Chemed Corp. (NYSE:CHE) Q1 2018 Earnings Conference Call - Preliminary Transcript

Apr 20, 2018 • 10:00 am ET

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Chemed Corp. (NYSE:CHE) Q1 2018 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good day ladies and gentlemen and welcome to the Q1 2018 Chemed Corporation Earnings Conference Call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder today's program is being recorded.

I would now like to turn the call over to Ms. Sherri Warner with Investor Relations. Ma'am, you may begin.

Executive
Sherri Warner

Good morning. Our conference call this morning will review the financial results for the first quarter of 2018 ended March 31, 2018. Before we begin, let me remind you that the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 apply to this conference call. During the course of this call, the company will make various remarks concerning management's expectations, predictions, plans and prospects that constitute forward-looking statements. Actual results may differ materially from those projected by these forward-looking statements as a result of a variety of factors including those identified in the company's news release of April 19 and in various other filings with the SEC. You're cautioned that any forward-looking statements reflect management's current view only and that the company undertakes no obligation to revise or update such statements in the future.

In addition, management may also discuss non-GAAP operating performance results during today's call including earnings before interest, taxes, depreciation and amortization or EBITDA and adjusted EBITDA. A reconciliation of these non-GAAP results is provided in the company's press release dated April 19, which is available on the company's website at chemed.com.

I would now like to introduce our speakers for today; Kevin McNamara, President and Chief Executive Officer of Chemed Corporation; Dave Williams, Executive Vice President and Chief Financial Officer of Chemed; and Nick Westfall, Chief Executive Officer of Chemed's VITAS Healthcare Corporation subsidiary.

I will now turn the call over to Kevin McNamara.

Executive
Kevin McNamara

Thank you, Sherri. Good morning. Welcome to Chemed Corporation's first quarter 2018 conference call. I will begin with highlights for the quarter and David and Nick will follow-up with additional operating detail. I will then open up the call for questions.

What a great start to the year. Our first quarter of 2018 had excellent operational performance, margin improvement and overall financial results in both of our operating segments. In the quarter, Chemed generated $439 million of revenue, an increase of 8.2%. Our consolidated net income in the quarter excluded certain discrete items generated adjusted earnings per diluted share of $2.72, an increase of 49.5%. Both, VITAS and Roto-Rooter performed well exceeding the high-end of our key operational and financial estimates. VITAS admissions excluded the Obama site closure in 2017, increased 4.7% in the quarter, and on average daily census expanded 6.6%, and our adjusted EBITDA excluded the benefit from Medicare cap increased 11.6%.

Roto-Rooter continues to show excellent results in our core plumbing and drain fitting service segments, as well as strong growth in water restoration. This resulted in Roto-Rooter having record first quarter 2018 revenue and profitability.