Addus HomeCare Announces Third-Quarter 2017 Financial Results

ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Reconciliation of Non-GAAP Financial Measures

(amounts in thousands, except per share data)

(Unaudited)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2017

2016

2017

2016

Reconciliation of Adjusted EBITDA to Net Income: ⁽¹⁾

Net income

$      3,408

$      1,699

$    10,366

$      4,456

Interest expense, net

840

632

2,255

1,714

Write off debt issuance costs

-

-

1,323

-

Gain on sale of adult day service centers

-

-

(2,065)

-

Other non-operating income

(64)

(126)

(165)

(126)

Income tax expense

1,623

290

4,908

1,498

Depreciation and amortization

1,781

1,721

4,811

4,943

M&A expenses

692

43

1,343

785

Stock-based compensation expense

727

445

1,818

1,264

Restructure charges

507

3,690

551

5,243

Severance and other costs

98

258

992

3,031

Adjusted EBITDA

$      9,612

$      8,652

$    26,137

$    22,808

Reconciliation of Net Income per Diluted Share to Adjusted Net Income per Diluted Share: ⁽²⁾

Net income per diluted share

$        0.29

$        0.15

$        0.89

$        0.40

Write off debt issuance costs per diluted share

-

-

0.09

-

Gain on sale of adult day service centers per      diluted share

-

-

(0.12)

-

Normalization of effective tax rate

-

(0.04)

-

(0.04)

M&A expenses per diluted share

0.04

-

0.08

0.05

Restructure charges per diluted share

0.04

0.23

0.03

0.32

Severance and other costs per diluted share

0.01

0.02

0.06

0.18

Stock-based compensation expense per      diluted share

0.04

0.03

0.10

0.08

Adjusted net income diluted share

$        0.42

$        0.39

$        1.13

$        0.99

Reconciliation of Net Service Revenues to Adjusted Net Service Revenues: ⁽³⁾

Net service revenues

$  108,592

$  103,502

$  313,758

$  297,032

Revenues associated with the closure of      certain sites

(87)

(1,634)

(1,340)

(4,493)

Adjusted net service revenues

$  108,505

$  101,868

$  312,418

$  292,539

⁽¹⁾      We define Adjusted EBITDA as net income before interest expense, taxes, depreciation, amortization, write off of debt issuance costs, gain on sale, other non-operating income, M&A expenses, stock-based compensation expense, restructure charges and severance and other costs. Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP.

⁽²⁾    We define Adjusted net income per diluted share as net income per diluted share, adjusted for write off of debt issuance costs, gain on sale, normalization of effective tax rate, M&A expenses, stock-based compensation expense, restructure charges and severance and other costs.  Adjusted net income per diluted share is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP.

⁽³⁾    We define Adjusted net service revenues as net service revenues adjusted for the closure of certain sites.  Adjusted net service revenues is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP).  It should not be considered in isolation or as a substitute for net service revenues or any other measure of financial performance calculated in accordance with GAAP.