LOUISVILLE, Ky., Nov. 5, 2009 (GLOBE NEWSWIRE) -- ResCare, Inc. (Nasdaq:RSCR) today announced results for the third quarter and nine months ended September 30, 2009.
Third Quarter 2009 Financial Results
Revenues for the third quarter of 2009 increased 2% over the prior year period to $395.8 million. Net income was $11.7 million, or $0.35 per diluted common share, compared with $11.5 million, or $0.34 per diluted common share, in the same period of 2008. EBITDA for the third quarter of 2009 was $29.1 million versus $28.3 million in the prior year quarter.
Ralph G. Gronefeld, Jr., president and chief executive officer, said, "I am pleased with our operating results despite a challenging environment. Meeting those challenges has strengthened our company and positioned us well for 2010 and the longer term. We are effectively managing our working capital and continuing to pay down debt. Our strong cash flow enabled us to reduce debt by $45 million since the end of 2008. We will continue to apply the lessons we have learned during the past 35 years. Fiscal discipline, organic growth, a selective acquisition strategy and dedicated, energized employees will help us offset the reimbursement challenges in this difficult economic cycle."
2009 Guidance
The Company confirmed its 2009 revenue guidance of $1.60 billion to $1.63 billion and $1.30 to $1.34 per diluted common share.
A listen-only simulcast of ResCare's third quarter 2009 conference call will be available on-line at www.rescare.com on November 6, 2009, beginning at 9:00 a.m. Eastern Time and a replay available at 11:00 a.m. Eastern Time.
ResCare, with 35 years of experience helping people reach their highest level of independence, is one of the largest providers of home care to the elderly and persons with disabilities. It also offers residential and support services to people with intellectual and developmental disabilities and provides education, vocational training and job placement for people of all ages and skill levels. Based in Louisville, Kentucky, ResCare and its more than 46,000 dedicated employees serve daily more than 65,000 people in 39 states, Washington, D.C., Puerto Rico and in a growing number of international locations. For more information about ResCare, please visit the Company's website at www.rescare.com.
From time to time, ResCare makes forward-looking statements in its public disclosures, including statements relating to expected financial results, revenues that might be expected from new or acquired programs and facilities, its development and acquisition activities, reimbursement under federal and state programs, financing plans, compliance with debt covenants and other risk factors, and various trends favoring privatization of government programs. In ResCare's filings under the federal securities laws, including its annual, periodic and current reports, the Company identifies important factors that could cause its actual results to differ materially from those anticipated in forward-looking statements. Please refer to the discussion of those factors in the Company's filed reports. Forward-looking statements in this release related to expected financial results are as of this date only, and ResCare does not assume any responsibility to update these statements.
RESCARE, INC. Unaudited Financial Highlights (In thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, ---------------------- ---------------------- 2009 2008 2009 2008 ---------- ---------- ---------- ---------- Income Statement Data: Revenues $ 395,837 $ 387,923 $1,191,927 $1,148,700 Facility and program expenses 358,829 350,165 1,083,763 1,056,102 ---------- ---------- ---------- ---------- Facility and program contribution 37,008 37,758 108,164 92,598 Corporate general and administrative 14,196 14,896 45,027 44,346 Other operating expense (income), net 186 189 (217) (4) ---------- ---------- ---------- ---------- Operating income 22,626 22,673 63,354 48,256 Interest expense, net 3,972 4,531 12,475 13,628 ---------- ---------- ---------- ---------- Income from continuing operations before income taxes 18,654 18,142 50,879 34,628 Income tax expense 7,158 6,514 19,104 12,469 ---------- ---------- ---------- ---------- Income from continuing operations 11,496 11,628 31,775 22,159 Loss from discontinued operations, net of tax -- (122) -- (279) ---------- ---------- ---------- ---------- Net income - including noncontrolling interest 11,496 11,506 31,775 21,880 Net loss - noncontrolling interest (159) -- (578) -- ---------- ---------- ---------- ---------- Net income - ResCare, Inc 11,655 11,506 32,353 21,880 Net income attributable to preferred shareholders 1,665 1,650 4,636 3,149 ---------- ---------- ---------- ---------- Net income attributable to common shareholders $ 9,990 $ 9,856 $ 27,717 $ 18,731 ========== ========== ========== ========== Basic earnings (loss) per common share: From continuing operations $ 0.35 $ 0.35 $ 0.96 $ 0.67 From discontinued operations -- (0.00) -- (0.01) ---------- ---------- ---------- ---------- Basic earnings per common share $ 0.35 $ 0.35 $ 0.96 $ 0.66 ========== ========== ========== ========== Diluted earnings (loss) per common share: From continuing operations $ 0.35 $ 0.35 $ 0.96 $ 0.66 From discontinued operations -- (0.01) -- (0.01) ---------- ---------- ---------- ---------- Diluted earnings per common share $ 0.35 $ 0.34 $ 0.96 $ 0.65 ========== ========== ========== ========== Weighted average number of common shares: Basic 28,858 28,553 28,757 28,425 Diluted 28,858 28,747 28,757 28,617 EBITDA (1) $ 29,130 $ 28,285 $ 83,012 $ 64,711
(1) EBITDA is defined as income from continuing operations before depreciation and amortization, net interest expense and income taxes. EBITDA should not be considered as a measure of financial performance under accounting principles generally accepted in the United States of America. The items excluded from EBITDA are significant components in understanding and assessing financial performance. Management routinely calculates and presents EBITDA because it believes that EBITDA is useful to investors and is commonly used as an analytical indicator within the industry to evaluate performance, measure leverage capacity and debt service ability, and to estimate current or prospective enterprise value. EBITDA is also used in measurements under certain covenants contained in the Company's credit agreement. A reconciliation of income from continuing operations to EBITDA is included on the next page of this release.
RESCARE, INC. Unaudited Financial Highlights (continued) (In thousands) Three Months Ended Nine Months Ended September 30, September 30, ------------------ ------------------ 2009 2008 2009 2008 -------- -------- -------- -------- Reconciliation of Income from Continuing Operations to EBITDA: Income from continuing operations $ 11,496 $ 11,628 $ 31,775 $ 22,159 Add: Interest, net 3,972 4,531 12,475 13,628 Depreciation and amortization 6,504 5,612 19,658 16,455 Income tax expense 7,158 6,514 19,104 12,469 -------- -------- -------- -------- EBITDA(1) $ 29,130 $ 28,285 $ 83,012 $ 64,711 ======== ======== ======== ========
Sept. 30, Dec. 31, -------- -------- 2009 2008 -------- -------- Balance Sheet Data: ASSETS Cash and cash equivalents $ 4,677 $ 13,594 Accounts receivable, net 240,139 230,976 Other current assets 47,323 46,913 -------- -------- Total current assets 292,139 291,483 Property and equipment, net 83,183 84,157 Goodwill 490,107 476,196 Other assets, net 61,960 62,307 -------- -------- $927,389 $914,143 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities $162,327 $155,921 Other long-term liabilities 79,992 65,959 Long-term debt 211,421 255,386 Shareholders' equity 473,649 436,877 -------- -------- $927,389 $914,143 ======== ========
(1) The nine months ended September 30, 2008 period for EBITDA includes a pre-tax charge of $24.4 million, recorded as a result of the Company's increasing its legal reserves due to adverse developments on four lawsuits.
RESCARE, INC. Unaudited Financial Highlights (continued) (In thousands) Nine Months Ended September 30, ------------------ 2009 2008 -------- -------- Cash Flow Data: Net income - including noncontrolling interest $ 31,775 $ 21,880 Adjustments to reconcile net income, including noncontrolling interest, to cash provided by operating activities: Depreciation and amortization 19,658 16,454 Amortization of discount 909 891 Share-based compensation 3,413 3,577 Deferred income taxes 7,384 1,450 Excess tax benefits from share-based compensation -- (1,049) Provision for losses on accounts receivable 5,666 5,221 Gain on purchase of business (559) -- Loss on sale of assets 248 11 Changes in operating assets and liabilities (1,546) (1,111) -------- -------- Cash provided by operating activities 66,948 47,324 -------- -------- Cash flows from investing activities: Purchases of property and equipment (12,654) (14,150) Acquisitions of businesses (17,994) (38,979) Proceeds from sale of assets 169 571 -------- -------- Cash used in investing activities (30,479) (52,558) -------- -------- Cash flows from financing activities: Debt borrowings, net (44,851) 8,354 Debt issuance costs (38) (118) Excess tax benefits from share-based compensation -- 1,049 Proceeds received from exercise of stock options 415 1,339 Employee withholding payments on share-based compensation (1,302) (1,446) -------- -------- Cash (used in) provided by financing activities (45,776) 9,178 -------- -------- Effect of exchange rate on cash and cash equivalents 390 (432) -------- -------- (Decrease) increase in cash and cash equivalents $ (8,917) $ 3,512 ======== ========
RESCARE, INC. Unaudited Financial Highlights (continued) (Dollars in thousands) Three Months Ended Nine Months Ended September 30, September 30, ------------------ ---------------------- 2009 2008 2009 2008 -------- -------- ---------- ---------- Segment Data: Revenues: Community Services $292,138 $282,619 $ 864,188 $ 825,219 Job Corps Training Services 31,966 39,952 113,378 122,270 Employment Training Services 61,167 55,140 175,457 166,641 Other 10,566 10,212 38,904 34,570 -------- -------- ---------- ---------- Consolidated $395,837 $387,923 $1,191,927 $1,148,700 ======== ======== ========== ========== Operating Income: Community Services (1) $ 30,747 $ 30,185 $ 87,604 $ 64,709 Job Corps Training Services 2,241 2,974 8,346 8,836 Employment Training Services 5,009 5,229 12,611 17,439 Other (1,132) (685) (347) 1,715 Corporate general and administrative (14,239) (15,030) (44,860) (44,443) -------- -------- ---------- ---------- Consolidated (1) $ 22,626 $ 22,673 $ 63,354 $ 48,256 ======== ======== ========== ========== Operating Margin: Community Services (1) 10.5% 10.7% 10.1% 7.8% Job Corps Training Services 7.0% 7.4% 7.4% 7.2% Employment Training Services 8.2% 9.5% 7.2% 10.5% Other (10.7%) (6.7%) (0.9%) 5.0% Corporate general and administrative (3.6%) (3.9%) (3.8%) (3.9%) Consolidated (1) 5.7% 5.8% 5.3% 4.2%
(1) The 2008 nine month period includes a pre-tax charge of $24.4 million, recorded as a result of the Company's increasing its legal reserves due to adverse developments on four lawsuits.