Healthcare Services Group Inc. (HCSG:NASDAQ), which provides housekeeping, laundry, facility maintenance and nutritional services to hospitals and medical and long-term care facilities, today announced financial results for the first quarter of 2021 ended March 31, 2021.
The company advised that for Q1/21 it posted revenue of $407.8 million, compared to $449.2 in Q1/20. Healthcare Services Group stated that the Q1/21 revenues were comprised of housekeeping & laundry revenues of $215.1 million and dining & nutrition segment revenues of $192.7 million.
The company reported also that it earned net income of $24.7 million, or $0.33 per basic and diluted common share in Q1/21, versus net income of $20.2 million, or $0.27 per share in Q1/20.
Healthcare Services Group further noted that its Board of Directors declared a quarterly cash dividend of $0.2075 per common share. The company stated that this marks the 71st consecutive increase in the dividend paid by the firm since in first initiated dividend payments in 2003. The dividend will be payable to shareholders of record as of May 21, 2021, on June 25, 2021.
Healthcare Services Group's CEO Ted Wahl commented, "The vaccine roll-out is proving to be a real game changer for the industry, as new COVID cases among patients and residents dropped over 90% between Q4 and Q1. Vaccinations have not only helped stabilize census but have also boosted morale for frontline caregivers and HCSG heroes, who continue their tireless efforts to protect those most vulnerable. And although the pace of census and overall industry recovery remains uncertain, immunization is a critical first step."
"We delivered outstanding operational outcomes in Q1, and I'm extremely pleased with our strong start to the year. We remain laser-focused on the elements of our business within our control: successful service execution, customer satisfaction, systems adherence and regulatory compliance...Looking ahead, we will continue to closely monitor the path and pace of industry recovery and remain flexible in order to deliver the best possible outcomes on all fronts in Q2. While COVID remains a near-term headwind on revenue, some of the recent, more positive industry and customer data have provided us with improved top line visibility for potential growth opportunities in the back of the year," CEO Wahl added.
The company further stated that "it remains authorized to repurchase 1.7 million shares of our common stock pursuant to the previous Board of Directors' authorization and expects to repurchase up to 1.0 million shares through February 2022."
The company reported that as it previously disclosed "the Securities and Exchange Commission (SEC) has been conducting an investigation into the company's earnings per share (EPS) calculation practices." The firm noted that its Audit Committee conducted an internal investigation which was completed in March 2019. Healthcare Services Group advised that it is working with the SEC to reach a final resolution of the inquiry.
Healthcare Services Group offers management, administrative and operating services to the healthcare industry in the areas of housekeeping, laundry, linen, facility maintenance, dining and nutritional and dietary services. The firm's customers include hospitals, nursing homes, rehabilitation centers and retirement complexes across the U.S.
Healthcare Services Group began the day with a market cap of around $2.1 billion with approximately 74.72 million shares outstanding and a short interest of about 15.9%. HCSG shares opened greater than 7% higher today at $30.01 (+$2.08, +7.45%) over yesterday's $27.93 closing price. The stock has traded today between $28.08 and $31.81 per share and closed for trading today at $31.62 (+$3.69, +13.21%).[NLINSERT]
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