ARA Investor Presentation

Q1 2020

Disclaimers

Forward-Looking Statements

Statements in this press release that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our outlook for Adjusted EBITDA-NCI, are based upon currently available information, operating plans and projections about future events and trends. Terminology such as "anticipate," "believe," "contemplate," "estimate," "expect," "forecast," "intend," "may," "objective," "outlook," "plan," "potential," "project," "seek," "should," "strategy," "target" or "will" or variations of such words or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such terms.

Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from those predicted in such forward-looking statements. Such risks and uncertainties include, among others, the effect of the ongoing COVID-19 pandemic and responses thereto; the effect of the restatement of our previously issued financial results and related matters; our ability to remediate material weaknesses in our internal controls over financial reporting; continuing decline in the number of patients with commercial insurance, including as a result of changes to the healthcare exchanges or changes in regulations or enforcement of regulations regarding the healthcare exchanges and challenges from commercial payors or any regulatory or other changes leading to changes in the ability of patients with commercial insurance coverage to receive charitable premium support; decline in commercial payor reimbursement rates, including with respect to Medicare Advantage plans; the ultimate resolution of the Centers for Medicare and Medicaid Services Interim Final Rule published December 14, 2016 related to dialysis facilities Conditions for Coverage (CMS 3337-IFC), including an issuance of a different but related Final Rule; reduction of government-based payor reimbursement rates or insufficient rate increases or adjustments that do not cover all of our operating costs; our ability to successfully develop de novo clinics, acquire existing clinics and attract new nephrologist partners; our ability to compete effectively in the dialysis services industry; the performance of our joint venture subsidiaries and their ability to make distributions to us; changes to the Medicare end-stage renal disease ("ESRD") program that could affect reimbursement rates and evaluation criteria, as well as changes in Medicaid or other non-Medicare government programs or payment rates, including the ESRD prospective payment rate system final rule for 2020 issued October 31, 2019; federal or state healthcare laws that could adversely affect us; our ability to comply with all of the complex federal, state and local government regulations that apply to our business, including those in connection with federal and state anti- kickback laws and state laws prohibiting the corporate practice of medicine or fee-splitting; heightened federal and state investigations and enforcement efforts; the impact of the SEC investigation; changes in the availability and cost of erythropoietin-stimulating agents and other pharmaceuticals used in our business; changes in the reimbursement rates of the calcimimetics pharmaceutical class reimbursed under the Medicare Transitional Drug Add-on Payment Adjustment; development of new technologies or government regulation that could decrease the need for dialysis services or decrease our in-center patient population; our ability to timely and accurately bill for our services and meet payor billing requirements; claims and losses relating to malpractice, professional liability and other matters; the sufficiency of our insurance coverage for those claims and rising insurances costs, and negative publicity or reputational damage arising from such matters; loss of any members of our senior management; damage to our reputation or our brand and our ability to maintain brand recognition; our ability to maintain relationships with our medical directors and renew our medical director agreements; shortages of qualified skilled clinical personnel, or higher than normal turnover rates; competition and consolidation in the dialysis services industry; deterioration in economic conditions, particularly in states where we operate a large number of clinics, or disruptions in the financial markets or the effects of natural or other disasters, public health crises or adverse weather events; the participation of our physician partners in material strategic and operating decisions and our ability to favorably resolve any disputes; our ability to honor obligations under the joint venture operating agreements with our physician partners were they to exercise certain put rights and other rights; unauthorized disclosure of personally identifiable, protected health or other sensitive or confidential information; our ability to meet our obligations and comply with restrictions under our substantial level of indebtedness; and the ability of our principal stockholder, whose interests may conflict with yours, to strongly influence or effectively control our corporate decisions.

For additional information and other factors that could cause ARA's actual results to materially differ from those set forth herein, please see ARA's filings with the SEC. Investors are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. ARA undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

Use of Non-GAAP Financial Measures

In addition to the results prepared in accordance with generally accepted accounting principles in the United States ("GAAP") provided throughout this press release, the Company has presented the following Non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA less noncontrolling interests, Adjusted net income (loss) attributable to American Renal Associates Holdings, Inc., Adjusted cash provided by (used in) operating activities and Adjusted owned net debt, which exclude various items detailed in the attached "Reconciliation of Non-GAAP Financial Measures."

These Non-GAAP financial measures are not intended to replace financial performance and liquidity measures determined in accordance with GAAP. Rather, they are presented as supplemental measures of the Company's performance and liquidity that management believes may enhance the evaluation of the Company's ongoing operating results. Please see "Reconciliation of Non-GAAP Financial Measures" for additional reasons why these measures are provided.

2

Our Core Values

  • Take good care of the patients and the financial success will follow
    • Enable the nephrologist to practice as he / she deems appropriate
      • Provide the nephrologist the autonomy to make operational decisions
        • Acknowledge that clinic staff members are a critical and valuable asset; do everything possible to hire and retain the best possible staff
          • Listen to the practitioners and provide the tools needed to take excellent care of their patients
            • The Corporate office works for our staff, our doctors and our patients

3

At a Glance: Largest Dialysis Services Provider in the U.S. Focused on the Physician Partnership Model

American Renal Associates at a Glance(1)

American Renal Associates Financial Profile

247 Clinics Serving more than 17,300 Patients

Net Revenue: $823 million (2019A)

Partnerships with ~400 Local Nephrologists

Adj. EBITDA-NCI: $88 million (2019A)*

Operating in 27 States and the District of Columbia

Normalized Treatment Growth: 7.3% & NAG: 5.3% (2019A)(2)

  1. As of March 31, 2020.
  2. Normalized for clinic sales and treatment days. NAG represents normalizednon-acquired treatment growth.

*See Appendix for Definitions and Reconciliations of Non-GAAP Financial Measures.

4

American Renal Associates' Senior Management Team

Joseph A. Carlucci

Syed T. Kamal

Don Williamson,

Mark Herbers

Darren Lehrich

M.D.

Co-Founder,

CEO and Chairman

  • Co-foundedARA in 1999
  • President and CEO of Optimal Renal Care
  • VP of Administration, Fresenius Medical Care
  • Director of U.S. Operations, Fresenius Medical Care
  • Regional Manager, Fresenius Medical Care
  • Facility Administrator, Fresenius Medical Care

Co-Founder,

President and Director

  • Co-foundedARA in 1999
  • President, Southern Business Unit, Fresenius Medical Care
  • VP of Operations, N. America, Fresenius Medical Care
  • Director of Operations, International, Fresenius Medical Care
  • Regional Manager,Mid-Atlantic & Southeast, Fresenius Medical Care

EVP and COO

  • ARA Physician Partner since 2002
  • ARA Chief Medical Officer since 2011
  • Practicing Nephrologist for 26 years
  • President, CEO, and Managing Partner of Nephrology Associates P.C.
  • Co-founder,CEO, and Managing Partner of Kinetic Decision Solutions
    LLC
  • Member of ESRD Advisory Council

Interim CFO

  • Joined ARA in 2019
  • Director, Alix Partners since 2014
  • Managing Director FTI Consulting from2004-2014
  • Significant consulting, revenue cycle, reimbursement and financial leadership experience in other health care organizations

SVP, Strategy & Investor Relations

  • Joined ARA in 2015
  • Managing Director, Deutsche Bank
  • Managing Director, Piper Jaffray & Co.
  • Vice President, SunTrust Robinson Humphrey
  • Vice President, Furman Selz

5

Treatment Volume Growth

Normalized Total Treatment Growth

Normalized Non-Acquired Treatment Growth

15.4%

12.0%

8.8%

6.1%

7.3%

7.2%

4.7%

2015A

2016A(1)2017A(2)2018A(1)

2019A(1)

YTD(1)

YTD(1)

Mar

Mar

2019A

2020A

11.7%

11.4%

8.6%

5.0%

5.3%

5.3%

4.4%

2015A

2016A(1)2017A(2)2018A(1)2019A(1)

YTD(1)

YTD (1)

Mar

Mar

2019A

2020A

(1)

Normalized for clinic sales and treatment days.

(2)

Normalized for clinic sales, treatment days, and 2017 Hurricanes.

6

Why Patients Choose ARA Clinics

  • Relationship with high quality nephrologists
  • Well trained and compassionate clinical staff
  • Convenient location and flexible scheduling capability
  • Continuity of staff that enhances trust and patient interaction
  • State of the art amenities and cleanliness of facilities

7

Strong Patient Satisfaction - ICH-CAHPS Survey Results

Press-GaneyICH-CAHPS Patient Satisfaction Survey Results

(November 2019 - January 2020)

79% 81%

72%

75%

70%

68%

69%

68%

68%

66%

64%

64%

better

better

better

better

better

better

4%

6%

6%

2%

4%

2%

Rate Kidney Doctors

Rate Dialysis Center

Rate Dialysis Center

Nephrologists'

Quality of Dialysis

Providing Information

Staff

Communication &

Center Care &

to Patients

Caring

Operations

Industry Average

ARA Average

Note: Figures may not sum due to rounding.

Source: Press-GaneyIn-Center Hemodialysis Consumer Assessment of Healthcare Providers and Systems (ICH-CAHPS) Priority Index Survey Data. Surveys

received November 2019 - January 2020. Industry average based on n=2,792 dialysis facilities. Press-Ganey: Top Rating is a 9-10 Score, based on a scale of 0-10.

8

Strong Quality Outcomes Driven By Low Staff Turnover

Strong Culture Drives Low Voluntary Dialysis

Clinic Staff Turnover

Low Staff

Turnover

Drives:

• Operating

Efficiency

7.8%

7.8%

7.8%

• Clinical

6.6%

6.9%

Outcomes

2015A

2016A

2017A

2018A

2019A

(1) Source: QIP data from CMS

ARA out-performs industry in Medicare's ESRD Quality Incentive Program ("QIP"), which is CMS' largest value-based program in dialysis segment(1)

Average QIP Score

64.1

63.3

Industry Average

ARA

Average for Performance Years 2016-2018

9

Revenue per Treatment and Mix Trends

Net Patient Service Operating

2019A Commercial Treatment Mix

Revenues Per Treatment

$369

$378

$333

$349

$334

$324

$312

12%

88%

2015A

2016A

2017A

2018A

2019A

YTD

YTD

Mar

Mar

2019A

2020A

Commercial

Government

Accelerated Contracting Efforts

YTD 2020A Commercial Treatment Mix

▪ In-network treatment volume represents 84%

12%

of commercial treatments in 2020 which is up from 79% in 2019, and up from 62% in 2018

88%

Note: Commercial treatment mix includes Veterans Affairs (VA) treatments.

Commercial

Government

10

Financial and Operational Review

Q1 2020

De Novo Clinics

Existing Physician Partners

New Physician Partners

Partner Satisfaction

Brand Recognition in Nephrology Community

Attractive Growth

Clinical Autonomy

Patient Satisfaction

Comprehensive Clinic Management Services

Success with De Novo Clinic Openings

Clinics with

New Partners

Since 2015

33

Clinics with

39

Existing Partners

Since 2015

Total: 72 Clinics

Note: Figures for clinic openings are January 1, 2015 through March 31, 2020.

12

Development Track Record

  • ARA's development is driven by its reputation in the Nephrology community:
    • Through De Novo growth in new markets
    • Through De Novo expansion in existing local markets
    • Through selectively acquiring majority ownership in other dialysis clinics

De Novo

Acquired

26

22

22

22

6

5

11

18

2

18

13

15

2

3

14

12

12

12

11

3

1

10

2

10

3

9

5

8

3

7

3

6

5

2

2

5

1

1

1

5

7

3

5

9

5

11

12

7

8

12

16

17

15

16

20

15

13

7

1

2000A 2001A 2002A 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019A

YTD

Mar

2020A

1

8

19

27

31

43

53

64

75

83

93

108

129

150

175

192

214

228

241

246

247

Cumulative Clinic Growth Since Inception

De Novo

205

Acquired

64

Sold

(11)

Closed

(1)

Merged

(10)

13

Total

247

Historical Net Revenue and Adjusted EBITDA

Net Patient Service Operating Revenues

Adjusted EBITDA *

$767

$806

$823

$824

$729

$667

2015A

2016A

2017A

2018A

2019A

LTM Mar

2020A

Notes:

$ in millions.

Figures may not sum due to rounding.

14

* See Appendix for Definitions and Reconciliations of Non-GAAP Financial Measures.

$229

$201

$99

$161

$81

$141

$128

$126

$63

$51

$40

$40

$121

$131

$98

$90

$88

$87

2015A

2016A

2017A

2018A

2019A

LTM Mar

2020A

Adj EBITDA-NCI *

NCI

Annual Operating Performance Trends: 2015A - 2019A

Patients

Operating Net Revenue & Cost per Treatment

17,306

RPT

CPT (1)

15,637

16,543

$369

$378

14,590

$333

$349

$334

13,151

$291

$260

$266

$262

$285

2015A

2016A

2017A

2018A

2019A

2015A

2016A

2017A

2018A

2019A

Treatments

Normalized Non-Acquired Treatment Growth

2,191,172

2,311,037

2,460,710

11.7%

11.4%

2,027,423

1,804,910

8.6%

5.0%

5.3%

2015A

2016A

2017A

2018A

2019A

2015A

2016A(2)

2017A(3)

2018A(2)

2019A(2)

(1)

executive

transactions at the time of the IPO ("Modification Expense"), and gains or losses on sales.

(2)

Normalized for clinic sales and treatment days.

15

(3)

Normalized for clinic sales, treatment days, and 2017 Hurricanes.

Quarterly Operating Performance Trends: Q1 2020A vs. Q1 2019A

Normalized Treatment Growth

7.2%

1.9%

4.7%

0.3%

5.3%

4.4%

Q1' 2019A(1)

Q1' 2020A(1)

Normalized Non-Acquired Treatment Growth Normalized Acquired Treatment Growth

Net Revenue ($ in 000s)

Operating Net Revenue & Cost per Treatment

RPT

CPT (2)

$324

$294

$312

$287

Q1' 2019A

Q1' 2020A

Adjusted EBITDA-NCI * ($ in 000s)

$191,762

$193,182

$13,877

$12,922

Q1' 2019A

Q1' 2020A

Q1' 2019A

Q1' 2020A

  1. Normalized for clinic sales and treatment days.
  2. Cost per treatment (CPT) includes patient care expense and G&A expense, excludes executive severance, executive retirement, and expense related to the modification of options, other transactions at the time of the IPO ("Modification Expense"), and gains or losses on sales.

* See Appendix for Definitions and Reconciliations of Non-GAAP Financial Measures.

16

Cash Flow

Key Points

▪

Restatement process

Cash Flow

impacted 2019 CFFO due to

from

higher legal and professional

fees, credit agreement

Operations

amendment costs, as well as

other factors.

Distributions

▪

Should closely approximate

to Non-

NCI from the income

Controlling

statement over long-term.

Interests

Cash Flow Statistics ($ in millions)

$134

$172

$129

$106

$39

$(10)

$14

2015A

2016A

2017A

2018A

2019A

YTD

YTD

Mar

Mar

2019A

2020A

$79

$94

$79

$71

$63

$5

$11

2015A

2016A

2017A

2018A

2019A

YTD

YTD

Mar

Mar

2019A

2020A

Routine

▪ Routine capex 0.5% to 1% of

$11

$13

$12

$7

$6

$2

$2

Capitalnet revenue (expected 2020).

Expenditures

2015A 2016A 2017A 2018A 2019A YTD

YTD

Mar

Mar

2019A

2020A

$48

Development

▪ Development capex ~2% of

$35

$30

$33

$17

$7

$4

Capitalnet revenue (expected 2020).

Expenditures

2015A 2016A 2017A 2018A 2019A YTD

YTD

Mar

Mar

2019A

2020A

17

Selected Balance Sheet Highlights

Adjusted Owned Net Debt

($ in millions)

Adjusted Owned Net Debt

as of March 31, 2020

Total ARA

ARA "Owned"

Cash (other than clinic-level cash)

$38.6

$38.6

Clinic-level cash

23.7

12.6

Total Cash

$62.4

$51.2

Debt (other than clinic-level debt)

$526.8

$526.8

Clinic-level debt

102.8

55.4

Unamortized debt discount and fees

(11.7)

(11.6)

Total Debt

$617.9

$570.6

Adjusted Owned Net Debt (total debt - total cash)

$519.4

Note: Numbers may not add due to rounding.

.

18

Appendix

Appendix

Historical Quarterly Financial and Operating Data

Summary Quarterly Financial Data:

Three Months Ended

2018

2019

2020

$ in millions

March 31

June 30

September 30

December 31

March 31

June 30

September 30

December 31

March 31

Net patient service operating revenues

$

186.3

$

206.0

$

205.7

$

207.8

$

191.8

$

213.3

$

211.4

$

206.1

$

193.2

Net income (loss)

7.2

(8.4)

12.5

11.2

(5.1)

5.1

17.0

9.1

(2.3)

Adjusted EBITDA including noncontrolling interests (1)

28.3

40.0

36.5

36.5

19.2

37.6

38.7

32.0

17.8

Less: Noncontrolling interests

(11.0)

(15.3)

(13.2)

(11.7)

(5.3)

(13.3)

(12.3)

(9.0)

(4.9)

Adjusted EBITDA-NCI(2)

17.3

24.8

23.3

24.7

13.9

24.3

26.5

23.0

12.9

Summary Quarterly Operating Data:

Three Months Ended

2018

2019

2020

March 31

June 30

September 30

December 31

March 31

June 30

September 30

December 31

March 31

Treatments

558,936

572,929

578,982

600,190

591,365

614,844

625,684

628,817

619,549

Normalized total treatment growth

6.3 %

6.3 %

6.1 %

5.6 %

7.2 %

7.9 %

7.9 %

6.0 %

4.7 %

Net patient service operating revenues per treatment:

$

333

$

359

$

355

$

346

$

324

$

347

$

338

$

328

$

312

Adjusted patient care costs per treatment (2):

$

240

$

247

$

252

$

247

$

251

$

249

$

247

$

246

$

249

Adjusted general and administrative expenses per

treatment (3):

$

45

$

46

$

43

$

42

$

44

$

39

$

32

$

34

$

38

Total adjusted costs per treatment

$

285

$

293

$

295

$

289

$

294

$

287

$

279

$

280

$

287

Note: Figures may not sum due to rounding.

  1. See "Use ofNon-GAAP Financial Measures."
  2. The three months ended September 30, 2019 excludes severance expenses.
  3. The three months ended March 31, 2018 excludes a gain on sale of clinics, the three months ended March 31, 2019 excludes severance expense and a gain on sale of clinics, the three months ended June 30, 2019 excludes severance expense, the three months ended September 30, 2019 excludes a bonus adjustment for prior years, a gain on sale of clinics, and severance expense adjustments, the three months ended December 31, 2019 excludes loss on sale of clinics, and the three months ended March 31, 2020 excludes severance, executive retirement and related costs, stock compensation, modification expense and loss on sale or closure of clinics.

20

Appendix

Reconciliation of Non-GAAP Financial Measures

We use Adjusted EBITDA and Adjusted EBITDA-NCI to track our performance. "Adjusted EBITDA" is defined as net income before stock-based compensation and associated payroll taxes, depreciation, amortization and impairment, interest expense, net, income taxes and other non-income-based tax, change in fair value of income tax receivable agreement, certain legal and other matters, severance, executive retirement and related costs and gain or loss on sale or closure of clinics. "Adjusted EBITDA-NCI" is defined as Adjusted EBITDA less net income attributable to noncontrolling interests. We believe Adjusted EBITDA and Adjusted EBITDA-NCI provide information useful for evaluating our business and a further understanding of our results of operations from management's perspective. We believe Adjusted EBITDA is helpful in highlighting trends because Adjusted EBITDA excludes certain expenses that can differ significantly from company to company depending on, among other things, long-term strategic decisions regarding capital structure and investments, and the tax jurisdictions in which companies operate, or that we believe do not reflect our core business operations. We believe Adjusted EBITDA-NCI is helpful in highlighting the amount of Adjusted EBITDA that is available to us after reflecting the interests of our joint venture partners. Adjusted EBITDA and Adjusted EBITDA-NCI are not measures of operating performance computed in accordance with GAAP and should not be considered as a substitute for operating income, net income, cash flows from operations, or other statement of operations or cash flow data prepared in conformity with GAAP, or as measures of profitability or liquidity. In addition, Adjusted EBITDA and Adjusted EBITDA-NCI may not be comparable to similarly titled measures of other companies and differ from the calculation of "Consolidated EBITDA" under our credit agreement. Adjusted EBITDA and Adjusted EBITDA-NCI may not be indicative of historical operating results, and we do not mean for these items to be predictive of future results of operations or cash flows. Adjusted EBITDA and Adjusted EBITDA-NCI have limitations as analytical tools, and they should not be considered in isolation, or as substitutes for an analysis of our results as reported under GAAP. Some of these limitations are that Adjusted EBITDA and Adjusted EBITDA-NCI: do not include stock-based compensation expense and associated payroll taxes; do not include depreciation, amortization and impairment-because construction and operation of our dialysis clinics requires significant capital expenditures, depreciation and amortization are a necessary element of our costs and our ability to generate profits; do not include interest expense-as we have borrowed money for general corporate and facility purposes, interest expense is a necessary element of our costs and ability to generate profits and cash flows; do not include income tax expense or benefits and other non-income-based taxes; do not include change in fair value of income tax receivable agreement; do not include costs related to certain legal and other matters; do not include severance, executive retirement and related costs; and do not reflect the gain or loss on sale or closure of clinics.

In addition, Adjusted EBITDA is not adjusted for the portion of earnings that we distribute to our joint venture partners.

We use Adjusted net income (loss) attributable to American Renal Associates Holdings, Inc. because it is a useful measure to evaluate our performance by excluding the impact of certain items that we believe are not related to our normal business operations and/or are a result of changes in our liabilities from period to period. See the notes to the tables below for further explanation of the exclusion of certain items. By excluding these items, we believe Adjusted net income allows us and investors to evaluate our net income on a more consistent basis. "Adjusted net income (loss) attributable to American Renal Associates Holdings, Inc." is defined as Net income (loss) attributable to American Renal Associates Holdings, Inc. plus or minus, as applicable, certain legal and other matters costs, severance, executive retirement and related costs, loss (gain) on sale or closure of clinics, change in valuation allowance for held for sale assets, change in fair value of income tax receivable agreement, tax valuation and other tax adjustments and accounting changes in fair value of non-controlling interest puts, net of taxes. We use the Adjusted weighted average number of diluted shares to calculate Adjusted net income (loss) attributable to American Renal Associates Holdings, Inc. per share.

We use Adjusted cash provided (used) by operating activities less distributions to NCI because it is a useful measure to evaluate the cash flow that is available to the Company for investment in property, plant and equipment, debt service, growth and other general corporate purposes. "Adjusted cash provided (used) by operating activities less distributions to NCI" is defined as cash provided by operating activities less distributions to noncontrolling interests.

We use Adjusted owned net debt because we believe it is a useful metric to evaluate the Company's share of interests in the cash on our consolidated balance sheet and the debt of the Company. "Adjusted owned net debt" is defined as debt (other than clinic-level debt) plus clinic-level debt guaranteed by our wholly owned subsidiaries less unamortized debt discounts and fees less cash (other than clinic-level cash) less the Company's pro rata interest in clinic-level cash..

21

Appendix

Quarterly Reconciliation of Adjusted EBITDA and Adjusted EBITDA less NCI

Reconciliation of Net income

Three Months Ended

LTM (1)

March

Adjusted EBITDA

2018

2019

2020

31, 2020

(Dollars in millions)

March 31

June 30

September 30

December 31

March 31

June 30

September 30

December 31

March 31

Net income (loss)

$

7.2

$

(8.4)

$

12.5

$

11.2

$

(5.1)

$

5.1

$

17.0

$

9.1

$

(2.3)

$

29.0

Stock-based compensation and

associated payroll taxes

$

1.4

$

1.7

$

1.3

$

1.6

$

1.4

$

0.9

$

1.0

$

1.5

$

2.8

$

6.2

Depreciation and amortization

$

9.6

$

9.8

$

10.0

$

10.3

$

10.1

$

10.3

$

10.2

$

13.2

$

8.5

$

42.2

Interest expense, net

$

7.5

$

8.1

$

8.2

$

8.8

$

8.8

$

11.5

$

12.2

$

11.1

$

11.0

$

45.8

Income tax expense (benefit) and

other non-income based tax

$

(3.1)

$

(2.0)

$

(0.1)

$

8.6

$

0.8

$

0.9

$

(11.2)

$

(7.6)

$

(3.7)

$

(21.7)

Transaction-related costs

$

0.9

$

-

$

-

$

-

$

-

$

-

$

-

$

-

$

-

$

-

Change in fair value of income tax

receivable

$

1.0

$

(1.7)

$

3.5

$

(5.4)

$

(1.7)

$

0.3

$

-

$

1.1

$

(1.7)

$

(0.2)

Certain legal and other matters (2)

$

4.1

$

32.5

$

1.0

$

1.4

$

5.3

$

8.4

$

9.6

$

2.5

$

2.3

$

22.8

Severance, executive retirement

and related costs

$

-

$

-

$

-

$

-

$

0.2

$

0.2

$

-

$

-

$

0.5

$

0.8

(Gain) loss on sale or closure of

clinics

$

(0.3)

$

-

$

-

$

-

$

(0.5)

$

-

$

(0.3)

$

1.1

$

0.4

$

1.3

Adjusted EBITDA (including

noncontrolling interests)

$

28.3

$

40.0

$

36.5

$

36.5

$

19.2

$

37.6

$

38.7

$

32.0

$

17.8

$

126.2

Less: Net income attributable to

noncontrolling interests

$

(11.0)

$

(15.3)

$

(13.2)

$

(11.7)

$

(5.3)

$

(13.3)

$

(12.3)

$

(9.0)

$

(4.9)

$

(39.5)

Adjusted EBITDA-NCI

$

17.3

$

24.8

$

23.3

$

24.7

$

13.9

$

24.3

$

26.5

$

23.0

$

12.9

$

86.7

Note: Figures may not sum due to rounding.

  1. Last twelve months ("LTM") is the period beginning April 1, 2019 through March 31, 2020.
  2. Certain legal and other matters include legal fees and other expenses associated with matters that we believe do not reflect our core business operations, including, but not limited to, our handling of, and response to the following: the United litigation and settlement; the SEC investigation and related Audit Committee review and restatement process; the securities and derivative litigation related to the foregoing; our internal review and analysis of factual and legal issues relating to the aforementioned matters; and legal fees and other expenses relating to matters that we believe do not reflect our core business operations.

22

Appendix

Annual Reconciliation of Adjusted EBITDA and Adjusted EBITDA less NCI

Reconciliation of Net income (loss) to

LTM (1)

Adjusted EBITDA

Year Ended December 31,

March 31,

(Dollars in millions)

2015

2016

2017

2018

2019

2020

Net income (loss)

$

99.9

$

101.7

$

58.1

$

22.5

$

26.1

$

29.0

Stock-based compensation and associated payroll taxes

1.5

40.3

16.4

5.9

6.2

6.2

Depreciation and amortization

31.8

33.9

37.6

39.8

43.8

42.2

Interest expense, net

45.4

36.0

29.3

32.6

43.6

45.8

Income tax expense (benefit) and other non-income based tax

19.0

2.8

9.8

3.4

(17.2)

(21.7)

Transaction-related costs

2.1

2.2

0.7

0.9

-

-

Loss on early extinguishment of debt

-

4.7

0.5

-

-

-

Change in fair value of income tax receivable

-

(1.3)

(7.2)

(2.7)

(0.2)

(0.2)

Certain legal and other matters (1)

-

6.8

15.2

39.1

25.8

22.8

Executive and management severance costs

-

1.7

0.9

-

0.5

0.8

(Gain) loss on sale or closure of clinics

-

-

(0.5)

(0.3)

0.3

1.3

Management fees

1.8

0.5

-

-

-

-

Adjusted EBITDA (including noncontrolling interests)

201.4

229.2

160.9

141.3

127.5

126.2

Less: Net income attributable to noncontrolling interests

(80.5)

(98.5)

(62.7)

(51.2)

(39.9)

(39.5)

Adjusted EBITDA-NCI

$

120.9

$

130.7

$

98.1

$

90.0

$

87.6

$

86.7

Note: Figures may not sum due to rounding.

  1. Last twelve months ("LTM") is the period beginning April 1, 2019 through March 31, 2020.
  2. Certain legal and other matters include legal fees and other expenses associated with matters that we believe do not reflect our core business operations, including, but not limited to, our handling of, and response to the following: the United litigation and settlement; the SEC Investigation and related Audit Committee review and restatement process; the securities and derivative litigation related to the foregoing; our internal review and analysis of factual and legal issues relating to the aforementioned matters; and legal fees and other expenses relating to matters that we believe do not reflect our core business operations.

23

Appendix

Reconciliation of Adjusted Net Income Attributable to American Renal Associates Holdings, Inc.

Reconciliation of Net income (Loss) to Attributable to American Renal Associates

Three Months Ended

Holdings, Inc. to Adjusted Net Income (Loss) Attributable to American Renal

Associates Holdings, Inc.:

(dollars in thousands, except per share data)

March 31, 2019

June 30, 2019

September 30, 2019

December 31, 2019

March 31, 2020

Net (loss) income attributable to American Renal Associates Holdings, Inc.

$

(10,479)

$

(8,178)

4,777

$

90

(7,234)

Change in the difference between the redemption value and estimated fair value for

accounting purposes of the related noncontrolling interests(1)

(741)

1,025

(1,161)

(7,122)

(258)

Net (loss) income attributable to common shareholders

$

(11,220)

$

(7,153)

$

3,616

$

(7,032)

$

(7,492)

Adjustments:

Certain legal and other matters(2)

5,291

8,381

9,634

2,518

2,287

Severance, executive retirement and related costs

212

243

25

-

515

(Gain) loss on sale or closure of clinics

(512)

-

(264)

1,119

415

Bonus compensation reduction

-

-

(808)

-

-

Impairment for held for sale assets

-

270

675

4,225

505

Total pre-tax adjustments

$

4,991

$

8,894

$

9,262

$

7,862

$

3,722

Tax effect

1,298

2,312

2,408

2,044

968

Net taxable adjustments

$

3,693

$

6,582

$

6,854

$

5,818

$

2,754

Change in fair value of income tax receivable agreement

(1,682)

304

30

1,127

(1,699)

Tax valuation allowance and other tax adjustments(3)

-

-

-

(515)

(3,250)

Change in the difference between the redemption value and estimated fair value for

accounting purposes of the related noncontrollling interests(1)

(741)

1,025

(1,161)

(7,122)

(258)

Total adjustments, net

$

2,752

$

5,861

$

8,045

$

13,552

$

(1,937)

Adjusted net (loss) income attributable to American Renal Associates Holdings, Inc.

$

(8,468)

$

(1,292)

$

11,661

$

6,520

$

(9,429)

Basic Shares outstanding

32,187,715

32,275,807

32,281,818

32,351,067

32,459,792

Adjusted effect of dilutive stock options

-

-

1,336,905

1,447,887

-

Adjusted weighted average number of diluted shares used to compute adjusted net income

attributable to American Renal Associates Holdings, Inc. per share

32,187,715

32,275,807

33,618,723

33,798,954

32,459,792

Adjusted net (loss) income attributable to American Renal Associates Holdings, Inc.

per share

$

(0.26)

$

(0.04)

$

0.35

$

0.19

$

(0.29)

Note: Figures may not sum due to rounding.

  1. Changes in fair values of contractual noncontrolling interest put provisions are related to certain put rights that were accelerated as a result of the IPO.
  2. Certain legal and other matters include legal fees and other expenses associated with matters that we believe do not reflect our core business operations, including, but not limited to, our handling of, and response to the following: the United litigation and settlement; the Restatement and the related SEC investigation and Audit Committee review; the securities and derivative litigation related to the foregoing; our internal review and analysis of factual and legal issues relating to the aforementioned matters; and legal fees and other expenses relating to matters that we

believe do not reflect our core business operations.

(3) Represents a decrease to the Company's established valuation allowance for certain tax items.

24

Attachments

  • Original document
  • Permalink

Disclaimer

American Renal Associates Holdings Inc. published this content on 11 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 May 2020 08:29:07 UTC