Healthcare Services Group reported second-quarter 2026 results with revenue of $470.8 million and net income of $22.7 million, or diluted EPS of $0.32. The company generated cash flow from operations of $21.9 million (or $27.9 million excluding the change in payroll accrual) and repurchased $20.9 million of common stock in the quarter. Management reaffirmed its 2026 mid-single-digit growth outlook and noted continued focus on operational execution.

Financial Highlights

  • Revenue: $470.8 million for the three months ended June 30, 2026.
  • Cost of services: $396.0 million (84.1% of revenue); company target noted to manage cost of services in the ~86% range.
  • Operating income (income from operations): $22.2 million for the quarter.
  • Net income: $22.7 million; diluted EPS: $0.32 for the quarter.
  • Cash flow from operations: $21.9 million; cash flow from operations excluding change in payroll accrual: $27.9 million.

Business Highlights

  • Segment performance: Environmental Services revenue $213.2 million with a margin of 13.3%; Dietary Services revenue $257.6 million with a margin of 7.5%.
  • Share repurchase activity: Repurchased $20.9 million in Q2 under the $75.0 million program announced February 2026; $44.9 million repurchased year-to-date with 8.3 million shares remaining under authorization.
  • Liquidity position: Cash and marketable securities of $200.9 million and an unutilized $300.0 million revolving credit facility at quarter end.
  • SG&A and other items: SG&A reported at $52.6 million; after adjusting for a $6.9 million increase in deferred compensation, SG&A was $45.7 million (9.7% of revenue). Other income net was $8.8 million (or $1.9 million after same deferred compensation adjustment).
  • Tax and guidance: Effective tax rate for the quarter was 26.8%; company expects its 2026 effective tax rate to be approximately 25.0% and reaffirmed mid-single-digit growth for 2026.

Original SEC Filing:

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