AMN HEALTHCARE SERVICES, INC. SAN DIEGO, May 4, 2017 /PRNewswire/ -- AMN Healthcare Services, Inc. (NYSE: AMN), healthcare's leader and innovator in workforce solutions and staffing services, today announced its first quarter 2017 financial results. Financial highlights are as follows:
Dollars in millions, except per share amounts.
Q1 2017 % Change
Q1 2016
-------
Revenue $495.2 6%
------- ------ ---
Gross profit $161.8 7%
------------ ------ ---
Net income $32.0 24%
---------- ----- ---
Diluted EPS $0.65 23%
----------- ----- ---
Adj. diluted EPS* $0.63 5%
---------------- ----- ---
Adjusted EBITDA* $63.2 8%
--------------- ----- ---
* 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
-- AMN Healthcare delivered another record quarter of revenue and earnings.
-- Several new MSP, VMS and workforce optimization clients were added,
reflecting the increased demand for workforce solutions within
healthcare.
-- Our largest division, Travel Nurse staffing, was up 9% over prior year,
and the Allied division increased by 14%.
-- Adjusted EBITDA grew 8% year-over-year representing a 12.8% margin, a 30
basis point increase.
-- Operating cash flow for the first quarter was $52 million, a 49%
increase compared to the first quarter 2016.
"AMN Healthcare's capabilities as the leader and most comprehensive workforce partner within healthcare continues to set us apart in the marketplace and deliver strong results for our clients and shareholders," said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. "Our solutions are helping clients in multiple ways to ensure they have the right talent when and where they are needed and to effectively manage their labor costs as they navigate new care delivery models and regulatory changes."
"With a positive outlook for 2017 and favorable long-term macro drivers providing us confidence in our business, we will continue to make investments that enable us to extend our leadership position into the future," added Ms. Salka.
First Quarter 2017 Results
Consolidated revenue for the quarter was $495 million, a 6% increase over prior year. Excluding labor disruption revenue and the leap year impact, consolidated first quarter revenue was up 10% year-over-year and 4% sequentially.
Revenue for the Nurse and Allied Solutions segment was $314 million, which is 5% higher year-over-year and 2% higher sequentially. The Travel Nurse division continued with strong performance, with revenue up 9% year-over-year and 6% sequentially. The Allied division revenue increased 14% year-over-year and 3% sequentially. There was no labor disruption revenue reported in the quarter as compared to approximately $12 million in the prior year quarter.
Locum Tenens Solutions segment revenue was $103 million, flat year-over-year and down 1% sequentially. The Other Workforce Solutions segment revenue was $79 million, an increase of 17% year-over-year and 4% sequentially, with the year-over-year growth driven by the Peak Health Solutions acquisition last June and growth in our VMS, interim leadership, and workforce optimization businesses.
Gross margin was 32.7%, which is 20 basis points higher both year-over-year and sequentially.
SG&A expenses were $102 million, or 20.6% of revenue, compared to $98 million, or 20.9% of revenue, in the same quarter last year and $101 million, or 20.7% of revenue, in the previous quarter.
Net income was $32 million, or $0.65 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 $0.63. Adjusted EBITDA was $63 million, a year-over-year increase of 8%. Adjusted EBITDA margin was 12.8%, representing a 30 basis point increase year-over-year and sequentially.
At March 31, 2017, cash and cash equivalents totaled $38 million. Cash flow from operations was $52 million and capital expenditures were $5 million. The Company ended the quarter with total debt outstanding of $368 million, with a leverage ratio as calculated in accordance with the Company's credit agreement of 1.6 to 1.
Second-Quarter 2017 Outlook
Metric Guidance*
------ --------
Consolidated revenue $486 - $492 MM
-------------------- --------------
Gross margin 32.5%
------------ ----
SG&A as percentage of revenue 20.5%
----------------------------- ----
Adjusted EBITDA margin 12.5%
---------------------- ----
*Note: Guidance percentage metrics
are approximate. No significant
labor disruption revenues are
projected for this quarter. For a
reconciliation of adjusted EBITDA
margin, see the table entitled
"Reconciliation of Guidance
Adjusted EBITDA Margin to Guidance
Operating Margin" below.
Excluding any labor disruption revenue, the second quarter is expected to reflect year-over-year growth of 7-8%. On an "as reported" basis, the projected growth rate of 3-4% reflects the impact of significant labor disruption revenue in the prior year. The sequential decline comes from a seasonal decline in Travel Nursing, partially offset by growth in all other divisions.
Conference Call on May 4, 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 first quarter 2017 financial results on Thursday, May 4, 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) 230-1092 in the U.S. or (612) 332-0720 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 May 4, 2017, and can be accessed until 11:59 p.m. Eastern Time on May 18, 2017 by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 421631.
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 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.
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 second quarter 2017 revenue, gross margin, SG&A expenses as a percentage of revenue, and adjusted EBITDA margin, our positive outlook for 2017, the existence of favorable long-term macro drivers, our ability to make successful investments, and the ability of our solutions to help our clients operate effectively in new regulatory environments. 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:
Neil Thomas
Senior Director, 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
------------------
March 31, December 31,
---------
2017 2016 2016
---- ---- ----
Revenue $495,169 $468,002 $487,858
Cost of revenue 333,393 316,104 329,252
------- ------- -------
Gross profit 161,776 151,898 158,606
------- ------- -------
Gross margin 32.7% 32.5% 32.5%
Operating expenses:
Selling, general and
administrative (SG&A) 102,073 97,823 101,113
SG&A as a % of revenue 20.6% 20.9% 20.7%
Depreciation and
amortization 7,668 6,765 7,732
----- ----- -----
Total operating
expenses 109,741 104,588 108,845
------- ------- -------
Income from operations 52,035 47,310 49,761
Operating margin (1) 10.5% 10.1% 10.2%
Interest expense, net,
and other 5,130 3,249 6,400
----- ----- -----
Income before income
taxes 46,905 44,061 43,361
Income tax expense 14,897 18,192 17,010
------ ------ ------
Net income $32,008 $25,869 $26,351
------- ------- -------
Net income as a % of
revenue 6.5% 5.5% 5.4%
Other comprehensive income (loss):
Foreign currency
translation and other 3 39 102
Unrealized gain (loss) on cash flow hedge, net of
income taxes
43 (463) 260
--- ---- ---
Other comprehensive
income (loss) 46 (424) 362
Comprehensive income $32,054 $25,445 $26,713
------- ------- -------
Net income per common share:
Basic $0.67 $0.54 $0.55
----- ----- -----
Diluted $0.65 $0.53 $0.54
----- ----- -----
Weighted average common shares outstanding:
Basic 47,782 47,894 47,806
------ ------ ------
Diluted 49,520 49,103 49,208
------ ------ ------
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except per share data and operating data)
(unaudited)
Three Months Ended
------------------
March 31, December 31,
--------- ------------
2017 2016 2016
Revenue
Nurse and allied
solutions $313,523 $297,724 $307,898
Locum tenens solutions 102,843 102,738 103,822
Other workforce solutions 78,803 67,540 76,138
$495,169 $468,002 $487,858
Reconciliation of Non-GAAP Items:
Segment operating income (2)
Nurse and allied
solutions $45,980 $41,618 $43,262
Locum tenens solutions 12,219 13,291 15,123
Other workforce solutions 19,857 17,586 21,139
78,056 72,495 79,524
Unallocated corporate overhead 14,891 13,805 18,649
------ ------ ------
Adjusted EBITDA (3) 63,165 58,690 60,875
Adjusted EBITDA margin (4) 12.8% 12.5% 12.5%
Depreciation and amortization 7,668 6,765 7,732
Share-based compensation 2,681 3,381 2,604
Acquisition and integration costs 781 1,234 778
--- ----- ---
Income from operations 52,035 47,310 49,761
Interest expense, net, and other 5,130 3,249 6,400
----- ----- -----
Income before income taxes 46,905 44,061 43,361
Income tax expense 14,897 18,192 17,010
------ ------ ------
Net income $32,008 $25,869 $26,351
GAAP diluted net
income per share
(EPS) $0.65 $0.53 $0.54
Adjustments:
Amortization of intangible assets 0.09 0.09 0.10
Acquisition and integration costs 0.02 0.03 0.01
Debt financing related costs 0.00 0.00 0.02
Tax effect on above adjustments (0.04) (0.05) (0.05)
Excess tax benefits (5) (0.09) 0.00 0.00
Adjusted diluted EPS
(6) $0.63 $0.60 $0.62
Three Months Ended
------------------
March 31, December 31,
--------- ------------
2017 2016 2016
Gross Margin
Nurse and allied
solutions 27.7% 26.6% 27.3%
Locum tenens
solutions 30.7% 31.0% 30.8%
Other workforce
solutions 55.0% 60.3% 55.7%
Operating Data:
---------------
Nurse and allied
solutions
Average healthcare
professionals on
assignment -
consolidated (7) 9,051 8,474 8,764
Locum tenens
solutions
Days filled (8) 55,243 58,166 57,008
Revenue per day
filled (9) $1,862 $1,766 $1,821
As of March 31, As of December 31,
--------------- ------------------
2017 2016 2016
Leverage ratio
(10) 1.6 1.9 1.6
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)
(unaudited)
March 31, December 31,
2017 2016
---- ----
Assets
Current assets:
Cash
and
cash
equivalents $37,711 $10,622
Accounts
receivable,
net 334,782 341,977
Accounts
receivable,
subcontractor 48,838 49,233
Prepaid
and
other
current
assets 50,893 48,796
------ ------
Total
current
assets 472,224 450,628
Restricted cash, cash equivalents
and
investments 29,141 31,287
Fixed
assets,
net 62,620 59,954
Other
assets 65,368 57,534
Goodwill 340,564 341,754
Intangible
assets,
net 241,130 245,724
------- -------
Total
assets $1,211,047 $1,186,881
---------- ----------
Liabilities and stockholders' equity
Current liabilities:
Accounts
payable
and
accrued
expenses $136,028 $137,512
Accrued
compensation
and
benefits 99,642 107,993
Current
portion
of
notes
payable 3,750 3,750
Deferred
revenue 8,840 8,924
Other
current
liabilities 29,428 16,611
------ ------
Total
current
liabilities 277,688 274,790
Notes
payable,
less
unamortized
fees 358,512 359,192
Deferred
income
taxes,
net 16,548 21,420
Other
long-
term
liabilities 81,494 82,096
------ ------
Total
liabilities 734,242 737,498
Commitments and contingencies
Stockholders'
equity 476,805 449,383
------- -------
Total
liabilities
and
stockholders'
equity $1,211,047 $1,186,881
---------- ----------
AMN Healthcare Services, Inc.
Summary Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
(unaudited)
Three Months Ended
------------------
March 31, December 31
---------
2017 2016 2016
---- ---- ----
Net cash provided by
operating activities $52,314 $35,227 $47,031
Net cash used in
investing activities (13,301) (174,703) (16,091)
Net cash provided by
(used in) financing
activities (11,928) 152,967 (36,128)
Effect of exchange
rates on cash 4 39 102
--- --- ---
Net increase
(decrease) in cash
and cash equivalents 27,089 13,530 (5,086)
Cash and cash
equivalents at
beginning of period 10,622 9,576 15,708
------ ----- ------
Cash and cash
equivalents at end of
period $37,711 $23,106 $10,622
------- ------- -------
AMN Healthcare Services, Inc.
Additional Supplemental Non-GAAP Disclosures
Reconciliation of Guidance Adjusted EBITDA Margin to
Guidance Operating Margin
(unaudited)
Three Months Ending
-------------------
June 30, 2017
-------------
Adjusted EBITDA margin 12.5% (11)
Deduct:
Share-based compensation 0.6%
---
EBITDA margin 11.9%
----
Depreciation and amortization 1.6%
Operating margin 10.3%
====
(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 facilities 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 months ended March 31, 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
$4,297,000 for the three months ended
March 31, 2017. Since a majority of our
equity awards vest during the first
quarter, 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, are 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 are unrepresentative of
our normal effective tax rate, we
excluded its impact on adjusted diluted
EPS for the three months ended March 31,
2017.
(6) Adjusted diluted EPS represents GAAP
diluted EPS excluding the impact of (A)
amortization of intangible assets, (B)
acquisition and integration costs, (C)
debt financing related costs, (D) tax
effect, if any, of the foregoing
adjustments, and (E) 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.
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SOURCE AMN Healthcare Services, Inc.
