Segment Information

9 Months Ended

Sep. 28, 2024

Segment Reporting [Abstract]

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):

	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	%
	For the three-month period ended September 30, 2023
	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	%

	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	)