10-Q 1 che-20240930x10q.htm 10-Q che-20240930x10q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x Quarterly Report Under Section 13 or 15 (d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended September 30, 2024

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 1-8351

CHEMED CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		31-0791746
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)
255 E. Fifth Street, Suite 2600, Cincinnati, Ohio		45202
(Address of principal executive offices)		(Zip code)
(513) 762-6690 (Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.


Yes	x	No	o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).


Yes	x	No	o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Large Accelerated Filer

Accelerated Filer

Non-accelerated Filer

Smaller Reporting Company

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended the extended transition period for complying with a new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


Yes	o	No	x

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol	Name of Each Exchange on which Registered	Amount	Date

Capital Stock $1 Par Value	CHE	New York Stock Exchange	14,982,607 Shares	September 30, 2024

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-1-

CHEMED CORPORATION AND

SUBSIDIARY COMPANIES

Index



	Page No.
PART I. FINANCIAL INFORMATION:

Item 1. Financial Statements
Unaudited Consolidated Balance Sheets -
September 30, 2024 and December 31, 2023	3

Unaudited Consolidated Statements of Income -
Three months and nine months ended September 30, 2024 and 2023	4

Unaudited Consolidated Statements of Cash Flows -
Nine months ended September 30, 2024 and 2023	5

Unaudited Consolidated Statements of Changes in Stockholders’ Equity-
Three months and nine months ended September 30, 2024 and 2023	6

Notes to Unaudited Consolidated Financial Statements	8

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3. Quantitative and Qualitative Disclosures about Market Risk	39

Item 4. Controls and Procedures	39

PART II. OTHER INFORMATION

Item 1. Legal Proceedings	39

Item 1A. Risk Factors	39

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	40

Item 3. Defaults Upon Senior Securities	40

Item 4. Mine Safety Disclosures	40

Item 5. Other Information	40

Item 6. Exhibits	41

EX – 31.1
EX – 31.2
EX – 32.1
EX – 32.2
EX – 101
EX – 104

SIGNATURES	42

‎

-2-


PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)



	September 30, 2024		December 31, 2023
ASSETS
Current assets
Cash and cash equivalents	$	238,451	$	263,958
Accounts receivable less allowances		196,481		181,511
Inventories		9,899		12,004
Prepaid income taxes		14,229		13,166
Prepaid expenses		31,377		30,204
Total current assets		490,437		500,843
Investments of deferred compensation plans held in trust		126,631		106,126
Properties and equipment, at cost, less accumulated depreciation of $375,775 (2023- $354,872)		200,939		203,840
Lease right of use asset		134,111		126,387
Identifiable intangible assets less accumulated amortization of $56,581 (2023 - $48,965)		94,753		90,264
Goodwill		666,860		585,017
Other assets		55,704		55,618
Total Assets	$	1,769,435	$	1,668,095

LIABILITIES
Current liabilities
Accounts payable	$	44,938	$	64,034
Accrued insurance		60,308		58,568
Income taxes		3,385		6,858
Accrued compensation		73,141		88,381
Short-term lease liability		42,490		38,635
Other current liabilities		40,517		55,574
Total current liabilities		264,779		312,050
Deferred income taxes		28,076		30,321
Deferred compensation liabilities		122,240		104,069
Long-term lease liability		105,416		100,776
Other liabilities		13,169		13,003
Total Liabilities		533,680		560,219
Commitments and contingencies (Note 10)
STOCKHOLDERS' EQUITY
Capital stock - authorized 80,000,000 shares $1 par; issued 37,394,553 shares (2023 - 37,183,681 shares)		37,395		37,184
Paid-in capital		1,462,569		1,341,273
Retained earnings		2,639,011		2,446,925
Treasury stock - 22,466,949 shares (2023 - 22,148,927 shares)		(2,905,430)		(2,719,588)
Deferred compensation payable in Company stock		2,210		2,082
Total Stockholders' Equity		1,235,755		1,107,876
Total Liabilities and Stockholders' Equity	$	1,769,435	$	1,668,095

See Accompanying Notes to Unaudited Consolidated Financial Statements.

‎

-3-


CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)



	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Service revenues and sales	$	606,181	$	564,532	$	1,791,294	$	1,678,505
Cost of services provided and goods sold (excluding depreciation)		396,187		362,358		1,171,064		1,107,256
Selling, general and administrative expenses		101,981		99,602		320,109		294,684
Depreciation		13,147		12,858		39,601		37,778
Amortization		2,550		2,521		7,617		7,548
Other operating expense		159		343		288		2,064
Total costs and expenses		514,024		477,682		1,538,679		1,449,330
Income from operations		92,157		86,850		252,615		229,175
Interest expense		(427)		(444)		(1,281)		(2,766)
Other income - net		9,299		6,859		28,008		8,365
Income before income taxes		101,029		93,265		279,342		234,774
Income taxes		(25,253)		(18,307)		(67,662)		(52,318)
Net income	$	75,776	$	74,958	$	211,680	$	182,456

Earnings Per Share:
Net income	$	5.04	$	4.97	$	14.04	$	12.14
Average number of shares outstanding		15,025		15,075		15,082		15,034

Diluted Earnings Per Share:
Net income	$	5.00	$	4.93	$	13.88	$	12.02
Average number of shares outstanding		15,168		15,200		15,253		15,178

Cash Dividends Per Share	$	0.50	$	0.40	$	1.30	$	1.16

See Accompanying Notes to Unaudited Consolidated Financial Statements.

‎

-4-


CHEMED CORPORATION AND SUBSIDIARY COMPANIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Nine Months Ended September 30,
	2024		2023
Cash Flows from Operating Activities
Net income	$	211,680	$	182,456
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization		47,218		45,326
Stock option expense		23,933		22,376
Noncash long-term incentive compensation		15,783		6,637
Litigation settlements		(5,750)		2,050
Benefit for deferred income taxes		(2,245)		(8,232)
Noncash directors' compensation		1,282		1,444
Amortization of debt issuance costs		241		500
Changes in operating assets and liabilities:
Increase in accounts receivable		(14,336)		(27,843)
Decrease/(increase) in inventories		2,125		(2,239)
(Increase)/decrease in prepaid expenses		(1,173)		781
Decrease in accounts payable and other current liabilities		(19,641)		(15,815)
Change in current income taxes		(4,545)		12,314
Net change in lease assets and liabilities		(400)		(892)
Increase in other assets		(21,101)		(8,622)
Increase in other liabilities		18,348		11,426
Other sources		1,165		69
Net cash provided by operating activities		252,584		221,736
Cash Flows from Investing Activities
Business combinations, net of cash acquired		(97,400)		(3,994)
Capital expenditures		(36,770)		(45,075)
Proceeds from sale of fixed assets		3,060		506
Other uses		(281)		(409)
Net cash used by investing activities		(131,391)		(48,972)
Cash Flows from Financing Activities
Purchases of treasury stock		(152,049)		(27,769)
Proceeds from exercise of stock options		49,906		58,277
Dividends paid		(19,594)		(17,446)
Change in cash overdrafts payable		(15,749)		16,182
Capital stock surrendered to pay taxes on stock-based compensation		(8,827)		(5,446)
Payments on other long-term debt		-		(97,500)
Other uses		(387)		(38)
Net cash used by financing activities		(146,700)		(73,740)
(Decrease)/increase in Cash and Cash Equivalents		(25,507)		99,024
Cash and cash equivalents at beginning of period		263,958		74,126
Cash and cash equivalents at end of period	$	238,451	$	173,150

See Accompanying Notes to Unaudited Consolidated Financial Statements.

‎

-5-

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(in thousands, except per share data)

For the three months ended September 30, 2024 and 2023:

Deferred

Compensation

Treasury

Payable in

Capital

Paid-in

Retained

Stock-

Company

CHEMED CORP [CHE] Filings
10-Q	[2024-11]
10-Q	[2024-07]
10-Q	[2024-04-29]
10-K	[2024-02-29]
10-Q	[2023-10-27]
10-Q	[2023-07-28]
10-Q	[2023-04-28]
10-K	[2023-02-27]
10-Q	[2022-11-02]
10-Q	[2022-07-29]
10-Q	[2022-04-29]
10-K	[2022-02-28]
10-Q	[2021-11-01]
10-Q	[2021-07-30]
10-Q	[2021-04-30]
10-K	[2021-02-26]
10-Q	[2020-11-04]
10-Q	[2020-07-31]
10-Q	[2020-05-01]
10-K	[2020-02-26]
10-Q	[2019-11-04]
10-Q	[2019-07-31]
10-Q	[2019-05-02]
10-K	[2019-02-27]
10-Q	[2018-11-02]
10-Q	[2018-07-30]
10-Q	[2018-04-27]
10-K	[2018-02-26]
10-Q	[2017-10-27]
10-Q	[2017-07-31]
10-Q	[2017-04-28]
10-K	[2017-02-27]
10-Q	[2016-11-01]
10-Q	[2016-07-29]
10-Q	[2016-05-02]
10-K	[2016-02-26]
10-Q	[2015-10-30]
10-Q	[2015-07-31]
10-Q	[2015-05-01]
10-K	[2015-02-27]
10-Q	[2014-11-05]
10-Q	[2014-07-30]
10-Q	[2014-05-02]
10-K	[2014-02-27]
10-Q	[2013-11-01]
10-Q	[2013-07-25]
10-Q	[2013-04-26]
10-K	[2013-02-27]
10-Q	[2012-11-02]
10-Q	[2012-08-02]
10-Q	[2012-04-30]
10-K	[2012-02-27]

CHEMED CORP [CHE] Filings

CHEMED CORPORATION AND