Chemed Corporation (NYSE:CHE) Q2 2023 Earnings Conference Call July 27, 2023 10:00 AM ET

Company Participants

Holley Schmidt - Assistant Controller

Kevin McNamara - President and Chief Executive Officer

David Williams - Executive Vice President and Chief Financial Officer

Nicholas Westfall - President and Chief Executive Officer, VITAS Healthcare Corporation

Conference Call Participants

Mike Murray - RBC Capital Markets

Joanna Gajuk - Bank of America

Holley Schmidt

Good morning. Our conference call this morning will review the financial results for the Second Quarter of 2023 ended June 30, 2023.

Before we begin, let me remind you that the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 apply to this conference call. During the course of this call, the company will make various remarks concerning management's expectations, predictions, plans and prospects that constitute forward-looking statements. Actual results may differ materially from those projected by these forward-looking statements as a result of a variety of factors, including those identified in the company's news release of July 26 and in various other filings with the SEC. You are cautioned that any forward-looking statements reflect management's current view only and that the company undertakes no obligation to revise or update such statements in the future.

In addition, management may also discuss non-GAAP operating performance results during today's call, including earnings before interest, taxes, depreciation and amortization or EBITDA and adjusted EBITDA. A reconciliation of these non-GAAP results is provided in the company's press release dated July 26, which is available on the company's website at chemed.com.

I would now like to introduce our speakers for today: Kevin McNamara, President and Chief Executive Officer of Chemed Corporation; Dave Williams, Executive Vice President and Chief Financial Officer of Chemed; and Nick Westfall, President and Chief Executive Officer of Chemed's Healthcare Corporation subsidiary.

I will now turn the call over to Kevin McNamara.

Kevin McNamara

Thank you, Holley. Good morning. Welcome to Chemed Corporation's second quarter 2023 conference call. I will begin with highlights for the quarter then Dave and Nick will follow up with additional operating detail. I will then open up the call for questions.

Our second quarter 2023 operating results released last night reflect significant improvement in VITAS’ operational metrics post pandemic. In the quarter, our admissions increased 5.9% over the prior period. These strengthening admissions continued to drive higher patient census. In the second quarter, our average daily census or ABC expanded 1077, an increase of 6.2% when compared to the prior year, and 3.2% when compared with the first quarter of 2023. VITAS’ improving operating metrics are a direct result of our retention and hiring program launched July 1 of last year. This program was designed to stabilize turnover in our tenured staff as well expand patient capacity. Since July 1, 2022, our staffing has methodically increased on a sequential basis over this 12-month period. This increase in staffing and related patient capacity has been converted into increased admissions and census.