InnovAge Holding Corp. Q1 FY2025 earnings call

• First quarter performance: Total revenues of $205.1 million, center level contribution margin of $34.5 million, and adjusted EBITDA of $6.5 million. - Leadership: Welcomed Michael Scarbrough as President and COO, and Chris Bent is leaving. - Employee engagement: Employee Engagement Score of 79% and Net Promoter Score reached 56. - Organic growth: Census increased to ~7,210, a 10% year-over-year growth. Sales and marketing strategies led to a 7% improvement in qualified lead volume. - Regulatory: CMS closed audit for Sacramento, state audits remain open for Sacramento and San Bernardino. - Clinical and operational: Progress in CVIs and OVIs to manage medical costs, labor efficiency, and risk score accuracy.

Total revenues for the first fiscal quarter were $205.1 million. Center level contribution margin was $34.5 million, and adjusted EBITDA was $6.5 million. Compared to the first quarter of fiscal 2024, revenues increased by approximately 12% from $182.5 million and adjusted EBITDA increased by approximately 500% from $1.3 million. Census increased to approximately 7,210, representing a quarter-over-quarter improvement of approximately 3%.

• Ending census for fiscal year 2025 expected between 7,300 and 7,750 participants. - Member months projected in range of 86,000 to 89,000. - Total revenue projected in range of $815 million to $865 million. - Adjusted EBITDA projected in range of $24 million to $31 million. - De novo losses for fiscal 2025 anticipated in $18 million to $20 million range.

Forward-looking statements involve assumptions and are subject to risks and uncertainties. Risks discussed in Form 10-K annual report for fiscal year 2024 and subsequent SEC filings, including factors that can cause actual results to differ materially from expectations.

Q: Jamie Perse asked about enrollment trends in states like Colorado, Sacramento, and Florida, and Florida market contribution.

A: Patrick Blair said there's positive momentum in all markets, some enrollment processing bottlenecks related to care assessments, but seeing signs of improvement in enrollment processing.

Q: Jared Haase asked about guidance assumptions and employee engagement.

A: Patrick Blair discussed gradual impact of risk pool rebalancing, Florida centers progressing as expected, and employee engagement driven by clear company objectives and recognition of heroic efforts.

Q: Matt Gilmore asked about clinical and operational initiatives.

A: Dr. Rich Feifer and Ben Adams discussed CVIs showing fast progress in inpatient reduction, OVIs focused on fleet, food service, and contact centers; Michael Scarbrough expected to drive further impact.

Q: Matt Gilmore followed up on EMR implementation.

A: Dr. Rich Feifer discussed EPIC implementation improving chronic condition recapture rates, aiding revenue accuracy and clinical programs.