{
  "docId": "019dd923-622c-750b-8b98-dbf69e8285f9",
  "docSlug": "c97bc876ffb7",
  "documentTitle": "LHC Group, Inc. (LHCG)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Spruce Point Capital Management",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2020-01-15 00:00:00",
  "orientation": "landscape",
  "aspectRatio": 1.3333334,
  "pageNumber": 21,
  "pageCount": 41,
  "prevPage": 20,
  "nextPage": 22,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "balanced",
  "nDataPoints": 0,
  "notes": "Uses a numbered list of quotes to highlight the contradiction between initial claims of 'already integrated' and subsequent delays.",
  "elementsJson": [
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  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b98-dbf69e8285f9/21",
  "deckHref": "/decks/019dd923-622c-750b-8b98-dbf69e8285f9",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b98-dbf69e8285f9.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-dbf69e8285f9#slide-21",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "Regardless, it appears either that (1) AFAM is in decline as a stand-alone business or (2) management is seriously mismanaging the AFAM integration.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
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      "componentId": "019dd953-2b66-7100-895a-f42fae696288",
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    {
      "bbox": {
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      },
      "kind": "list",
      "text": "1. LHCG M&A Call (Nov 16, 2017): \"ALREADY INTEGRATED\" ... 2. LHCG Q1 FY18 Earnings Call (May 3, 2018): \"a few tweaks...\" ... 3. LHCG Q2 FY18 Earnings Call (Aug 2, 2018): \"through Q1\" ... 4. Baird Healthcare Conference (Sep 5, 2018): \"start January 1\" ... 5. LHCG Q3 FY18 Earnings Call (Nov 1, 2018): \"second quarter\" ... 6. LHCG Q2 FY19 Earnings Call (Aug 8, 2019): \"BY YEAR END\"",
      "attrs": null,
      "subkind": "numbered",
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      "toolSlug": null,
      "confidence": null,
      "componentId": "cf42919a-307b-4a5b-bfe3-6e8f2aea1c5a",
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    {
      "bbox": {
        "h": 0.18,
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      },
      "kind": "paragraph",
      "text": "On its Q2 FY19 earnings call, management blamed the delay in including AFAM in organic sales on its slow integration into Homecare Homebase... We find these explanations suspect given management's enthusiastic claim that the integration would be swift...",
      "attrs": null,
      "subkind": "paragraph",
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      "componentId": "c35eb1a9-88ca-45af-bc7a-c612ca3c3b83",
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    },
    {
      "bbox": null,
      "kind": "quote",
      "text": "\"we're already integrated the home health agencies of Almost Family into Homecare Homebase, which is the same platform that's being used at LHC.\" — C. Steven Guenthner, President, Financial Officer, Treasurer & Secretary, AFAM. \"we have begun to convert Almost Family agencies to the LHCG Group instance of Homecare Homebase. This conversion will last through the second quarter of 2019.\" — Donald Stelly, President & COO, LHCG.",
      "attrs": null,
      "subkind": null,
      "toolName": "Authority citation",
      "toolSlug": "authority-citation",
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      "componentId": "019dd953-2b66-7100-895a-f9992ef1c20e",
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    {
      "bbox": {
        "h": 0.08,
        "w": 0.68,
        "x": 0.28,
        "y": 0.03
      },
      "kind": "title",
      "text": "Management Statements Appear Either To Hide AFAM Headwinds Or Reveal Gross Mismanagement",
      "attrs": null,
      "subkind": "headline",
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      "componentId": "7de13f02-e661-49b9-9fcf-46807e797c95",
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    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "ceo-quote-contradiction",
      "slug": null,
      "matchId": "52e61a57-8ab4-4594-b766-331b2d3c8ef5",
      "evidence": "Chronological presentation of conflicting management statements to expose lack of credibility.",
      "confidence": 0.95
    }
  ],
  "arcBeats": [
    {
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      "beatId": "5e68455d-b779-4212-958f-b4a9362a2abe",
      "arcName": "Problem-Agitate-Solution",
      "arcSlug": "problem-agitate-solution",
      "beatName": "Agitate",
      "beatSlug": "problem-agitate-solution-agitate-make-it-worse",
      "evidence": "The expose contradiction slides detail various issues with LHCG's financials and management practices.",
      "position": 1,
      "confidence": 0.8,
      "parentBeatName": "Development",
      "parentBeatSlug": "development"
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  ],
  "loops": [
    {
      "to": 41,
      "from": 3,
      "name": "Cost Of Inaction",
      "slug": "27-cost-of-inaction",
      "bestFor": "Urgent budget requests, compliance, risk mitigation",
      "matchId": "100ad489-dbf4-43de-8e22-48ed5d7f68fc",
      "evidence": "The deck implies that investors will suffer financial losses if they do not heed Spruce Point's warning.",
      "position": 0,
      "objective": "The cost of inaction for investors who fail to recognize LHCG's true financial performance.",
      "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point",
      "confidence": 0.7,
      "description": "Quantify what happens if the audience does nothing"
    },
    {
      "to": 33,
      "from": 6,
      "name": "Hypothesis Test",
      "slug": "42-hypothesis-test",
      "bestFor": "Strategy validation, due diligence, research presentations",
      "matchId": "de4a5673-b092-41ab-b2cc-9f9019cdcb5c",
      "evidence": "The expose contradiction slides test this hypothesis and present evidence.",
      "position": 1,
      "objective": "Testing the hypothesis that LHCG's financial practices are aggressive and misleading.",
      "structure": "The Hypothesis -> Test 1 (Supports/Refutes) -> Test 2 (Supports/Refutes) -> Conclusion (Validated/Pivoted)",
      "confidence": 0.7,
      "description": "State a hypothesis upfront, then systematically prove or disprove it with evidence"
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  "locked": true
}