While COVID-19 had an impact, two companies that provide home health recently reported strong yearly earnings and sales.
Addus Homecare, which provides in-home care, home health and hospice, earned $33.1 million for the 2020 year, a 28.4% increase compared to the prior year, on a 17.9% increase in sales. Earnings for the fourth quarter fell 21.3% to $8.4 million on a slight 1.9% uptick in sales.
Dirk Allison, president and chief executive officer of Addus, noted that COVID-19 surged in the fourth quarter, affecting results.
“These results were achieved despite some extraordinary challenges, including the substantial surge of COVID-19 cases during November and December,” he said in a news release.
Despite the pandemic, the company completed four acquisitions in 2020 with a total of approximately $84 million in annualized revenue, Allison said. The company intends to “continue pursuing aggressive acquisition objectives in 2021 with a strong pipeline in each of our personal care, hospice and home health segments,” he said.
Meanwhile, The Pennant Group, a home health, hospice and senior living spin-off from The Ensign Group, earned $3.8 million in the fourth quarter on higher revenues, compared to a loss of $3.8 million for the same period last year. For the 2020 calendar year, earnings soared to $15.5 million, nearly five times what it made a year earlier — $3.2 million — on strong revenues.
Danny Walker, chairman and CEO of Pennant, disclosed last week in an earnings call that it was “an incredible year for our home health and hospice segment.”
The company disclosed earnings before interest, taxes, depreciation, amortisation and restructuring or rent costs (EBITDAR) from home health and hospice operations of $49.5 million for the year, an increase of 48.4% over the prior year. Segment-adjusted EBITDAR from operations totaled $14.8 million, an increase of 56.3% over the prior year quarter. Walker also pointed out that 2020 Medicare admissions grew nearly 7%.
To illustrate the strength of its clinical home health operations, Walker pointed out that the percentage of home health agencies achieving 5 stars grew from 3% to 30% sequentially in the fourth quarter. The home health star rating across the board improved to 4.3 stars across the company. That is above the national average of three stars, he said.
While home health and hospice are faring well, the company noted it is encountering a “challenging operating environment” for senior living. Segment-adjusted EBITDAR from senior living operations fell for the fourth quarter but rose slightly for the year.