Amedisys Reports Third Quarter 2020 Financial Results - Updates 2020 Guidance

BATON ROUGE, La., Oct. 28, 2020 (GLOBE NEWSWIRE) -- Amedisys, Inc.,  (NASDAQ: AMED) today reported its financial results for the three and nine-month periods ended September 30, 2020.

Three-Month Periods Ended September 30, 2020 and 2019

• Net service revenue increased $49.5 million to $544.1 million compared to $494.6 million in 2019.
   
• Net income attributable to Amedisys, Inc. of $72.0 million compared to $34.1 million in 2019.
   
• Net income attributable to Amedisys, Inc. per diluted share of $2.16 (inclusive of $0.72 income tax benefit related to executive stock option exercise) compared to $1.03 in 2019.

Adjusted Quarterly Results*

• Adjusted EBITDA of $75.7 million compared to $56.8 million in 2019.
   
• Adjusted net service revenue of $544.1 million compared to $494.6 million in 2019.
   
• Adjusted net income attributable to Amedisys, Inc. of $74.6 million compared to $37.9 million in 2019.
   
• Adjusted net income attributable to Amedisys, Inc. per diluted share of $2.24 (inclusive of $0.72 income tax benefit related to executive stock option exercise) compared to $1.15 in 2019.

Nine-Month Periods Ended September 30, 2020 and 2019

• Net service revenue increased $65.9 million to $1,520.8 million compared to $1,454.9 million in 2019.
   
• Net income attributable to Amedisys, Inc. of $138.5 million compared to $99.2 million in 2019.
   
• Net income attributable to Amedisys, Inc. per diluted share of $4.16 (inclusive of $0.72 income tax benefit related to executive stock option exercise) compared to $3.01 in 2019.

Adjusted Year to Date Results*

• Adjusted EBITDA of $195.4 million compared to $173.0 million in 2019.
   
• Adjusted net service revenue of $1,520.8 million compared to $1,460.9 million in 2019.
   
• Adjusted net income attributable to Amedisys, Inc. of $153.9 million compared to $114.2 million in 2019.
   
• Adjusted net income attributable to Amedisys, Inc. per diluted share of $4.63 (inclusive of $0.72 income tax benefit related to executive stock option exercise) compared to $3.47 in 2019.

*  See pages 13-15 for the definition and reconciliations of non-GAAP financial measures to GAAP measures.

Paul B. Kusserow, President and Chief Executive Officer stated, “I am very proud of our third quarter results which have bested both our internal and external expectations and have allowed us to increase our full year 2020 guidance ranges. Home health and hospice have shown strong recoveries and returned to growth this quarter which is no small feat given the continued impact of COIVD-19. We are well underway with our integration of Aseracare, have paid down a large portion of our already low debt and continue to drive prodigious amounts of cash flow. Most importantly, we have done all of this while delivering the highest quality care and continuing our relentless focus on clinical quality. The importance of caring for people in their homes, wherever they call home, has never been more evident, and as such, we are well positioned for continued success. A special thank you to all of our clinician staff for continuing to do what you do best. It is because of your compassion, bravery and tireless efforts that we are able to deliver another great quarter.”

Updated 2020 Guidance

• Net service revenue is anticipated to be in the range of $2.067 billion to $2.072 billion.
   
• Adjusted EBITDA is anticipated to be in the range of $269 million to $272 million.
   
• Adjusted diluted earnings per share is anticipated to be in the range of $6.02 to $6.08 (inclusive of $0.72 income tax benefit related to executive stock option exercise) based on an estimated 33.4 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 2020 guidance disclosed in this press release. The home health, hospice and personal care industries are 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, 2019, 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 Thursday, October 29, 2020, 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 29, 2020 by dialing (877) 660-6853 (Toll-Free) or (201) 612-7415 (Toll) and entering conference ID #13712002.

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 other operating income, defined as other operating income excluding certain items; (4) adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. excluding certain items; and (5) 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.

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 our patients to manage a chronic disease; or hospice care at the end of life. More than 2,600 hospitals and 67,000 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 more than 21,000 employees in 516 care centers within 39 states and the District of Columbia, Amedisys is dedicated to delivering the highest quality of care to the doorsteps of more than 415,000 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,” “strategy,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “could,” “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: the impact of the novel coronavirus pandemic (“COVID-19”), including the measures that have been and may be taken by governmental authorities to mitigate it, on our business, financial condition and results of operations, 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, 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, competition in the healthcare industry, 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 consistently provide high-quality care, our ability to attract and retain qualified personnel, our ability to keep our patients and employees safe, 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 disaster, acts of terrorism, widespread protest or civil unrest, our ability to integrate, manage and keep our information systems secure, our ability to realize the anticipated benefits of acquisitions 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
	Senior Vice President, Finance	Vice President, Marketing & Communications
	(855) 259-2046	(225) 299-3720
	IR@amedisys.com	kendra.kimmons@amedisys.com

 

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,
	2020			2019			2020			2019
Net service revenue	$	544,070		$	494,631		$	1,520,814		$	1,454,955
Other operating income		4,812			—			27,592			—
Cost of service, excluding depreciation and amortization		297,668			288,708			878,633			854,734
General and administrative expenses:
Salaries and benefits		123,146			99,941			330,329			293,127
Non-cash compensation		7,124			6,298			19,758			18,451
Other		49,348			48,474			142,616			140,284
Depreciation and amortization		8,283			4,366			19,955			12,440
Operating expenses		485,569			447,787			1,391,291			1,319,036
Operating income		63,313			46,844			157,115			135,919
Other income (expense):
Interest income		31			15			258			59
Interest expense		(2,692	)		(3,778	)		(8,675	)		(11,459	)
Equity in earnings from equity method investments		1,435			(812	)		2,399			4,120
Miscellaneous, net		122			1,975			(2,318	)		2,404
Total other expense, net		(1,104	)		(2,600	)		(8,336	)		(4,876	)
Income before income taxes		62,209			44,244			148,779			131,043
Income tax benefit (expense)		10,202			(9,919	)		(9,175	)		(31,105	)
Net income		72,411			34,325			139,604			99,938
Net income attributable to noncontrolling interests		(430	)		(193	)		(1,147	)		(760	)
Net income attributable to Amedisys, Inc.	$	71,981		$	34,132		$	138,457		$	99,178
Basic earnings per common share:
Net income attributable to Amedisys, Inc. common stockholders	$	2.20		$	1.06		$	4.26		$	3.09
Weighted average shares outstanding		32,662			32,211			32,469			32,096
Diluted earnings per common share:
Net income attributable to Amedisys, Inc. common stockholders	$	2.16		$	1.03		$	4.16		$	3.01
Weighted average shares outstanding		33,260			33,002			33,267			32,944

AMEDISYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)

	September 30, 2020 (unaudited)			December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	112,904		$	30,294
Restricted cash		2,549			66,196
Patient accounts receivable		250,777			237,596
Prepaid expenses		14,906			8,243
Other current assets		30,114			8,225
Total current assets		411,250			350,554
Property and equipment, net of accumulated depreciation of $101,512 and $96,137		24,104			28,113
Operating lease right of use assets		94,273			84,791
Goodwill		931,483			658,500
Intangible assets, net of accumulated amortization of $17,165 and $7,044		84,143			64,748
Deferred income taxes		24,189			21,427
Other assets		33,278			54,612
Total assets	$	1,602,720		$	1,262,745
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	39,037		$	31,259
Payroll and employee benefits		126,543			120,877
Accrued expenses		170,743			137,111
Provider relief fund advance		60,000			—
Current portion of long-term obligations		10,711			9,927
Current portion of operating lease liabilities		30,462			27,769
Total current liabilities		437,496			326,943
Long-term obligations, less current portion		300,576			232,256
Operating lease liabilities, less current portion		62,519			56,128
Other long-term obligations		44,386			5,905
Total liabilities		844,977			621,232
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; 37,457,444 and 36,638,021 shares issued; and 32,802,785 and 32,284,051 shares outstanding		37			37
Additional paid-in capital		690,099			645,256
Treasury stock, at cost 4,654,659 and 4,353,970 shares of common stock		(318,771	)		(251,241	)
Accumulated other comprehensive income		—			15
Retained earnings		384,840			246,383
Total Amedisys, Inc. stockholders’ equity		756,205			640,450
Noncontrolling interests		1,538			1,063
Total equity		757,743			641,513
Total liabilities and equity	$	1,602,720		$	1,262,745

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,
	2020			2019			2020			2019
Cash Flows from Operating Activities:
Net income	$	72,411		$	34,325		$	139,604		$	99,938
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		8,283			4,366			19,955			12,440
Non-cash compensation		7,124			6,298			19,758			18,451
Non-cash 401(k) employer match		—			2,859			—			7,545
Amortization and impairment of operating lease right of use assets		10,591			9,519			29,149			27,014
Loss (gain) on disposal of property and equipment		17			8			(77	)		6
Loss on sale of equity method investment		—			—			2,980			—
Write-off of other comprehensive income		—			—			(15	)		—
Deferred income taxes		1,274			11,923			(2,762	)		17,798
Equity in earnings from equity method investments		(1,435	)		812			(2,399	)		(4,120	)
Amortization of deferred debt issuance costs/debt discount		216			220			653			653
Return on equity investment		1,175			2,885			3,919			3,727
Changes in operating assets and liabilities, net of impact of acquisitions:
Patient accounts receivable		(2,511	)		(15,304	)		6,486			(39,469	)
Other current assets		(24,748	)		(1,851	)		(28,217	)		(10,194	)
Other assets		584			258			(91	)		202
Accounts payable		4,825			1,330			(1,627	)		(8,145	)
Accrued expenses		(2,396	)		(1,359	)		25,594			27,903
Other long-term obligations		17,735			(50	)		38,481			(231	)
Operating lease liabilities		(9,211	)		(7,916	)		(25,576	)		(24,116	)
Operating lease right of use assets		(851	)		(868	)		(2,775	)		(2,622	)
Net cash provided by operating activities		83,083			47,455			223,040			126,780
Cash Flows from Investing Activities:
Proceeds from sale of deferred compensation plan assets		73			74			94			287
Proceeds from the sale of property and equipment		—			12			80			158
Purchases of property and equipment		(1,294	)		(3,644	)		(2,995	)		(6,337	)
Investments in equity method investees		—			—			(875	)		(210	)
Proceeds from sale of equity method investment		—			—			17,876			—
Acquisitions of businesses, net of cash acquired		—			(46	)		(299,723	)		(345,460	)
Net cash used in investing activities		(1,221	)		(3,604	)		(285,543	)		(351,562	)
Cash Flows from Financing Activities:
Proceeds from issuance of stock upon exercise of stock options		3,123			2,045			6,070			3,388
Proceeds from issuance of stock to employee stock purchase plan		914			850			2,600			2,384
Shares withheld to pay taxes on non-cash compensation		(47,788	)		(4,895	)		(54,172	)		(9,385	)
Noncontrolling interest distribution		(300	)		(453	)		(672	)		(910	)
Proceeds from borrowings under term loan		—			—			—			175,000
Proceeds from borrowings under revolving line of credit		7,500			8,000			432,000			192,500
Repayments of borrowings under revolving line of credit		(97,500	)		(41,000	)		(357,000	)		(133,000	)
Principal payments of long-term obligations		(2,685	)		(1,543	)		(7,360	)		(3,820	)
Debt issuance costs		—			—			—			(847	)
Provider relief fund advance		(10,000	)		—			60,000			—
Net cash provided by (used in) financing activities		(146,736	)		(36,996	)		81,466			225,310
Net (decrease) increase in cash, cash equivalents and restricted cash		(64,874	)		6,855			18,963			528
Cash, cash equivalents and restricted cash at beginning of period		180,327			13,902			96,490			20,229
Cash, cash equivalents and restricted cash at end of period	$	115,453		$	20,757		$	115,453		$	20,757

 

Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	1,610		$	3,569		$	4,902		$	7,756
Cash paid for income taxes, net of refunds received	$	22,137		$	9,807		$	30,290		$	17,656
Cash paid for operating lease liabilities	$	10,062		$	8,784		$	28,351		$	26,738
Cash paid for finance lease liabilities	$	497		$	—		$	1,483		$	792
Supplemental Disclosures of Non-Cash Activity:
Right of use assets obtained in exchange for operating lease liabilities	$	10,982		$	4,635		$	29,876		$	110,304
Right of use assets obtained in exchange for finance lease liabilities	$	335		$	845		$	822		$	1,806
Reductions to right of use assets resulting from reductions to operating lease liabilities	$	360		$	324		$	767		$	1,235
Days revenue outstanding (1)		40.0			44.5			40.0			44.5

(1)    Our calculation of days revenue outstanding at September 30, 2020 and 2019 is derived by dividing our ending patient accounts receivable by our average daily patient revenue for the three-month periods ended September 30, 2020 and 2019, respectively.

 

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,
	2020			2019
Financial Information (in millions):
Medicare	$	222.2		$	211.5
Non-Medicare		103.8			100.0
Net service revenue		326.0			311.5
Other operating income		2.6			—
Cost of service		180.0			188.9
Gross margin		148.6			122.6
Other operating expenses		79.8			76.5
Operating income	$	68.8		$	46.1
Same Store Growth (1):
Medicare revenue		5	%		2	%
Non-Medicare revenue		4	%		16	%
Total admissions		5	%		9	%
Total volume (2)		6	%		6	%
Key Statistical Data - Total (3):
Admissions		85,578			81,937
Recertifications		47,094			43,340
Total volume		132,672			125,277
Medicare completed episodes (6)		77,552			75,807
Average Medicare revenue per completed episode (4) (6)	$	2,886		$	2,836
Medicare visits per completed episode (5) (6)		14.4			16.9
Visiting Clinician Cost per Visit	$	89.10		$	83.68
Clinical Manager Cost per Visit	$	8.91		$	8.09
Total Cost per Visit	$	98.01		$	91.77
Visits		1,836,895			2,057,184

 

	For the Nine-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Medicare	$	619.0		$	644.0
Non-Medicare		300.8			296.2
Net service revenue		919.8			940.2
Other operating income		17.7			—
Cost of service		543.8			562.4
Gross margin		393.7			377.8
Other operating expenses		229.6			224.0
Operating income	$	164.1		$	153.8
Same Store Growth (1):
Medicare revenue		(4	%)		4	%
Non-Medicare revenue		2	%		18	%
Total admissions		(1	%)		7	%
Total volume (2)		2	%		6	%
Key Statistical Data - Total (3):
Admissions		245,880			247,669
Recertifications		135,263			128,496
Total volume		381,143			376,165
Medicare completed episodes (6)		221,848			229,229
Average Medicare revenue per completed episode (4) (6)	$	2,811		$	2,853
Medicare visits per completed episode (5) (6)		15.2			17.1
Visiting Clinician Cost per Visit	$	88.64		$	82.23
Clinical Manager Cost per Visit	$	9.10		$	7.91
Total Cost per Visit	$	97.74		$	90.14
Visits		5,563,992			6,238,758

(1)    Same store information represents the percent change in our Medicare, Non-Medicare and Total revenue, admissions or volume for the period as a percent of the Medicare, Non-Medicare and Total revenue, admissions or volume of the prior period. Effective July 1, 2019, same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center.
(2)    Total volume includes all admissions and recertifications.
(3)    Total includes acquisitions and denovos.
(4)    Average Medicare revenue per completed episode is the average Medicare revenue earned for each Medicare completed episode of care. Average Medicare revenue per completed episode for the three and nine-month periods ended September 30, 2020 reflects the suspension of sequestration effective May 1, 2020. Additionally average Medicare revenue per completed episode for the nine-month period ended September 30, 2020 reflects the transition to PDGM during the year and therefore includes reimbursement under both the 60-day episode of care (pre-PDGM) payment rate and the 30-day period of care (PDGM) payment rate.
(5)    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.
(6)    Prior year amounts have been recast to conform to the current year calculation.

Segment Information - Hospice

	For the Three-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Medicare	$	189.0		$	153.5
Non-Medicare		10.7			8.9
Net service revenue		199.7			162.4
Other operating income		1.7			—
Cost of service		104.1			84.5
Gross margin		97.3			77.9
Other operating expenses		48.4			36.2
Operating income	$	48.9		$	41.7
Same Store Growth (1):
Medicare revenue		3	%		10	%
Hospice admissions		9	%		4	%
Average daily census		—	%		5	%
Key Statistical Data - Total (2):
Hospice admissions		13,026			9,914
Average daily census		13,953			11,565
Revenue per day, net	$	155.57		$	152.67
Cost of service per day	$	81.05		$	79.51
Average discharge length of stay		101			98

 

	For the Nine-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Medicare	$	516.5		$	430.0
Non-Medicare		29.7			22.6
Net service revenue		546.2			452.6
Other operating income		8.9			—
Cost of service		293.1			245.9
Gross margin		262.0			206.7
Other operating expenses		129.1			100.9
Operating income	$	132.9		$	105.8
Same Store Growth (1):
Medicare revenue		4	%		6	%
Hospice admissions		3	%		5	%
Average daily census		1	%		6	%
Key Statistical Data - Total (2):
Hospice admissions		35,755			30,055
Average daily census		12,841			10,997
Revenue per day, net	$	155.23		$	150.77
Cost of service per day	$	83.29		$	81.92
Average discharge length of stay		98			98

(1)    Same store information represents the percent change in our Medicare revenue, Hospice admissions or average daily census for the period as a percent of the Medicare revenue, Hospice admissions or average daily census of the prior period. Effective July 1, 2019, same store is defined as care centers that we have operated for at least the last twelve months and startups that are an expansion of a same store care center.
(2)    Total includes acquisitions and denovos.

 

Segment Information - Personal Care

	For the Three-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Medicare	$	—		$	—
Non-Medicare		18.4			20.7
Net service revenue		18.4			20.7
Other operating income		0.5			—
Cost of service		13.5			15.3
Gross margin		5.4			5.4
Other operating expenses		3.2			3.1
Operating income	$	2.2		$	2.3
Key Statistical Data - Total (1):
Billable hours		673,161			824,251
Clients served		10,153			12,687
Shifts		280,470			370,451
Revenue per hour	$	27.33		$	25.12
Revenue per shift	$	65.59		$	55.90
Hours per shift		2.4			2.2

 

	For the Nine-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Medicare	$	—		$	—
Non-Medicare		54.8			62.1
Net service revenue		54.8			62.1
Other operating income		1.0			—
Cost of service		41.7			46.4
Gross margin		14.1			15.7
Other operating expenses		9.6			9.5
Operating income	$	4.5		$	6.2
Key Statistical Data - Total (1):
Billable hours		2,067,958			2,506,113
Clients served		14,057			16,134
Shifts		896,141			1,128,920
Revenue per hour	$	26.51		$	24.77
Revenue per shift	$	61.18		$	55.00
Hours per shift		2.3			2.2

(1)    Total includes acquisitions.

Segment Information - Corporate

	For the Three-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Other operating expenses	$	49.9		$	40.4
Depreciation and amortization		6.7			2.9
Total operating expenses	$	56.6		$	43.3

 

	For the Nine-Month Periods Ended September 30,
	2020			2019
Financial Information (in millions):
Other operating expenses	$	129.2		$	122.0
Depreciation and amortization		15.2			7.9
Total operating expenses	$	144.4		$	129.9

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”) Reconciliation:

	For the Three- Month Periods Ended September 30,						For the Nine- Month Periods Ended September 30,
	2020			2019			2020			2019
Net income attributable to Amedisys, Inc.	$	71,981		$	34,132		$	138,457		$	99,178
Add:
Income tax (benefit) expense		(10,202	)		9,919			9,175			31,105
Interest expense, net		2,661			3,763			8,417			11,400
Depreciation and amortization		8,283			4,366			19,955			12,440
Certain items (1)		3,494			5,088			20,843			20,259
Interest component of certain items (1)		(558	)		(451	)		(1,450	)		(1,338	)
Adjusted EBITDA (2) (7)	$	75,659		$	56,817		$	195,397		$	173,044

Adjusted Net Service Revenue Reconciliation:

	For the Three- Month Periods Ended September 30,						For the Nine- Month Periods Ended September 30,
	2020			2019			2020			2019
Net service revenue	$	544,070		$	494,631		$	1,520,814		$	1,454,955
Add:
Certain items (1)		—			—			—			5,993
Adjusted net service revenue (3) (7)	$	544,070		$	494,631		$	1,520,814		$	1,460,948

Adjusted Other Operating Income Reconciliation:

	For the Three- Month Periods Ended September 30,						For the Nine- Month Periods Ended September 30,
	2020			2019			2020			2019
Other operating income	$	4,812		$	—		$	27,592		$	—
Add:
Certain items (1)		(4,812	)		—			(27,592	)		—
Adjusted other operating income (4) (7)	$	—		$	—		$	—		$	—

Adjusted Net Income Attributable to Amedisys, Inc Reconciliation:

	For the Three- Month Periods Ended September 30,						For the Nine- Month Periods Ended September 30,
	2020			2019			2020			2019
Net income attributable to Amedisys, Inc.	$	71,981		$	34,132		$	138,457		$	99,178
Add:
Certain items (1)		2,585			3,765			15,424			14,992
Adjusted net income attributable to Amedisys, Inc. (5) (7)	$	74,566		$	37,897		$	153,881		$	114,170

Adjusted Net Income Attributable to Amedisys, Inc. per Diluted Share Reconciliation:

	For the Three- Month Periods Ended September 30,						For the Nine- Month Periods Ended September 30,
	2020			2019			2020			2019
Net income attributable to Amedisys, Inc. common stockholders per diluted share	$	2.16		$	1.03		$	4.16		$	3.01
Add:
Certain items (1)		0.08			0.11			0.46			0.46
Adjusted net income attributable to Amedisys, Inc. common stockholders per diluted share (6) (7)	$	2.24		$	1.15		$	4.63		$	3.47

(1)    The following details the certain items for the three and nine-month periods ended September 30, 2020 and 2019:

Certain Items:

	For the Three-Month Period Ended September 30, 2020			For the Nine-Month Period Ended September 30, 2020
	(Income) Expense			(Income) Expense
Certain Items Impacting Other Operating Income:
CARES Act & State COVID-19 grants	$	(4,812	)	$	(27,592	)
Certain Items Impacting Cost of Service:
COVID-19 costs		4,389			27,399
Severance - reductions in staffing levels		(550	)		4,633
Certain Items Impacting Operating Expenses:
Acquisition and integration costs		3,626			9,561
COVID-19 costs		322			1,385
Severance - reductions in staffing levels		—			271
Certain Items Impacting Total Other Income (Expense):
Interest component of certain items		558			1,450
Other (income) expense, net		(39	)		3,736
Total	$	3,494		$	20,843
Net of tax		2,585			15,424
Diluted EPS	$	0.08		$	0.46

 

	For the Three-Month Period Ended September 30, 2019			For the Nine-Month Period Ended September 30, 2019
	(Income) Expense			(Income) Expense
Certain Items Impacting Net Service Revenue:
Contingency accrual	$	—		$	6,541
Planned closures (8)		—			(548	)
Certain Items Impacting Cost of Service:
Planned closures (8)		15			1,172
Certain Items Impacting Operating Expenses:
Planned closures (8)		28			185
Acquisition and integration costs		4,141			14,393
Legal fees - non-routine		397			373
Certain Items Impacting Total Other Income (Expense):
Interest component of certain items		451			1,338
Other (income) expense, net		56			(3,195	)
Total	$	5,088		$	20,259
Net of tax		3,765			14,992
Diluted EPS	$	0.11		$	0.46

(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 excluding certain items as described in footnote 1.
(4)    Adjusted other operating income is defined as other operating income excluding certain items as described in footnote 1.
(5)    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.
(6)    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.
(7)    Adjusted EBITDA, adjusted net service revenue, adjusted other operating income, 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 measures 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.
(8)    Planned closures consist of in-patient units acquired from Compassionate Care Hospice whose operations ceased in April 2019.