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Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a Continuing Operations substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP.
Adjusted EBITDA Percentage is defined as Adjusted EBITDA divided by Net Service Revenues Select Balance Sheet Information 19 Balances for 3/31/2013 are unaudited. ($ in millions) Key Balances 12/31/2008 12/31/2009 12/31/2010 12/31/2011 12/31/2012 3/31/2013 Cash 6.1 $ 0.5 $ 0.8 $ 2.0 $ 1.7 $ 17.8 $ Accounts receivable, net 49.2 70.5 71.0 72.4 71.3 60.6 Total Assets 135.7 161.3 166.9 154.7 149.9 151.4 Debt, including current maturities 63.2 49.2 45.2 31.5 16.5 Stock holders' equity 34.6 $ 80.6 $ 88.1 $ 86.4 $ 94.4 $ 107.8 $ Debt to capital ratio 64.6% 37.9% 33.9% 26.7% 14.8% 0.0% Investment Highlights Large Growing Market Broad Range of Services and Payors Positioned to Excel under Healthcare Reform History of Growth through Acquisition Multiple Organic Growth Opportunities Differentiated, Coordinated Care Model Experienced Management Team Significant Operational Scale Across National Footprint EBITDA Reconciliation 21 ($ in millions) 12/31/2008 12/31/2009 12/31/2010 12/31/2011 12/31/2012 3/31/2012 3/31/2013 (2) Net Income (0.2) $ (1.8) $ 6.0 $ (2.0) $ 7.6 $ 0.6 $ 13.3 $ Less: (Earnings) loss from discontinued operations (2.5) (2.4) (1.7) 10.4 1.7 1.1 (10.6) Net Income from continuing operations (2.7) (4.2) 4.3 8.4 9.3 1.7 2.7 Preferred stock dividends 4.3 5.4 Revaluation of contingent consideration (0.5) Interest Income (0.2) (2.3) (0.2) Interest Expense 5.7 6.8 3.2 2.5 1.7 0.4 0.2 Income Tax Expense (0.5) (0.1) 1.9 4.3 4.8 1.2 0.8 Depreciation and amortization 5.2 4.1 3.4 3.2 2.5 0.6 0.6 Stock based compensation expense 0.3 0.3 0.3 0.3 0.3 0.1 0.1 Adjusted EBITDA (1) 12.3 $ 12.3 $ 12.9 $ 15.9 $ 18.4 $ 4.0 $ 4.4 $ (1) (2) 3/31/13 and 3/31/12 amounts are unaudited Year Ended Three Months Ended We define Adjusted EBITDA as earnings before discontinued operations, preferred stock dividends, revaluation of contingent consideration, interest expense, taxes, depreciation, amortization, severance costs related to former chairman and stock based compensation expense.
Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP. Gross Margin percentage is defined as Net Service Revenues less Cost of Service Revenues divided by Net Service Revenues.
Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP. ($ in thousands) Condensed Consolidated Statements of Income 18 ($ in millions) 12/31/2008 12/31/2009 12/31/2010 12/31/2011 12/31/2012 3/31/2012 3/31/2013 Unaudited Unaudited Net Service Revenues 197.9 $ 219.9 $ 230.1 $ 230.1 $ 244.3 $ 58.9 $ 63.0 $ Cost of Service Revenues (147.3) (162.7) (170.4) (168.6) (180.2) (43.9) (47.2) General Administrative (38.6) (45.1) (47.0) (45.4) (45.9) (11.6) (11.5) Adjusted EBITDA 12.3 $ 12.3 $ 12.9 $ 15.9 $ 18.4 $ 4.0 $ 4.4 $ Gross Margin Percentage 25.6% 26.0% 25.9% 26.7% 26.2% 25.5% 25.1% Adjusted EBITDA Percentage 6.2% 5.6% 5.6% 6.9% 7.5% 6.8% 7.0% Year Ended Three Months Ended Continuing Operations Notes: We define Adjusted EBITDA as earnings before discontinued operations, preferred stock dividends, revaluation of contingent consideration, interest expense, taxes, depreciation, amortization, and stock based compensation expense.
Nursing Home Residents Scripps Gerontology Center Study HCBS Strategies Study Nursing home admissions fell, in spite of rising populations; substantial savings The home is the lowest cost setting in which to provide care, and is preferred by consumers and families Home Care Programs Improve Outcomes Census Revenue EBITDA Trends 17 We define Adjusted EBITDA as earnings before discontinued operations, preferred stock dividends, reevaluation of contingent consideration, interest expense, taxes, depreciation, amortization, and stock based compensation expense.
Source: CCP Cost Effectiveness: Comparison of CCP growth with Nursing Facility Prevalence Reductions HCBS Strategies Inc. February 10, 2010 Illinois Residents Age 75+ Total Population vs. Nursing Home Residents Source: Coming of Age: Tracking the Progress and Challenges of Delivering Long Term Services and Supports in Ohio Scripps Gerontology Center, Miami University of Ohio, June 2011 Ohio Residents Age 60+ Total Population vs.
Ambulance $1,000/ride Total Episodic Cost one year of Nursing Home $75,620 Sources: Consumer Health Ratings.com CMS.gov The Choice is Obvious! Addus Dual Advantage TM A Powerful Resource No one knows more about the member No one is in a better position to positively effect health outcomes Than the Addus Home Care Aide 13 Home Care Integrated Clinical Strategy Begins In The Home Addus Home Care Aide Client Primary Care Health Providers Addus Call Center Health Plan Case Manager 14 Community Based Providers Pharmacies Interdisciplinary Care Team Community Based Resources Advocacy Groups Family Addus Dual Advantage TM A Model for Extending the Reach of Health Plan Case Managers 15 Serving the dual eligible population at home: Complicated Logistics intense Highly transactional Requires disciplined processes Provides tremendous opportunity for case management extension!
Medicare Program Populations 65+ years Hospital Services (Part A) Post Acute Care SNF / Rehab Professional Services (Part B) Post acute Home Care Services Prescription Services (Part D) Duals Represent 36% of Total Medicare Spending Medicaid Programs Generally populations 65+ years w Income limits Home Based Personal Care Long term Nursing Home Care Duals Represent 39% of Total Medicaid Spending 69% of Medicaid Spending is for Long Term Care 10 Eliminate service duplication / streamline administration Keep member functioning in the home environment Avoid / lower the cost for Acute Care services Pilot Program Features / Objectives Sources: Kaiser Commission on Medicaid and the Uninsured, April 2011 MCO Plans/Programs already implemented 2013 Implementation Plans 2014 Implementation Plans No Implementation Plans Addus location(s) Source: Kaiser Commission on Medicaid and the Uninsured, May 2012 States Pursuing a Dual Program Health Plan s Worst Nightmare 12 Home Personal Care $9,200/year Emergency Room $1,700/visit Acute Care Hospital $12,320/stay Rehab Facility $18,600/stay Nursing Home $42,000/year Vs.
Long Term Care Expenditures . SOURCE: KCMU and Urban Institute analysis of HCFA/CMS 64 data. June 2011 Growth in Medicaid Long Term Care Expenditures Medicaid Spending Per Beneficiary Source: Kassner, Reinhard, Fox Grage, Houser, Accius, Coleman and Milne. AARP Public Policy Institute: A Balancing Act: State Long Term Care Reform, July 2008 9 THE LANDSCAPE IS SHIFTING States are shifting responsibility for care to health plans and managed care Focus on managing and coordinating care for the costly dual eligible population $0.00 $10.00 $20.00 $30.00 $40.00 $50.00 $60.00 $70.00 $80.00 1990 1995 2000 2002 2004 2006 2008 2009 Insitutional Care Expenditures(Billions) Home Community Based Services Expenditures (Billions) $24,500 $9,200 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 Nursing Home Home Care Total $300 Billion in annual spending for dual eligible enrollees in 2007 Funding for both programs administered through the States 26 States have indicated they will participate over the next 3 years Each State will decide on the size, nature and timing of the pilots Approximately 9 million are Duals Bids are being solicited from multiple Managed Care Companies Stated Objectives: Dual Eligible What is the Opportunity?
Source: Kaiser Family Foundation calculations using data from U.S. Department of Health and Human Services, Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey (MEPS), 2007 7 Companionship $ Healthy Living Eat an Apple Telephone Reassurance Personal Emergency Response (PERS) Friendly Visiting Meals at Home Transportation Adult Day Services Personal Care $ Case Management $ Home Health $ Hospice $$ Home Physicians $$ Ambulance/ ER $$$ Hospital Stay $$$$ Hospital Intensive Care $$$$ Rehab Facility $$$$ Psychiatric Inpatient $$$$$ Nursing Home $$$$$ Sub Acute Facilities $$$$$ Pre Acute Acute Where are we in the Continuum of Care?
Comprehensive provider of home and community based services, which are primarily social in nature, focused primarily on the Dual Eligible population: Personal Care Private Duty Adult Day Service Founded in 1979 14,000+ employees 26,000+ consumers (many dual eligible) 2012 Revenues of $244.3 million Diversified payor base (200+ payors) Largest payor 64% of 2012 total revenues 6 98 Locations Across 20 States Key Facts: Who We Serve Focusing on the Dual Eligible Population Addus focuses on the top 5% in terms of resource needs and expenditures!
Reward for accomplishing our mission includes pride in our organization, contribution to the community and a reasonable profit. Mission Investment Highlights Large Growing Market Broad Range of Services and Payors Positioned to Excel under Healthcare Reform History of Growth through Acquisition Multiple Organic Growth Opportunities Differentiated, Coordinated Care Model Experienced Management Team Significant Operational Scale Across National Footprint Addus Dual Advantage TM The New Paradigm Long term care risk makes it essential that health plan dual eligible members live safely and healthfully at home as long as possible 5 About Addus Who is Addus?
Addus undertakes no obligation to update or revise any forward looking statements, except as may be required by law. 2 It is the primary mission of Addus HealthCare to improve the health and well being of our consumers through the provision of quality, cost effective home and community based services. We will accomplish our goals by fostering an environment in which our employees enthusiastically support and advance our mission.
The future results of Addus may vary from the results expressed in, or implied by, the following forward looking statements, possibly to a material degree, and historical results may not be an indication of future performance. For a discussion of some of the important factors that could cause Addus' results to differ from those expressed in, or implied by, the following forward looking statements, please refer to Addus most recent Annual Report on Form 10 K, and its Quarterly Reports on Form 10 Q, each of which is available at www.SEC.gov, particularly the Sections entitled Risk Factors .
Coordinated Personal Home Care A pre acute solution to the post acute problem SM JMP Securities Research Conference May 14, 2013 Exhibit 99.1 Forward Looking Statements The following information contains, or may be deemed to contain, forward looking statements. By their nature, forward looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future.