Addus HomeCare is sticking to its plans to acquire home health companies, Chair and CEO Dirk Allison told analysts Tuesday.
Addus’ plans run counter to those of some private equity firms that have paused deals, according to mergers and acquisitions consultants, given the threat of higher interest rates and potential government reimbursement cuts.
Related: Medicaid cuts could gut home care access, workforce
Allison shrugged off concerns about possible Medicaid cuts during a call about fourth-quarter 2024 earnings and said the Frisco, Texas-based home care provider is in the process of looking at opportunities to build out its clinical businesses in the 22 states where it offers home-based services. He said the company is especially interested in expanding home healthcare in Texas, where Addus is the largest provider of personal care services.
Although Allison said the company was focused mostly on acquiring smaller home health companies, he did not rule out buying a larger provider.
“There are some larger transactions coming out potentially toward the end of 2025 and those are in the clinical care areas where pricing may be difficult for us, but it is something that we will continue to look at,” he said.
Last December, Addus HomeCare completed its $350 million acquisition of Gentiva’s personal care business — the largest deal in the company’s 46-year history. The addition of Gentiva is expected to contribute approximately $280 million in annual revenue.
In the fourth quarter of 2024, the company reported adjusted net income of $25.2 million, or $1.38 per diluted share, on revenue of $297.1 million, a 7.5% increase compared with the same quarter in 2023. The company reported adjusted net income of $21.6 million, or $1.32 per diluted share, on revenue of $276.4 million during the fourth quarter of 2023.
Addus is one of the nation’s largest providers of home care services, with approximately 75% of its business in the nonclinical personal care space. The company employs more than 33,000 caregivers and serves approximately 40,000 patients a week.
