Addus HomeCare (ADUS) Q1 2025 earnings summary

Executive summary

• Net service revenues rose 20.3% year-over-year to $337.7 million for Q1 2025, driven by organic growth, acquisitions (notably Gentiva), and expansion in all segments.

• Adjusted EBITDA grew 25.1% to $40.6 million, with adjusted EPS up 17.4% to $1.42; net income increased 34.1% to $21.2 million ($1.16 per diluted share).

• Personal care segment drove results, with 24.2% revenue growth to $258.3 million, 7.4% organic growth, and strong hiring trends.

• Completed Gentiva, Jacksonville, and Great Lakes acquisitions, expanding personal care and home health services; divested New York operations.

• Operations now span 23 states, serving approximately 72,000 individuals in Q1 2025.

Financial highlights

• Gross margin improved to 31.9% from 31.4% year-over-year; adjusted EBITDA margin reached 12%.

• Operating income rose 29.1% to $30.5 million; net cash flow from operations was $18.9 million.

• Cash at quarter-end was $97 million; $203 million outstanding on the credit facility at 6.32% interest.

• Bank debt reduced by $20 million to $203 million, with net leverage under 1x adjusted EBITDA.

• Days sales outstanding (DSO) was 36.9 days (34.9 days excluding Gentiva); Illinois DSO at 48 days.

Outlook and guidance

• Expect adjusted EBITDA margin to remain above 12% for the full year, with continued organic growth and further acquisition opportunities.

• Personal care same-store hour growth expected in the 2-2.5% range; hospice revenue growth anticipated at the upper end of 5-7%.

• Company expects to benefit from 2025 rate increases in Illinois for in-home care; CMS finalized rule on Medicaid direct care worker compensation by 2030.

• Medicare payment rates for hospice and home health increased modestly for 2025.

• Focus remains on expanding the care continuum and integrating recent acquisitions.