient accounts receivable by our average daily patient revenue for the three month periods ended September 30, 2018 and 2017, respectively.

 

6


AMEDISYS, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(Amounts in millions, except statistical information)

(Unaudited)

Segment Information - Home Health

 

     For the Three-
Month Periods
Ended September 30,
     2018   2017

Financial Information (in millions):

    

Medicare

   $ 208.0     $ 191.4  

Non-Medicare

     86.9       72.7  
  

 

 

 

 

 

 

 

Net service revenue

     294.9       264.1  

Cost of service

     181.8       168.3  
  

 

 

 

 

 

 

 

Gross margin

     113.1       95.8  

Other operating expenses

     69.6       71.7  
  

 

 

 

 

 

 

 

Operating income

   $ 43.5     $ 24.1  
  

 

 

 

 

 

 

 

Same Store Growth (1):

    

Medicare revenue

     10     (7 %) 

Non-Medicare revenue

     20     18

Total admissions

     4     1

Total volume (2)

     6     5

Total Episodic admissions (3)

     3     1

Total Episodic volume (4)

     5     3

Key Statistical Data - Total (5):

    

Medicare:

    

Admissions

     46,371       46,823  

Recertifications

     28,551       26,996  
  

 

 

 

 

 

 

 

Total volume

     74,922       73,819  

Completed episodes

     73,114       71,454  

Visits

       1,301,090         1,259,156  

Average revenue per completed episode (6)

   $ 2,855     $ 2,820  

Visits per completed episode (7)

     17.6       17.4  

Non-Medicare:

    

Admissions

     29,325       26,686  

Recertifications

     14,539       12,263  
  

 

 

 

 

 

 

 

Total volume

     43,864       38,949  

Visits

     698,181       592,742  

Total (5):

    

Visiting Clinician Cost per Visit

   $ 82.78     $ 82.53  

Clinical Manager Cost per Visit

     8.18       8.30  
  

 

 

 

 

 

 

 

Total Cost per Visit

   $ 90.96     $ 90.83  

Visits

     1,999,271       1,851,898  

 

7


     For the Nine-
Month Periods
Ended September 30,
     2018   2017

Financial Information (in millions):

    

Medicare

   $ 619.3     $ 588.4  

Non-Medicare

     251.2       213.6  
  

 

 

 

 

 

 

 

Net service revenue

     870.5       802.0  

Cost of service

     532.7       496.1  
  

 

 

 

 

 

 

 

Gross margin

     337.8       305.9  

Other operating expenses

     207.6       210.5  
  

 

 

 

 

 

 

 

Operating income

   $ 130.2     $ 95.4  
  

 

 

 

 

 

 

 

Same Store Growth (1):

    

Medicare revenue

     7     (5 %) 

Non-Medicare revenue

     18     14

Total admissions

     4     1

Total volume (2)

     7     3

Total Episodic admissions (3)

     3     1

Total Episodic volume (4)

     6     3

Key Statistical Data - Total (5):

    

Medicare:

    

Admissions

     142,884       143,711  

Recertifications

     84,218       78,878  
  

 

 

 

 

 

 

 

Total volume

     227,102       222,589  

Completed episodes

     220,726       217,190  

Visits

       3,933,290         3,794,001  

Average revenue per completed episode (6)

   $ 2,841     $ 2,811  

Visits per completed episode (7)

     17.5       17.3  

Non-Medicare:

    

Admissions

     88,485       80,244  

Recertifications

     40,862       33,949  
  

 

 

 

 

 

 

 

Total volume

     129,347       114,193  

Visits

     2,049,662       1,727,618  

Total (5):

    

Visiting Clinician Cost per Visit

   $ 81.06     $ 81.41  

Clinical Manager Cost per Visit

     7.98       8.42  
  

 

 

 

 

 

 

 

Total Cost per Visit

   $ 89.04     $ 89.83  

Visits

     5,982,952       5,521,619  

 

  (1)

Same store information represents the percent increase (decrease) in our Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume for the period as a percent of the Medicare, Non-Medicare, Total and Episodic revenue, admissions or volume of the prior period.

  (2)

Total volume includes all admissions and recertifications.

  (3)

Total Episodic admissions includes admissions for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis.

  (4)

Total Episodic volume includes admissions and recertifications for Medicare and Non-Medicare payors that bill on a 60-day episode of care basis.

  (5)

Total includes acquisitions.

  (6)

Average Medicare revenue per completed episode is the average Medicare revenue earned for each Medicare completed episode of care.

  (7)

Medicare visits per completed episode are the home health Medicare visits on completed episodes divided by the home health Medicare episodes completed during the period.

 

8


Segment Information - Hospice

 

     For the Three-
Month Periods
Ended September 30,
     2018   2017

Financial Information (in millions):

    

Medicare

   $ 98.0     $         91.4  

Non-Medicare

     5.4       4.5  
  

 

 

 

 

 

 

 

Net service revenue

             103.4       95.9  

Cost of service

     53.4       48.4  
  

 

 

 

 

 

 

 

Gross margin

     50.0       47.5  

Other operating expenses

     21.7       19.2  
  

 

 

 

 

 

 

 

Operating income

   $ 28.3     $ 28.3  
  

 

 

 

 

 

 

 

Same Store Growth (1):

    

Medicare revenue

     7     17

Non-Medicare revenue

     19     11

Hospice admissions

     8     7

Average daily census

     11     14

Key Statistical Data - Total (2):

    

Hospice admissions

     6,765       6,257  

Average daily census

     7,768       7,026  

Revenue per day, net

   $ 144.71     $ 148.43  

Cost of service per day

   $ 74.72     $ 74.96  

Average discharge length of stay

     101       95  
     For the Nine-
Month Periods
Ended September 30,
     2018   2017

Financial Information (in millions):

    

Medicare

   $         286.7     $         257.9  

Non-Medicare

     15.4       11.9  
  

 

 

 

 

 

 

 

Net service revenue

     302.1       269.8  

Cost of service

     155.2       136.7  
  

 

 

 

 

 

 

 

Gross margin

     146.9       133.1  

Other operating expenses

     62.5       56.9  
  

 

 

 

 

 

 

 

Operating income

   $ 84.4     $ 76.2  
  

 

 

 

 

 

 

 

Same Store Growth (1):

    

Medicare revenue

     11     18

Non-Medicare revenue

     28     (1 %) 

Hospice admissions

     7     13

Average daily census

     12     15

Key Statistical Data - Total (2):

    

Hospice admissions

     20,444       19,010  

Average daily census

     7,514       6,705  

Revenue per day, net

   $ 147.28     $ 147.43  

Cost of service per day

   $ 75.65     $ 74.78  

Average discharge length of stay

     98       92  

 

  (1)

Same store information represents the percent increase (decrease) in our Medicare and Non-Medicare revenue, Hospice admissions or average daily census for the period as a percent of the Medicare and Non-Medicare revenue, Hospice admissions or average daily census of the prior period.

  (2)

Total includes acquisitions.

 

9


Segment Information - Personal Care

 

     For the Three-
Month Periods
Ended September 30,
               2018                       2017          

Financial Information (in millions):

    

Medicare

   $     $  

Non-Medicare

     19.0       13.7  
  

 

 

 

 

 

 

 

Net service revenue

     19.0       13.7  

Cost of service

     14.5       10.6  
  

 

 

 

 

 

 

 

Gross margin

     4.5       3.1  

Other operating expenses

     3.1       3.1  
  

 

 

 

 

 

 

 

Operating income

   $ 1.4     $  
  

 

 

 

 

 

 

 

Key Statistical Data:

    

Billable hours

     810,427       616,036  

Clients served

     12,380       7,978  

Shifts

     357,382       281,904  

Revenue per hour

     $23.40       $22.21  

Revenue per shift

     $53.06       $48.54  

Hours per shift

     2.3       2.2  
     For the Nine-
Month Periods
Ended September 30,
     2018   2017

Financial Information (in millions):

    

Medicare

   $     $  

Non-Medicare

     55.6       41.5  
  

 

 

 

 

 

 

 

Net service revenue

     55.6       41.5  

Cost of service

     42.7       31.3  
  

 

 

 

 

 

 

 

Gross margin

     12.9       10.2  

Other operating expenses

     9.7       9.3  
  

 

 

 

 

 

 

 

Operating income

   $ 3.2     $ 0.9  
  

 

 

 

 

 

 

 

Key Statistical Data:

    

Billable hours

     2,357,608       1,822,653  

Clients served

     15,731       10,980  

Shifts

     1,062,422       830,151  

Revenue per hour

     $23.57       $22.76  

Revenue per shift

     $52.30       $49.98  

Hours per shift

     2.2       2.2  

 

10


Segment Information - Corporate

 

 

     For the Three-
Month Periods
        Ended September 30,        
     2018    2017

Financial Information (in millions):

     

Other operating expenses

   $     31.3      $     25.9  

Depreciation and amortization

     2.0        3.1  
  

 

 

 

  

 

 

 

Total operating expenses

   $             33.3      $             29.0  
  

 

 

 

  

 

 

 

     For the Nine-
Month Periods
        Ended September 30,        
     2018    2017

Financial Information (in millions):

     

Other operating expenses

   $     92.6      $     85.4  

Depreciation and amortization

     6.5        9.6  
  

 

 

 

  

 

 

 

Total operating expenses before Securities Class Action Lawsuit settlement, net

     99.1        95.0  

Securities Class Action Lawsuit settlement, net

            28.7  
  

 

 

 

  

 

 

 

Total operating expenses

   $ 99.1      $ 123.7  
  

 

 

 

  

 

 

 

 

11


AMEDISYS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES

(Amounts in thousands)

(Unaudited)

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”):

 

     For the Three-
Month Period
        Ended September 30,        
  For the Nine-
Month Period
Ended September 30,
     2018   2017   2018   2017

Net income attributable to Amedisys, Inc.

   $     31,377     $     14,558     $     91,885     $     34,149  

Add:

        

Income tax expense

     9,825       9,364       29,984       17,324  

Interest expense, net

     1,962       1,291       5,571       3,496  

Depreciation and amortization

     3,164       4,185       9,882       13,139  

Certain items (1)

     (609     7,590       615       37,014  

Interest component of certain items (1)

     (451     (95     (1,280     (95
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA (2) (6)

   $ 45,268     $ 36,893     $ 136,657     $ 105,027  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Net Service Revenue Reconciliation:

 

     For the Three-
Month Period
Ended September 30,
   For the Nine-
Month Period
Ended September 30,
     2018    2017    2018    2017

Net service revenue

   $     417,335      $     373,704      $     1,228,200      $     1,113,311  

Add:

           

Certain items (1)

            6,506        1,687        6,506  
  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Adjusted net service revenue (3) (6)

   $ 417,335      $ 380,210      $ 1,229,887      $ 1,119,817  
  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Adjusted Net Income Attributable to Amedisys, Inc Reconciliation:

 

    For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
    2018   2017   2018   2017

Net income attributable to Amedisys, Inc.

  $     31,377     $     14,558     $     91,885     $     34,149  

Add:

       

Certain items (1)

    (450     4,592       455       22,394  
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income attributable to Amedisys, Inc. (4) (6)

  $ 30,927     $ 19,150     $ 92,340     $ 56,543  
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Net Income Attributable to Amedisys, Inc. per Diluted Share:        
    For the Three-
Month Period
Ended September 30,
  For the Nine-
Month Period
Ended September 30,
    2018   2017   2018   2017

Net income attributable to Amedisys, Inc. common stockholders per diluted share

  $     0.96     $     0.42     $     2.71     $     1.00  

Add:

       

Certain items (1)

    (0.01     0.13       0.01       0.65  
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income attributable to Amedisys, Inc. common stockholders per

diluted share (5) (6)

  $ 0.95     $ 0.56     $ 2.73     $ 1.65  
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12


(1)

The following details the certain items for the three and nine month periods ended September 30, 2018 and 2017:

Certain Items:

 

     For the Three-Month Period
Ended September 30, 2018
     For the Nine-Month Period
Ended September 30, 2018
 
     (Income) Expense      (Income) Expense  

Certain Items Impacting Net Service Revenue:

     

Florida self-audit (pre-acquisition)

   $ —       $ 1,687   

Certain Items Impacting Operating Expenses:

     

Acquisition costs

     857         1,732   

Legal fees - non-routine

     304         1,409   

Certain Items Impacting Total Other Income (Expense):

     

Legal settlements

     (1,437)        (1,437)  

Miscellaneous, other (income) expense, net

     (333)        (2,776)  
  

 

 

    

 

 

 

Total

   $ (609)      $ 615   
  

 

 

    

 

 

 

Net of tax

   $ (450)      $ 455   
  

 

 

    

 

 

 

Diluted EPS

   $ (0.01)      $ 0.01   
  

 

 

    

 

 

 
     For the Three-Month Period
Ended September 30, 2017
     For the Nine-Month Period
Ended September 30, 2017
 
     (Income) Expense      (Income) Expense  

Certain Items Impacting Net Service Revenue:

     

Florida ZPIC audit

   $ 6,506       $ 6,506   

Certain Items Impacting Operating Expenses:

     

Acquisition costs

     —         976   

Legal fees - non-routine

     176         1,410   

Securities Class Action Lawsuit settlement accrual, net

     —         28,712   

Restructuring activity

     1,670         1,670   

Data center relocation

     —         940   

Certain Items Impacting Total Other Income (Expense):

     

Legal settlements

     (647)        (2,014)  

Miscellaneous, other (income) expense, net

     (115)        (1,186)  
  

 

 

    

 

 

 

Total

   $ 7,590       $ 37,014   
  

 

 

    

 

 

 

Net of tax

   $ 4,592       $ 22,394   
  

 

 

    

 

 

 

Diluted EPS

   $ 0.13       $ 0.65   
  

 

 

    

 

 

 

 

(2)

Adjusted EBITDA is defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, excluding certain items as described in footnote 1.

(3)

Adjusted net service revenue is defined as net service revenue plus certain items as described in footnote 1.

(4)

Adjusted net income attributable to Amedisys, Inc. is defined as net income attributable to Amedisys, Inc. calculated in accordance with GAAP excluding certain items as described in footnote 1.

(5)

Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share is defined as diluted income per share calculated in accordance with GAAP excluding the earnings per share effect of certain items as described in footnote 1.

(6)

Adjusted EBITDA, adjusted net service revenue, adjusted net income attributable to Amedisys, Inc. and adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share should not be considered as an alternative to, or more meaningful than, income before income taxes or other measure calculated in accordance with GAAP. These calculations may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate these non-GAAP financial measures in the same manner.

 

13

(Back To Top)

Section 3: EX-99.2 (EX-99.2)

EX-99.2

Slide 1

Amedisys Third Quarter 2018 Earnings Call Supplemental Slides October 30th, 2018 Exhibit 99.2


Slide 2

This presentation may include forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon current expectations and assumptions about our business that are subject to a variety of risks and uncertainties that could cause actual results to differ materially from those described in this presentation. You should not rely on forward-looking statements as a prediction of future events. Additional information regarding factors that could cause actual results to differ materially from those discussed in any forward-looking statements are described in reports and registration statements we file with the SEC, including our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, copies of which are available on the Amedisys internet website http://www.amedisys.com or by contacting the Amedisys Investor Relations department at (225) 292-2031. We disclaim any obligation to update any forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based except as required by law. www.amedisys.com NASDAQ: AMED We encourage everyone to visit the Investors Section of our website at www.amedisys.com, where we have posted additional important information such as press releases, profiles concerning our business and clinical operations and control processes, and SEC filings. Forward-looking statements


Slide 3

Our Key Areas of Focus Strategic areas of focus for 2018 and beyond Home Health*: Total same store volume +6%. Total same store admission +4% Hospice: Admissions +8%, ADC +11% Personal Care: Double digit growth in billable hours / quarter +32% (including acquisitions) 1 Organic Growth Quality: Amedisys maintains a STARS score average of 4.40 (Jan’19 preview) with 94% of providers at 4+ STAR rating 69 Amedisys care centers rated at 5-Stars in the Jan’19 Preview Hospice quality – outperforming industry average in all hospice item set categories Continued focus on 30-Day and 60-Day ACH rate reduction 3 Clinical Initiatives Productivity driving continued CPV control (visiting clinician CPV up $0.25 year over year, in spite of $0.77 cpv impact from annual raises) Focusing on optimizing RN / LPN & PT / PTA staffing ratios 4 Impact Capacity and Productivity Signed definitive agreement to acquire Compassionate Care Hospice 10.7x net purchase price multiple 7.8x fully synergized Deal expected to close in Q1’19 Closed Personal Care acquisition of Bring Care Home (10/1/18) Equity investment in predictive analytics company Medalogix Tuck-in pipeline remains full 5 M&A 2 Recruiting / Retention Targeting industry leading employee retention amongst all employee categories – currently at 18% Focus on reduction of clinical turnover with heavy focus on RN’s *Note: Home Health same store volume is defined as admissions plus recertifications 2019 industry impact per Proposed Rule: +2.1% (+$400M) Working with CMS and Congress to address “behavioral assumptions” language in PDGM Three bills introduced aimed at mitigating “behavioral assumptions” S. 3458 (Kennedy/Cassidy) HR 6932 (Abraham/Graves/Buchanan/DesJarlais/Sewell) S. 3545 (Collins/Stabenow/Nelson) 6 Regulatory


Slide 4

Highlights and Summary Financial Results (Adjusted): 3Q 2018(1) Home Health total same store volume +6%, total same store admissions up +4%. Hospice same store admissions +8%. Personal Care +32% billable hours Amedisys Consolidated Revenue Growth: +10% EBITDA: $45M (+23%) EBITDA Margin: 11% EPS: $0.95 (+70%) 3Q’18 Net debt: $45.8M Net Leverage ratio: 0.3x CFFO: $68.5M Free cash flow (4) : $64.7M DSO: 40.6 (vs. Q2’18 of 41.1) Balance Sheet & Cash Flow 3Q’18 Same Store Volume (2): Total: +6% Episodic (2): +5% Same Store Admissions: Total: +4% Episodic (3): +3% Other Statistics: Revenue per Episode: $2,855 (+$35) Total Cost per Visit: Increased 0.1% Medicare Recert Rate: +120 bps Home Health Growth Metrics (5): Billable hours/quarter: +32% Clients served: +55% Personal Care Same Store Volume: Admissions: +8% ADC: +11% Other Statistics: Revenue per Day: $144.71 (-2.5%) Cost per day: -0.3% Hospice 3Q’18 3Q’18 3Q’18 Adjusted Financial Results(1) 3Q’18 The financial results for the three-month periods ended September 30, 2017 and September 30, 2018 are adjusted for certain items and should be considered a non-GAAP financial measure. A reconciliation of these non-GAAP financial measures is included in the corresponding 8-K detailing quarterly results for each respective reporting period. Same Store volume – Includes admissions and recertifications. Episodic admissions and volume – Includes Medicare and non-Medicare payors that bill on a 60-day episode of care basis. Free cash flow defined as cash flow from operations less routine capital expenditures and required debt repayments. Includes acquisitions.


Slide 5

Our revenue sources: 3Q18 Medicare FFS: Paid episodically over a 60 day episode Private Episodic: MA and Commercial plans who pay us over a 60 day episode. Generally at rates ~90% – 100% of Medicare Per Visit: Managed care, Medicaid and private payors reimbursing us per visit provided Hospice Per Day Reimbursement: Routine Care: Patient at home with symptoms controlled – 98% of the Hospice care AMED provides Continuous Care: Patient at home with uncontrolled symptoms Inpatient Care: Patient in facility with uncontrolled symptoms Respite Care: Patient at facility with symptoms controlled


Slide 6

Home Health and Hospice Segment (Adjusted) – 3Q 2018(1) Revenue per Episode up +$35 Recert rate up +120 bps CPV increase of 0.1% in Q3’18 EBITDA as a % percentage of revenue: +270bps Home Health Highlights Same store average daily census (ADC) up 11% Net revenue per day down 2.5% Two providers over cap as of Q3’18: ~ $1.2M liability Net revenue per day impacted by accrual for Medicare repayment Hospice Highlights The financial results for the three-month periods ended September 30, 2017 and September 30, 2018 are adjusted for certain items and should be considered a non-GAAP financial measure. A reconciliation of these non-GAAP financial measures is included in the corresponding 8-K detailing quarterly results for each respective reporting period. Segment EBITDA does not include any corporate G&A expenses. Same store admissions and volume exclude 7 closed and consolidated care centers in FL during 2017. Home health total volume growth strong (+6%); Hospice continues with double digit ADC growth (+11%)


Slide 7

General & Administrative Expenses – Adjusted (1,2) Notes: Year over year total G&A as a percentage of revenue decreased 120 basis points Home Health segment G&A: 230 bps decrease as % of revenue Hospice segment G&A: 90 bps increase as % of revenue Personal Care segment G&A: 610 bps decrease as % of revenue (Personal Care G&A reflects reclassification of certain support personnel to corporate in 2018) Corporate G&A: 40 bps increase as % of total revenue Total G&A sequential increase driven by planned wage increases and anticipated health insurance increases The financial results for the three-month periods ended September 30, 2017, December 31, 2017, March 31, 2018, June 30, 2018 and September 30, 2018 are adjusted for certain items and should be considered a non-GAAP financial measure. A reconciliation of these non-GAAP financial measures is included in the corresponding 8-K detailing quarterly results for each respective reporting period. Adjusted G&A expenses do not include depreciation and amortization. Impact of G&A cost control materializing as operational efficiencies are realized; Adding investments to Hospice segment


Slide 8

Industry Leading Quality Scores Note: Top Competitor Avg weighted by CCN count and include LHC, Kindred, AFAM, HLS and BKD Metric JUL 18 OCT 18 PREVIEW JAN 19 PREVIEW Quality of Patient Care 4.38 4.41 4.40 Entities at 4+ Stars 93% 94% 94% Metric JAN 18 Release APR 18 Release JUL 18 Release Patient Satisfaction Star 3.85 3.94 3.96 Performance Over Industry +7% +7% +7% Quality of Patient Care (QPC) Patient Satisfaction (PS) QPC Industry Performance PS Industry Performance *Scoring methodology change dropped entire industry’s PS STAR scores Amedisys maintains a 4-Star average in the Jan 2019 HHC preview with 94% of our providers at 4+ Stars and 66% at 4.5+ Stars 36 Amedisys providers (representing 69 care centers) rated at 5-Stars in the Jan 2019 preview AMED received ~$782K in bonus payments related to Value Based Purchasing (VBP) YTD through 3Q’18


Slide 9

Hospice Quality: Amedisys Hospice Continues to Move Towards Best-in-Class Hospice Quality


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Components 3Q’17 2Q’18 3Q’18 YoY Variance Detail Mitigation Plan Salaries $61.65 $59.98 $61.93 $0.28 YoY increase due to planned wage increases offset by volume growth and increased productivity Staffing mix optimization, productivity and scheduling improvement initiatives in place helped us overcome planned salary increases Contractors $2.81 $3.16 $3.35 $0.54 YoY increased demand due to increasing volumes Focused efforts on filling positions with full-time clinicians Benefits $11.12 $10.45 $11.14 $0.02 Sequential increase driven by seasonality of health insurance claims Focus on cost containment and spend optimization with specific focus on high cost claims Transportation & Supplies $6.95 $6.48 $6.36 ($0.59) YoY decrease primarily due to supplies costs More effective medical supply contracting cost initiatives are underway *Visiting Clinician CPV $82.53 $80.07 $82.78 $0.25 Clinical Managers $8.30 $7.76 $8.18 ($0.12) Fixed cost associated with non-visiting clinicians Unit cost reduced as volume increases Total CPV $90.83 $87.83 $ 90.96 $0.13 Operational Excellence: Home Health Cost Per Visit (CPV) Total CPV impacted by planned wage increases *Note: Direct comparison with industry competitors CPV calculation $82.53 $80.07 $82.78


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Driving Top Line Growth All three lines of business continue to grow. Hospice delivers another quarter of double digit ADC growth and Home Health total same store volume continues to trend in the mid-single digits Home Health Total Same Store Volume* Hospice ADC Personal Care Total Hours / Quarter *Total Home Health Same Store Volumes exclude 7 closed and consolidated care centers in Florida in 2017 Volume *Includes impact of Intercity (10/2/17) and East Tennessee (5/1/18) acquisitions


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Overview Metrics Integration Timing Amedisys signs definitive agreement to acquire Compassionate Care Hospice 100% stock purchase Compassionate Care Hospice: Founded in 1993 100% founder owned Average Daily Census: 3,300 Revenue: $188M Adj. EBITDA: $27M Care Centers: 53 States: 24 Proforma for acquisitions, AMED becomes the 3rd largest hospice provider in America Adds 12 new states to AMED hospice organization $340M gross price (12.6x) $290M net price (10.7x) Net of $50M dollar for dollar payment related to tax asset and working capital Synergized Multiple: 7.8x ~$10M in synergies (2020) Minimal overlap ~10% of ADC Balance sheet remains very flexible for continued inorganic growth opportunities: Initial leverage ratio: ~1.5x Proforma company will have significant cash generation Conversion to HCHB to begin day 1 and projected to take ~180 days Expected to see integration and HCHB implementation disruption during 1Q’19 and 2Q’19 AMED will invest in the business during 2019 to grow low ADC care centers and expand margin in large care centers Adding sales resources to accelerate growth in 2H’19 and 2020 Retention packages for key employees Care center staffing model and regional infrastructure Expect significant margin improvement throughout 2020 2021 expect margin profile similar to AMED hospice Transaction subject to customary regulatory approval Target closing: Feb 2019 AMED to Acquire Compassionate Care Hospice Deal Summary


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Debt and Liquidity Metrics Our debt levels remain very low at 0.3x net leverage Net debt defined as total debt outstanding ($59.8M) less cash balance ($14.0M). Leverage ratio (net) is defined as net debt divided by last twelve months adjusted EBITDA ($174M). Liquidity defined as the sum of cash balance and available revolving line of credit. Credit facility and cash provide significant capital for accretive acquisitions and/or other capital deployment options


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Cash Flow Statement Highlights (1) $64.7M in free cash flow for the quarter; $159M in cash flow from operations YTD 2018 Free cash flow defined as cash flow from operations less routine capital expenditures and required debt repayments.


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Income Statement Adjustments (1) Amount of non-GAAP adjustments remains low The financial results for the three-month periods ended September 30, 2017, December 31, 2017, March 31, 2018, June 30, 2018 and September 30, 2018 are adjusted for certain items and should be considered a non-GAAP financial measure. A reconciliation of these non-GAAP financial measures is included in the corresponding 8-K detailing quarterly results for each respective reporting period.


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2018 Guidance


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2018 Updated Guidance (2Q) Amedisys Revised 2018 Guidance Increasing Revenue, Adjusted EBITDA and Adjusted EPS; EPS includes impact of tax reform and share repurchase 2017 Revenue Adjusted EBITDA $142.2M $1.54B - $1.52B* Adjusted Earnings per Share $2.21 $158M – $163M $1.60B – $1.64B $2.97 – $3.08 *Adjusted for adoption of new revenue recognition accounting standard 2018 Original Guidance $168M – $172M $1.63B – $1.65B $3.32 – $3.41 2018 Updated Guidance (3Q) $177M – $180M $1.65B – $1.67B $3.54 – $3.60


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Amedisys 2018 Guidance Considerations Amedisys Consolidated Tax rate ~25% (includes impact from Tax Cuts and Jobs Act) Cash tax rate ~10% Diluted share count ~33.5 million shares Excludes potential acquisitions and related integration costs Capital Expenditures ~$7-$9 million Benefits increase ~5% - 6% Salary increase ~2% - 3% Overall ~ $9 million investment in business development resources Excludes acquisition activity Home Health Personal Care Hospice Total same store admission growth ~5% Focus on business development staffing strategy ~ $6 million (Y/Y increase) Continue focus on Quality of Care (Stars and Acute Care Hospitalization rates) Continued positive progress on underperforming care centers Total same store admission growth ~10% Continue to leverage industry-leading platform by exploring growth opportunities Large acquisitions Small acquisitions Denovos ~ $1 million Addition of business development resources to maintain organic growth ~ $3 million Total billable hours growth ~ 7% Employer Medical Assistance Contribution (EMAC) ~$1 million Includes impact of Intercity acquisition (closed Q4’17) Project solid revenue and earnings growth while continuing to invest in people and future organic growth


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Reimbursement Outlook 2018 Reimbursement Impact for Home Health and Hospice Home Health Hospice 2018 Market Basket Update 1.0% Nominal Case Mix Adjustment -0.90 Estimated Industry Impact +0.1% Estimated AMED-Specific Impact -0.7% 2018 Market Basket Update 1.0% Productivity / Other Adjustment __ Estimated Industry Impact +1.0% Estimated AMED-Specific Impact +1.0%


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EBITDA Seasonality: As Reported Q1 Q2 Q3 Q4 Drivers of Seasonality Weather disruption Lower RPE (LUPA) Payroll tax reset Short Month (Feb.) Lower Hospice ADC & Higher Salary Cost per Day Highest Completed Episodes Stronger revenue per episode (RPE) Incremental holiday vs. 1H High PTO Lower Volumes Health Insurance Increases Raises Incremental holiday vs. 1H Health Insurance Increases Better Volumes Raises


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EBITDA Seasonality: Excluding Health Insurance and Workers Compensation Q1 Q2 Q3 Q4 Drivers of Seasonality Weather disruption Lower RPE (LUPA) Payroll tax reset Short Month (Feb.) Lower Hospice ADC & Higher Salary Cost per Day Highest Completed Episodes Stronger revenue per episode (RPE) Incremental holiday vs. 1H High PTO Lower Volumes Health Insurance Increases Raises Incremental holiday vs. 1H Health Insurance Increases Better Volumes Raises

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