UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 3, 2017
AMN HEALTHCARE SERVICES, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
| 001-16753 | 06-1500476 | |
| (Commission File Number) |
(I.R.S. Employer Identification No.) |
12400 High Bluff Drive, Suite 100
San Diego, California 92130
(Address of Principal Executive Offices)
Registrant’s telephone number, including area code: (866) 871-8519
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Section 2—Financial Information
| Item 2.02. | Results of Operations and Financial Condition. |
On August 3, 2017, AMN Healthcare Services, Inc. (the “Company”) reported its second quarter 2017 results. The Company’s second quarter 2017 results are discussed in detail in the press release (the “Press Release”), which is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
The information in this Item 2.02 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
| 99.1 | Press Release issued by the Company on August 3, 2017 furnished pursuant to Item 2.02 of this Current Report on Form 8-K. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AMN Healthcare Services, Inc. | ||||||
| Date: August 3, 2017 | By: | /s/ Susan R. Salka | ||||
| Susan R. Salka | ||||||
| President & Chief Executive Officer | ||||||
Exhibit 99.1
| Contact: |
| Brian Scott |
| Chief Financial Officer & Chief Accounting Officer |
| 866.861.3229 |
AMN HEALTHCARE ANNOUNCES SECOND QUARTER 2017 RESULTS
Quarterly revenue of $490 million;
GAAP EPS of $0.63 and adjusted EPS of $0.67
SAN DIEGO – (August 3, 2017) – AMN Healthcare Services, Inc. (NYSE: AMN), healthcare’s leader and innovator in workforce solutions and staffing services, today announced its second quarter 2017 financial results. Financial highlights are as follows:
Dollars in millions, except per share amounts.
| Q2 2017 | % Change Q2 2016 |
YTD June 30, 2017 |
% Change YTD June 30, 2016 |
|||||||||||||
| Revenue |
$ | 489.8 | 3 | % | $ | 985.0 | 5 | % | ||||||||
| Gross profit |
$ | 161.0 | 4 | % | $ | 322.8 | 5 | % | ||||||||
| Net income |
$ | 31.3 | 19 | % | $ | 63.3 | 21 | % | ||||||||
| Diluted EPS |
$ | 0.63 | 19 | % | $ | 1.28 | 21 | % | ||||||||
| Adj. diluted EPS* |
$ | 0.67 | 10 | % | $ | 1.30 | 8 | % | ||||||||
| Adjusted EBITDA* |
$ | 67.2 | 13 | % | $ | 130.3 | 11 | % | ||||||||
| * | See “Non-GAAP Measures” below for a discussion of our use of non-GAAP items and the table entitled “Supplemental Financial and Operating Data” for a reconciliation of non-GAAP items. |
Highlights
| • | Consolidated revenue grew 3% year over year; revenue was 7% higher excluding the significant labor disruption revenue in the prior year quarter. |
| • | Travel Nurse Staffing, our largest division, grew revenue 9% year over year, driven by both volume and pricing. |
| • | Our Allied division reached a record high for revenue, growing 12% year over year. |
| • | Adjusted EBITDA grew 13% year over year, representing a 13.7% margin. |
“AMN Healthcare’s ability to deliver superior service and a diversified suite of workforce solutions continues to differentiate us in the marketplace. Every day, we are helping thousands of healthcare organizations access the best talent, control costs, and more effectively optimize their workforce to deliver the best patient care possible,” said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. “Listening and responding to our clients’ evolving workforce needs is paramount and enables us to strategically position AMN to have the right solutions at the right time.”
“Although there continues to be debate regarding potential changes to healthcare policy, several key macro-trends remain very much in our favor and should continue to provide opportunity for growth as well as the need for innovation in workforce solutions. This environment, combined with the positive momentum in our MSP business and robust pipeline, provides us great confidence as we look toward 2018,” added Ms. Salka.
Second Quarter 2017 Results
Consolidated revenue for the quarter was $490 million, a 3% increase over prior year and down 1% sequentially. Excluding labor disruption revenue from the prior year quarter, consolidated second quarter revenue was up 7% year over year. There was no labor disruption revenue reported in this quarter, compared to approximately $18 million in the same quarter last year.
Revenue for the Nurse and Allied Solutions segment was $301 million, which is 3% higher year-over-year and 4% lower sequentially. The Travel Nurse division continued its strong performance, with revenue up 9% year-over-year and seasonally down 5% sequentially. The Allied division revenue increased 12% year-over-year and 1% sequentially.
Locum Tenens Solutions segment revenue was $108 million, down 1% year-over-year and up 5% sequentially. The Other Workforce Solutions segment revenue was $81 million, reflecting an increase of 12% year-over-year and 3% sequentially, with the year-over-year growth driven by the Peak Health Solutions acquisition last June and growth in the VMS, interim leadership, and workforce optimization businesses, partially offset by declines in the permanent placement businesses.
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Gross margin was 32.9%, which is 20 basis points higher both year-over-year and sequentially.
SG&A expenses were $97 million, or 19.7% of revenue, compared to $100 million, or 21.0% of revenue, in the same quarter last year and $102 million, or 20.6% of revenue, in the previous quarter. SG&A included a favorable professional liability actuarial adjustment of $4 million, compared to a favorable adjustment of $2 million in the same quarter last year. On a sequential basis, the lower SG&A percentage was primarily driven by the favorable professional liability actuarial adjustment in the second quarter.
Net income was $31 million, or $0.63 per diluted share, compared to $26 million, or $0.53 per diluted share, in the same quarter last year. Excluding amortization of intangible assets, acquisition and integration costs, net of tax, and the excess tax benefits relating to a change in stock compensation accounting, adjusted net income per diluted share was $0.67. Adjusted EBITDA was $67 million, a year-over-year increase of 13%. Adjusted EBITDA margin was 13.7%, representing a 120 basis point increase year-over-year and 90 basis point increase sequentially.
At June 30, 2017, cash and cash equivalents totaled $23 million. For the quarter ended June 30, 2017, cash flow from operations was $18 million and capital expenditures were $6 million. The Company ended the quarter with total debt outstanding of $343 million, with a leverage ratio as calculated in accordance with the Company’s credit agreement of 1.4 to 1.
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Third-Quarter 2017 Outlook
| Metric |
Guidance* | |
| Consolidated revenue |
$490 -$496 M | |
| Gross margin |
32.5% | |
| SG&A as percentage of revenue |
20.5% | |
| Adjusted EBITDA margin |
12.5% |
| * | Note: Guidance percentage metrics are approximate. For a reconciliation of adjusted EBITDA margin, see the table entitled “Reconciliation of Guidance Adjusted EBITDA Margin to Guidance Operating Margin” below. |
The projected year-over-year revenue increase of 4% to 5% is driven primarily by growth in our Nurse and Allied and Other Workforce Solutions segments. Travel Nurse Staffing, our largest business, is expected to grow approximately 7% year over year. There is no material labor disruption revenue included in the third quarter guidance.
Conference Call on August 3, 2017
AMN Healthcare Services, Inc. (NYSE: AMN), healthcare’s leader and innovator in workforce solutions and staffing services, will host a conference call to discuss its second quarter 2017 financial results on Thursday, August 3, 2017 at 5:00 p.m. Eastern Time. A live webcast of the call can be accessed through AMN Healthcare’s website at http://amnhealthcare.investorroom.com/presentations. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software. Interested parties may participate live via telephone by dialing (800) 230-1059 in the U.S. or (612) 234-9959 internationally. Following the conclusion of the call, a replay of the webcast will be available at the Company’s website. Alternatively, a telephonic replay of the call will be available starting at 7:30 p.m. Eastern Time on August 3, 2017, and can be accessed until 11:59 p.m. Eastern Time on August 17, 2017 by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 426696.
About AMN Healthcare
AMN Healthcare is the leader and innovator in healthcare workforce solutions and staffing services to healthcare facilities across the nation. The Company provides unparalleled access to the most comprehensive network of quality healthcare professionals through its innovative recruitment strategies and breadth of career opportunities. With insights and expertise, AMN Healthcare helps providers optimize their workforce to successfully reduce
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complexity, increase efficiency and improve patient outcomes. AMN delivers managed services programs, healthcare executive search solutions, vendor management systems, recruitment process outsourcing, predictive modeling, medical coding and consulting, and other services. Clients include acute-care hospitals, community health centers and clinics, physician practice groups, retail and urgent care centers, home health facilities and many other healthcare settings.
The Company’s common stock is listed on the New York Stock Exchange under the symbol “AMN.” For more information about AMN Healthcare, visit www.amnhealthcare.com, where the Company posts news releases, investor presentations, webcasts, SEC filings and other material information. The Company also utilizes email alerts and Really Simple Syndication (“RSS”) as routine channels to supplement distribution of this information. To register for email alerts and RSS, visit http://amnhealthcare.investorroom.com/emailalerts.
Non-GAAP Measures
This earnings release contains certain non-GAAP financial information, which the Company provides as additional information, and not as an alternative, to the Company’s condensed consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures include (1) adjusted EBITDA, (2) adjusted EBITDA margin and (3) adjusted diluted EPS. The Company provides such non-GAAP financial measures because management believes that they are useful both to management and investors as a supplement, and not as a substitute, when evaluating the Company’s operating performance. Additionally, management believes that adjusted EBITDA, adjusted EBITDA margin and adjusted diluted EPS serve as industry-wide financial measures. The Company uses adjusted EBITDA for making financial decisions and allocating resources. The non-GAAP measures in this release are not in accordance with, or an alternative to, GAAP measures and may be different from non-GAAP measures, or may be calculated differently than other similarly titled non-GAAP measures, reported by other companies. They should not be used in isolation to evaluate the Company’s performance. A reconciliation of non-GAAP measures identified in this release, along with further detail about the use and limitations of certain of these non-GAAP measures, may be found below in the table entitled “Supplemental Financial and Operating Data” under the caption entitled “Reconciliation of Non-GAAP Items” and the footnotes thereto or on the Company’s website at http://amnhealthcare.investorroom.com/financialreports. Additionally, from time to time, additional information regarding non-GAAP financial measures, including pro forma measures, may be made available on the Company’s website.
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Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, among others, statements concerning our future financial performance, our guidance for third quarter 2017 revenue, gross margin, SG&A expenses as a percentage of revenue, adjusted EBITDA margin and segment growth, the existence of favorable long-term macro drivers, our ability to grow and the positive momentum and robust pipeline with our managed service programs. The Company bases these forward-looking statements on its current expectations, estimates and projections about future events and the industry in which it operates using information currently available to it. Actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “may,” “estimates,” variations of such words and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Factors that could cause actual results to differ from those implied by the forward-looking statements contained in this press release are set forth in our fillings with the Securities and Exchange Commission (SEC), including our most recent Annual Report on Form 10-K for the year ended December 31, 2016, our subsequent Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated and the Company is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.
| Contact: |
| Brian Scott |
| Chief Financial Officer & Chief Accounting Officer |
| 866.861.3229 |
6
AMN Healthcare Services, Inc.
Condensed Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||||||
| June 30, | March 31, | June 30, | ||||||||||||||||||
| 2017 | 2016 | 2017 | 2017 | 2016 | ||||||||||||||||
| Revenue |
$ | 489,803 | $ | 473,729 | $ | 495,169 | $ | 984,972 | $ | 941,731 | ||||||||||
| Cost of revenue |
328,791 | 318,976 | 333,393 | 662,184 | 635,080 | |||||||||||||||
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| Gross profit |
161,012 | 154,753 | 161,776 | 322,788 | 306,651 | |||||||||||||||
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| Gross margin |
32.9 | % | 32.7 | % | 32.7 | % | 32.8 | % | 32.6 | % | ||||||||||
| Operating expenses: |
||||||||||||||||||||
| Selling, general and administrative (SG&A) |
96,673 | 99,541 | 102,073 | 198,746 | 197,364 | |||||||||||||||
| SG&A as a % of revenue |
19.7 | % | 21.0 | % | 20.6 | % | 20.2 | % | 21.0 | % | ||||||||||
| Depreciation and amortization |
7,959 | 7,334 | 7,668 | 15,627 | 14,099 | |||||||||||||||
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| Total operating expenses |
104,632 | 106,875 | 109,741 | 214,373 | 211,463 | |||||||||||||||
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|||||||||||
| Income from operations |
56,380 | 47,878 | 52,035 | 108,415 | 95,188 | |||||||||||||||
| Operating margin (1) |
11.5 | % | 10.1 | % | 10.5 | % | 11.0 | % | 10.1 | % | ||||||||||
| Interest expense, net, and other |
4,928 | 2,800 | 5,130 | 10,058 | 6,049 | |||||||||||||||
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| Income before income taxes |
51,452 | 45,078 | 46,905 | 98,357 | 89,139 | |||||||||||||||
| Income tax expense |
20,197 | 18,756 | 14,897 | 35,094 | 36,948 | |||||||||||||||
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| Net income |
$ | 31,255 | $ | 26,322 | $ | 32,008 | $ | 63,263 | $ | 52,191 | ||||||||||
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| Net income as a % of revenue |
6.4 | % | 5.6 | % | 6.5 | % | 6.4 | % | 5.5 | % | ||||||||||
| Other comprehensive income (loss): |
||||||||||||||||||||
| Foreign currency translation and other |
(41 | ) | 86 | 3 | (38 | ) | 125 | |||||||||||||
| Cash flow hedge, net of income taxes |
(58 | ) | (111 | ) | 43 | (15 | ) | (574 | ) | |||||||||||
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| Other comprehensive income (loss) |
(99 | ) | (25 | ) | 46 | (53 | ) | (449 | ) | |||||||||||
| Comprehensive income |
$ | 31,156 | $ | 26,297 | $ | 32,054 | $ | 63,210 | $ | 51,742 | ||||||||||
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| Net income per common share: |
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| Basic |
$ | 0.65 | $ | 0.55 | $ | 0.67 | $ | 1.32 | $ | 1.09 | ||||||||||
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| Diluted |
$ | 0.63 | $ | 0.53 | $ | 0.65 | $ | 1.28 | $ | 1.06 | ||||||||||
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| Weighted average common shares outstanding: |
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| Basic |
47,916 | 48,034 | 47,782 | 47,849 | 47,964 | |||||||||||||||
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| Diluted |
49,475 | 49,348 | 49,520 | 49,498 | 49,225 | |||||||||||||||
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7
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except per share data and operating data)
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||||||
| June 30, | March 31, | June 30, | ||||||||||||||||||
| 2017 | 2016 | 2017 | 2017 | 2016 | ||||||||||||||||
| Revenue |
||||||||||||||||||||
| Nurse and allied solutions |
$ | 300,727 | $ | 292,663 | 313,523 | 614,250 | 590,387 | |||||||||||||
| Locum tenens solutions |
108,215 | 109,129 | 102,843 | 211,058 | 211,867 | |||||||||||||||
| Other workforce solutions |
80,861 | 71,937 | 78,803 | 159,664 | 139,477 | |||||||||||||||
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| $ | 489,803 | $ | 473,729 | 495,169 | 984,972 | 941,731 | ||||||||||||||
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| Reconciliation of Non-GAAP Items: |
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| Segment operating income (2) |
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| Nurse and allied solutions |
$ | 47,851 | $ | 39,503 | 45,980 | 93,831 | 81,121 | |||||||||||||
| Locum tenens solutions |
12,371 | 16,317 | 12,219 | 24,590 | 29,608 | |||||||||||||||
| Other workforce solutions |
22,041 | 17,858 | 19,857 | 41,898 | 35,444 | |||||||||||||||
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| 82,263 | 73,678 | 78,056 | 160,319 | 146,173 | ||||||||||||||||
| Unallocated corporate overhead |
15,080 | 14,420 | 14,891 | 29,971 | 28,225 | |||||||||||||||
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| Adjusted EBITDA (3) |
67,183 | 59,258 | 63,165 | 130,348 | 117,948 | |||||||||||||||
| Adjusted EBITDA margin (4) |
13.7 | % | 12.5 | % | 12.8 | % | 13.2 | % | 12.5 | % | ||||||||||
| Depreciation and amortization |
7,959 | 7,334 | 7,668 | 15,627 | 14,099 | |||||||||||||||
| Share-based compensation |
2,562 | 2,710 | 2,681 | 5,243 | 6,091 | |||||||||||||||
| Acquisition and integration costs |
282 | 1,336 | 781 | 1,063 | 2,570 | |||||||||||||||
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| Income from operations |
56,380 | 47,878 | 52,035 | 108,415 | 95,188 | |||||||||||||||
| Interest expense, net, and other |
4,928 | 2,800 | 5,130 | 10,058 | 6,049 | |||||||||||||||
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| Income before income taxes |
51,452 | 45,078 | 46,905 | 98,357 | 89,139 | |||||||||||||||
| Income tax expense |
20,197 | 18,756 | 14,897 | 35,094 | 36,948 | |||||||||||||||
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| Net income |
$ | 31,255 | $ | 26,322 | 32,008 | 63,263 | 52,191 | |||||||||||||
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| GAAP diluted net income per share (EPS) |
$ | 0.63 | $ | 0.53 | 0.65 | 1.28 | 1.06 | |||||||||||||
| Adjustments: |
||||||||||||||||||||
| Amortization of intangible assets |
0.09 | 0.09 | 0.09 | 0.19 | 0.18 | |||||||||||||||
| Acquisition and integration costs |
0.01 | 0.03 | 0.02 | 0.02 | 0.05 | |||||||||||||||
| Tax effect on above adjustments |
(0.04 | ) | (0.04 | ) | (0.04 | ) | (0.08 | ) | (0.09 | ) | ||||||||||
| Excess tax benefits (5) |
(0.02 | ) | 0.00 | (0.09 | ) | (0.11 | ) | 0.00 | ||||||||||||
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| Adjusted diluted EPS (6) |
$ | 0.67 | $ | 0.61 | 0.63 | 1.30 | 1.20 | |||||||||||||
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8
| Three Months Ended | Six Months Ended | |||||||||||||||||||
| June 30, | March 31, | June 30, | ||||||||||||||||||
| 2017 | 2016 | 2017 | 2017 | 2016 | ||||||||||||||||
| Gross Margin |
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| Nurse and allied solutions |
27.8% | 26.7 | % | 27.7 | % | 27.7 | % | 26.7 | % | |||||||||||
| Locum tenens solutions |
30.0% | 31.3 | % | 30.7 | % | 30.3 | % | 31.1 | % | |||||||||||
| Other workforce solutions |
55.7% | 58.9 | % | 55.0 | % | 55.3 | % | 59.6 | % | |||||||||||
| Operating Data: |
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| Nurse and allied solutions |
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| Average healthcare professionals on assignment (7) |
8,776 | 8,337 | 9,051 | 8,913 | 8,406 | |||||||||||||||
| Locum tenens solutions |
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| Days filled (8) |
58,660 | 61,068 | 55,243 | 113,903 | 119,234 | |||||||||||||||
| Revenue per day filled (9) |
$1,845 | $ | 1,787 | $ | 1,862 | $ | 1,853 | $ | 1,777 | |||||||||||
| As of June 30, | As of March 31, | ||||||||||||||
| 2017 | 2016 | 2017 | |||||||||||||
| Leverage ratio (10) |
1.4 | 1.9 | 1.6 | ||||||||||||
9
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)
(unaudited)
| June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
||||||||||
| Assets |
||||||||||||
| Current assets: |
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| Cash and cash equivalents |
$ | 22,878 | $ | 37,711 | $ | 10,622 | ||||||
| Accounts receivable, net |
334,597 | 334,782 | 341,977 | |||||||||
| Accounts receivable, subcontractor |
36,631 | 48,838 | 49,233 | |||||||||
| Prepaid and other current assets |
46,938 | 50,893 | 48,796 | |||||||||
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| Total current assets |
441,044 | 472,224 | 450,628 | |||||||||
| Restricted cash, cash equivalents and investments |
33,882 | 29,141 | 31,287 | |||||||||
| Fixed assets, net |
65,368 | 62,620 | 59,954 | |||||||||
| Other assets |
71,594 | 65,368 | 57,534 | |||||||||
| Goodwill |
340,596 | 340,564 | 341,754 | |||||||||
| Intangible assets, net |
236,486 | 241,130 | 245,724 | |||||||||
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| Total assets |
$ | 1,188,970 | $ | 1,211,047 | $ | 1,186,881 | ||||||
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| Liabilities and stockholders’ equity |
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| Current liabilities: |
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| Accounts payable and accrued expenses |
$ | 118,943 | $ | 136,028 | $ | 137,512 | ||||||
| Accrued compensation and benefits |
107,283 | 99,642 | 107,993 | |||||||||
| Current portion of notes payable, less unamortized fees |
18,071 | 3,750 | 3,750 | |||||||||
| Deferred revenue |
9,644 | 8,840 | 8,924 | |||||||||
| Other current liabilities |
12,387 | 29,428 | 16,611 | |||||||||
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|
|
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| Total current liabilities |
266,328 | 277,688 | 274,790 | |||||||||
| Notes payable, less unamortized fees |
319,462 | 358,512 | 359,192 | |||||||||
| Deferred income taxes, net |
12,387 | 16,548 | 21,420 | |||||||||
| Other long-term liabilities |
82,301 | 81,494 | 82,096 | |||||||||
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|
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|
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| Total liabilities |
680,478 | 734,242 | 737,498 | |||||||||
| Commitments and contingencies |
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| Stockholders’ equity |
508,492 | 476,805 | 449,383 | |||||||||
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| Total liabilities and stockholders’ equity |
$ | 1,188,970 | $ | 1,211,047 | $ | 1,186,881 | ||||||
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10
AMN Healthcare Services, Inc.
Summary Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||||||
| June 30, | March 31 | June 30, | ||||||||||||||||||
| 2017 | 2016 | 2017 | 2017 | 2016 | ||||||||||||||||
| Net cash provided by operating activities |
$ | 18,474 | $ | 20,053 | $ | 52,314 | $ | 70,788 | $ | 55,280 | ||||||||||
| Net cash used in investing activities |
(6,320 | ) | (58,451 | ) | (13,301 | ) | (19,621 | ) | (233,154 | ) | ||||||||||
| Net cash provided by (used in) financing activities |
(26,945 | ) | 36,268 | (11,928 | ) | (38,873 | ) | 189,235 | ||||||||||||
| Effect of exchange rates on cash |
(42 | ) | 86 | 4 | (38 | ) | 125 | |||||||||||||
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| Net increase (decrease) in cash and cash equivalents |
(14,833 | ) | (2,044 | ) | 27,089 | 12,256 | 11,486 | |||||||||||||
| Cash and cash equivalents at beginning of period |
37,711 | 23,106 | 10,622 | 10,622 | 9,576 | |||||||||||||||
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| Cash and cash equivalents at end of period |
$ | 22,878 | $ | 21,062 | $ | 37,711 | $ | 22,878 | $ | 21,062 | ||||||||||
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AMN Healthcare Services, Inc.
Additional Supplemental Non-GAAP Disclosures
Reconciliation of Guidance Adjusted EBITDA Margin to
Guidance Operating Margin
(unaudited)
| Three Months Ending | ||||
| September 30, 2017 | ||||
| Adjusted EBITDA margin |
12.5 | %(11) | ||
| Deduct: |
||||
| Share-based compensation |
0.5 | % | ||
|
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|
|||
| EBITDA margin |
12.0 | % | ||
|
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|
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| Depreciation and amortization |
1.6 | % | ||
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| Operating margin |
10.4 | % | ||
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11
| (1) | Operating margin represents income from operations divided by revenue. |
| (2) | Segment operating income represents net income plus interest expense (net of interest income) and other, income tax expense, depreciation and amortization, unallocated corporate overhead, acquisition and integration costs and share-based compensation. |
| (3) | Adjusted EBITDA represents net income plus interest expense (net of interest income) and other, income tax expense, depreciation and amortization, acquisition and integration costs and share-based compensation. Management believes that adjusted EBITDA provides an effective measure of the Company’s results, as it excludes certain items that management believes are not indicative of the Company’s operating performance and is a measure used in the Company’s credit agreement and the indenture governing our 5.125% Senior Notes due 2024. Adjusted EBITDA is not intended to represent cash flows for the period, nor has it been presented as an alternative to income from operations or net income as an indicator of operating performance. Although management believes that some of the items excluded from adjusted EBITDA are not indicative of the Company’s operating performance, these items do impact the statement of comprehensive income, and management therefore utilizes adjusted EBITDA as an operating performance measure in conjunction with GAAP measures such as net income. |
| (4) | Adjusted EBITDA margin represents adjusted EBITDA divided by revenue. |
| (5) | The consolidated effective tax rate for the three and six months ended June 30, 2017 was favorably affected by the recording of excess tax benefits relating to equity awards vested and exercised during the period. As a result of the adoption of a new accounting pronouncement on January 1, 2017, we no longer record excess tax benefits as an increase to additional paid-in capital, but record such excess tax benefits on a prospective basis as a reduction of income tax expense, which amounted to $1,028,000 and $5,325,000 for the three and six months ended June 30, 2017, respectively. Since the majority of our equity awards vest during the first quarter of the year, we do not anticipate the recording of additional excess tax benefits of this magnitude for the reminder of the year. The magnitude of the impact of excess tax benefits generated in the future, which may be favorable or unfavorable, is dependent upon the Company’s future grants of share-based compensation, the Company’s future stock price on the date awards vest or exercise in relation to the fair value of the awards on the grant date or the exercise behavior of the Company’s stock appreciation rights holders. Since these favorable tax benefits are largely unrelated to our current year’s income before taxes and is unrepresentative of our normal effective tax rate, we excluded their impact on adjusted diluted EPS for the three and six months ended June 30, 2017. |
| (6) | Adjusted diluted EPS represents GAAP diluted EPS excluding the impact of (A) amortization of intangible assets, (B) acquisition and integration costs, (C) tax effect, if any, of the foregoing adjustments, and (D) excess tax benefits relating to equity awards vested and exercised since January 1, 2017. Management included this non-GAAP measure to provide investors and prospective investors with an alternative method for assessing the Company’s operating results in a manner that is focused on its operating performance and to provide a more consistent basis for comparison between periods. However, investors and prospective investors should note that this non-GAAP measure involves judgment by management (in particular, judgment as to what is classified as a special item to be excluded from adjusted diluted EPS). Although management believes the items excluded from adjusted diluted EPS are not indicative of the Company’s operating performance, these items do impact the statement of comprehensive income, and management therefore utilizes adjusted diluted EPS as an operating performance measure in conjunction with GAAP measures such as GAAP diluted EPS. |
| (7) | Average healthcare professionals on assignment represents the average number of nurse and allied healthcare professionals on assignment during the period presented. |
| (8) | Days filled is calculated by dividing the locum tenens hours filled during the period by eight hours. |
| (9) | Revenue per day filled represents revenue of the Company’s locum tenens solutions segment divided by days filled for the period presented. |
| (10) | Leverage ratio represents the ratio of the consolidated funded indebtedness (as calculated per the Company’s credit agreement) at the end of the subject period to the consolidated adjusted EBITDA (as calculated per the Company’s credit agreement) for the twelve-month period ended at the end of the subject period. |
| (11) | Guidance percentage metrics are approximate. No significant labor disruption revenues are projected for this quarter. |
12