Kindred hosted its earnings call last week. The spin started the day before with the press release on first quarter results:
- Kindred reported a first-quarter loss of $5.7 million, after reporting a profit in the same period a year earlier.
- Consolidated revenues were $1.77 billion, a 3.8% year-over-year decrease. It was below forecasts of $1.78 billion.
- The company expects full-year earnings in the range of 40 cents to 70 cents per share.
It's not a stirring financial report but the stock market reacted positively. With projected earnings of 55 cents/share (midpoint) Kindred's stock has a price-earnings ratio of over 19 for 2017. That's a heady valuation for a company potentially on the sale block, especially as it's carrying $3.2 billion in debt.
Hospice and home health held up our end of the delivery equation by doing more with less.
Mr. Breier continued, "In the first quarter, we delivered very encouraging sequential and year-over-year improvement in our Kindred at Home Division, with strong same-store volume growth in both our home health and hospice businesses. Combined with a sequential reduction of labor costs in the first quarter, we returned to historic growth levels and delivered results in line with our 2017 expectations."
The call opened with Breier's usual hollow pander to employees.
I'd like to start my comments by extending my deep appreciation to our more than 100,000 teammates across the country. Each day our partners at Kindred work hard to improve the lives of the more than 1 million patients we care for annually. We're proud of the excellent care and clinical outcomes we deliver which are direct result of their efforts.
For all the talk of "clinical care" and "results" executives announced the termination of the clinical ladder at the end of 2017 with no plans to replace it. To boot our branch manager informed staff there are no raises in this year's budget.
Ben Breier: "We’re working hard on our merit design and making sure that we're giving people a competitive market increase.We’ve worked hard at our benefit plans, reinstated our 401(k) match, working on a lots of different ways that we can make the employee experience here at Kindred, the teammate experience here at Kindred as best that it can be.We have made great progress I think in terms of measuring employee satisfaction and the various things we’re doing. "
There's no sign of the PwC annual employee survey, which Kindred conducted twice after buying Gentiva. The 2016 survey fell into a management hole at our hospice site. Employees never heard the results and our branch manager said Kindred de-emphasized the survey, which was the direct result of employee feedback efforts. Apparently, executives measured employee satisfaction and ignored the results
Staff turnover within Kindred at Home actually increased in 2016 to 23.6% from 22.6% in 2015. That statistic meant having to hire more replacements.
We’re better and better every quarter at recruiting people into the company and keeping people longer.
Actually when you look at our turnover rates and our retention rates, we continue to really outperform even our own expectations. Our turnover remains at really kind of historical lows across our business settings and our retention rates remain at sort of historical high.So we’re doing we think a lot of the right things, probably not all of the right things. But we are doing a lot of the right things. And I think that it still remains the contested labor market particularly for nurses in the acute setting. And that’s where kind of the real kind of hand to hand fight continues for us.
Executives "hand to hand fight" is against current employees within the company, at least our hospice site. Our "reinstated" 401(k) match is a fraction of Gentiva's and Kindred's health insurance makes it financially difficult to see a physician outside the annual wellness visit.
No voice, no raise, clinical ladder pay cuts and ongoing benefits erosion are the Causby/Kindred way. This might be preparation for the next sellout and another round of executive enrichment.
Gentiva did a number of squirrely things to polish the numbers while Kindred's Paul Diaz courted the company. Our site has experienced similarly strange but different dollar squeezing initiatives. They are an impediment to good patient care and employee retention. Due diligence caused undo harm to employees and patient care in the past. It may well resurface. Brace yourself.
Anonymous (from KindredforSale)