Moody's Reveals KAH Executive Selfish Greed

Strange Tony,

Moody's issued an update to its rating of Gentiva (Kindred at Home) debt.  It noted improvements from a financial standpoint that lessens investor worry for holding Gentiva debt. 

Moody's Investors Service ("Moody's") upgraded Gentiva Health Services, Inc.'s (dba Kindred at Home, or KAH) Corporate Family Rating (CFR) to B1 from B2

While Gentiva's debt rating improved it is still considered junk.  Kindred at Home plans to spend $487 million to replace $475 of second lien term loan.  Financial rapscallions charge deal fees for such debt exchanges.  It's one of the ways they rob funds from companies they own.

The upgrade of the CFR follows the successful separation from Kindred Healthcare, Inc. and merger with Curo Health Services, LLC in July 2018. KAH has performed well since completing these transactions, and is ahead of plan with respect to realizing benefits of cost saving initiatives. As a result, the company has deleveraged meaningfully over the last year and generated over $100 million of free cash flow since the separation. Additionally, the proposed refinancing transaction will modestly reduce leverage and result in about $18 million in annual interest expense savings. 

My hospice coworkers helped generate Kindred at Home's over $100 million of free cash flow since July 2, 2018.  $77 million of KAH cash will be used to give WCAS and TPG Capital another payday (more deal fees).

A hospice coworker informed me that her first raise in years was a mere 12 cents.  That's a wage increase of $249.60 per year before taxes.  I know how hard she works and the love she shares with patients.

Kindred at Home offers a miserly 1% retirement benefit according to Fidelity.  It's 401(k) match declined under Gentiva from 3%.

This decrease prepared us for Humana's cutting two holidays for 2019 and reducing holiday pay.   It's clear none to a mere pittance of the $18 million in interest expense savings will go to employees.

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) soared over the last twelve months according to Moody's.

Moody's recognizes that adjusted debt/EBITDA has declined from 7.5x at the time of the separation transaction, to 6.3x for the twelve months ended 3/31/2019. Moody's believes that adjusted debt/EBITDA will decline to the mid-5.0x range by the end of 2019.

Gentiva/KAHDebt did not change during the period.  That means EBITDA soared 19%.  Moody's understands income statements and balance sheets but has no clue when company cuts turn into poor care and bad customer service, eventually eroding revenue.

The stable outlook reflects Moody's view that the company will continue to de-lever as it realizes continued cost saving benefits, while maintaining very good liquidity and solid growth. 

Moody's also does not know when company technology robs employees of pay for hours worked and miles driven.  Homecare Homebase is complex and cumbersome on the clinical side but even worse for payroll and expense reimbursement.  Fellow employees were shorted pay and mileage during the period cited by Moody's.  Management and corporate have ignored employee concerns.  It's called wage theft.

Moody's expects Gentiva/Kindred at Home to have "organic revenue growth and further realization of cost savings."  I believe cost savings have harmed customer service and further cuts will harm revenue at our hospice site.  Customer service is already far below our historical standards.  How far will our hospice shrink to fund a giant executive payday (based on a multiple of EBITDA)? 

Shrink, Shrank, Shrunk.

Anonymous (from KAH/Gentiva with its unstable, greedy executives, clearly unwilling to share)