Aveanna Healthcare (AVAH) Bank of America Home Care Conference summary

Strategic initiatives and business model

• Focus on scale and density across 38 states, serving over 80,000 patients with pediatric, adult, and geriatric care.

• Recent acquisition of Thrive Skilled Pediatrics expanded pediatric services into Kansas and New Mexico and increased density in five other states.

• Five key initiatives: enhancing payer partnerships, cost efficiencies, modernizing Medical Solutions, capital management, and employee engagement.

• Preferred payer strategy now includes 93 agreements across all segments, with no single payer over 10% of revenue.

• Value-based agreements and government affairs drive alignment and growth, with 10 state rate increases achieved in 2025.

Financial performance and outlook

• Updated 2025 guidance: revenue above $2.375 billion and Adjusted EBITDA above $300 million.

• Q3 revenue up 22.2% year-over-year to $622 million; EBITDA up 67.5% to $80.1 million.

• Private Duty Services (PDS) segment grew 25.6% year-over-year; Home Health and Hospice up 15.3%.

• Medical Solutions segment growth muted in 2025 due to modernization, expected to return to 8-10% growth after Q1.

• Long-term organic growth targeted at 5-7%, with strategic M&A expected to push total growth above 10%.

Preferred payer and rate environment

• PDS preferred payer agreements increased from 22 to 30 in 2025, with 56-60% of managed care PDS volumes now under these contracts.

• New patient admissions in PDS are over 95% aligned with preferred payers; goal to reach low- to mid-80% in next 2-3 years.

• Preferred payer contracts typically offer a 20% premium over standard fee schedules, enabling higher caregiver wages and improved staffing.

• Gross margin in PDS remains stable, with additional rate dollars invested in wages.

• State rate increases have largely caught up post-COVID, with future increases expected to be smaller and more targeted.