Chemed Reports Third-Quarter 2024 Results

CINCINNATI--(BUSINESS WIRE)--Chemed Corporation (Chemed) (NYSE: CHE), which operates VITAS Healthcare Corporation (VITAS), one of the nation’s largest providers of end-of-life care, and Roto-Rooter, the nation’s largest commercial and residential plumbing and drain cleaning services provider, reported financial results for its third quarter ended September 30, 2024, versus the comparable prior-year period.

Changes to Non-GAAP Metrics

Chemed uses certain non-GAAP metrics such as EBITDA, adjusted EBITDA, adjusted net income and adjusted diluted earnings per share, to provide additional context and perspective to reported operational results.

Chemed’s previously reported non-GAAP metrics during the four sequential quarters from September 30, 2022 through June 30, 2023 excluded the 12-month pandemic-related licensed healthcare professional retention bonus (Retention Program). Starting with the quarter-ended September 30, 2023, the Company no longer excludes the cost of the Retention Program when presenting non-GAAP operating metrics in current or prior periods.

For the nine-months ended September 30, 2023, the pretax and after-tax Retention Program expense was $23.7 million and $18.0 million, respectively. There was no material impact on financial results for the quarter or nine months-ended September 30, 2024 as a result of the Retention Program.

Results for Quarter Ended September 30, 2024

Consolidated operating results:

• Revenue increased 7.4% to $606.2 million
• GAAP Diluted Earnings-per-Share (EPS) of $5.00, an increase of 1.4%
• Adjusted Diluted EPS of $5.64, an increase of 6.0%

VITAS segment operating results:

• Net Patient Revenue of $391.4 million, an increase of 17.3%
• Average Daily Census (ADC) of 21,785, an increase of 15.5%
• Admissions of 16,775, an increase of 6.3%
• Net Income, excluding certain discrete items, of $53.8 million, an increase of 26.4%
• Adjusted EBITDA, excluding Medicare Cap, of $73.1 million, an increase of 33.1%
• Adjusted EBITDA margin, excluding Medicare Cap, of 18.6%, an increase of 212-basis points

Roto-Rooter segment operating results:

• Revenue of $214.8 million, a decrease of 6.9%
• Net Income, excluding certain discrete items, of $39.8 million, a decrease of 18.9%
• Adjusted EBITDA of $56.4 million, a decline of 15.8%
• Adjusted EBITDA margin of 26.3%, a decline of 275-basis points

VITAS

As previously announced, VITAS completed its acquisition of the hospice assets and an assisted living facility of Covenant Health and Community Services, Inc. (Covenant Health) on April 17, 2024 for $85.0 million in cash. Before presenting VITAS’ overall results, it is important to disclose the methodology used in determining the impact of Covenant Health’s acquisition on VITAS’ overall results. VITAS had significant operations in two of the three Florida locations we acquired from Covenant Health. Those locations require that we estimate the Covenant Health impact, as once the operations are integrated, there are not separate results. For instance, there are no VITAS-specific referral sources versus Covenant Health-specific referral sources in these locations. It is very likely that referral sources in the area have historically referred to both VITAS and Covenant Health. We have used historical operating trends in these locations to determine what is “legacy” VITAS activity. All activity above those historical operating trends have been attributed as the Covenant Health impact. We have included the specifically determined impact as it relates to new operating territories acquired. Based on the above, we discuss the range of impact that Covenant had on the overall VITAS operating metrics.

Covenant Health contributed approximately $10 million to $11 million of revenue in the third quarter of 2024. This revenue translated to net income of approximately $1.8 million to $2.0 million. Adjusted EBITDA in the quarter attributed to Covenant Health is between $2.4 million and $2.6 million.

VITAS net revenue was $391.4 million in the third quarter of 2024, which is an increase of 17.3% when compared to the prior-year period. This revenue increase is comprised primarily of a 15.5% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.6%. Acuity mix shift negatively impacted revenue growth 144-basis points in the quarter when compared to the prior-year period’s revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by approximately 64-basis points.

In the third quarter of 2024, VITAS accrued $2.2 million in Medicare Cap billing limitations. This compares to a $125,000 Medicare Cap billing limitation in the third quarter of 2023.

Of VITAS’ 32 Medicare provider numbers, 24 provider numbers have a trailing 12-month Medicare Cap cushion of 10% or greater, five provider numbers have a cushion between 0% and 10%, and three provider numbers have a trailing 12-month Medicare Cap billing limitation totaling $9.4 million.

Average revenue per patient per day in the third quarter of 2024 was $199.16 which is 139-basis points above the prior-year period. Reimbursement for routine home care and high acuity care averaged $175.82 and $1,094.97, respectively. During the quarter, high acuity days-of-care were 2.5% of total days of care, a decline of 26-basis points when compared to the prior-year quarter.

The third quarter 2024 gross margin, excluding Medicare Cap, was 25.1%. This compares to the prior year quarter’s gross margin of 24.0%, excluding Medicare Cap. Selling, general and administrative expenses were $25.9 million in the third quarter of 2024 compared to $25.3 million in the prior-year quarter.

Adjusted EBITDA, excluding Medicare Cap, totaled $73.1 million in the quarter, an increase of 33.1% when compared to the prior year period. Adjusted EBITDA margin in the quarter, excluding Medicare Cap, was 18.6%, which is 212-basis points above the prior-year period.

Hurricane Helene, which impacted the panhandle of Florida and other parts of the southeastern United States in late September, did not result in any significant property loss or damage to VITAS. However, as with other similar events, we did experience a slowdown in admission activity while health systems prepared for the hurricane and then dealt with the aftermath. We estimate that admissions were negatively impacted during the quarter by approximately 60-100 patients. We also believe that the Florida admission impact will be more significant in the fourth quarter with the combination of Hurricanes Helene and Milton.

Roto-Rooter

Roto-Rooter generated quarterly revenue of $214.8 million in the third quarter of 2024, a decrease of 6.9%, when compared to the prior-year quarter.

Roto-Rooter branch commercial revenue in the quarter totaled $53.5 million, a decrease of 5.9% from the prior-year period. This aggregate commercial revenue change consisted of drain cleaning revenue declining 4.4%, plumbing declining 12.1%, excavation declining 2.3%, and water restoration declining 3.3%.

Roto-Rooter branch residential revenue in the quarter totaled $146.0 million, a decrease of 6.3%, over the prior-year period. This aggregate residential revenue change consisted of drain cleaning declining 5.9%, plumbing declining 11.2%, excavation declining 6.1%, and water restoration declining 6.9%.

Roto-Rooter’s gross margin in the quarter was 52.9%, essentially flat when compared to the third quarter of 2023. Roto-Rooter’s selling, general and administrative expenses were $57.1 million in the quarter, which is an increase of 3.5% compared to the third quarter of 2023. This increase was caused by continued enhanced marketing efforts designed to drive additional demand.

Adjusted EBITDA in the third quarter of 2024 totaled $56.4 million, a decrease of 15.8% when compared to the third quarter of 2023. The Adjusted EBITDA margin in the quarter was 26.3% which represents a 275-basis point decline from the third quarter of 2023.

Chemed Consolidated

As of September 30, 2024, Chemed had total cash and cash equivalents of $238.5 million and no current or long-term debt.

In June 2022, Chemed entered into a five-year $550 million Amended and Restated Credit Agreement (Credit Agreement). This Credit Agreement consisted of a $100 million amortizable term loan and a $450 million revolving credit facility. The interest rate on this Credit Agreement has a floating rate that is currently SOFR plus 100-basis points. There is approximately $404.8 million of undrawn borrowing capacity under the Credit Agreement after excluding $45.2 million for Letters of Credit.

During the quarter, the Company repurchased 100,000 shares of Chemed stock for $57.8 million which equates to a cost per share of $578.21. As of September 30, 2024, there was approximately $168.1 million of remaining share repurchase authorization under its plan.

Revision to Guidance for 2024

VITAS continues to perform as anticipated, and we reiterate the metrics for VITAS as presented in our second quarter 2024 press release. Roto-Rooter’s revenue and resulting adjusted EBITDA and adjusted net income was softer than anticipated during the third quarter of 2024. As a result of these factors, full-year consolidated 2024 earnings per diluted share, excluding non-cash expense for stock options, tax benefits from stock option exercises, costs related to litigation and other discrete items, is estimated to be in the range of $23.00 to $23.15. This range represents a 13.3% to 14.0% increase from Chemed’s 2023 reported adjusted earnings per diluted share of $20.30. This guidance assumes an effective corporate tax rate on adjusted earnings of 24.3% and a diluted share count of 15.22 million shares.

Conference Call

As previously disclosed, Chemed will host a conference call and webcast at 10 a.m., ET, on Wednesday October 30, 2024, to discuss the company's quarterly results and to provide an update on its business. Participants may access a live webcast of the conference call through the investor relations section of Chemed’s website, Investor Relations Home | Chemed Corporation or the hosting website https://edge.media-server.com/mmc/p/c93ntfig/.

Participants may also register via teleconference at: https://register.vevent.com/register/BI0022c41ceecf4b83a582584604bc732b.

Once registration is completed, participants will be provided with a dial-in number containing a personalized conference code to access the call. All participants are instructed to dial-in 15 minutes prior to the start time.

A taped replay of the conference call will be available beginning approximately two hours after the call's conclusion. You may access the replay via webcast through the investor relations section of Chemed’s website.

Chemed Corporation operates in the healthcare field through its VITAS Healthcare Corporation subsidiary. VITAS provides daily hospice services to patients with severe, life-limiting illnesses. This type of care is focused on making the terminally ill patient's final days as comfortable and pain-free as possible.

Chemed operates in the residential and commercial plumbing and drain cleaning industry under the brand name Roto-Rooter. Roto-Rooter provides plumbing, drain cleaning, and water cleanup services through company-owned branches, independent contractors and franchisees in the United States and Canada. Roto-Rooter also has licensed master franchisees in the republics of Indonesia and Singapore, and the Philippines.

This press release contains information about Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS, which are not measures derived in accordance with GAAP and which exclude components that are important to understanding Chemed’s financial performance. In reporting its operating results, Chemed provides EBITDA, Adjusted EBITDA and Adjusted Diluted EPS measures to help investors and others evaluate the Company’s operating results, compare its operating performance with that of similar companies that have different capital structures and evaluate its ability to meet its future debt service, capital expenditures and working capital requirements. Chemed’s management similarly uses EBITDA, Adjusted EBITDA and Adjusted Diluted EPS to assist it in evaluating the performance of the Company across fiscal periods and in assessing how its performance compares to its peer companies. These measures also help Chemed’s management to estimate the resources required to meet Chemed’s future financial obligations and expenditures. Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS should not be considered in isolation or as a substitute for comparable measures calculated and presented in accordance with GAAP. We calculated Adjusted EBITDA Margin by dividing Adjusted EBITDA by service revenue and sales. A reconciliation of Chemed’s net income to its EBITDA, Adjusted EBITDA and Adjusted Diluted EPS is presented in the tables following the text of this press release.

Forward-Looking Statements

Certain statements contained in this press release and the accompanying tables are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "hope," "anticipate," "plan" and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Chemed does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause Chemed's actual results to differ from those expressed in such forward-looking statements.

These risks and uncertainties arise from, among other things, possible changes in regulations governing the hospice care or plumbing and drain cleaning industries; periodic changes in reimbursement levels and procedures under Medicare and Medicaid programs; difficulties predicting patient length of stay and estimating potential Medicare reimbursement obligations; challenges inherent in Chemed's growth strategy; the current shortage of qualified nurses, other healthcare professionals and licensed plumbing and drain cleaning technicians; Chemed’s dependence on patient referral sources; and other factors detailed under the caption "Description of Business by Segment" or "Risk Factors" in Chemed’s most recent report on form 10-Q or 10-K and its other filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on such forward-looking statements and there are no assurances that the matters contained in such statements will be achieved.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)(unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Service revenues and sales	$	606,181		$	564,532		$	1,791,294		$	1,678,505
Cost of services provided and goods sold		396,187			362,358			1,171,064			1,107,256
Selling, general and administrative expenses (aa)		101,981			99,602			320,109			294,684
Depreciation		13,147			12,858			39,601			37,778
Amortization		2,550			2,521			7,617			7,548
Other operating expense		159			343			288			2,064
Total costs and expenses		514,024			477,682			1,538,679			1,449,330
Income from operations		92,157			86,850			252,615			229,175
Interest expense		(427	)		(444	)		(1,281	)		(2,766	)
Other income--net (bb)		9,299			6,859			28,008			8,365
Income before income taxes		101,029			93,265			279,342			234,774
Income taxes		(25,253	)		(18,307	)		(67,662	)		(52,318	)
Net income	$	75,776		$	74,958		$	211,680		$	182,456
Earnings Per Share
Net income	$	5.04		$	4.97		$	14.04		$	12.14
Average number of shares outstanding		15,025			15,075			15,082			15,034
Diluted Earnings Per Share
Net income	$	5.00		$	4.93		$	13.88		$	12.02
Average number of shares outstanding		15,168			15,200			15,253			15,178
(aa) Selling, general and administrative ("SG&A") expenses comprise (in thousands):
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
SG&A expenses before long-term incentive compensation
and the impact of market value adjustments related to
deferred compensation plans	$	93,269		$	91,792		$	287,712		$	281,426
Market value adjustments related to deferred
compensation trusts		5,629			4,257			16,600			5,441
Long-term incentive compensation		3,083			3,553			15,797			7,817
Total SG&A expenses	$	101,981		$	99,602		$	320,109		$	294,684
(bb) Other income--net comprises (in thousands):
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Market value adjustments related to deferred
compensation trusts	$	5,629		$	4,257		$	16,600		$	5,441
Interest income		3,668			2,600			11,405			2,863
Other		2			2			3			61
Total other income--net	$	9,299		$	6,859		$	28,008		$	8,365

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)(unaudited)
	September 30,
	2024			2023
Assets
Current assets
Cash and cash equivalents	$	238,451		$	173,150
Accounts receivable less allowances		196,481			168,031
Inventories		9,899			12,511
Prepaid income taxes		14,229			11,337
Prepaid expenses		31,377			29,510
Total current assets		490,437			394,539
Investments of deferred compensation plans held in trust		126,631			104,410
Properties and equipment, at cost less accumulated depreciation		200,939			205,462
Lease right of use asset		134,111			123,353
Identifiable intangible assets less accumulated amortization		94,753			92,768
Goodwill		666,860			584,977
Other assets		55,704			56,570
Total Assets	$	1,769,435		$	1,562,079
Liabilities
Current liabilities
Accounts payable	$	44,938		$	56,508
Accrued insurance		60,308			61,122
Accrued income taxes		3,385			5,135
Accrued compensation		73,141			74,865
Short-term lease liability		42,490			37,615
Other current liabilities		40,517			61,974
Total current liabilities		264,779			297,219
Deferred income taxes		28,076			30,381
Deferred compensation liabilities		122,240			102,815
Long-term lease liability		105,416			99,346
Other liabilities		13,169			13,075
Total Liabilities		533,680			542,836
Stockholders' Equity
Capital stock		37,395			37,013
Paid-in capital		1,462,569			1,254,356
Retained earnings		2,639,011			2,362,928
Treasury stock, at cost		(2,905,430	)		(2,637,102	)
Deferred compensation payable in Company stock		2,210			2,048
Total Stockholders' Equity		1,235,755			1,019,243
Total Liabilities and Stockholders' Equity	$	1,769,435		$	1,562,079

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)(unaudited)
	Nine Months Ended September 30,
	2024			2023
Cash Flows from Operating Activities
Net income	$	211,680		$	182,456
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization		47,218			45,326
Stock option expense		23,933			22,376
Noncash long-term incentive compensation		15,783			6,637
Litigation settlements		(5,750	)		2,050
Benefit for deferred income taxes		(2,245	)		(8,232	)
Noncash directors' compensation		1,282			1,444
Amortization of debt issuance costs		241			500
Changes in operating assets and liabilities, excluding
amounts acquired in business combinations:
Increase in accounts receivable		(14,336	)		(27,843	)
Decrease/(increase) in inventories		2,125			(2,239	)
(Increase)/decrease in prepaid expenses		(1,173	)		781
Decrease in accounts payable and
other current liabilities		(19,641	)		(15,815	)
Change in current income taxes		(4,545	)		12,314
Net change in lease assets and liabilities		(400	)		(892	)
Increase in other assets		(21,101	)		(8,622	)
Increase in other liabilities		18,348			11,426
Other sources		1,165			69
Net cash provided by operating activities		252,584			221,736
Cash Flows from Investing Activities
Business combinations, net of cash acquired		(97,400	)		(3,994	)
Capital expenditures		(36,770	)		(45,075	)
Proceeds from sale of fixed assets		3,060			506
Other uses		(281	)		(409	)
Net cash used by investing activities		(131,391	)		(48,972	)
Cash Flows from Financing Activities
Purchases of treasury stock		(152,049	)		(27,769	)
Proceeds from exercise of stock options		49,906			58,277
Dividends paid		(19,594	)		(17,446	)
Change in cash overdrafts payable		(15,749	)		16,182
Capital stock surrendered to pay taxes on stock-based compensation		(8,827	)		(5,446	)
Payments on long-term debt		-			(97,500	)
Other uses		(387	)		(38	)
Net cash used by financing activities		(146,700	)		(73,740	)
(Decrease)/increase in Cash and Cash Equivalents		(25,507	)		99,024
Cash and cash equivalents at beginning of year		263,958			74,126
Cash and cash equivalents at end of year	$	238,451		$	173,150

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(in thousands)(unaudited)
										Chemed
	VITAS			Roto-Rooter			Corporate			Consolidated
2024 (a)
Service revenues and sales	$	391,406		$	214,775		$	-		$	606,181
Cost of services provided and goods sold		294,936			101,251			-			396,187
Selling, general and administrative expenses		25,883			57,072			19,026			101,981
Depreciation		5,063			8,071			13			13,147
Amortization		26			2,524			-			2,550
Other operating expense		97			62			-			159
Total costs and expenses		326,005			168,980			19,039			514,024
Income/(loss) from operations		65,401			45,795			(19,039	)		92,157
Interest expense		(46	)		(114	)		(267	)		(427	)
Intercompany interest income/(expense)		4,920			3,656			(8,576	)		-
Other income—net		62			18			9,219			9,299
Income/(loss) before income taxes		70,337			49,355			(18,663	)		101,029
Income taxes		(16,851	)		(11,400	)		2,998			(25,253	)
Net income/(loss)	$	53,486		$	37,955		$	(15,665	)	$	75,776
2023 (b)
Service revenues and sales	$	333,728		$	230,804		$	-		$	564,532
Cost of services provided and goods sold		253,731			108,627			-			362,358
Selling, general and administrative expenses		25,256			55,141			19,205			99,602
Depreciation		5,009			7,836			13			12,858
Amortization		26			2,495			-			2,521
Other operating expense/(income)		(53	)		396			-			343
Total costs and expenses		283,969			174,495			19,218			477,682
Income/(loss) from operations		49,759			56,309			(19,218	)		86,850
Interest expense		(52	)		(131	)		(261	)		(444	)
Intercompany interest income/(expense)		4,935			3,040			(7,975	)		-
Other income—net		849			34			5,976			6,859
Income/(loss) before income taxes		55,491			59,252			(21,478	)		93,265
Income taxes		(11,160	)		(8,925	)		1,778			(18,307	)
Net income/(loss)	$	44,331		$	50,327		$	(19,700	)	$	74,958
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(in thousands)(unaudited)
										Chemed
	VITAS			Roto-Rooter			Corporate			Consolidated
2024 (a)
Service revenues and sales	$	1,119,970		$	671,324		$	-		$	1,791,294
Cost of services provided and goods sold		852,347			318,717			-			1,171,064
Selling, general and administrative expenses		73,968			175,683			70,458			320,109
Depreciation		15,288			24,275			38			39,601
Amortization		79			7,538			-			7,617
Other operating expense		160			128			-			288
Total costs and expenses		941,842			526,341			70,496			1,538,679
Income/(loss) from operations		178,128			144,983			(70,496	)		252,615
Interest expense		(138	)		(349	)		(794	)		(1,281	)
Intercompany interest income/(expense)		15,096			10,638			(25,734	)		-
Other income—net		138			64			27,806			28,008
Income/(loss) before income taxes		193,224			155,336			(69,218	)		279,342
Income taxes		(46,517	)		(36,010	)		14,865			(67,662	)
Net income/(loss)	$	146,707		$	119,326		$	(54,353	)	$	211,680
2023 (b)
Service revenues and sales	$	965,066		$	713,439		$	-		$	1,678,505
Cost of services provided and goods sold		770,470			336,786			-			1,107,256
Selling, general and administrative expenses		71,248			171,966			51,470			294,684
Depreciation		14,907			22,830			41			37,778
Amortization		78			7,470			-			7,548
Other operating expense/(income)		(15	)		2,079			-			2,064
Total costs and expenses		856,688			541,131			51,511			1,449,330
Income/(loss) from operations		108,378			172,308			(51,511	)		229,175
Interest expense		(154	)		(387	)		(2,225	)		(2,766	)
Intercompany interest income/(expense)		14,393			8,652			(23,045	)		-
Other income—net		1,109			96			7,160			8,365
Income/(loss) before income taxes		123,726			180,669			(69,621	)		234,774
Income taxes		(28,503	)		(38,315	)		14,500			(52,318	)
Net income/(loss)	$	95,223		$	142,354		$	(55,121	)	$	182,456
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING SUMMARIES OF EBITDA
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(in thousands)(unaudited)
										Chemed
	VITAS			Roto-Rooter			Corporate			Consolidated
2024
Net income/(loss)	$	53,486		$	37,955		$	(15,665	)	$	75,776
Add/(deduct):
Interest expense		46			114			267			427
Income taxes		16,851			11,400			(2,998	)		25,253
Depreciation		5,063			8,071			13			13,147
Amortization		26			2,524			-			2,550
EBITDA		75,472			60,064			(18,383	)		117,153
Add/(deduct):
Intercompany interest expense/(income)		(4,920	)		(3,656	)		8,576			-
Interest income		(59	)		(18	)		(3,589	)		(3,666	)
Stock option expense		-			-			6,038			6,038
Long-term incentive compensation		-			-			3,083			3,083
Acquisition expense		394			(8	)		-			386
Adjusted EBITDA	$	70,887		$	56,382		$	(4,275	)	$	122,994
2023
Net income/(loss)	$	44,331		$	50,327		$	(19,700	)	$	74,958
Add/(deduct):
Interest expense		52			131			261			444
Income taxes		11,160			8,925			(1,778	)		18,307
Depreciation		5,009			7,836			13			12,858
Amortization		26			2,495			-			2,521
EBITDA		60,578			69,714			(21,204	)		109,088
Add/(deduct):
Intercompany interest expense/(income)		(4,935	)		(3,040	)		7,975			-
Interest income		(847	)		(34	)		(1,719	)		(2,600	)
Litigation settlement		-			300			-			300
Stock option expense		-			-			5,495			5,495
Long-term incentive compensation		-			-			3,553			3,553
Adjusted EBITDA	$	54,796		$	66,940		$	(5,900	)	$	115,836
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING SUMMARIES OF EBITDA
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(in thousands)(unaudited)
										Chemed
	VITAS			Roto-Rooter			Corporate			Consolidated
2024
Net income/(loss)	$	146,707		$	119,326		$	(54,353	)	$	211,680
Add/(deduct):
Interest expense		138			349			794			1,281
Income taxes		46,517			36,010			(14,865	)		67,662
Depreciation		15,288			24,275			38			39,601
Amortization		79			7,538			-			7,617
EBITDA		208,729			187,498			(68,386	)		327,841
Add/(deduct):
Intercompany interest expense/(income)		(15,096	)		(10,638	)		25,734			-
Interest income		(136	)		(64	)		(11,205	)		(11,405	)
Stock option expense		-			-			23,933			23,933
Long-term incentive compensation		-			-			10,460			10,460
Severance arrangement		-			-			5,337			5,337
Acquisition expense		1,302			37			-			1,339
Adjusted EBITDA	$	194,799		$	176,833		$	(14,127	)	$	357,505
2023
Net income/(loss)	$	95,223		$	142,354		$	(55,121	)	$	182,456
Add/(deduct):
Interest expense		154			387			2,225			2,766
Income taxes		28,503			38,315			(14,500	)		52,318
Depreciation		14,907			22,830			41			37,778
Amortization		78			7,470			-			7,548
EBITDA		138,865			211,356			(67,355	)		282,866
Add/(deduct):
Intercompany interest expense/(income)		(14,393	)		(8,652	)		23,045			-
Interest income		(1,046	)		(96	)		(1,720	)		(2,862	)
Stock option expense		-			-			22,376			22,376
Long-term incentive compensation		-			-			7,817			7,817
Litigation settlements		-			2,056			-			2,056
Adjusted EBITDA	$	123,426		$	204,664		$	(15,837	)	$	312,253
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
RECONCILIATION OF ADJUSTED NET INCOME
(in thousands, except per share data)(unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Net income as reported	$	75,776		$	74,958		$	211,680		$	182,456
Add/(deduct) pre-tax cost of:
Stock option expense		6,038			5,495			23,933			22,376
Long-term incentive compensation		3,083			3,553			10,460			7,817
Amortization of reacquired franchise rights		2,352			2,352			7,056			7,056
Severance arrangement		-			-			5,337			-
Acquisition expense		386			-			1,339			-
Litigation settlement		-			300			-			2,056
Add/(deduct) tax impacts:
Tax impact of the above pre-tax adjustments (1)		(1,761	)		(1,326	)		(6,762	)		(6,443	)
Tax impact of deferred tax rate change		-			(4,241	)		-			(4,241	)
Excess tax benefits on stock compensation		(389	)		(225	)		(4,308	)		(3,376	)
Adjusted net income	$	85,485		$	80,866		$	248,735		$	207,701
Diluted Earnings Per Share As Reported
Net income	$	5.00		$	4.93		$	13.88		$	12.02
Average number of shares outstanding		15,168			15,200			15,253			15,178
Adjusted Diluted Earnings Per Share
Adjusted net income	$	5.64		$	5.32		$	16.31		$	13.68
Average number of shares outstanding		15,168			15,200			15,253			15,178
(1) The tax impact of pre-tax adjustments was calculated using the effective tax rate of the operating unit for which each adjustment is associated.
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
OPERATING STATISTICS FOR VITAS SEGMENT
(unaudited)
	Three Months Ended September 30,								Nine Months Ended September 30,
OPERATING STATISTICS	2024				2023				2024				2023
Net revenue ($000) (c)
Homecare	$	338,344			$	287,389			$	967,981			$	832,554
Inpatient		29,923				27,818				89,297				84,312
Continuous care		25,799				22,032				74,295				63,054
Other		5,082				3,562				13,900				9,738
Subtotal	$	399,148			$	340,801			$	1,145,473			$	989,658
Room and board, net		(3,336	)			(2,646	)			(9,437	)			(8,317	)
Contractual allowances		(2,167	)			(4,302	)			(10,077	)			(10,650	)
Medicare cap allowance		(2,239	)			(125	)			(5,989	)			(5,625	)
Net Revenue	$	391,406			$	333,728			$	1,119,970			$	965,066
Net revenue as a percent of total before Medicare cap allowance
Homecare		84.8		%		84.3		%		84.5		%		84.1		%
Inpatient		7.5				8.2				7.8				8.5
Continuous care		6.5				6.5				6.5				6.4
Other		1.2				1.0				1.2				1.0
Subtotal		100.0				100.0				100.0				100.0
Room and board, net		(0.8	)			(0.8	)			(0.8	)			(0.8	)
Contractual allowances		(0.5	)			(1.3	)			(0.9	)			(1.1	)
Medicare cap allowance		(0.6	)			-				(0.5	)			(0.6	)
Net Revenue		98.1		%		97.9		%		97.8		%		97.5		%
Days of care
Homecare		1,622,680				1,391,377				4,621,755				4,018,469
Nursing home		320,664				287,785				908,013				833,112
Respite		9,952				7,292				26,806				19,211
Subtotal routine homecare and respite		1,953,296				1,686,454				5,556,574				4,870,792
Inpatient		26,524				25,493				79,064				76,987
Continuous care		24,365				23,071				72,335				65,630
Total		2,004,185				1,735,018				5,707,973				5,013,409
Number of days in relevant time period		92				92				274				273
Average daily census ("ADC") (days)
Homecare		17,639				15,124				16,867				14,720
Nursing home		3,485				3,128				3,314				3,052
Respite		108				79				98				70
Subtotal routine homecare and respite		21,232				18,331				20,279				17,842
Inpatient		288				277				289				282
Continuous care		265				251				264				240
Total		21,785				18,859				20,832				18,364
Total Admissions		16,775				15,774				51,020				47,564
Total Discharges		16,217				15,328				48,285				45,837
Average length of stay (days)		102.0				103.1				102.2				100.8
Median length of stay (days)		18.0				17.0				17.0				16.0
ADC by major diagnosis
Cerebro		43.6		%		42.0		%		43.7		%		42.2		%
Neurological		13.3				14.7				13.3				15.9
Cancer		10.0				10.6				10.0				10.6
Cardio		16.3				16.4				16.2				16.1
Respiratory		7.1				7.2				7.2				7.1
Other		9.7				9.1				9.6				8.1
Total		100.0		%		100.0		%		100.0		%		100.0		%
Admissions by major diagnosis
Cerebro		28.4		%		26.6		%		27.7		%		26.3		%
Neurological		7.7				8.8				7.9				9.9
Cancer		25.7				26.1				25.1				26.0
Cardio		15.1				16.0				15.7				16.2
Respiratory		9.5				9.7				9.9				10.1
Other		13.6				12.8				13.7				11.5
Total		100.0		%		100.0		%		100.0		%		100.0		%
Estimated uncollectible accounts as a percent of revenues		0.6		%		1.3		%		0.9		%		1.1		%
Accounts receivable --
Days of revenue outstanding-excluding unapplied Medicare payments		37.5				36.4				n.a.				n.a.
Days of revenue outstanding-including unapplied Medicare payments		35.5				33.8				n.a.				n.a.
The "Footnotes to Financial Statements" are integral parts of this financial information.

CHEMED CORPORATION AND SUBSIDIARY COMPANIES
FOOTNOTES TO FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(unaudited)
(a)	Included in the results of operations for 2024 are the following significant credits/(charges) which may not be indicative of ongoing operations
	(in thousands):
		Three Months Ended September 30, 2024
		VITAS			Roto-Rooter			Corporate			Consolidated
	Stock option expense	$	-		$	-		$	(6,038	)	$	(6,038	)
	Long-term incentive compensation		-			-			(3,083	)		(3,083	)
	Amortization of reacquired franchise agreements		-			(2,352	)		-			(2,352	)
	Acquisition expense		(394	)		8			-			(386	)
	Pretax impact on earnings		(394	)		(2,344	)		(9,121	)		(11,859	)
	Excess tax benefits on stock compensation		-			-			389			389
	Income tax benefit on the above		96			546			1,119			1,761
	After-tax impact on earnings	$	(298	)	$	(1,798	)	$	(7,613	)	$	(9,709	)
		Nine Months Ended September 30, 2024
		VITAS			Roto-Rooter			Corporate			Consolidated
	Stock option expense	$	-		$	-		$	(23,933	)	$	(23,933	)
	Long-term incentive compensation		-			-			(10,460	)		(10,460	)
	Amortization of reacquired franchise agreements		-			(7,056	)		-			(7,056	)
	Severance arrangement		-			-			(5,337	)		(5,337	)
	Acquisition expense		(1,302	)		(37	)		-			(1,339	)
	Pretax impact on earnings		(1,302	)		(7,093	)		(39,730	)		(48,125	)
	Excess tax benefits on stock compensation		-			-			4,308			4,308
	Income tax benefit on the above		317			1,652			4,793			6,762
	After-tax impact on earnings	$	(985	)	$	(5,441	)	$	(30,629	)	$	(37,055	)
(b)	Included in the results of operations for 2023 are the following significant credits/(charges) which may not be indicative of ongoing operations
	(in thousands):
		Three Months Ended September 30, 2023
		VITAS			Roto-Rooter			Corporate			Consolidated
	Stock option expense	$	-		$	-		$	(5,495	)	$	(5,495	)
	Long-term incentive compensation		-			-			(3,553	)		(3,553	)
	Amortization of reacquired franchise agreements		-			(2,352	)		-			(2,352	)
	Litigation settlement		-			(300	)		-			(300	)
	Pretax impact on earnings		-			(2,652	)		(9,048	)		(11,700	)
	Excess tax benefits on stock compensation		-			-			225			225
	Tax impact of deferred tax rate change		1,772			3,559			(1,090	)		4,241
	Income tax benefit on the above		-			412			914			1,326
	After-tax impact on earnings	$	1,772		$	1,319		$	(8,999	)	$	(5,908	)
		Nine Months Ended September 30, 2023
		VITAS			Roto-Rooter			Corporate			Consolidated
	Stock option expense	$	-		$	-		$	(22,376	)	$	(22,376	)
	Long-term incentive compensation		-			-			(7,817	)		(7,817	)
	Amortization of reacquired franchise agreements		-			(7,056	)		-			(7,056	)
	Litigation settlements		-			(2,056	)		-			(2,056	)
	Pretax impact on earnings		-			(9,112	)		(30,193	)		(39,305	)
	Excess tax benefits on stock compensation		-			-			3,376			3,376
	Tax impact of deferred tax rate change		1,772			3,559			(1,090	)		4,241
	Income tax benefit on the above		-			2,123			4,320			6,443
	After-tax impact on earnings	$	1,772		$	(3,430	)	$	(23,587	)	$	(25,245	)
(c)	VITAS has 10 large (greater than 450 ADC), 23 medium (greater than 200 but less than 450 ADC) and 22 small (less than 200 ADC) hospice programs. Of Vitas' 32 Medicare provider numbers, for the trailing 12 months, 24 provider numbers have a Medicare cap cushion of greater than 10%, one provider number has a Medicare cap cushion between 5% and 10%, four provider numbers have a Medicare cap cushion between 0% and 5%, and three provider numbers have a Medicare cap liability.