UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
September 28, 2006
CHEMED CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8351 31-0791746
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification
incorporation) Number)
2600 Chemed Center, 255 East 5th Street, Cincinnati, OH 45202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(513) 762-6900
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2 below):
[_] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
230.425)
[_] Pre-commencement communications pursuant to Rule 14d-2(b) under Exchange
Act (17 CFR 230.425)
[_] Pre-commencement communications pursuant to Rule 13e-4 (c) under Exchange
Act (17 CFR 230.425)
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Item 2.02 Results of Operations and Financial Condition
On September 28, 2006 Chemed Corporation issued a press release
announcing its VITAS subsidiary is exiting the Phoenix hospice
market and updating financial guidance for 2006. A copy of the
release is furnished herewith as Exhibit 99.1.
Item 2.05 Costs Associated with Exit or Disposal Activities
On September 28, 2006 Chemed Corporation announced that the
Executive Committee of its Board of Directors authorized the
discontinuance of its VITAS subsidiary's Phoenix hospice program.
VITAS will cease operations in Phoenix either by selling or
closing down its Phoenix program. The estimated costs and cash
flows associated with ceasing hospice operations in Phoenix are
(in millions):
Cash Outflow
Expense /(Inflow)
------------- ---------------
Cost of transferring patients to
other facilities $ 2.8 $ 2.8
Write-off customer referral network 2.2 -
Severance and employee related costs 0.7 0.7
Lease termination costs 0.6 0.6
Other costs 0.9 0.5
Potential increase in the above
cost estimates 1.6 1.6
------------- ---------------
Pretax cost 8.8 6.2
Income tax benefit (3.3) (8.2)
------------- ---------------
Aftertax cost/ (cash inflow) $ 5.5 $ (2.0)
============= ===============
Chemed currently anticipates VITAS will dispose of or cease
operations in Phoenix by year-end 2006.
The Phoenix program's contributions to VITAS' results of
operations during the year ended December 31, 2005 and the six
months ended June 30, 2006 were (in millions):
Year Ended Six Months
December 31, Ended June 30,
2005 2006
-------------- --------------
Net patient revenues $ 10.5 $ 3.0(a)
Income/(loss) from operations 2.6 (0.9)
Net income/(loss) 1.5 (0.5)
(a) Net patient revenues for the first six months of 2006 include a pretax
reduction of $1.7 million ($1.0 million aftertax) for effect of Medicare
billing limitations.
Item 9.01 Financial Statements and Exhibits
c) Exhibit
(99.1) Registrant's press release dated
September 28, 2006
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
CHEMED CORPORATION
Dated: October 2, 2006 By: /s/ Arthur V. Tucker, Jr.
--------------- -----------------------------
Arthur V. Tucker, Jr.
Vice President and Controller
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