Get noticed about the list of notable companies` earning reports after markets close today and before markets open tomorrow.

Chemed (CHE) Q3 Earnings call transcript Oct 30, 2024

Daily EarningsWednesday, Oct 30, 2024 11:43 pm ET

1min read

CHE --

Chemed Corporation, a leading healthcare and home services provider, recently held its third quarter 2024 earnings call, shedding light on the company's financial performance and strategic direction. In the call, executives from Chemed, including Kevin McNamara, President and CEO, Mike Witzeman, CFO, and Nick Westfall, CEO of Chemed's VITAS Healthcare Corporation subsidiary, discussed key trends, growth opportunities, and challenges facing the company.

Strong Performance at VITAS Healthcare

The call highlighted the exceptional performance of VITAS Healthcare, Chemed's flagship business, which has shown significant growth in admissions and census numbers. The third quarter of 2024 saw a 6.3% increase in admissions, totaling 16,775, and a 15.5% rise in average daily census, reaching 2,926. This growth can be attributed to the successful acquisition of Covenant Health, which has met all internal financial projections and contributed positively to the company's bottom line.

Roto-Rooter's Challenges

Conversely, Chemed's other business, Roto-Rooter, faced challenges in the third quarter, with revenue declining by 6.9% and call volume down by 11.7%. The residential business experienced a particularly tough quarter, impacted by lower demand and high levels of competition. However, the company remains optimistic about Roto-Rooter's future, citing its core competitive advantages and ongoing efforts to improve performance.

Growth Opportunities and Challenges

The call also touched on the impact of hurricanes Helene and Milton on admissions, particularly in Florida, where Chemed is expanding its presence. The company remains confident in its growth prospects, particularly in the healthcare sector, but acknowledges challenges in the residential services market.

Financial Highlights

From a financial standpoint, VITAS' net revenue increased by 17.3% in the third quarter, driven by higher days of care and geographically weighted average Medicare reimbursement rates. Roto-Rooter, on the other hand, experienced a decline in adjusted EBITDA, although management is optimistic about the new marketing agency's potential impact.

Investor Insights

Key shareholders and analysts, including Benjamin Hendrix and Joanna Gajuk, posed insightful questions during the call, highlighting their concerns and priorities. These interactions provided valuable insights into the market's perception of Chemed's performance and its strategic direction.

Looking Ahead

Overall, Chemed Corporation's third quarter 2024 earnings call painted a mixed picture, with strong performance in healthcare services and challenges in the residential services sector. The company remains optimistic about its future, particularly in healthcare, and is taking steps to address challenges in other areas. As Chemed continues to navigate its dual business model, investors and analysts will be closely watching for signs of growth and improvement.

Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.