Accendra Health — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net revenue for the third quarter of 2026 was $601.8 million, a decrease from $697.3 million in the same period of 2025. Year-to-date (YTD) net revenue was $1,842.8 million, down from $2,053.1 million in 2025.
• GAAP loss from continuing operations, net of tax, for Q3 2026 was $18.0 million, compared to a loss of $5.6 million in Q3 2025. YTD GAAP loss from continuing operations was $113.5 million, compared to $93.2 million in 2025.
• Non-GAAP adjusted loss from continuing operations, net of tax, for Q3 2026 was $18.0 million, compared to an adjusted income of $19.9 million in Q3 2025. YTD non-GAAP adjusted loss was $35.4 million, compared to an adjusted income of $63.6 million in 2025.
• Non-GAAP Adjusted EBITDA for Q3 2026 was $47.8 million, down from $92.2 million in Q3 2025. YTD Adjusted EBITDA was $166.2 million, down from $284.8 million in 2025.
• Non-GAAP Free Cash Flow for Q3 2026 was $5.8 million, down from $29.2 million in Q3 2025. YTD Free Cash Flow was a negative $21.3 million, compared to positive $80.0 million in 2025.
• GAAP loss per share (diluted) for Q3 2026 was $0.23, compared to $0.07 in Q3 2025. YTD GAAP loss per share was $1.48, compared to $1.21 in 2025.
• Non-GAAP adjusted loss per share for Q3 2026 was $0.23, compared to an adjusted income of $0.25 in Q3 2025. YTD non-GAAP adjusted loss per share was $0.46, compared to $0.80 in 2025.
• Total debt as of September 30, 2026, was $1,754.966 million, down from $2,049.876 million as of December 31, 2025. Net debt (non-GAAP) was $1,728.358 million as of September 30, 2026.
• Cash and cash equivalents were $26.6 million as of September 30, 2026, down from $281.989 million as of December 31, 2025.
• Operating costs and expenses for Q3 2026 totaled $600.4 million, compared to $670.8 million in Q3 2025.
• Interest expense, net, for Q3 2026 was $37.6 million, up from $29.0 million in Q3 2025. YTD interest expense was $104.5 million, up from $79.3 million in 2025.
• Acquisition-related charges and intangible amortization for Q3 2026 were $5.0 million, down from $29.2 million in Q3 2025. YTD charges were $63.4 million, compared to $66.6 million in 2025.
• Exit and realignment charges, net, for Q3 2026 were $5.5 million, up from $0.7 million in Q3 2025. YTD charges were $7.8 million, compared to $16.8 million in 2025.

Guidance and Future Outlook:

• The Company expects full-year 2026 net revenue to be at the bottom end of the prior outlook range of $2.45 billion to $2.55 billion.
• The Company forecasts that adjusted EBITDA for 2026 could be as much as 30% lower than the $310 million midpoint of the prior outlook range.
• The Company stated it is unable to forecast GAAP measures without unreasonable effort due to unpredictable elements such as restructuring and acquisition charges.
• Management identified four key areas critical to the company's continued transformation and returning the business to profitability.
• A value creation plan is underway to return the business to its potential, with details to be shared with stakeholders in the coming months.

Business Segments and Product Lines:

• Continuing operations reflect the previously reported Patient Direct segment and certain functional operations.
• The Company's portfolio includes essentials for diabetes, sleep health, wound care, respiratory care, urology, and ostomy, backed by Apria and Byram brands.
• The Company is executing a sale of the Products & Healthcare Services (P&HS) business, with related costs included in exit and realignment charges.
• A contract termination with a commercial Payor resulted in gains on the sale of patient service equipment captured within exit and realignment charges.

Market and Competitive Landscape:

• Management noted favorable end markets and a dedicated teammate population as key themes.
• The Company operates as a leading nationwide provider of products, technology, and services supporting health beyond the hospital.
• The Company is addressing macro and market conditions as part of its forward-looking strategy.

Risks and Challenges:

• Results for 2026 have fallen well short of expectations and potential.
• The Company faces risks related to market conditions, consumer demand, supply chain stability, and interest rates.
• The Company must address the risk of noncompliance with New York Stock Exchange listing standards.
• Unpredictable restructuring and acquisition charges may significantly impact GAAP results.
• Litigation and related charges are inherently unpredictable in timing and amount.

Management Commentary and Tone:

• Kenny Gardner-Smith, President & CEO, stated that results to date in 2026 have fallen well short of expectations.
• Management expressed confidence in the company's strong brands and dedicated team, emphasizing the need to return the business to profitability.
• The tone indicates a focus on immediate action on a turnaround strategy and the implementation of a value creation plan.

Other Key Points:

• The Company completed a "Balance Sheet Optimization Transaction," which included the recognition of previously deferred debt issuance costs and third-party fees.
• A transaction breakage fee of $80 million was paid to Rotech in 2025 for the termination of a previously expected acquisition.
• The Company recorded a $33 million gain on the sale of a non-core asset and a $51 million gain on the sale of patient service equipment in connection with a commercial Payor contract termination during the nine months ended September 30, 2026.
• The Company incurred $17.3 million in loss on modification and extinguishment of debt in the first nine months of 2026.
• The Company hosted a conference call for investors and analysts on November 5, 2026.
• Share-based awards of approximately 1.0 million for the three months ended September 30, 2026, were excluded from diluted loss per share calculations as they were anti-dilutive.