Segment Information |
12. SEGMENT INFORMATION The Company’s operating segments have been identified based upon how management has organized the business by services provided to customers and how the CODM manages the business and allocates resources. The Company has three operating segments and three reportable segments, Private Duty Services, Home Health & Hospice, and Medical Solutions. The PDS segment predominantly includes private duty skilled nursing services, non-clinical and personal care services, and pediatric therapy services. The HHH segment provides home health and hospice services to predominately elderly patients. Through the MS segment, the Company provides enteral nutrition and other products to adults and children, delivered on a periodic or as-needed basis. The CODM evaluates performance using gross margin (and gross margin percentage). Gross margin includes revenue less all costs of revenue, excluding depreciation and amortization, but excludes branch and regional administrative expenses, corporate expenses and other non-field expenses. The CODM does not evaluate a measure of assets when assessing performance. Results shown for the three and nine-month periods ended September 28, 2024 and September 30, 2023 are not necessarily those which would be achieved if each segment was an unaffiliated business enterprise. There are no intersegment transactions. The following tables summarize the Company’s segment information for the three and nine-month periods ended September 28, 2024 and September 30, 2023, respectively (amounts in thousands):
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|
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For the three-month period ended September 28, 2024 |
|
|
PDS |
|
HHH |
|
MS |
|
Total |
|
Revenue |
$ |
409,558 |
|
$ |
54,139 |
|
$ |
45,326 |
|
$ |
509,023 |
|
Cost of revenue, excluding depreciation and amortization |
|
299,731 |
|
|
24,948 |
|
|
24,645 |
|
|
349,324 |
|
Gross margin |
$ |
109,827 |
|
$ |
29,191 |
|
$ |
20,681 |
|
$ |
159,699 |
|
Gross margin percentage |
|
26.8 |
% |
|
53.9 |
% |
|
45.6 |
% |
|
31.4 |
% |
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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For the three-month period ended September 30, 2023 |
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|
PDS |
|
HHH |
|
MS |
|
Total |
|
Revenue |
$ |
384,750 |
|
$ |
52,989 |
|
$ |
40,271 |
|
$ |
478,010 |
|
Cost of revenue, excluding depreciation and amortization |
|
280,288 |
|
|
27,597 |
|
$ |
22,861 |
|
|
330,746 |
|
Gross margin |
$ |
104,462 |
|
$ |
25,392 |
|
$ |
17,410 |
|
$ |
147,264 |
|
Gross margin percentage |
|
27.2 |
% |
|
47.9 |
% |
|
43.2 |
% |
|
30.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine-month period ended September 28, 2024 |
|
|
PDS |
|
HHH |
|
MS |
|
Total |
|
Revenue |
$ |
1,212,418 |
|
$ |
163,382 |
|
$ |
128,834 |
|
$ |
1,504,634 |
|
Cost of revenue, excluding depreciation and amortization |
|
891,588 |
|
|
75,814 |
|
|
73,412 |
|
|
1,040,814 |
|
Gross margin |
$ |
320,830 |
|
$ |
87,568 |
|
$ |
55,422 |
|
$ |
463,820 |
|
Gross margin percentage |
|
26.5 |
% |
|
53.6 |
% |
|
43.0 |
% |
|
30.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine-month period ended September 30, 2023 |
|
|
PDS |
|
HHH |
|
MS |
|
Total |
|
Revenue |
$ |
1,135,365 |
|
$ |
164,525 |
|
$ |
116,478 |
|
$ |
1,416,368 |
|
Cost of revenue, excluding depreciation and amortization |
|
815,221 |
|
|
87,189 |
|
$ |
66,974 |
|
|
969,384 |
|
Gross margin |
$ |
320,144 |
|
$ |
77,336 |
|
$ |
49,504 |
|
$ |
446,984 |
|
Gross margin percentage |
|
28.2 |
% |
|
47.0 |
% |
|
42.5 |
% |
|
31.6 |
% |
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|
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For the three-month periods ended |
|
For the nine-month periods ended |
|
Segment Reconciliation: |
September 28, 2024 |
|
September 30, 2023 |
|
September 28, 2024 |
|
September 30, 2023 |
|
Total segment gross margin |
$ |
159,699 |
|
$ |
147,264 |
|
$ |
463,820 |
|
$ |
446,984 |
|
Branch and regional administrative expenses |
|
88,184 |
|
|
91,004 |
|
|
264,070 |
|
|
273,967 |
|
Corporate expenses |
|
31,894 |
|
|
27,446 |
|
|
91,981 |
|
|
84,735 |
|
Goodwill impairment |
|
- |
|
|
105,136 |
|
|
- |
|
|
105,136 |
|
Depreciation and amortization |
|
2,587 |
|
|
2,962 |
|
|
8,332 |
|
|
10,494 |
|
Acquisition-related costs |
|
150 |
|
|
428 |
|
|
150 |
|
|
466 |
|
Other operating expense (income) |
|
2,860 |
|
|
(3,360 |
) |
|
5,271 |
|
|
(6,593 |
) |
Operating income (loss) |
|
34,024 |
|
|
(76,352 |
) |
|
94,016 |
|
|
(21,221 |
) |
Interest income |
|
100 |
|
|
50 |
|
|
297 |
|
|
238 |
|
Interest expense |
|
(39,245 |
) |
|
(39,599 |
) |
|
(118,505 |
) |
|
(113,542 |
) |
Other (expense) income |
|
(22,211 |
) |
|
14,143 |
|
|
2,329 |
|
|
27,124 |
|
Loss before income taxes |
$ |
(27,332 |
) |
$ |
(101,758 |
) |
$ |
(21,863 |
) |
$ |
(107,401 |
) |
|