Addus HomeCare: Acquisitions Drive Revenue Growth
Home and community-based services provider Addus HomeCare Corporation (Nasdaq: ADUS) on July 31 reported an increase in revenue over the prior year for the quarter ended June 30, attributing part of its performance to the recent acquisition of Aid & Assist in Tennessee.
Total net service revenues from continuing operations for the second quarter of 2014 were $77 million, a 17.1% increase compared to $65.8 million in the prior year quarter. Acquisitions added an additional 6.8 million or 8.8% of revenues, including one month of revenues from the recently closed Aid & Assist acquisition.
Previously, Addus HomeCare said its June acquisition of Aid & Assist is expected to add $12 million to $13 million to Addus’ revenue this year.
“We welcome the employees of Aid & Assist who give us a stronger presence in Tennessee, a key managed care state,” said Addus HomeCare President and CEO Mark Heaney in a news release. “The next step in the integration process is to merge our existing business into Aid for improved efficiency and effectiveness.”
The home-based care provider is also moving forward with care demonstration projects in California, albeit slowly, said Senior Vice President Darby Anderson during an earnings call.
“We have many of the contract relationships we need there, but progress in California has been slower,” Anderson said. “We’re ready, but the state and the plans continue to work out rates and funding.”
Revenue growth for both Addus HomeCare stores and new acquisitions remains strong, driven by an 8.7% increase in average census in the quarter in the same stores, Heaney said.
In December of last year, the growing home-based service provider acquired substantially all of the assets of Coordinated Home Health Care, formerly owned by Transition Capital Partners. The deal included 15 New Mexico-based offices and grew the company’s presence in the state.
Addus HomeCare has over 130 locations in 22 states, serves more than 30,000 consumers, and employs over 17,000 caregivers.
“Our growth is being driven both organically and through acquisitions,” Heaney said. “We’ve continued to position ourselves for the shift to managed care as that payor assumes increasing responsibility for the dual-eligible population across the country.”
Written by Cassandra Dowell