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Addus HomeCare (ADUS)
Q4 2012 Earnings Call
March 13, 2013 10:00 am ET
Dennis B. Meulemans - Chief Financial Officer, Principal Accounting Officer, Vice President and Secretary
Mark S. Heaney - Chairman, Chief Executive Officer and President
Darby Anderson - Vice President of Home & Community Services
Matthew D. Gillmor - Robert W. Baird & Co. Incorporated, Research Division
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Dennis B. Meulemans
Thank you, operator, and good morning. This is Dennis Meulemans, and thank you for joining us. Before we begin, I'll briefly state the Safe Harbor statement. This presentation will contain forward-looking statements within the meaning of the federal securities laws. Statements regarding future events and developments, the company's future performance, as well as management's expectations, beliefs, intentions, plans, estimates or projections relating to the future are forward-looking statements within the meaning of these laws. These forward-looking statements are subject to a number of risks and uncertainties including factors outlined from time to time in our most recent Form 10-K or Form 10-Q, our earnings announcements and other reports we file with the Securities and Exchange Commission. These are available at www.sec.gov. The company undertakes no obligation to update publicly any forward-looking statement whether as a result of new information, future events or otherwise.
With that complete, I'd like to turn the call over to Mark Heaney, our CEO.
Mark S. Heaney
Thank you. Good morning and thank you, all, for joining us on Addus HomeCare's 2012 fourth quarter investor call. I'm joined here in our Support Center by Dennis Meulemans, whom you just heard, our CFO; and Darby Anderson, Vice President for Home & Community Services.
I characterize our performance in the fourth quarter as I characterize our overall performance in 2012, as positive, strong and from a strategic perspective, critically important.
Our consolidated revenues for the quarter increased by 9.4% to $63.8 million. Net income from continuing operations was $3.5 million, an increase of 20%. These results represent a solid beginning for our new company with a single focus on growing our core business while we at the same time work to expand our relationship with managed care, who are increasingly assuming responsibility for our at-risk populations.
After announcing our decision to enter into a strategic evaluation of our Home Health division at the end of the third quarter, we not only completed our evaluation but ultimately sold the division on good terms in a forthright manner to one of the top home health companies in the country, LHC Group. Our home health professionals have landed with one of the best. That was important to us. We retained an equity interest in important markets for both us and LHC. And we look forward to exploring avenues, markets or opportunities where we might work cooperatively to provide patients with a best-in-class personal care, home health and hospice continuum of collaborative structure we think payors will increasingly favor as health care reform evolves.
With the sale of the Home Health business combined with our steady improvement over the year in growing our core Home & Community business, as well as our improved cash management, we have de-levered the company to an unprecedented level.
In the quarter and over the year, our core service, our core competency, Home & Community services performed solidly. Revenues in census were steady up. Our efforts at becoming a sales organization are taking root. We're not done. Our operating costs were controlled or reduced.
We've made steady progress with our centralization efforts, wherein we are reducing site staffing and operating costs through the increased use of technology. Technology not only intended to make us more efficient, but more importantly to make us more effective in the delivery of outcome-oriented personal care services, linking our caregivers and their at-risk consumers to the health system, resulting in a consistent, predictable, early identification and early intervention system, that being our highest pure objective.
Over the year, I believe our team has effectively operated the business for growth and earnings while at the same time evaluating, making decisions and executing on strategies which we believe have positioned us for what we think will be a very exciting and rewarding future as the industry transitions to managed care.
Now at this time, I'd like to turn the call over to Darby Anderson, who is going to talk to us a little bit about our Home & Community operations in the quarter. Then Dennis will give us more comments on our financial performance. But at the conclusion, Dennis, I'd like you to turn it back to me because I'd like to come back with some closing comments, addressing where we think the world is headed and how we think we can go on. Darby?
Thank you, Mark. I'm also pleased to report a strong quarter with year-over-year revenue growth of 9.4%, census growth of 5% and units of service growth of 9.2%. Our operating costs, when measured as a percentage of revenues, are down from a year ago. Overall, I am pleased with our results for the quarter and our consistent growth.