AMN HEALTHCARE SERVICES, INC. SAN DIEGO, Feb. 19, 2015 /PRNewswire/ -- AMN Healthcare Services, Inc. (NYSE: AHS), healthcare's innovator in workforce solutions and staffing services, today announced full year and fourth quarter 2014 financial results exceeded the Company's guidance for revenue and adjusted EBITDA. Fourth quarter and full year financial highlights are as follows:
Dollars in millions, except per share amounts.
Q4 2014 % Change Full Year 2014 % Change Full Year 2013
Q4 2013
-------
Revenue $279.6 12% $1,036.0 2%
------- ------ --- -------- ---
Gross
profit $84.7 14% $316.1 6%
------ ----- --- ------ ---
Net
income $9.9 18% $33.2 1%
------ ---- --- ----- ---
Diluted
EPS $0.20 18% $0.69 0%
------- ----- --- ----- ---
Adjusted
Diluted
EPS* $0.21 N/A $0.74 7%
-------- ----- --- ----- ---
Adjusted
EBITDA* $25.3 19% $91.5 7%
-------- ----- --- ----- ---
* 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.
-- All AMN's business segments experienced year-over-year growth for the
fourth quarter and full year.
-- The Nurse and Allied Healthcare Staffing and Physician Permanent
Placement Services segments led with fourth quarter year-over-year
revenue growth of 17% and 14%, respectively.
-- Full year gross margin of 30.5% represented an improvement of 110 basis
points from the prior year.
-- Full year adjusted EBITDA margin of 8.8% reflected a 40 basis point
improvement from the prior year.
-- The Company completed the acquisitions of Avantas in December 2014, and
Onward Healthcare, Locum Leaders and Medefis in January 2015.
"During 2014, AMN Healthcare delivered a total shareholder return of 33% through solid execution and our differentiated strategy as the innovator in healthcare workforce solutions. The market environment accelerated mid-year as a stronger economy and millions of newly insured Americans released pent-up demand for both healthcare services and the underlying clinical labor that delivers patient care. Market trends continued to strengthen as the fourth quarter progressed, resulting in better than anticipated revenue and earnings growth," said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. "We were very pleased to add Avantas, Onward Healthcare, Locum Leaders and Medefis into the AMN family to bolster our workforce solutions and recruitment and supply capabilities. Our stronger portfolio of services and differentiated capabilities, combined with the favorable market conditions, give us a very optimistic outlook for 2015."
Fourth Quarter 2014 Results
For the fourth quarter of 2014, consolidated revenue was $280 million, an increase of 12% from the same quarter last year and 6% sequentially. Fourth quarter revenue for the Nurse and Allied Healthcare Staffing segment was $192 million, up 17% from the same quarter last year and 10% sequentially. Locum Tenens Staffing segment revenue in the fourth quarter was $76 million, an increase of 3% from the same quarter last year and down 3% sequentially. Fourth quarter Physician Permanent Placement Services segment revenue was $12 million, an increase of 14% from the same quarter last year and 4% sequentially.
Fourth quarter gross margin of 30.3% was higher by 50 basis points than the same quarter last year but lower by 10 basis points sequentially.
SG&A expenses for the fourth quarter were $62 million, representing 22.1% of revenue, compared to 21.9% in the same quarter last year and 22.8% in the prior quarter. The year-over-year increase in SG&A expenses as a percentage of revenue was due primarily to the additional SG&A expenses from ShiftWise. The lower sequential SG&A expenses as a percentage of revenue were driven by a favorable professional liability actuarial adjustment in the fourth quarter.
Fourth quarter net income was $10 million and net income per diluted share was $0.20. Excluding acquisition related costs, adjusted net income per diluted share was $0.21. Fourth quarter adjusted EBITDA was $25 million, a year-over-year increase of 19% and sequential increase of 16%. Adjusted EBITDA margin of 9.0% represented a 50 basis point increase over prior year.
Full Year 2014 Results
Full year 2014 consolidated revenue was $1,036 million, an increase of 2% from prior year. Nurse and Allied Healthcare Staffing segment revenue was $695 million, a year-over-year increase of 2%. Locum Tenens Staffing segment revenue was $296 million, a year-over-year increase of 3%. Physician Permanent Placement Services segment revenue was $45 million, a year-over-year increase of 5%.
Full year gross margin was 30.5% as compared to 29.4% for prior year, with gross margin expansion across all three reportable segments.
Full year SG&A expenses were $232 million, representing 22.4% of revenue as compared to 21.6% for the prior year. The increase in SG&A expenses was due primarily to the addition of a full year of our ShiftWise business in 2014 as well as higher employee, professional services and technology-related expenses to support business growth and strategic initiatives.
Full year net income was $33 million. Full year net income per diluted common share was $0.69. Excluding non-cash charges to interest expense associated with the execution of a new credit agreement and acquisition related costs incurred during the year, adjusted net income per diluted share was $0.74. Full year adjusted EBITDA grew 7% to $91 million. Adjusted EBITDA margin of 8.8% represented a 40 basis point increase over prior year.
At December 31, 2014, cash and cash equivalents totaled $13 million. Full year cash flow from operations was $28 million and capital expenditures were $19 million. The Company ended the year with total debt outstanding of $162 million, with a leverage ratio of 1.9 to 1.
Business Trends and Outlook
The Company expects consolidated first quarter 2015 revenue of $310 million to $314 million. Gross margin is expected to be approximately 30.5%. SG&A expenses as a percentage of revenue are expected to be approximately 22.5%. Adjusted EBITDA margin is expected to be 8.5% to 9.0%. This guidance includes the expected results for Avantas for the entire quarter and the Onward Healthcare, Locum Leaders and Medefis companies from the January 7th acquisition date.
About AMN Healthcare
AMN Healthcare is the innovator in healthcare workforce solutions and staffing services to healthcare facilities across the nation. AMN Healthcare's workforce solutions - including managed services programs, vendor management systems, and recruitment process outsourcing - enable providers to successfully reduce complexity, increase efficiency and improve patient outcomes within the rapidly evolving healthcare environment. The Company provides unparalleled access to the most comprehensive network of quality healthcare professionals through its innovative recruitment strategies and breadth of career opportunities. 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. AMN Healthcare disseminates news and information about the Company through its website, which can be found at www.amnhealthcare.com.
Conference Call on February 19, 2015
AMN Healthcare Services, Inc.'s fourth quarter 2014 conference call will be held on Thursday, February 19, 2015, 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) 234-9960 internationally. Following the conclusion of the call, a replay of the webcast will be available at the Company's website. A telephonic replay of the call will be available at 7:30 p.m. Eastern Time on February 19, 2015, and can be accessed until 11:59 p.m. Eastern Time on March 5, 2015, by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 351234.
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 and adjusted EBITDA margin serve as industry-wide financial measures, and it 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, and may be different from non-GAAP measures, or may be calculated differently than other similarly title-captioned 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" 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.
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. Such statements include expectations regarding the 2015 outlook and first quarter revenue, gross margin, SG&A expenses and adjusted EBITDA margin. The Company based 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 the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and its other periodic reports as well as the Company's current and other reports filed from time to time with the Securities and Exchange Commission. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated with the passage of time.
Contact:
Amy C. Chang
Vice President, Investor Relations
866.861.3229
AMN Healthcare Services, Inc.
Condensed Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------
2014 2013 2014 2014 2013
---- ---- ---- ---- ----
Revenue $279,649 $248,658 $264,584 $1,036,027 $1,011,816
Cost of revenue 194,953 174,465 184,278 719,910 714,536
------- ------- ------- ------- -------
Gross profit 84,696 74,193 80,306 316,117 297,280
------ ------ ------ ------- -------
30.3% 29.8% 30.4% 30.5% 29.4%
Operating expenses:
Selling, general and
administrative 61,668 54,470 60,319 232,221 218,233
22.1% 21.9% 22.8% 22.4% 21.6%
Depreciation and
amortization 4,077 3,698 4,086 15,993 13,545
----- ----- ----- ------ ------
Total operating expenses 65,745 58,168 64,405 248,214 231,778
------ ------ ------ ------- -------
Income from operations 18,951 16,025 15,901 67,903 65,502
Interest expense, net, and
other 1,329 1,836 1,433 9,237 9,665
---
Income before income taxes 17,622 14,189 14,468 58,666 55,837
Income tax expense 7,727 5,833 5,969 25,449 22,904
----- ----- ----- ------ ------
Net income $9,895 $8,356 $8,499 $33,217 $32,933
====== ====== ====== ======= =======
Other comprehensive income
(loss) 113 (36) 75 142 (55)
--- --- --- --- ---
Comprehensive income $10,008 $8,320 $8,574 $33,359 $32,878
======= ====== ====== ======= =======
Net income per common share:
Basic $0.21 $0.18 $0.18 $0.71 $0.72
===== ===== ===== ===== =====
Diluted $0.20 $0.17 $0.18 $0.69 $0.69
===== ===== ===== ===== =====
Weighted average common shares outstanding:
Basic 46,634 46,010 46,546 46,504 45,963
====== ====== ====== ====== ======
Diluted 48,462 47,818 48,122 48,086 47,787
====== ====== ====== ====== ======
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except per share data)
(unaudited)
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------- ------------
2014 2013 2014 2014 2013
Revenue
Nurse and allied
healthcare staffing $191,570 $164,121 $174,292 $695,206 $681,979
Locum tenens staffing 76,170 74,067 78,816 296,166 287,484
Physician permanent placement
services 11,909 10,470 11,476 44,655 42,353
$279,649 $248,658 $264,584 $1,036,027 $1,011,816
Reconciliation of Non-GAAP Items:
Segment operating income (1)
Nurse and allied
healthcare staffing $23,963 $19,464 $21,279 $87,246 $82,458
Locum tenens staffing 8,155 7,365 8,139 30,985 24,712
Physician permanent placement
services 2,744 2,194 2,756 9,818 8,929
34,862 29,023 32,174 128,049 116,099
Unallocated corporate overhead 9,601 7,842 10,396 36,559 30,927
----- ----- ------ ------ ------
Adjusted EBITDA (2) 25,261 21,181 21,778 91,490 85,172
Adjusted EBITDA margin (3) 9.0% 8.5% 8.2% 8.8% 8.4%
Depreciation and amortization 4,077 3,698 4,086 15,993 13,545
Share-based compensation 1,796 1,458 1,791 7,157 6,125
Acquisition transaction costs 437 0 0 437
Interest expense, net, and other 1,329 1,836 1,433 9,237 9,665
----- ----- ----- ----- -----
Income before income taxes 17,622 14,189 14,468 58,666 55,837
Income tax expense 7,727 5,833 5,969 25,449 22,904
----- ----- ----- ------ ------
Net income $9,895 $8,356 $8,499 $33,217 $32,933
GAAP based diluted net
income per share
(EPS) $0.20 $0.17 $0.18 $0.69 $0.69
Adjustments:
Loss on debt extinguishment 0.00 0.00 0.00 0.04 0.00
Acquistion transaction costs 0.01 0.00 0.00 0.01 0.00
Adjusted diluted EPS
(4) $0.21 N/A $ N/A $0.74 $0.69
===
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------- ------------
2014 2013 2014 2014 2013
Gross Margin
Nurse and allied healthcare
staffing 28.6% 27.7% 28.7% 28.8% 27.4%
Locum tenens staffing 28.8% 29.9% 29.0% 29.3% 29.1%
Physician permanent
placement services 66.1% 63.0% 64.9% 64.4% 62.7%
Operating Data:
---------------
Nurse and allied healthcare
staffing
Average clinicians on
assignment (5) 6,030 5,609 5,632 5,715 5,880
Locum tenens staffing
Days filled (6) 48,391 50,529 49,982 192,171 197,006
As of December 31, As of September 30,
------------------ -------------------
2014 2013 2014
Leverage Ratio (7) 1.9 2.0 1.7
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)
(unaudited)
December 31, September 30, December 31,
2014 2014 (8) 2013 (8)
---- ------- -------
Assets
Current assets:
Cash and cash equivalents $13,073 $9,663 $15,580
Accounts receivable, net 186,274 164,078 147,477
Accounts receivable,
subcontractor 28,443 21,569 18,271
Deferred income taxes,
net 27,330 24,970 24,938
Prepaid and other current
assets 27,550 28,844 26,631
------ ------ ------
Total current assets 282,670 249,124 232,897
Restricted cash, cash
equivalents and
investments 19,567 21,012 23,115
Fixed assets, net 32,880 29,202 21,158
Other assets 39,895 40,045 32,279
Goodwill 154,387 144,937 144,642
Intangible assets, net 152,517 144,498 150,197
------- ------- -------
Total assets $681,916 $628,818 $604,288
======== ======== ========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and
accrued expenses $78,993 $67,036 $71,314
Accrued compensation and
benefits 67,995 64,574 55,949
Revolving credit facility 18,000 0 10,000
Current portion of notes
payable 7,500 7,500 0
Deferred revenue 3,177 1,336 1,373
Other current liabilities 2,630 7,323 4,454
----- ----- -----
Total current liabilities 178,295 147,769 143,090
Notes payable, net of
discount 136,875 138,750 148,672
Deferred income tax
benefits, net 32,491 18,357 17,764
Other long-term
liabilities 77,674 78,524 77,020
------ ------ ------
Total liabilities 425,335 383,400 386,546
Commitments and contingencies
Stockholders' equity 256,581 245,418 217,742
------- ------- -------
Total liabilities and
stockholders' equity $681,916 $628,818 $604,288
======== ======== ========
AMN Healthcare Services, Inc.
Summary Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
(unaudited)
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------
2014 2013 (8) 2014 2014 2013 (8)
---- ------- ---- ---- -------
Net cash
provided by
operating
activities $5,039 $15,820 $15,489 $27,678 $60,169
Net cash used
in investing
activities (17,908) (42,148) (4,511) (28,228) (49,198)
Net cash
provided by
(used in)
financing
activities 16,166 10,291 (6,891) (2,099) (1,017)
Effect of
exchange
rates on cash 113 (36) 75 142 (55)
--- --- --- --- ---
Net increase
(decrease) in
cash and cash
equivalents 3,410 (16,073) 4,162 (2,507) 9,899
Cash and cash
equivalents
at beginning
of period 9,663 31,653 5,501 15,580 5,681
----- ------ ----- ------ -----
Cash and cash
equivalents
at end of
period $13,073 $15,580 $9,663 $13,073 $15,580
======= ======= ====== ======= =======
(1) Segment operating income represents net
income plus interest expense (net of
interest income) and other, income
taxes, depreciation and amortization,
unallocated corporate overhead and
share-based compensation expense.
(2) Adjusted EBITDA represents net income
plus interest expense (net of interest
income) and other, income taxes,
depreciation and amortization,
acquisition transaction costs and
share-based compensation expense.
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
considers measures used in credit
facilities. 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.
(3) Adjusted EBITDA margin represents
adjusted EBITDA divided by revenue.
(4) Adjusted diluted EPS represents GAAP
diluted EPS excluding the impact of 1)
loss on debt extinguishment of $3,113
and $434 for the twelve months ended
December 31, 2014 and 2013,
respectively; and 2) acquistion
transaction costs of $437 for the
three and twelve months ended December
31, 2014. Management believes such a
measure provides a picture of the
Company's results that is more
comparable among periods since it
excludes the impact of items that may
recur occasionally, but tend to be
irregular as to timing, thereby
distorting comparisons between
periods. However, 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 EPS). Although
management believes the item excluded
from adjusted EPS is not indicative of
the Company's operating performance,
this item does impact the statement of
comprehensive income, and management
therefore utilizes adjusted EPS as an
operating performance measure in
conjunction with GAAP measures such as
GAAP EPS.
(5) Average clinicians on assignment
represents the average number of nurse
and allied healthcare professionals on
assignment during the period
presented.
(6) Days filled is calculated by dividing
the locum tenens hours filled during
the period by eight hours.
(7) Leverage ratio represents the ratio of
the consolidated funded indebtedness
(as calculated per the Company's
credit agreement) at the end of the
period to the consolidated adjusted
EBITDA (as calculated per the
Company's credit agreement) for the
last twelve months.
(8) Certain reclassifications have been
made to the prior periods'
consolidated financial statements to
conform to the current year
presentation.
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SOURCE AMN Healthcare Services, Inc.
