18. 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 September 30, 2012 and December 31, 2011 for the balance sheet, the three and nine months ended September 30, 2012 and September 30, 2011 for the income statement and the nine months ended September 30, 2012 and September 30, 2011 for the statement of cash flows (dollars in thousands):


September 30, 2012		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
ASSETS
Cash and cash equivalents	$ 58,449	$ 3,010	$ 7,837	$ -	$ 69,296
Accounts receivable, less allowances	955	99,639	558	-	101,152
Intercompany receivables	-	298,490	-	(298,490)	-
Inventories - net	-	6,946	693	-	7,639
Current deferred income taxes	(1,628)	15,512	234	-	14,118
Prepaid income taxes	5,251	(1,799)	(408)	-	3,044
Prepaid expenses	730	8,935	190	-	9,855
Total current assets	63,757	430,733	9,104	(298,490)	205,104
Investments of deferred compensation plans	-	-	35,053	-	35,053
Properties and equipment, at cost, less accumulated depreciation	11,132	76,273	2,730	-	90,135
Identifiable intangible assets less accumulated amortization	-	57,507	-	-	57,507
Goodwill	-	461,277	4,584	-	465,861
Other assets	6,396	1,765	2,966	-	11,127
Investments in subsidiaries	852,204	24,205	-	(876,409)	-
Total assets	$ 933,489	$ 1,051,760	$ 54,437	$ (1,174,899)	$ 864,787
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$ (5,239)	$ 48,934	$ 361	$ -	$ 44,056
Intercompany payables	294,307	-	4,183	(298,490)	-
Income taxes	(818)	601	1,713	-	1,496
Accrued insurance	1,288	38,230	-	-	39,518
Accrued compensation	3,075	40,595	447	-	44,117
Other current liabilities	3,124	15,017	353	-	18,494
Total current liabilities	295,737	143,377	7,057	(298,490)	147,681
Deferred income taxes	(12,830)	47,968	(10,874)	-	24,264
Long-term debt	172,812	-	-	-	172,812
Deferred compensation liabilities	-	33	34,593	-	34,626
Other liabilities	3,145	6,875	759	-	10,779
Stockholders' equity	474,625	853,507	22,902	(876,409)	474,625
Total liabilities and stockholders' equity	$ 933,489	$ 1,051,760	$ 54,437	$ (1,174,899)	$ 864,787

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 September 30, 2012		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 347,384	$ 6,969	$ -	$ 354,353
Cost of services provided and goods sold	-	252,688	3,922	-	256,610
Selling, general and administrative expenses	5,991	43,992	2,972	-	52,955
Depreciation	237	6,099	221	-	6,557
Amortization	486	649	-	-	1,135
Other operating expenses	-	1,126	-	-	1,126
Total costs and expenses	6,714	304,554	7,115	-	318,383
Income/ (loss) from operations	(6,714)	42,830	(146)	-	35,970
Interest expense	(3,517)	(211)	(15)	-	(3,743)
Other (expense)/income - net	4,450	(4,184)	1,574	-	1,840
Income/ (loss) before income taxes	(5,781)	38,435	1,413	-	34,067
Income tax (provision)/ benefit	1,877	(14,560)	(539)	-	(13,222)
Equity in net income of subsidiaries	24,749	885	-	(25,634)	-
Net income	$ 20,845	$ 24,760	$ 874	$ (25,634)	$ 20,845


For the three months ended September 30, 2011		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 334,937	$ 6,502	$ -	$ 341,439
Cost of services provided and goods sold	-	241,604	3,459	-	245,063
Selling, general and administrative expenses	5,678	42,595	(655)	-	47,618
Depreciation	235	5,870	208	-	6,313
Amortization	467	667	-	-	1,134
Total costs and expenses	6,380	290,736	3,012	-	300,128
Income/ (loss) from operations	(6,380)	44,201	3,490	-	41,311
Interest expense	(3,361)	(194)	-	-	(3,555)
Other (expense)/income - net	4,379	(4,301)	(2,013)	-	(1,935)
Income/ (loss) before income taxes	(5,362)	39,706	1,477	-	35,821
Income tax (provision)/ benefit	1,677	(15,029)	(582)	-	(13,934)
Equity in net income of subsidiaries	25,572	953	-	(26,525)	-
Net income	$ 21,887	$ 25,630	$ 895	$ (26,525)	$ 21,887

For the nine months ended Septmber 30, 2012		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 1,040,015	$ 21,451	$ -	$ 1,061,466
Cost of services provided and goods sold	-	759,549	11,874	-	771,423
Selling, general and administrative expenses	17,124	131,695	7,073	-	155,892
Depreciation	704	17,816	658	-	19,178
Amortization	1,437	1,938	-	-	3,375
Other operating expenses	-	1,126	-	-	1,126
Total costs and expenses	19,265	912,124	19,605	-	950,994
Income/ (loss) from operations	(19,265)	127,891	1,846	-	110,472
Interest expense	(10,437)	(551)	(44)	-	(11,032)
Other (expense)/income - net	13,196	(12,982)	2,751	-	2,965
Income/ (loss) before income taxes	(16,506)	114,358	4,553	-	102,405
Income tax (provision)/ benefit	5,376	(43,442)	(1,775)	-	(39,841)
Equity in net income of subsidiaries	73,694	2,857	-	(76,551)	-
Net income	$ 62,564	$ 73,773	$ 2,778	$ (76,551)	$ 62,564


For the nine months ended September 30, 2011		Guarantor	Non-Guarantor	Consolidating
	Parent	Subsidiaries	Subsidiaries	Adjustments	Consolidated
Continuing Operations
Service revenues and sales	$ -	$ 985,500	$ 20,217	$ -	$ 1,005,717
Cost of services provided and goods sold	-	711,335	10,783	-	722,118
Selling, general and administrative expenses	17,936	130,617	5,143	-	153,696
Depreciation	711	17,651	597	-	18,959
Amortization	1,287	1,956	-	-	3,243
Total costs and expenses	19,934	861,559	16,523	-	898,016
Income/ (loss) from operations	(19,934)	123,941	3,694	-	107,701
Interest expense	(9,814)	(446)	-	-	(10,260)
Other (expense)/income - net	12,011	(11,918)	788	-	881
Income/ (loss) before income taxes	(17,737)	111,577	4,482	-	98,322
Income tax (provision)/ benefit	5,863	(42,164)	(1,747)	-	(38,048)
Equity in net income of subsidiaries	72,148	2,861	-	(75,009)	-
Net income	$ 60,274	$ 72,274	$ 2,735	$ (75,009)	$ 60,274


For the nine months ended September 30, 2012		Guarantor	Non-Guarantor
	Parent	Subsidiaries	Subsidiaries	Consolidated
Cash Flow from Operating Activities:
Net cash provided by operating activities	$ 1,486	$ 74,206	$ 1,645	$ 77,337
Cash Flow from Investing Activities:
Capital expenditures	(196)	(25,491)	(802)	(26,489)
Business combinations, net of cash acquired	-	(5,900)	-	(5,900)
Other sources/(uses) - net	201	359	(32)	528
Net cash used by investing activities	5	(31,032)	(834)	(31,861)
Cash Flow from Financing Activities:
Change in cash overdrafts payable	(4,580)	1,281	-	(3,299)
Change in intercompany accounts	40,489	(40,022)	(467)	-
Dividends paid to shareholders	(9,641)	-	-	(9,641)
Purchases of treasury stock	(14,960)	-	(87)	(15,047)
Proceeds from exercise of stock options	10,483	-	-	10,483
Realized excess tax benefit on share based compensation	2,714	-	-	2,714
Other sources/(uses) - net	(17)	(1)	547	529
Net cash provided/(used) by financing activities	24,488	(38,742)	(7)	(14,261)
Net increase in cash and cash equivalents	25,979	4,432	804	31,215
Cash and cash equivalents at beginning of year	32,470	(1,422)	7,033	38,081
Cash and cash equivalents at end of period	$ 58,449	$ 3,010	$ 7,837	$ 69,296

For the nine months ended September 30, 2011		Guarantor	Non-Guarantor
	Parent	Subsidiaries	Subsidiaries	Consolidated
Cash Flow from Operating Activities:
Net cash provided by operating activities	$ 21,558	$ 83,903	$ 2,475	$ 107,936
Cash Flow from Investing Activities:
Capital expenditures	(23)	(22,378)	(1,058)	(23,459)
Business combinations, net of cash acquired	-	(3,689)	-	(3,689)
Other sources/(uses) - net	(150)	(713)	34	(829)
Net cash used by investing activities	(173)	(26,780)	(1,024)	(27,977)
Cash Flow from Financing Activities:
Purchases of treasury stock	(110,221)	-	(67)	(110,288)
Change in cash overdrafts payable	208	2,089	-	2,297
Change in intercompany accounts	60,028	(59,090)	(938)	-
Proceeds from exercise of stock options	7,979	-	-	7,979
Dividends paid to shareholders	(9,393)	-	-	(9,393)
Debt issuance costs	(2,723)	-	-	(2,723)
Realized excess tax benefit on share based compensation	3,368	-	-	3,368
Other sources/(uses) - net	(5)	-	231	226
Net cash used by financing activities	(50,759)	(57,001)	(774)	(108,534)
Net increase/(decrease) in cash and cash equivalents	(29,374)	122	677	(28,575)
Cash and cash equivalents at beginning of year	45,324	(1,571)	6,164	49,917
Cash and cash equivalents at end of period	$ 15,950	$ (1,449)	$ 6,841	$ 21,342