AMN HEALTHCARE SERVICES, INC. SAN DIEGO, Feb. 16, 2017 /PRNewswire/ -- AMN Healthcare Services, Inc. (NYSE: AMN), healthcare's leader and innovator in workforce solutions and staffing services, today announced its fourth quarter and full year 2016 financial results. Financial highlights are as follows:
Dollars in millions, except per share amounts.
Q4 2016 % Change Full Year % Change
Q4 2015 2016 Full Year
2015
----
Revenue $487.9 21% $1,902.2 30%
------- ------ --- -------- ---
Gross
profit $158.6 20% $619.7 32%
------ ------ --- ------ ---
Net
income $26.4 31% $105.8 29%
------ ----- --- ------ ---
Diluted
EPS $0.54 32% $2.15 28%
------- ----- --- ----- ---
Adj.
diluted
EPS* $0.62 32% $2.44 49%
------- ----- --- ----- ---
Adjusted
EBITDA* $60.9 30% $236.9 43%
-------- ----- --- ------ ---
* 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 year of revenue and earnings and
continued to expand its position as the leading provider of healthcare
workforce and staffing solutions.
-- Full year revenue increased by 30%, driven by organic growth of 17%;
adjusted EBITDA margin of 12.5% reflected a 120 basis point increase
from prior year.
-- Fourth quarter consolidated revenue of $488 million increased 21%
year-over-year, with 10% organic growth; adjusted EBITDA grew 30%
year-over-year with a 90 basis point margin increase.
-- Operating cash flow for the fourth quarter was $47 million and $132
million for the full year 2016, a 134% increase compared to the full
year 2015.
-- The Company repurchased 443,353 shares during the fourth quarter at an
average price of $29.88.
"2016 was another very successful year for AMN Healthcare. In addition to our strong financial performance, we made great strides in advancing our long-term strategy. We completed the integrations of B.E. Smith, HealthSource Global and Peak Health Solutions, allowing AMN to become an even more comprehensive, value-added workforce partner to our clients," said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. "Our strong performance in the fourth quarter and throughout the year positions us well for the future and led to a total shareholder return of 24% for 2016."
Ms. Salka added, "Our businesses operate in a dynamic healthcare market with favorable long-term macro drivers, providing us the confidence to continue making investments to ensure we are the best and most innovative partner to help our clients optimize their workforce and achieve their financial and patient care goals."
Fourth Quarter 2016 Results
Consolidated revenue for the quarter was $488 million, an increase of 21% year-over-year, including 10% organic growth.
Revenue for the Nurse and Allied Solutions segment was $308 million, which is 17% higher year-over-year and 7% higher sequentially. The Travel Nurse division continued with strong performance, with revenue up 15% year-over-year and 4% sequentially. The Allied division revenue increased 12% year-over-year and 2% sequentially. Along with 12% year-over-year organic revenue growth, the quarter also included higher than projected labor disruption revenue.
Locum Tenens Solutions segment revenue was $104 million, an increase of 5% year-over-year. Revenue was down 4% sequentially, in line with typical seasonality.
The Other Workforce Solutions segment revenue was $76 million, an increase of 89% year-over-year and down 1% sequentially, with the year-over-year growth driven by acquisitions during the year and growth in our vendor management solutions (VMS), interim nurse leadership, and workforce optimization businesses.
Gross margin was 32.5%, which is 20 basis points lower year-over-year and sequentially.
SG&A expenses were $101 million, or 20.7% of revenue, compared to $90 million, or 22.4% of revenue, in the same quarter last year and $100 million, or 21.2% of revenue, in the previous quarter. The year-over-year 170 basis point decline in SG&A as a percentage of revenue was driven by improved operating leverage.
Net income was $26 million, or $0.54 per diluted share, compared to $20 million, or $0.41 per diluted share, in the same quarter last year. Excluding amortization of intangible assets, acquisition and integration costs and debt refinancing related costs, net of tax, adjusted net income per diluted share was $0.62. Adjusted EBITDA was $61 million, a year-over-year increase of 30%. Adjusted EBITDA margin was 12.5%, representing a 90 basis point increase year-over-year and a 20 basis point increase sequentially.
During the fourth quarter of 2016, the Company repurchased 443,353 shares of our common stock at an average price of $29.88 per share, resulting in an aggregate purchase price of $13 million.
Full Year 2016 Results
Full year 2016 consolidated revenue was $1,902 million, an increase of 30% from prior year. Nurse and Allied Solutions segment revenue was $1,185 million, a year-over-year increase of 24%. Locum Tenens Solutions segment revenue was $424 million, a year-over-year increase of 10%. Other Workforce Solutions segment revenue was $293 million, a year-over-year increase of 135%.
Full year gross margin was 32.6% as compared to 32.1% for prior year. The increase was due to growth in the higher margin Other Workforce Solutions segment and higher bill-to-pay spreads in the Locum Tenens Solutions segment, partially offset by higher direct costs in the Nurse and Allied Solutions segment during 2016.
Full year SG&A expenses were $398 million, representing 20.9% of revenue as compared to 21.8% for the prior year. The decrease in SG&A margin was due primarily to operating leverage on the revenue growth.
Full year net income was $106 million. Full year net income per diluted common share was $2.15. Excluding amortization of intangible assets, acquisition and integration costs and debt refinancing related costs incurred during the year, net of tax, adjusted net income per diluted common share was $2.44. Full year adjusted EBITDA grew 43% to $237 million. Full year adjusted EBITDA margin of 12.5% represented a 120 basis point increase over prior year.
At December 31, 2016, cash and cash equivalents totaled $11 million. Cash flow from operations was $47 million for the quarter and $132 million for the full year. Capital expenditures were $4 million in the quarter and $22 million for the year. The Company ended the year with total debt outstanding of $369 million, with a leverage ratio as calculated in accordance with the Company's credit agreement of 1.6 to 1.
First-Quarter 2017 Outlook
Metric Guidance*
------ --------
Consolidated revenue $489 - $495 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.
Conference Call on February 16, 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 fourth quarter 2016 financial results on Thursday, February 16, 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) 234-9960 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 February 16, 2017, and can be accessed until 11:59 p.m. Eastern Time on March 2, 2017 by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 415736.
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. Such statements include expectations regarding the Company's 2017 first quarter revenue, gross margin, SG&A expenses as a percentage of revenue, and adjusted EBITDA margin. 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 the Company's Annual Report on Form 10-K for the year ended December 31, 2015 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.
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 Twelve Months Ended
------------------ -------------------
December 31, September December 31,
30,
2016 2015 2016 2016 2015
---- ---- ---- ---- ----
Revenue $487,858 $402,552 $472,636 $1,902,225 $1,463,065
Cost of revenue 329,252 270,748 318,169 1,282,501 993,702
------- ------- ------- --------- -------
Gross profit 158,606 131,804 154,467 619,724 469,363
------- ------- ------- ------- -------
Gross margin 32.5% 32.7% 32.7% 32.6% 32.1%
Operating expenses:
Selling, general and
administrative (SG&A) 101,113 90,154 99,995 398,472 319,531
SG&A as a % of revenue 20.7% 22.4% 21.2% 20.9% 21.8%
Depreciation and
amortization 7,732 5,322 7,789 29,620 20,953
----- ----- ----- ------ ------
Total operating
expenses 108,845 95,476 107,784 428,092 340,484
------- ------ ------- ------- -------
Income from operations 49,761 36,328 46,683 191,632 128,879
Operating margin (1) 10.2% 9.0% 9.9% 10.1% 8.8%
Interest expense, net,
and other 6,400 1,993 3,016 15,465 7,790
----- ----- ----- ------ -----
Income before income
taxes 43,361 34,335 43,667 176,167 121,089
Income tax expense 17,010 14,170 16,371 70,329 39,198
Net income $26,351 $20,165 $27,296 $105,838 $81,891
======= ======= ======= ======== =======
Net income as a % of
revenue 5.4% 5.0% 5.8% 5.6% 5.6%
Other comprehensive income:
Foreign currency
translation 102 33 40 267 75
Unrealized gain (loss)
on cash flow hedge,
net of income taxes 260 429 231 (83) 98
--- --- --- --- ---
Other comprehensive
income 362 462 271 184 173
Comprehensive income $26,713 $20,627 $27,567 $106,022 $82,064
======= ======= ======= ======== =======
Net income per common share:
Basic $0.55 $0.42 $0.57 $2.21 $1.72
===== ===== ===== ===== =====
Diluted $0.54 $0.41 $0.55 $2.15 $1.68
===== ===== ===== ===== =====
Weighted average common shares outstanding:
Basic 47,806 47,699 48,049 47,946 47,525
====== ====== ====== ====== ======
Diluted 49,208 49,157 49,410 49,267 48,843
====== ====== ====== ====== ======
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except per share data and revenue per day)
(unaudited)
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------- ------------
2016 2015 (2) 2016 2016 2015 (2)
Revenue
Nurse and allied solutions $307,898 $263,019 $286,810 $1,185,095 $953,253
Locum tenens solutions 103,822 99,256 108,553 424,242 385,091
Other workforce solutions 76,138 40,277 77,273 292,888 124,721
$487,858 $402,552 $472,636 $1,902,225 $1,463,065
Reconciliation of Non-GAAP Items:
Segment operating income (3)
Nurse and allied solutions $43,262 $33,094 $37,396 $161,779 $123,969
Locum tenens solutions 15,123 13,869 14,026 58,757 48,011
Other workforce solutions 21,139 11,993 20,867 77,450 40,390
79,524 58,956 72,289 297,986 212,370
Unallocated corporate overhead 18,649 12,101 14,235 61,109 47,194
------ ------ ------ ------ ------
Adjusted EBITDA (4) 60,875 46,855 58,054 236,877 165,176
Adjusted EBITDA margin (5) 12.5% 11.6% 12.3% 12.5% 11.3%
Depreciation and amortization 7,732 5,322 7,789 29,620 20,953
Share-based compensation 2,604 3,733 2,704 11,399 10,284
Acquisition and integration costs 778 1,472 878 4,226 5,060
--- ----- --- ----- -----
Income from operations 49,761 36,328 46,683 191,632 128,879
Interest expense, net, and other 6,400 1,993 3,016 15,465 7,790
----- ----- ----- ------ -----
Income before income taxes 43,361 34,335 43,667 176,167 121,089
Income tax expense 17,010 14,170 16,371 70,329 39,198
------ ------ ------ ------ ------
Net income $26,351 $20,165 $27,296 $105,838 $81,891
GAAP diluted net income per share (EPS) $0.54 $0.41 $0.55 $2.15 $1.68
Adjustments:
Amortization of intangible assets 0.10 0.06 0.09 0.37 0.24
Acquisition and integration costs 0.01 0.03 0.02 0.09 0.10
IRS adjustment 0.00 0.00 0.00 0.00 (0.25)
Debt financing related costs 0.02 0.00 0.00 0.02 0.00
Tax effect of adjustments (0.05) (0.03) (0.04) (0.19) (0.13)
Adjusted diluted EPS (6) $0.62 $0.47 $0.62 $2.44 $1.64
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, September 30, December 31,
------------ ------------- ------------
2016 2015(2) 2016 2016 2015(2)
Gross Margin
Nurse and allied
solutions 27.3% 27.1% 26.7% 26.9% 27.1%
Locum tenens
solutions 30.8% 31.2% 31.2% 31.1% 30.2%
Other workforce
solutions 55.7% 73.6% 56.7% 57.8% 75.9%
Operating Data:
---------------
Nurse and allied
solutions
Average healthcare
professionals on
assignment -
consolidated (7) 8,764 8,032 8,458 8,508 7,512
Locum tenens
solutions
Days filled (8) 57,008 55,929 59,612 235,854 229,300
Revenue per day
filled (9) $1,821 $1,775 $1,821 $1,799 $1,679
As of December 31, As of September 30,
------------------ -------------------
2016 2015 2016
Leverage ratio
(10) 1.6 1.4 1.7
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)
(unaudited)
December 31, September 30, December 31,
2016 2016 2015
---- ---- ----
Assets
Current assets:
Cash and cash
equivalents $10,622 $15,708 $9,576
Accounts receivable,
net 341,977 331,220 277,996
Accounts receivable,
subcontractor 49,233 42,094 50,807
Prepaid and other
current assets 48,796 44,635 37,249
------ ------ ------
Total current assets 450,628 433,657 375,628
Restricted cash, cash
equivalents 31,287 28,222 27,352
and investments
Fixed assets, net 59,954 57,965 50,134
Other assets 57,534 57,296 47,569
Goodwill 341,754 342,174 204,779
Intangible assets, net 245,724 250,455 174,970
------- ------- -------
Total assets $1,186,881 $1,169,769 $880,432
========== ========== ========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and
accrued expenses $137,512 $118,289 $118,822
Accrued compensation
and benefits 107,993 99,629 83,701
Current portion of
revolving credit
facility ---- ---- 30,000
Current portion of
notes payable 3,750 3,750 7,500
Deferred revenue 8,924 8,446 5,620
Other current
liabilities 16,661 9,962 5,374
------ ----- -----
Total current
liabilities 274,790 240,076 251,017
Revolving credit
facility ---- 182,500 52,500
Notes payable, less
unamortized fees 359,192 198,793 128,490
Deferred income taxes,
net 21,420 28,278 22,431
Other long-term
liabilities 82,096 86,949 78,134
------ ------ ------
Total liabilities 737,498 736,596 532,572
Commitments and contingencies
Stockholders' equity 449,383 433,173 347,860
------- ------- -------
Total liabilities and
stockholders' equity $1,186,881 $1,169,769 $880,432
========== ========== ========
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,
------------ ------------
2016 2015 2016 2016 2015
---- ---- ---- ---- ----
Net cash
provided by
operating
activities $47,031 $676 $29,540 $131,851 $56,313
Net cash used
in investing
activities (16,091) (10,451) (8,117) (257,362) (116,085)
Net cash
provided by
(used in)
financing
activities (36,128) 4,910 (26,817) 126,290 56,200
Effect of
exchange
rates on cash 102 33 40 267 75
--- --- --- --- ---
Net increase
(decrease) in
cash and cash
equivalents (5,086) (4,832) (5,354) 1,046 (3,497)
Cash and cash
equivalents
at beginning
of period 15,708 14,408 21,062 9,576 13,073
------ ------ ------ ----- ------
Cash and cash
equivalents
at end of
period $10,622 $9,576 $15,708 $10,622 $9,576
======= ====== ======= ======= ======
AMN Healthcare Services, Inc.
Additional Supplemental Non-GAAP Disclosures
Reconciliation of Guidance Adjusted EBITDA Margin to
Guidance Operating Margin
(unaudited)
Three Months Ending
-------------------
March 31, 2017
--------------
Adjusted EBITDA margin 12.5% (11)
Deduct:
Share-based compensation 0.5%
Acquisition and integration costs 0.1%
EBITDA margin 11.9%
----
Depreciation and amortization 1.6%
---
Operating margin 10.3%
====
(1) Operating margin represents income
from operations divided by revenue.
(2) Effective as of January 1, 2016, we
modified our reportable segments. We
previously utilized three reportable
segments, which we identified as
follows: (a) nurse and allied
healthcare staffing, (b) locum
tenens staffing and (c) physician
permanent placement services. In
light of our acquisitions over the
past several years as well as our
transition to a healthcare workforce
solutions company, our management
renamed our three reportable
segments and also placed several of
our business lines that were in our
nurse and allied healthcare staffing
segment into a different segment to
better reflect how the business is
evaluated by our chief operating
decision maker. As of January 1,
2016, we began to disclose the
following three reportable segments:
(a) nurse and allied solutions, (b)
locum tenens solutions, and (c)
other workforce solutions. The nurse
and allied solutions segment
consists of our travel nurse,
allied, local and labor disruption
and rapid response staffing
businesses. The locum tenens
solutions segment consists of our
locum tenens staffing business. The
other workforce solutions segment
consists of our healthcare interim
leadership staffing and executive
search services business, physician
permanent placement services
business, recruitment process
outsourcing business, vendor
management systems business,
workforce optimization services
business, medical coding and related
consulting business, and our
education business. Prior period
data has been reclassified to
conform to the new segment reporting
structure.
(3) 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.
(4) 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 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.
(5) Adjusted EBITDA margin represents
adjusted EBITDA divided by revenue.
(6) Adjusted diluted EPS represents GAAP
diluted EPS excluding the impact of
(A) amortization of intangible
assets, (B) acquisition and
integration costs, (C) IRS
adjustment, (D) debt financing
related costs, and (E) tax effect,
if any, of the foregoing
adjustments. 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.
Average healthcare professionals on
assignment represents the average
number of nurse and allied
healthcare professionals on
assignment during the period
(7) 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.
