CHEMED CORP
For the period ended Jun 30, 2026. Filed Jul 31, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Jul 31, 2026
CHE$528.05-1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-04-28.
0000019584-26-000012
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-07-31.
0000019584-26-000020
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 46 previous paragraphs and 65 current paragraphs.
22 unchanged; 20 reworded; 13 added; 3 removed; 1 previous and 10 current paragraphs rearranged.
Tables are not compared: 13 previous and 23 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
For the six months ended June 30, 2026, the increase in consolidated service revenues and sales was driven by a 7.4% increase at VITAS and by a 1.1% increase at Roto-Rooter. The increase in service revenues at VITAS is comprised primarily of 4.2% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.5%. Acuity mix shift negatively impacted revenue growth by 120-basis points in the year when compared to the prior year’s revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by 190-basis points. The increase in service revenues at Roto-Rooter was driven by an increase in plumbing, drain cleaning and excavation offset by a decrease in water restoration.
Current report
A $10.3 million increase in prepaid expenses due to prepaid insurance premiums paid in the second quarter.
Current report
A $11.4 million increase in lease right of use asset due to lease renewals. This resulted in a similar increase in the lease liability accounts.
Current report
A $10.8 million increase in the liability of deferred compensation plans due mainly to market valuation gains. This resulted in a similar increase in the assets associated with deferred compensation plans.
Current report
The increase in plumbing revenues for the second quarter of 2026 versus 2025 is attributable to a 10.1% increase in price and service mix shift offset by a 4.3% decrease in job count. The increase in drain cleaning revenues for the second quarter of 2026 versus 2025 is attributable to a 6.5% increase in price and service mix offset by a 3.0% decrease in job count. The increase in excavation
Current report
After-tax earnings as a percent of revenue at VITAS in thesecond quarter of 2026 was 13.7% as compared to 9.6% in thesecond quarter of 2025. VITAS’ after-tax earnings increased primarily due to increased revenues including a $15.9 million decrease in Medicare Cap liability in the second quarter of 2026 compared to the second quarter of 2025.
Current report
Roto-Rooter’s net income was essentially flat when compared with the same quarter of 2025 but was negatively impacted by an increase in marketing expenses. Roto-Rooter’s after-tax earnings as a percent of revenue in the second quarter of 2026 was 13.9%, as compared to 14.3% in thesecond quarter of 2025.
Current report
After-tax Corporate expenses for thesecond quarter of 2026 increased 42.4% when compared to thesecond quarter in 2025 due primarily to a $2.3 million decrease in interest income related to lower cash and investment balances and a $1.3 million increase in interest expense related to an increase in long-term debt as a result of stock repurchases and Roto-Rooter acquisitions, a $1.6 million increase in intercompany interest expense, a $1.1 million increase in stock-based compensation and a $495,000 decrease in excess tax benefit related to reduced stock option exercises.
Current report
Results of Operations
Current report
The increase in service revenues at VITAS is comprised primarily of 4.2% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.5%. Acuity mix shift negatively impacted revenue growth by 120-basis points in the year when compared to the prior year revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by 190-basis points.
Current report
-30- revenues for the first six months of 2026 versus 2025 is attributable to an 8.3% increase in price and service mix shift offset by a 4.7% decrease in job count. Water restoration revenues decreased 8.9%, and contractors operations decreased 2.6%. Implicit price concessions and credit memos decreased 16.3% mainly related to the water restoration business.
Current report
The consolidated gross margin was 32.9% in the first six months of 2026 as compared with 31.7% in the first six months of 2025. On a segment basis, VITAS’ gross margin was 23.2% in the first six months of 2026 as compared with 21.2% in the first six months of 2025. The increase was primarily related to increased revenues including a $15.8 million decrease in Medicare Cap billing limitation in the first six months of 2026 compared to the first six months of 2025. The Roto-Rooter segment’s gross margin was 50.7% for the first six months of 2026 which was almost equal to the first six months of 2025.
Current report
After-tax earnings as a percent of revenue at VITAS in thefirst six months of 2026 was 13.1% as compared to 11.0% in thefirst six months of 2025. The increase was primarily related to increased revenues including a $15.8 million decrease in Medicare Cap liability in the first six months of 2026 compared to the first six months of 2025.
Removed paragraphs (3)
Previous report
The decline in service revenues at Roto-Rooter was driven by a 1.9% decrease in commercial revenue and a 1.5% decrease in residential revenue.
Previous report
Our effective tax rate reconciliation is as follows (in thousands):
Previous report
After-tax earnings as a percent of revenue at VITAS in thefirst quarter of 2026 was 12.4% as compared to 12.3% in thefirst quarter of 2025.
Reworded paragraphs (20)
Previous wording
Adjusted net income, adjusted diluted EPS, earnings before interest, taxes and depreciation and amortization (“EBITDA”), Adjusted EBITDA and Adjusted EBITDA as a percent of revenue are not measures derived in accordance with US GAAP. We provide non-GAAP measures to help readers evaluate our operating results and to compare our operating performance with that of similar companies that have different capital structures. Our non-GAAP measures should not be considered in isolation or as a substitute for comparable measures presented in accordance with GAAP. A reconciliation of our non-GAAP measures is presented on pages 28-29.
Current wording
Adjusted net income, adjusted diluted EPS, earnings before interest, taxes and depreciation and amortization (“EBITDA”), Adjusted EBITDA and Adjusted EBITDA as a percent of revenue are not measures derived in accordance with US GAAP. We provide non-GAAP measures to help readers evaluate our operating results and to compare our operating performance with that of similar companies that have different capital structures. Our non-GAAP measures should not be considered in isolation or as a substitute for comparable measures presented in accordance with GAAP. A reconciliation of our non-GAAP measures is presented on pages 37-39.
Previous wording
For the three months ended March 31, 2026, the increase in consolidated service revenues and sales was driven by a 3.1% increase at VITAS offset by a 0.9% decrease at Roto-Rooter. The increase in service revenues at VITAS is comprised primarily of 2.2% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.6%. Acuity mix shift negatively impacted revenue growth by 120-basis points in the quarter when compared to the prior year revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes decreased revenue growth by 47-basis points.
Current wording
For the three months ended June 30, 2026, the increase in consolidated service revenues and sales was driven by an 11.9 % increase at VITAS and a 3.3% increase at Roto-Rooter. The increase in service revenues at VITAS is comprised primarily of 6.1% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.4%. Acuity mix shift negatively impacted revenue growth by 115-basis points in the quarter when compared to the prior year quarter’s revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by 455-basis points. The increase in service revenues at Roto-Rooter was driven by an increase in plumbing, drain cleaning and excavation offset by a decrease in water restoration.
Previous wording
A $32.9 million increase in accounts receivable due to the timing of payments. Other significant changes in our accounts receivable balances are typically driven by the timing of payments received from the Federal government at our VITAS subsidiary. We typically receive a payment in excess of $62.0 million from the Federal government for hospice services
Current wording
A $6.1 million increase in accounts receivable due to the timing of payments. Other significant changes in our accounts receivable balances are typically driven by the timing of payments received from the Federal government at our VITAS subsidiary. We typically receive a payment in excess of $63.0 million from the Federal government for hospice services every other Friday. The timing of a period end will have a significant impact on the accounts receivable at VITAS. These changes generally normalize over a two-year period, as cash flow variations in one year are offset in the following year.
Previous wording
A $20.5 million increase in goodwill due to the two acquisitions at Roto-Rooter.
Current wording
A $32.4 million increase in goodwill due to four acquisitions at Roto-Rooter.
Previous wording
A $23.3 million increase in income taxes payable due to timing of payments.
Current wording
A $20.3 million increase in accounts payable due to timing of payments.
Previous wording
A $91.2 million increase in long-term debt due primarily to the acquisitions and stock repurchases.
Current wording
A $140.0 million increase in long-term debt due primarily to acquisitions and stock repurchases.
Previous wording
A $201.1 million increase in treasury stock due to stock repurchases.
Current wording
A $291.9 million increase in treasury stock due to stock repurchases.
Previous wording
Net cash provided by operating activities increased $55.5 million from March 31, 2025 to March 31, 2026. See the Unaudited Consolidated Statements of Cash Flow on page 5 for the detail components making up the change.
Current wording
Net cash provided by operating activities increased $1.7 million from June 30, 2025 to June 30, 2026. See the Unaudited Consolidated Statements of Cash Flows on page 5 for the detail components making up the change.
Previous wording
On April 10, 2026, we replaced the Prior Credit Agreement with a sixth amended and restated Credit Agreement. Terms of the Credit Agreement consist of a five-year $450.0 million revolving credit facility including $100.0 million for letters of credit. The interest on this Credit Agreement has a floating interest rate that is generally the secured overnight financing rate (“SOFR”) plus an additional tiered rate which varies based on our current leverage ratio. As of March 31, 2026, the interest rate is SOFR plus 100 basis points. The Credit Agreement includes an expansion feature that provides the Company the opportunity to increase its revolver by an additional $250.0 million.
Current wording
On April 10, 2026, we replaced the Prior Credit Agreement with a sixth amended and restated Credit Agreement. Terms of the Credit Agreement consist of a five-year $450.0 million revolving credit facility including $100.0 million for letters of credit. This Credit Agreement has a floating interest rate that is generally the secured overnight financing rate (“SOFR”) plus an additional tiered rate which varies based on our current leverage ratio. As of June 30, 2026, the interest rate is SOFR plus 100 basis points. The Credit Agreement includes an expansion feature that provides the Company the opportunity to increase its revolver by an additional $250.0 million.
Previous wording
We have issued $45.5 million in standby letters of credit as of March 31, 2026 under the Prior Credit Agreement, which has continued under the Credit Agreement mainly for insurance purposes. Issued letters of credit reduce our available credit under the Credit Agreement. As of March 31, 2026, we have approximately $313.3 million of unused linesof credit available and are eligible to be drawn down underthe Prior Credit Agreement. Management believes its liquidity and sources of capital are satisfactory for the Company’s needs in the foreseeable future.
Current wording
We have issued $47.3 million in standby letters of credit as of June 30, 2026, mainly for insurance purposes. Issued letters of credit reduce our available credit under the Credit Agreement. As of June 30, 2026, we have approximately $262.7 million of unused linesof credit available and are eligible to be drawn down underthe Credit Agreement. Management believes its liquidity and sources of capital are satisfactory for the Company’s needs in the foreseeable future.
Previous wording
Collectively, the terms of the Credit Agreement require us to meet various financial covenants, to be tested quarterly. We were in compliance with all financial and other debt covenants as of March 31, 2026 under the Prior Credit Agreement and anticipate remaining in compliance under the Credit Agreement throughout the foreseeable future.
Current wording
Collectively, the terms of the Credit Agreement require us to meet various financial covenants, to be tested quarterly. We are in compliance with all financial and other debt covenants as of June 30, 2026.
Previous wording
Our service revenues and sales for the first quarter of 2026 increased 1.6% versus services and sales revenues for the first quarter of 2025. Of this increase, a $12.6 million increase was attributable to VITAS, offset by a $2.0 million decrease at Roto-Rooter. The following chart shows the components of revenue by operating segment (in thousands):
Current wording
Our service revenues and sales for the second quarter of 2026 increased 8.8% versus services revenue and sales for the second quarter of 2025. Of this increase, a $47.1 million increase was attributable to VITAS, and a $7.3 million increase at Roto-Rooter. The following chart shows the components of revenue by operating segment (in thousands):
Previous wording
The increase in service revenues at VITAS is comprised primarily of 2.2% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.6%. Acuity mix shift negatively impacted revenue growth by 120-basis points in the quarter when compared to the prior year revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes decreased revenue growth by 47-basis points.
Current wording
The increase in service revenues at VITAS is comprised primarily of 6.1% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.4%. Acuity mix shift negatively impacted revenue growth by 115-basis points in the quarter when compared to the prior year revenue and level-of-care mix. The combination of Medicare Cap and other contra revenue changes increased revenue growth by 455-basis points.
Previous wording
1.1%, water restoration revenues decreased 11.7%, and contractors operations decreased 3.3%. Implicit price concessions and credit memos decreased 16.5% mainly related to the water restoration business.
Current wording
-27- revenues for the second quarter of 2026 versus 2025 is attributable to a 5.5% increase in price and service mix shift and by a 3.5% increase in job count. Water restoration revenues decreased 6.0%, and contractors operations decreased 1.9%. Implicit price concessions and credit memos decreased 16.0% mainly related to the water restoration business.
Previous wording
The consolidated gross margin was 32.8% in the first quarter of 2026 as compared with 33.5% in the first quarter of 2025. On a segment basis, VITAS’ gross margin was 22.5% in the first quarter of 2026 as compared with 23.2% in the first quarter of 2025. The decline is related to an increase in variable patient care expenses in the first quarter of 2026 compared to the first quarter of 2025. The Roto-Rooter segment’s gross margin was 51.0% for the first quarter of 2026 which was essentially flat with the first quarter of 2025.
Current wording
The consolidated gross margin was 32.9% in the second quarter of 2026 as compared with 29.8% in the second quarter of 2025. On a segment basis, VITAS’ gross margin was 23.8% in the second quarter of 2026 as compared with 19.1% in the second quarter of 2025. The increase was primarily related to increased revenues including a $15.9 million decrease in Medicare Cap billing limitation in the second quarter of 2026 compared to second quarter of 2025. The Roto-Rooter segment’s gross margin was 50.4% for the second quarter of 2026 compared with 49.0% in the second quarter of 2025.
Previous wording
SG&A expenses before long-term incentive compensation and the impact of market value adjustments related to deferred compensation trusts for thefirst quarter of 2026 were up 5.0% when compared to the first quarter of 2025. $3.9 million of this increase was the result of increased advertising at Roto-Rooter in the first quarter of 2026 compared to the first quarter of 2025.
Current wording
SG&A expenses before long-term incentive compensation and the impact of market value adjustments related to deferred compensation trusts for thesecond quarter of 2026 were up 10.9% when compared to the second quarter of 2025. Of this increase $2.9 million was the result of increased advertising at Roto-Rooter in the second quarter of 2026 compared to the second quarter of 2025. The remaining increase was the result of increased legal expenses of $1.3 million mainly at VITAS, normal salary increases and increased incentive compensation.
Previous wording
Net income/(loss) for the first quarter of 2026 versus the first quarter of 2025 by segment (in thousands):
Current wording
Net income/(loss) for the second quarter of 2026 versus the second quarter of 2025 by segment (in thousands):
Previous wording
The increase in plumbing revenues for the first quarter of 2026 versus 2025 is attributable to a 14.1% increase in price and service mix shift offset by a 6.4% decrease in job count. The increase in drain cleaning revenues for the first quarter of 2026 versus 2025 is attributable to a 12.3% increase in price and service mix offset by a 12.0% decrease in job count. Excavation revenues decreased
Current wording
The increase in plumbing revenues for the first six months of 2026 versus 2025 is attributable to a 12.0% increase in price and service mix shift offset by a 5.3% decrease in job count. The increase in drain cleaning revenues for the first six months of 2026 versus 2025 is attributable to a 9.5% increase in price and service mix offset by a 7.6% decrease in job count. The increase in excavation
Previous wording
Roto-Rooter’s net income was negatively impacted in the first quarter of 2026 compared to the first quarter of 2025 due mainly to an increase in marketing expenses. Roto-Rooter’s after-tax earnings as a percent of revenue in the first quarter of 2026 was 15.1%, as compared to 16.7% in thefirst quarter of 2025.
Current wording
Roto-Rooter’s net income was negatively impacted in the first six months of 2026 compared to the first six months of 2025 due mainly to an increase in marketing expenses. Roto-Rooter’s after-tax earnings as a percent of revenue in the first six months of 2026 was 14.5%, as compared to 15.5% in thefirst six months of 2025.
Previous wording
After-tax Corporate expenses for thefirst quarter of 2026 increased 19.1% when compared to thefirst quarter in 2025 due primarily to a $1.5 million increase in intercompany interest expense, a lower tax benefit related to reduced stock option exercises and a $1.2 million decrease in interest income offset by an $881,000 decrease in stock-based compensation.
Current wording
After-tax Corporate expenses for thefirst six months of 2026 increased 30.5% when compared to thefirst six months in 2025 due primarily to a $3.5 million decrease in interest income related to lower cash and investment balances and a $1.5 million increase in interest expense related to an increase in long-term debt as a result of stock repurchases and Roto-Rooter acquisitions, a $3.2 million increase in intercompany interest expense, and a $1.0 million decrease in excess tax benefit related to reduced stock option exercises.
Rearranged current paragraphs (10)
Current report — wording carried from elsewhere
Six months ended June 30, 2026 versus 2025 - Consolidated Results
Current report — wording carried from elsewhere
Our service revenues and sales for the first six months of 2026 increased 5.1% versus services revenue and sales for the first six months of 2025. Of this increase, a $59.8 million increase was attributable to VITAS, and a $5.3 million increase at Roto-Rooter. The following chart shows the components of revenue by operating segment (in thousands):
Current report — wording carried from elsewhere
Days of care at VITAS during the six months ended June 30 were as follows:
Current report — wording carried from elsewhere
Selling, general andadministrative expenses (“SG&A”) comprise (in thousands):
Current report — wording carried from elsewhere
SG&A expenses before long-term incentive compensation and the impact of market value adjustments related to deferred compensation trusts for thefirst six months of 2026 were up 7.8% when compared to the first six months of 2025. $6.7 million of this increase was the result of increased advertising at Roto-Rooter in the first six months of 2026 compared to the first six months of 2025. The remaining increase was the result of increased legal expense of $2.5 million mainly at VITAS, normal salary increases and increased incentive compensation.
Current report — wording carried from elsewhere
Other income – net comprise (in thousands):
Current report — wording carried from elsewhere
We invest excess cash in money market funds with major commercial banks. We closely monitor the creditworthiness of the institutions with which we invest our overnight funds. Chemed invests excess cash in money market funds holding US Treasuries. Deposits and withdrawals are made daily, based on the Company’s excess cash balance. There are no penalties associated with withdrawals. The accounts bear interest at a normal market rate.
Current report — wording carried from elsewhere
Net income for both periods include the following after tax items/adjustments that (reduce) or increased after tax earnings (in thousands):
Current report — wording carried from elsewhere
Six months ended June 30, 2026 versus 2025 - Segment Results
Current report — wording carried from elsewhere
Net income/(loss) for the first six months of 2026 versus the first six months of 2025 by segment (in thousands):
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
-21- every other Friday. The timing of a period end will have a significant impact on the accounts receivable at VITAS. These changes generally normalize over a two-year period, as cash flow variations in one year are offset in the following year.