Chemed (CHE) Q4 2024 earnings summary

Executive summary

• Consolidated 2024 service revenues reached $2.43B, up 7.4% year-over-year, with adjusted EBITDA up 11.3% to $503M and adjusted net income up 13.8% to $351M.

• VITAS delivered strong Q4 2024 results, with admissions up 3.5% and average daily census up 14.6% year-over-year, aided by the Covenant Health acquisition.

• Roto-Rooter Q4 revenue declined 2.9% year-over-year but exceeded internal estimates, with commercial revenue up 0.4% and residential down 2%.

• VITAS completed the $85 million acquisition of Covenant Health hospice assets, contributing $11–12 million in Q4 revenue and $2.1–2.3 million in net income.

• New programs in Pasco and Marion Counties, Florida, offer significant growth opportunities for VITAS in 2025 and beyond.

Financial highlights

• VITAS Q4 2024 net revenue was $411 million, up 17.4% year-over-year, driven by a 14.6% increase in days of care and a 3.5% Medicare reimbursement rate increase.

• Adjusted EBITDA for VITAS (excluding Medicare cap) was $93.2 million, up 11.8%, with a margin of 22.5%, 112 bps below prior year due to a non-recurring 2023 vacation policy change.

• Roto-Rooter Q4 adjusted EBITDA was $60.3 million, down 7.2% year-over-year, with a margin of 26.3%, a 120 bps decline.

• Adjusted diluted EPS increased 13.9% to $23.13 for 2024, with a 21.3% CAGR since 2003.

• Cash and cash equivalents at year-end were $178.4 million, with no current or long-term debt.

Outlook and guidance

• VITAS 2025 revenue (pre-Medicare cap) expected to grow 10.5–11.3%, with ADC up 8.5–9%.

• VITAS 2025 adjusted EBITDA margin (pre-cap) projected at 18.4–18.9%, down from 19.1% in 2024.

• Roto-Rooter 2025 revenue growth forecasted at 2.4–3%, with EBITDA margin of 25.7–26.3%.

• 2025 adjusted EPS expected at $24.95–$25.45, up from $23.13 in 2024; earnings weighted to the second half.

• Focus remains on organic growth, strategic acquisitions, and disciplined capital allocation.