10-Q 1 che-20240630x10q.htm 10-Q che-20240630x10q

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 June 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	15,050,136 Shares	June 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 -
June 30, 2024 and December 31, 2023	3

Unaudited Consolidated Statements of Income -
Three months and six months ended June 30, 2024 and 2023	4

Unaudited Consolidated Statements of Cash Flows -
Six months ended June 30, 2024 and 2023	5

Unaudited Consolidated Statements of Changes in Stockholders’ Equity-
Three months and six months ended June 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)



	June 30, 2024		December 31, 2023
ASSETS
Current assets
Cash and cash equivalents	$	222,903	$	263,958
Accounts receivable less allowances		184,961		181,511
Inventories		10,735		12,004
Prepaid income taxes		17,084		13,166
Prepaid expenses		28,929		30,204
Total current assets		464,612		500,843
Investments of deferred compensation plans held in trust		120,784		106,126
Properties and equipment, at cost, less accumulated depreciation of $373,912 (2023- $354,872)		202,249		203,840
Lease right of use asset		132,262		126,387
Identifiable intangible assets less accumulated amortization of $54,031 (2023 - $48,965)		97,035		90,264
Goodwill		662,124		585,017
Other assets		55,918		55,618
Total Assets	$	1,734,984	$	1,668,095

LIABILITIES
Current liabilities
Accounts payable	$	43,001	$	64,034
Income taxes		-		6,858
Accrued insurance		59,899		58,568
Accrued compensation		78,374		88,381
Short-term lease liability		41,169		38,635
Other current liabilities		39,310		55,574
Total current liabilities		261,753		312,050
Deferred income taxes		27,901		30,321
Deferred compensation liabilities		119,780		104,069
Long-term lease liability		105,233		100,776
Other liabilities		13,020		13,003
Total Liabilities		527,687		560,219
Commitments and contingencies (Note 10)
STOCKHOLDERS' EQUITY
Capital stock - authorized 80,000,000 shares $1 par; issued 37,312,834 shares (2023 - 37,183,681 shares)		37,313		37,184
Paid-in capital		1,416,166		1,341,273
Retained earnings		2,570,722		2,446,925
Treasury stock - 22,317,642 shares (2023 - 22,148,927 shares)		(2,819,053)		(2,719,588)
Deferred compensation payable in Company stock		2,149		2,082
Total Stockholders' Equity		1,207,297		1,107,876
Total Liabilities and Stockholders' Equity	$	1,734,984	$	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 June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Service revenues and sales	$	595,880	$	553,816	$	1,185,113	$	1,113,973
Cost of services provided and goods sold (excluding depreciation)		389,750		374,193		774,877		744,898
Selling, general and administrative expenses		102,255		94,987		218,128		195,082
Depreciation		13,167		12,634		26,454		24,920
Amortization		2,546		2,514		5,067		5,027
Other operating expense/(income)		37		(18)		129		1,721
Total costs and expenses		507,755		484,310		1,024,655		971,648
Income from operations		88,125		69,506		160,458		142,325
Interest expense		(429)		(771)		(854)		(2,322)
Other income - net		6,132		1,609		18,709		1,506
Income before income taxes		93,828		70,344		178,313		141,509
Income taxes		(22,941)		(16,967)		(42,409)		(34,011)
Net income	$	70,887	$	53,377	$	135,904	$	107,498

Earnings Per Share:
Net income	$	4.70	$	3.54	$	8.99	$	7.16
Average number of shares outstanding		15,097		15,058		15,109		15,013

Diluted Earnings Per Share:
Net income	$	4.65	$	3.51	$	8.89	$	7.09
Average number of shares outstanding		15,251		15,219		15,295		15,167

Cash Dividends Per Share	$	0.40	$	0.38	$	0.80	$	0.76

See Accompanying Notes to Unaudited Consolidated Financial Statements.

‎

-4-


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

	Six Months Ended June 30,
	2024		2023
Cash Flows from Operating Activities
Net income	$	135,904	$	107,498
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization		31,521		29,947
Stock option expense		17,895		16,882
Noncash long-term incentive compensation		12,699		3,493
Litigation settlements		(5,750)		1,750
Benefit for deferred income taxes		(2,420)		(1,932)
Noncash directors' compensation		1,282		1,444
Amortization of debt issuance costs		160		420
Changes in operating assets and liabilities:
(Increase)/decrease in accounts receivable		(2,422)		20,100
Decrease/(increase) in inventories		1,289		(1,412)
Decrease in prepaid expenses		1,275		1,719
(Decrease)/increase in accounts payable and other current liabilities		(19,499)		8,561
Change in current income taxes		(10,776)		1,865
Net change in lease assets and liabilities		(109)		(1,046)
Increase in other assets		(15,365)		(3,810)
Increase in other liabilities		15,730		7,344
Other sources/(uses)		652		(14)
Net cash provided by operating activities		162,066		192,809
Cash Flows from Investing Activities
Business combinations, net of cash acquired		(92,300)		(305)
Capital expenditures		(23,225)		(33,420)
Proceeds from sale of fixed assets		2,916		360
Other uses		(265)		(169)
Net cash used by investing activities		(112,874)		(33,534)
Cash Flows from Financing Activities
Purchases of treasury stock		(94,228)		(13,425)
Proceeds from exercise of stock options		38,594		53,675
Change in cash overdrafts payable		(15,749)		-
Dividends paid		(12,107)		(11,412)
Capital stock surrendered to pay taxes on stock-based compensation		(5,960)		(5,313)
Payments on other long-term debt		-		(97,500)
Other (uses)/sources		(797)		498
Net cash used by financing activities		(90,247)		(73,477)
(Decrease)/increase in Cash and Cash Equivalents		(41,055)		85,798
Cash and cash equivalents at beginning of period		263,958		74,126
Cash and cash equivalents at end of period	$	222,903	$	159,924

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 June 30, 2024 and 2023:

Deferred

Compensation

Treasury

Payable in

Capital

Paid-in

Retained

Stock-

Company

Stock

Capital

CHEMED CORP [CHE] Filings
10-Q	[2024-07-26]
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