16. Guarantor Subsidiaries

Our 1.875% Notes are fully and unconditionally guaranteed on an unsecured, jointly, and severally liable basis by certain of our 100% owned subsidiaries. The following unaudited, condensed, consolidating financial data presents the composition of the parent company (Chemed), the guarantor subsidiaries and the non-guarantor subsidiaries as of June 30, 2012 and December 31, 2011 for the balance sheet, the three and six months ended June 30, 2012 and June 30, 2011 for the income statement and the six months ended June 30, 2012 and June 30, 2011 for the statement of cash flows (dollars in thousands):


*June 30, 2012*		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
ASSETS
Cash and cash equivalents	$ 53,280	$ (803)	$ 7,489	$ -	$ 59,966
Accounts receivable, less allowances	1,082	80,120	609	-	81,811
Intercompany receivables	-	303,347	-	(303,347)	-
Inventories - net	-	7,414	732	-	8,146
Current deferred income taxes	(1,311)	14,329	208	-	13,226
Prepaid income taxes	4,701	(890)	376	-	4,187
Prepaid expenses	980	9,554	203	-	10,737
Total current assets	58,732	413,071	9,617	(303,347)	178,073
Investments of deferred compensation plans	-	-	33,215	-	33,215
Properties and equipment, at cost, less accumulated depreciation	11,203	74,761	2,607	-	88,571
Identifiable intangible assets less accumulated amortization	-	57,635	-	-	57,635
Goodwill	-	457,487	4,478	-	461,965
Other assets	7,010	1,733	2,926	-	11,669
Investments in subsidiaries	833,241	23,043	-	(856,284)	-
Total assets	$ 910,186	$ 1,027,730	$ 52,843	$ (1,159,631)	$ 831,128
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$ (748)	$ 51,304	$ 446	$ -	$ 51,002
Intercompany payables	298,601	-	4,746	(303,347)	-
Income taxes	-	-	167	-	167
Accrued insurance	402	36,384	-	-	36,786
Accrued compensation	2,020	37,166	543	-	39,729
Other current liabilities	1,992	12,618	296	-	14,906
Total current liabilities	302,267	137,472	6,198	(303,347)	142,590
Deferred income taxes	(13,314)	49,264	(10,693)	-	25,257
Long-term debt	170,769	-	-	-	170,769
Deferred compensation liabilities	-	30	33,119	-	33,149
Other liabilities	3,019	6,394	2,505	-	11,918
Stockholders' equity	447,445	834,570	21,714	(856,284)	447,445
Total liabilities and stockholders' equity	$ 910,186	$ 1,027,730	$ 52,843	$ (1,159,631)	$ 831,128

December 31, 2011		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
ASSETS
Cash and cash equivalents	$ 32,470	$ (1,422)	$ 7,033	$ -	$ 38,081
Accounts receivable, less allowances	606	76,816	502	-	77,924
Intercompany receivables	-	273,413	-	(273,413)	-
Inventories - net	-	8,032	636	-	8,668
Current deferred income taxes	(650)	13,059	131	-	12,540
Prepaid income taxes	(114)	1,689	556	-	2,131
Prepaid expenses	503	10,757	149	-	11,409
Total current assets	32,815	382,344	9,007	(273,413)	150,753
Investments of deferred compensation plans	-	-	31,629	-	31,629
Properties and equipment, at cost, less accumulated depreciation	11,641	68,755	2,555	-	82,951
Identifiable intangible assets less accumulated amortization	-	58,262	-	-	58,262
Goodwill	-	456,183	4,450	-	460,633
Other assets	7,616	1,552	2,509	-	11,677
Investments in subsidiaries	793,277	21,148	-	(814,425)	-
Total assets	$ 845,349	$ 988,244	$ 50,150	$ (1,087,838)	$ 795,905
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$ (683)	$ 48,490	$ 418	$ -	$ 48,225
Intercompany payables	269,042	-	4,371	(273,413)	-
Income taxes	-	-	90	-	90
Accrued insurance	489	36,658	-	-	37,147
Accrued compensation	3,828	36,655	604	-	41,087
Other current liabilities	1,719	15,728	1,404	-	18,851
Total current liabilities	274,395	137,531	6,887	(273,413)	145,400
Deferred income taxes	(12,330)	51,601	(9,808)	-	29,463
Long-term debt	166,784	-	-	-	166,784
Deferred compensation liabilities	-	-	30,693	-	30,693
Other liabilities	2,816	4,630	2,435	-	9,881
Stockholders' equity	413,684	794,482	19,943	(814,425)	413,684
Total liabilities and stockholders' equity	$ 845,349	$ 988,244	$ 50,150	$ (1,087,838)	$ 795,905


*For the three months ended June 30, 2012*		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 347,017	$ 7,153	$ -	$ 354,170
Cost of services provided and goods sold	-	253,434	3,934	-	257,368
Selling, general and administrative expenses	5,937	43,356	477	-	49,770
Depreciation	234	5,926	220	-	6,380
Amortization	481	646	-	-	1,127
Total costs and expenses	6,652	303,362	4,631	-	314,645
Income/ (loss) from operations	(6,652)	43,655	2,522	-	39,525
Interest expense	(3,487)	(171)	(14)	-	(3,672)
Other (expense)/income - net	4,340	(4,357)	(953)	-	(970)
Income/ (loss) before income taxes	(5,799)	39,127	1,555	-	34,883
Income tax (provision)/ benefit	1,918	(14,918)	(609)	-	(13,609)
Equity in net income of subsidiaries	25,155	990	-	(26,145)	-
Net income	$ 21,274	$ 25,199	$ 946	$ (26,145)	$ 21,274


For the three months ended June 30, 2011		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 326,406	$ 6,954	$ -	$ 333,360
Cost of services provided and goods sold	-	235,855	3,742	-	239,597
Selling, general and administrative expenses	5,574	42,441	2,409	-	50,424
Depreciation	237	5,919	202	-	6,358
Amortization	465	674	-	-	1,139
Total costs and expenses	6,276	284,889	6,353	-	297,518
Income/ (loss) from operations	(6,276)	41,517	601	-	35,842
Interest expense	(3,321)	(140)	-	-	(3,461)
Other (expense)/income - net	3,862	(3,888)	740	-	714
Income/ (loss) before income taxes	(5,735)	37,489	1,341	-	33,095
Income tax (provision)/ benefit	1,783	(14,083)	(509)	-	(12,809)
Equity in net income of subsidiaries	24,238	875	-	(25,113)	-
Net income	$ 20,286	$ 24,281	$ 832	$ (25,113)	$ 20,286

*For the six months ended June 30, 2012*		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 692,631	$ 14,482	$ -	$ 707,113
Cost of services provided and goods sold	-	506,861	7,952	-	514,813
Selling, general and administrative expenses	11,133	87,703	4,101	-	102,937
Depreciation	467	11,717	437	-	12,621
Amortization	951	1,289	-	-	2,240
Total costs and expenses	12,551	607,570	12,490	-	632,611
Income/ (loss) from operations	(12,551)	85,061	1,992	-	74,502
Interest expense	(6,920)	(340)	(29)	-	(7,289)
Other (expense)/income - net	8,746	(8,798)	1,177	-	1,125
Income/ (loss) before income taxes	(10,725)	75,923	3,140	-	68,338
Income tax (provision)/ benefit	3,499	(28,882)	(1,236)	-	(26,619)
Equity in net income of subsidiaries	48,945	1,972	-	(50,917)	-
Net income	$ 41,719	$ 49,013	$ 1,904	$ (50,917)	$ 41,719


For the six months ended June 30, 2011		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 650,563	$ 13,715	$ -	$ 664,278
Cost of services provided and goods sold	-	469,731	7,324	-	477,055
Selling, general and administrative expenses	12,258	88,022	5,798	-	106,078
Depreciation	476	11,781	389	-	12,646
Amortization	820	1,289	-	-	2,109
Total costs and expenses	13,554	570,823	13,511	-	597,888
Income/ (loss) from operations	(13,554)	79,740	204	-	66,390
Interest expense	(6,453)	(252)	-	-	(6,705)
Other (expense)/income - net	7,632	(7,617)	2,801	-	2,816
Income/ (loss) before income taxes	(12,375)	71,871	3,005	-	62,501
Income tax (provision)/ benefit	4,186	(27,135)	(1,165)	-	(24,114)
Equity in net income of subsidiaries	46,576	1,908	-	(48,484)	-
Net income	$ 38,387	$ 46,644	$ 1,840	$ (48,484)	$ 38,387


*For the six months ended June 30, 2012*		Guarantor	Non-Guarantor
	Parent	Subsidiaries	Subsidiaries	Consolidated
Cash Flow from Operating Activities:
Net cash provided by operating activities	$ (3,716)	$ 57,667	$ 704	$ 54,655
Cash Flow from Investing Activities:
Capital expenditures	(28)	(17,966)	(480)	(18,474)
Business combinations, net of cash acquired	-	(1,500)	-	(1,500)
Other sources/(uses) - net	200	167	(10)	357
Net cash used by investing activities	172	(19,299)	(490)	(19,617)
Cash Flow from Financing Activities:
Change in cash overdrafts payable	(46)	1,031	-	985
Change in intercompany accounts	38,573	(38,780)	207	-
Dividends paid to shareholders	(6,160)	-	-	(6,160)
Purchases of treasury stock	(12,783)	-	(58)	(12,841)
Proceeds from exercise of stock options	3,670	-	-	3,670
Realized excess tax benefit on share based compensation	1,069	-	-	1,069
Other sources - net	31	-	93	124
Net cash used by financing activities	24,354	(37,749)	242	(13,153)
Net increase in cash and cash equivalents	20,810	619	456	21,885
Cash and cash equivalents at beginning of year	32,470	(1,422)	7,033	38,081
Cash and cash equivalents at end of period	$ 53,280	$ (803)	$ 7,489	$ 59,966

For the six months ended June 30, 2011		Guarantor	Non-Guarantor
	Parent	Subsidiaries	Subsidiaries	Consolidated
Cash Flow from Operating Activities:
Net cash provided/(used) by operating activities	$ 3,594	$ 48,849	$ (1,316)	$ 51,127
Cash Flow from Investing Activities:
Capital expenditures	(5)	(14,085)	(870)	(14,960)
Business combinations, net of cash acquired	-	(3,689)	-	(3,689)
Other sources/(uses) - net	(103)	(771)	5	(869)
Net cash used by investing activities	(108)	(18,545)	(865)	(19,518)
Cash Flow from Financing Activities:
Purchases of treasury stock	(25,438)	-	(44)	(25,482)
Change in cash overdrafts payable	698	(8,512)	-	(7,814)
Change in intercompany accounts	26,733	(28,804)	2,071	-
Proceeds from exercise of stock options	7,698	-	-	7,698
Dividends paid to shareholders	(5,967)	-	-	(5,967)
Debt issuance costs	(2,723)	-	-	(2,723)
Realized excess tax benefit on share based compensation	3,339	-	-	3,339
Other sources - net	41	1	322	364
Net cash provided/(used) by financing activities	4,381	(37,315)	2,349	(30,585)
Net increase/(decrease) in cash and cash equivalents	7,867	(7,011)	168	1,024
Cash and cash equivalents at beginning of year	45,324	(1,571)	6,164	49,917
Cash and cash equivalents at end of period	$ 53,191	$ (8,582)	$ 6,332	$ 50,941