Accendra Health (ACH) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue grew to $2.63B, led by Patient Direct segment growth and a 173 basis point margin expansion in Patient Direct; Products & Healthcare Services (P&HS) segment saw profit improvement initiatives but operating income declined.

• Net loss per share was $(0.32), impacted by $16M in acquisition-related charges and higher exit and realignment costs, while adjusted net income rose to $18.1M ($0.23/share).

• Announced and actively engaged in the potential sale of the P&HS segment and the $1.36B Rotech acquisition, expected to close in H1 2025 with financing in place.

• 2025 financial guidance reaffirmed, with focus on Patient Direct growth and ongoing cost-saving and strategic initiatives.

Financial highlights

• Q1 2025 revenue was $2.63B, up 0.7% year-over-year; Patient Direct revenue grew 5.7% to $674M, while P&HS revenue declined 0.8% to $1.96B.

• Adjusted operating income rose to $61.3M (2.33% margin), and adjusted EBITDA increased to $122M.

• Adjusted net income was $18M ($0.23/share), up from $15M ($0.19/share) in Q1 2024; GAAP net loss was $25M.

• Gross profit was $526M (20% margin), down from $536M (20.5%) year-over-year; consolidated gross margin declined by 50 basis points.

• Operating cash flow was $(35)M, with cash and equivalents at $59M at quarter-end.

Outlook and guidance

• 2025 revenue guidance reaffirmed at $10.85B–$11.15B, with adjusted EBITDA of $560M–$590M and adjusted EPS of $1.60–$1.85.

• Guidance excludes impacts from Rotech acquisition, P&HS sale, share repurchases, and unpredictable items such as exit and realignment charges.

• Free cash flow outlook unchanged, with cash flow expected to improve and be used for debt reduction.

• Rotech acquisition expected to be neutral in year one and accretive in year two, with updates to guidance upon deal closure.