-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, URiYscLqNc5RQWy1DAEwzCuxKeu10rXdZhTDs8gG/Sh1CZKpj+xOh98Bog5qUc7+ Pmu/lY77ipF9xdYZ81v7Ug== 0000812191-03-000035.txt : 20030903 0000812191-03-000035.hdr.sgml : 20030903 20030903170830 ACCESSION NUMBER: 0000812191-03-000035 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030903 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030903 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REHABCARE GROUP INC CENTRAL INDEX KEY: 0000812191 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-HOSPITALS [8060] IRS NUMBER: 510265872 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14655 FILM NUMBER: 03879699 BUSINESS ADDRESS: STREET 1: 7733 FORSYTH BLVD 17TH FLR STREET 2: SUITE 1700 CITY: ST LOUIS STATE: MO ZIP: 63105 BUSINESS PHONE: 3148637422 FORMER COMPANY: FORMER CONFORMED NAME: REHABCARE CORP DATE OF NAME CHANGE: 19940218 8-K 1 eightk903.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): September 3, 2003 REHABCARE GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 0-19294 51-0265872 (State or other (Commission File (I.R.S. Employer jurisdiction of Number) Identification incorporation) Number) 7733 Forsyth Boulevard 17th Floor St. Louis, Missouri 63105 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (314) 863-7422 Item 7. Financial Statements and Exhibits. (c) Exhibits. See Exhibit Index. Item 9. Regulation FD Disclosure. Beginning on September 3, 2003, RehabCare executives will make presentations at investor conferences to analysts and in other forums using the slides as included in this Form 8-K as Exhibit 99. Presentations will be made using these slides, or modifications thereof, in connection with other presentations in the foreseeable future. The current slides incorporated into the investor relations presentation are included in this Form 8-K as Exhibit 99. The full slide presentation is available in the Investor Info section on our website at www. rehabcare.com. Information contained in this presentation is an overview and intended to be considered in the context of RehabCare's SEC filings and all other publicly disclosed information. We undertake no duty or obligation to update or revise this information. However, we may update the presentation periodically in a Form 8-K filing. The presentation included in this report does not include images included in the actual slides. In order that all investors be provided with substantially the same information, RehabCare is making these slides available on its website. The presentation in its entirety will be made available in the Investor Info section of the RehabCare website, www.rehabcare.com, although this availability may be discontinued at any time. Forward-looking statements have been provided pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties may include, but are not limited to, the cost, effect and timing of restructuring activities that have been commenced, including our ability to achieve the annual expense reductions anticipated; the timing and rate of the resumed growth in the staffing division; changes in and compliance with governmental reimbursement rates; regulations or policies affecting the hospital rehabilitation services and contract therapy divisions, including our estimates with respect to the effect of newly promulgated regulations on the Company's business; our ability to attract new client relationships or to retain and grow existing client relationships through the integration of our new information system with those of our clients and the development of alternative product offerings; our ability to identify and consummate strategic acquisitions to accelerate growth in our divisions; our ability, and the additional costs, to attract operational and professional employees; significant increases in health, worker's compensation and professional and general liability insurance premiums; the adequacy and effectiveness of operating and administrative systems; litigation risks, including our ability to predict the ultimate costs and liabilities or the disruption of RehabCare Group's operations; competitive effects on pricing and margins; and general economic conditions, including efforts by insurers, healthcare providers and others to contain healthcare costs. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: September 3, 2003 REHABCARE GROUP, INC. By: /s/ Vincent L. Germanese ----------------------------------------- Vincent L. Germanese Senior Vice President, Chief Financial Officer and Secretary EXHIBIT INDEX Exhibit No. Description 99 Text of Investor Relations Presentation in Use Beginning September 3, 2003 Exhibit 99 Safe Harbor Forward-looking statements have been provided pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties may include, but are not limited to, the cost, effect and timing of restructuring activities that have been commenced, including our ability to achieve the annual expense reductions anticipated; the timing and rate of the resumed growth in the staffing division; changes in and compliance with governmental reimbursement rates; regulations or policies affecting the hospital rehabilitation services and contract therapy divisions, including our estimates with respect to the effect of newly promulgated regulations on the Company's business; our ability to attract new client relationships or to retain and grow existing client relationships through the integration of our new information system with those of our clients and the development of alternative product offerings; our ability to identify and consummate strategic acquisitions to accelerate growth in our divisions; our ability, and the additional costs, to attract operational and professional employees; significant increases in health, worker's compensation and professional and general liability insurance premiums; the adequacy and effectiveness of operating and administrative systems; litigation risks, including our ability to predict the ultimate costs and liabilities or the disruption of RehabCare Group's operations; competitive effects on pricing and margins; and general economic conditions, including efforts by insurers, healthcare providers and others to contain healthcare costs.
RHB Financial Performance Q2/03 Vs. Q1/03 Q1/03 Q2/03 % Change Revenue $138.8 million $136.0 million (2.0%) EBITDA* $9.1 million $9.8 million 7.6% Net Earnings $4.0 million $4.5 million 10.2% EPS $0.25 $0.27 10.2%
* Earnings before interest, taxes, depreciation and amortization RHB Financial Position Strong Balance Sheet o Current cash - $24 million o Cash generated per month - $2 million o No Debt o Unused $118 million/5 year revolver - 2 years remaining o Current Ratio - 3.2:1 o DSO - 58 days RHB Performance Adjusted EPS Growth (Graphic Omitted) 1992-2002 Annual Compounded Growth Rate 21% Fiscal Year Ended February 28 1992 - $0.20 1993 - $0.24 1994 - $0.29 1995 - $0.35 1996 - $0.42 Fiscal Year Ended December 31 1996 - $0.47** 1997 - $0.68* 1998 - $0.85* 1999 - $1.08* 2000 - $1.45 2001 - $1.18* 2002 - $1.38 2003 - $1.09-$1.23 Guidance **Annualized *The results for 2001 and 1999 do not reflect non-operating losses associated with write-down of investments of $0.02 per share and $0.05 per share, respectively. The results for 1998 do not include a $0.06 per share gain on sale of securities or a $0.05 per share charge for the cumulative effect of change in accounting for start-up costs. The results for 1997 do not reflect a $0.06 per share gain on sale of securities. Considering the effects of these non-operating items, EPS in 2001, 1999, 1998 and 1997 was $1.16, $1.03, $0.86 and $0.73, respectively. RHB Revenues Q2/03 Total Revenue $136 million (Graphic Omitted) Program Management $79.2 million Hospital Rehabilitation Services $46.3 million Contract Therapy $32.9 million Healthcare Staffing $56.8 million Supplemental $32.1 million Travel $24.7 million RHB Business Profile Hospital Rehabilitation Services (Graphic Omitted) Management of inpatient and outpatient rehabilitation programs, skilled nursing units and the delivery of therapy to medical/surgical patients. Inpatient $33.8 million Outpatient $12.5 million 159 Hospital Clients as of June 30, 2003 4 ARU, SNU & OP 15 ARU & SNU 23 ARU & OP 87 ARU only 30 OP only Acute Rehabilitation Units Elderly - 44% orthopedic, 19% stroke, 6% neurological Skilled Nursing Units Elderly - 21% circulatory, 13% respiratory, 10% musculoskeletal Outpatient Middle-aged - over 80% musculoskeletal
RHB Business Profile Hospital Rehabilitation Services (Graphic Omitted) Annual Revenue (in millions) ARU OP SNU 1992 $44.5 1993 48.4 1994 61.7 1995 75.5 $ 7.2 $ 0.5 1996 76.7 10.5 4.4 1997 86.6 9.4 10.8 1998 96.5 16.5 15.2 1999 106.2 30.7 10.3 2000 109.3 42.3 10.7 2001 112.5 50.0 10.8 2002 120.7 49.0 10.0
Billable Patient Days/Visits ARU Days OP Visits SNU Days 1992 247,534 1993 260,134 1994 323,040 1995 397,470 135,064 6,314 1996 386,643 223,904 40,352 1997 430,059 231,256 102,136 1998 493,531 378,108 162,832 1999 548,149 785,943 149,620 2000 563,469 173,324 153,524 2001 581,321 1,439,169 159,617 2002 591,069 1,366,439 141,767
"RehabCare manages the complete continuum of rehabilitation care, from acute therapy through outpatient services. It's a large commitment." Eileen Malo Executive VP, Continuing Care Services Bon Secours Hampton Roads Health System Norfolk, VA RHB Business Profile Hospital Rehabilitation Services Locations (Graphic Omitted) Map omitted showing HRS Acute Rehab Unit locations, HRS Outpatient locations, HRS Skilled Nursing Unit locations and Corporate Headquarters location. RHB Business Profile Contract Therapy (as of June 30, 2003) (Graphic Omitted) Management of post-acute rehabilitation services for patients in skilled nursing and continuing care facilities 195 Clients 455 Programs Elderly; stroke, orthopedic, neurological, complex medical Contract therapy revenues 2Q/03 $32.9M "We were looking for a partner that could not only provide high-quality services, but also help us grow our business." Mr. Dean Eliason Vice President Fountains Retirement Communities, Inc. Tucson, AZ
RHB Business Profile Contract Therapy (Graphic Omitted) Annual Revenue (in millions) Average Revenue Per Location 1997 $8.4 $234,921 1998 13.9 281,547 1999 14.1 154,899 2000 30.0 192,130 2001 64.7 258,902 2002 105.3 278,427
RHB Business Profile Contract Therapy Locations (Graphic Omitted) Map omitted showing Contract Therapy locations and Corporate Office location RHB Business Profile StarMed Supplemental (Graphic Omitted) Placement of healthcare professionals in single shift to multiple shift assignments in local StarMed markets - - 1,804 clients, 76% Hospitals in Q2/03 - - 91% nursing, 9% allied - - Any healthcare environment including hospitals, physician offices, etc. - - 72 branches, 3,808 professionals on assignment, June 30, 2003 Supplemental revenues Q2/03 $32.1M "StarMed has the assignments that I want, when I want them. That's why StarMed's my company." Valerie Sanders Registered Nurse StarMed Ambassador RHB Business Profile StarMed Travel (Graphic Omitted) Placement of healthcare professionals in generally 8 to 26 week assignments at healthcare facilities throughout the U.S. - - 503 clients, 75% Hospitals in Q2/03 - - 73% nursing, 18% radiology - - Hospitals or other healthcare facilities - - 968 professionals on assignment, June 30, 2003 Travel revenues 2Q/03 $24.7M "Promises fulfilled. I stick with StarMed because I've learned to trust what they tell me." Renato Oliveros Physical Therapy Assistant StarMed Ambassador
RHB Business Profile StarMed (Graphic Omitted) Annual Revenue (in millions) Weeks Worked Supplemental Travel Supplemental Travel 1996 $28.9 21,908 1997 46.4 29,652 1998 $ 28.4 38.2 27,673 24,592 1999 112.9 35.4 106,447 24,663 2000 205.9 54.2 190,806 33,145 2001 225.6 79.0 188,368 45,530 2002 172.1 105.5 128,396 54,156
RHB Business Profile StarMed Locations (Graphic Omitted) Map omitted showing StarMed locations and Corporate Office location RHB Business Description Market Drivers (Graphics Omitted)
Aging of Baby Boomers U. S. Population Over 65 (in millions) 2000 34.4 2005 36.3 2010 39.7 2015 45.9 2020 53.7 2025 62.6
Source: U.S. Census Bureau, Population Projections Bureau, January 13, 2000
Shortage of Healthcare Professionals RN Demand Vs. Supply (in millions) Demand Supply 2000 1.999 1.889 2005 2.161 2.012 2010 2.344 2.069 2015 2.562 2.055 2020 2.810 2.001
Source: National Center for Health Workforce Analysis, U.S.D.H.H.S., July 2002 RHB Business Description Client Needs Program Management - - Increased facility profitability - - Increased census (with the "right" patients) - - Post-acute care management - - Qualified therapists - - LOS management - - Partners that understand PPS (acute, rehab & SNF) - - Innovative clinical programs - - Partnerships backed with capital - - Systems expertise RHB Business Description Client Needs Staffing - - Profitable units at all census levels - - Competency assurance - - Good value - - Integration with permanent staff - - Staffing partners, not vendors - - Easy staffing solutions RHB Strategic Initiatives (Graphic omitted) Restructuring Service Offerings Client Relationships Acquisitions RHB Strategic Initiatives (Graphic omitted) 1. Restructure Operations - $12 million in cost reductions 47% Personnel Related 25% Vendor Relationships 28% Discretionary Expenditures RHB Strategic Initiatives 2. Re-design Service Offering Post-Acute Continuum (Graphic omitted) StarMed - integrate Travel and Supplemental into single source staffing provider (Graphic omitted) RHB Strategic Initiatives 3. Strengthen client relationships Build Partnerships instead of transactional relationships Program Management - Develop joint venture and capital infusion models - Create a la carte service offering for HRS Healthcare Staffing - Consolidate Travel & Supplemental into an operations and sales model that builds partnerships with our clients - Bond - technology consolidation - Simulis - proving competencies - Economies of scale RHB Strategic Initiatives (Graphic omitted) 4. Acquisitions Capital available Key executives focused on acquisitions Experience with acquisitions Hospital Rehabilitation Services -------------------------------- Advanced Rehabilitation Resources, Inc. - IP Physical Therapy Resources, Inc. - OP Rehabilitative Care Systems of America - OP Salt Lake Physical Therapy - OP DiversiCare Rehab Services, Inc. - OP Contract Therapy ---------------- TeamRehab Moore Rehabilitation Services, Inc. Rehab Unlimited, Inc. Therapeutic Systems, Ltd Healthcare Staffing ------------------- Healthcare Staffing Solutions, Inc. StarMed All Staff, Inc. eai Healthcare Staffing Solutions, Inc. RHB Elements of Success (Graphic omitted) Consistent Long-Term EPS Growth Strong Cash Flow Strong Client Experienced Innovative Products Relationships Management Team & Services Market Trend Shortage of Positive To Partnering Clinicians Demographics -----END PRIVACY-ENHANCED MESSAGE-----