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Same Facility Revenue Increases 11.5%
Affirms 2014 Adjusted Earnings Guidance in Range of
Revenue for the first six months of 2014 grew 22.6% to
“We are pleased to report a continuation of strong operating and
financial results for Acadia’s second quarter,” said
“Acadia’s revenue growth for the second quarter was primarily due to the
addition of approximately 675 licensed beds in the 12 months ended
“The strong operating leverage created by double-digit same facility
revenue growth, combined with increased operating efficiencies, produced
a 150 basis point increase in our same facility EBITDA margin to 26.3%.
The Company’s adjusted consolidated EBITDA increased 20.5% to
“Acadia continues to evaluate potential acquisitions and develop new
beds in existing facilities. We are well positioned to finance these
growth strategies, with availability under our revolving credit facility
of approximately
Acadia today affirmed its guidance for 2014 adjusted earnings per
diluted share in a range of
Acadia will hold a conference call to discuss its second quarter
financial results at 9:00 a.m. Eastern Time on
Risk Factors
This news release contains forward-looking statements. Generally words
such as “may,” “will,” “should,” “could,” “anticipate,” “expect,”
“intend,” “estimate,” “plan,” “continue,” and “believe” or the negative
of or other variation on these and other similar expressions identify
forward-looking statements. These forward-looking statements are made
only as of the date of this news release. We do not undertake to update
or revise the forward-looking statements, whether as a result of new
information, future events or otherwise. Forward-looking statements are
based on current expectations and involve risks and uncertainties and
our future results could differ significantly from those expressed or
implied by our forward-looking statements. Factors that may cause actual
results to differ materially include, without limitation, (i) Acadia’s
ability to complete acquisitions and successfully integrate the
operations of acquired facilities, including the PiC facilities; (ii)
Acadia’s ability to add beds, expand services, enhance marketing
programs and improve efficiencies at its facilities; (iii) potential
reductions in payments received by Acadia from the government and
third-party payors; (iv) the occurrence of patient incidents, which
could adversely affect the price of our common stock and result in
incremental regulatory burdens and governmental investigations; (v) the
risk that Acadia may not generate sufficient cash from operations to
service its debt and meet its working capital and capital expenditure
requirements; and (vi) potential operating difficulties, client
preferences, changes in competition and general economic or industry
conditions that may prevent Acadia from realizing the expected benefits
of its business strategy. These factors and others are more fully
described in Acadia’s periodic reports and other filings with the
About Acadia
Acadia is a provider of inpatient behavioral healthcare services. Acadia
operates a network of 75 behavioral healthcare facilities with more than
5,600 licensed beds in 24 states, the
Acadia Healthcare Company, Inc. | ||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenue before provision for doubtful accounts | $ | 220,664 | $ | 182,951 | $ | 426,783 | $ | 348,656 | ||||||||
Provision for doubtful accounts | (6,861 | ) | (5,457 | ) | (11,562 | ) | (9,949 | ) | ||||||||
Revenue | 213,803 | 177,494 | 415,221 | 338,707 | ||||||||||||
Salaries, wages and benefits (including equity-based compensation expense of $2,406, $1,812, $4,170 and $2,413, respectively) |
122,473 | 100,764 | 240,048 | 195,115 | ||||||||||||
Professional fees | 10,891 | 9,324 | 21,273 | 18,338 | ||||||||||||
Supplies | 10,596 | 9,613 | 20,660 | 18,211 | ||||||||||||
Rents and leases | 2,889 | 2,394 | 5,658 | 4,721 | ||||||||||||
Other operating expenses | 24,646 | 20,096 | 47,756 | 37,079 | ||||||||||||
Depreciation and amortization | 5,935 | 4,212 | 11,371 | 7,834 | ||||||||||||
Interest expense, net | 9,730 | 9,445 | 19,437 | 18,207 | ||||||||||||
Debt extinguishment costs | - | - | - | 9,350 | ||||||||||||
Gain on foreign currency derivatives | (13,735 | ) | - | (13,735 | ) | - | ||||||||||
Transaction-related expenses | 3,016 | 1,355 | 4,595 | 2,829 | ||||||||||||
Total expenses | 176,441 | 157,203 | 357,063 | 311,684 | ||||||||||||
Income from continuing operations before income taxes | 37,362 | 20,291 | 58,158 | 27,023 | ||||||||||||
Provision for income taxes | 14,905 | 8,020 | 22,680 | 10,698 | ||||||||||||
Income from continuing operations | 22,457 | 12,271 | 35,478 | 16,325 | ||||||||||||
(Loss) income from discontinued operations, net of income taxes | (6 | ) | (74 | ) | 31 | (390 | ) | |||||||||
Net income | $ | 22,451 | $ | 12,197 | $ | 35,509 | $ | 15,935 | ||||||||
Basic earnings per share: | ||||||||||||||||
Income from continuing operations | $ | 0.43 | $ | 0.24 | $ | 0.70 | $ | 0.33 | ||||||||
(Loss) income from discontinued operations | - | - | - | (0.01 | ) | |||||||||||
Net income | $ | 0.43 | $ | 0.24 | $ | 0.70 | $ | 0.32 | ||||||||
Diluted earnings per share: | ||||||||||||||||
Income from continuing operations | $ | 0.43 | $ | 0.24 | $ | 0.69 | $ | 0.33 | ||||||||
(Loss) income from discontinued operations | - | - | - | (0.01 | ) | |||||||||||
Net income | $ | 0.43 | $ | 0.24 | $ | 0.69 | $ | 0.32 | ||||||||
Weighted-average shares outstanding: | ||||||||||||||||
Basic | 51,616 | 50,009 | 50,872 | 49,961 | ||||||||||||
Diluted | 51,819 | 50,282 | 51,174 | 50,196 | ||||||||||||
Acadia Healthcare Company, Inc. | ||||||
Condensed Consolidated Balance Sheets | ||||||
(Unaudited) | ||||||
June 30, | December 31, | |||||
2014 | 2013 | |||||
(In thousands) | ||||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | 277,744 | $ | 4,569 | ||
Accounts receivable, net of allowance for doubtful accounts of $19,894 and $18,345, respectively | 110,904 | 95,885 | ||||
Deferred tax assets | 12,756 | 15,703 | ||||
Other current assets | 48,192 | 28,969 | ||||
Total current assets | 449,596 | 145,126 | ||||
Property and equipment, net | 419,386 | 370,109 | ||||
Goodwill | 665,695 | 661,549 | ||||
Intangible assets, net | 20,852 | 20,568 | ||||
Deferred tax assets - noncurrent | 4,227 | - | ||||
Other assets | 32,796 | 27,307 | ||||
Total assets | $ | 1,592,552 | $ | 1,224,659 | ||
LIABILITIES AND EQUITY | ||||||
Current liabilities: | ||||||
Current portion of long-term debt | $ | 11,445 | $ | 15,195 | ||
Accounts payable | 31,515 | 36,026 | ||||
Accrued salaries and benefits | 39,445 | 37,721 | ||||
Other accrued liabilities | 20,260 | 25,748 | ||||
Total current liabilities | 102,665 | 114,690 | ||||
Long-term debt | 555,812 | 601,941 | ||||
Deferred tax liabilities - noncurrent | 17,894 | 7,971 | ||||
Other liabilities | 20,959 | 19,347 | ||||
Total liabilities | 697,330 | 743,949 | ||||
Equity: | ||||||
Common stock | 592 | 501 | ||||
Additional paid-in capital | 840,719 | 461,807 | ||||
Retained earnings | 53,911 | 18,402 | ||||
Total equity | 895,222 | 480,710 | ||||
Total liabilities and equity | $ | 1,592,552 | $ | 1,224,659 | ||
Acadia Healthcare Company, Inc. | ||||||||
Condensed Consolidated Statements of Cash Flows | ||||||||
(Unaudited) | ||||||||
Six Months Ended June 30, | ||||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Operating activities: | ||||||||
Net income | $ | 35,509 | $ | 15,935 | ||||
Adjustments to reconcile net income to net cash provided by continuing operating activities: | ||||||||
Depreciation and amortization | 11,371 | 7,834 | ||||||
Amortization of debt issuance costs | 1,334 | 1,110 | ||||||
Equity-based compensation expense | 4,170 | 2,413 | ||||||
Deferred income tax expense | 9,097 | 5,392 | ||||||
(Income) loss from discontinued operations, net of taxes | (31 | ) | 390 | |||||
Debt extinguishment costs | - | 9,350 | ||||||
Gain on foreign currency derivatives | (13,735 | ) | - | |||||
Other | 25 | 14 | ||||||
Change in operating assets and liabilities, net of effect of acquisitions: | ||||||||
Accounts receivable, net | (15,303 | ) | (10,557 | ) | ||||
Other current assets | (4,792 | ) | 107 | |||||
Other assets | (578 | ) | (807 | ) | ||||
Accounts payable and other accrued liabilities | (1,300 | ) | 1,038 | |||||
Accrued salaries and benefits | 1,782 | (3,074 | ) | |||||
Other liabilities | 1,701 | 458 | ||||||
Net cash provided by continuing operating activities | 29,250 | 29,603 | ||||||
Net cash used in discontinued operating activities | (11 | ) | (358 | ) | ||||
Net cash provided by operating activities | 29,239 | 29,245 | ||||||
Investing activities: | ||||||||
Cash paid for acquisitions, net of cash acquired | (10,000 | ) | (121,731 | ) | ||||
Cash paid for capital expenditures | (43,323 | ) | (29,709 | ) | ||||
Cash paid for real estate acquisitions | (18,326 | ) | (3,959 | ) | ||||
Other | (439 | ) | (554 | ) | ||||
Net cash used in investing activities | (72,088 | ) | (155,953 | ) | ||||
Financing activities: | ||||||||
Borrowings on long-term debt | 7,500 | 150,000 | ||||||
Borrowings on revolving credit facility | 59,500 | 8,000 | ||||||
Principal payments on revolving credit facility | (113,000 | ) | (8,000 | ) | ||||
Principal payments on long-term debt | (3,750 | ) | (1,875 | ) | ||||
Repayment of long-term debt | - | (52,500 | ) | |||||
Payment of debt issuance costs | (5,810 | ) | (4,307 | ) | ||||
Payment of premium on note redemption | - | (6,759 | ) | |||||
Issuance of common stock, net | 374,336 | - | ||||||
Common stock withheld for minimum statutory taxes, net | (2,981 | ) | (1,062 | ) | ||||
Excess tax benefit from equity awards | 3,479 | 1,211 | ||||||
Cash paid for contingent consideration | (3,250 | ) | - | |||||
Net cash provided by financing activities | 316,024 | 84,708 | ||||||
Net increase (decrease) in cash and cash equivalents | 273,175 | (42,000 | ) | |||||
Cash and cash equivalents at beginning of the period | 4,569 | 49,399 | ||||||
Cash and cash equivalents at end of the period | $ | 277,744 | $ | 7,399 | ||||
Effect of acquisitions: | ||||||||
Assets acquired, excluding cash | $ | 10,500 | $ | 146,062 | ||||
Liabilities assumed | - | (12,647 | ) | |||||
Prior year deposits paid for acquisitions | (500 | ) | (11,684 | ) | ||||
Cash paid for acquisitions, net of cash acquired | $ | 10,000 | $ | 121,731 | ||||
Acadia Healthcare Company, Inc. | |||||||||||||||||||||||
Operating Statistics | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
(Revenue in thousands) | |||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2014 | 2013 | % Change | 2014 | 2013 | % Change | ||||||||||||||||||
Same Facility Results | |||||||||||||||||||||||
Revenue | $ | 196,981 | $ | 176,743 | 11.5% | $ | 373,391 | $ | 337,297 | 10.7% | |||||||||||||
Patient Days | 294,156 | 265,914 | 10.6% | 558,778 | 512,190 | 9.1% | |||||||||||||||||
Admissions | 16,472 | 14,197 | 16.0% | 30,568 | 27,066 | 12.9% | |||||||||||||||||
Average Length of Stay (a) | 17.9 | 18.7 | -4.7% | 18.3 | 18.9 | -3.4% | |||||||||||||||||
Revenue per Patient Day | $ | 670 | $ | 665 | 0.8% | $ | 668 | $ | 659 | 1.5% | |||||||||||||
EBITDA margin | 26.3% | 24.8% | 150 bps | 26.1% | 24.0% | 210 bps | |||||||||||||||||
Total Facility Results | |||||||||||||||||||||||
Revenue | $ | 212,834 | $ | 176,743 | 20.4% | $ | 413,398 | $ | 337,297 | 22.6% | |||||||||||||
Patient Days | 315,710 | 265,914 | 18.7% | 612,767 | 512,190 | 19.6% | |||||||||||||||||
Admissions | 18,908 | 14,197 | 33.2% | 36,826 | 27,066 | 36.1% | |||||||||||||||||
Average Length of Stay (a) | 16.7 | 18.7 | -10.9% | 16.6 | 18.9 | -12.1% | |||||||||||||||||
Revenue per Patient Day | $ | 674 | $ | 665 | 1.4% | $ | 675 | $ | 659 | 2.4% | |||||||||||||
EBITDA margin | 24.9% | 24.8% | 10 bps | 24.3% | 24.0% | 30 bps | |||||||||||||||||
(a) Average length of stay is defined as patient days divided by admissions. | |||||||||||||||||||||||
Acadia Healthcare Company, Inc. | ||||||||||||||
Reconciliation of Net Income to Adjusted EBITDA | ||||||||||||||
(Unaudited) | ||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(in thousands) | ||||||||||||||
Net income | $ | 22,451 | $ | 12,197 | $ | 35,509 | $ | 15,935 | ||||||
(Income) loss from discontinued operations | 6 | 74 | (31 | ) | 390 | |||||||||
Provision for income taxes | 14,905 | 8,020 | 22,680 | 10,698 | ||||||||||
Interest expense, net | 9,730 | 9,445 | 19,437 | 18,207 | ||||||||||
Depreciation and amortization | 5,935 | 4,212 | 11,371 | 7,834 | ||||||||||
EBITDA | 53,027 | 33,948 | 88,966 | 53,064 | ||||||||||
Adjustments: | ||||||||||||||
Equity-based compensation expense (a) | 2,406 | 1,812 | 4,170 | 2,413 | ||||||||||
Debt extinguishment costs (b) | - | - | - | 9,350 | ||||||||||
Gain on foreign currency derivatives (c) | (13,735 | ) | - | (13,735 | ) | - | ||||||||
Transaction-related expenses (d) | 3,016 | 1,355 | 4,595 | 2,829 | ||||||||||
Adjusted EBITDA | $ | 44,714 | $ | 37,115 | $ | 83,996 | $ | 67,656 | ||||||
See footnotes on page 10. | ||||||||||||||
Acadia Healthcare Company, Inc. | ||||||||||||||||
Reconciliation of Adjusted Income from Continuing Operations to Income from | ||||||||||||||||
Continuing Operations | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Income from continuing operations | $ | 22,457 | $ | 12,271 | $ | 35,478 | $ | 16,325 | ||||||||
Provision for income taxes | 14,905 | 8,020 | 22,680 | 10,698 | ||||||||||||
Income from continuing operations before income taxes | 37,362 | 20,291 | 58,158 | 27,023 | ||||||||||||
Adjustments to income from continuing operations: | ||||||||||||||||
Debt extinguishment costs (b) | - | - | - | 9,350 | ||||||||||||
Gain on foreign currency derivatives (c) | (13,735 | ) | - | (13,735 | ) | - | ||||||||||
Transaction-related expenses (d) | 3,016 | 1,355 | 4,595 | 2,829 | ||||||||||||
Income tax provision reflecting tax effect of adjustments to income from continuing operations (e) |
(10,047 | ) | (8,554 | ) | (18,406 | ) | (15,520 | ) | ||||||||
Adjusted income from continuing operations | $ | 16,596 | $ | 13,092 | $ | 30,612 | $ | 23,682 | ||||||||
Weighted-average shares outstanding - diluted | 51,819 | 50,282 | 51,174 | 50,196 | ||||||||||||
Adjusted income from continuing operations per diluted share | $ | 0.32 | $ | 0.26 | $ | 0.60 | $ | 0.47 | ||||||||
See footnotes on page 10. | ||||||||||||||||
Footnotes | ||
We have included certain financial measures in this press release, including EBITDA, Adjusted EBITDA and Adjusted income from continuing operations, which are “non-GAAP financial measures” as defined under the rules and regulations promulgated by the SEC. We define EBITDA as net income adjusted for loss (income) from discontinued operations, net interest expense, income tax provision and depreciation and amortization. We define Adjusted EBITDA as EBITDA adjusted for equity-based compensation expense, debt extinguishment costs, gain on foreign currency derivatives and transaction-related expenses. | ||
EBITDA, Adjusted EBITDA and Adjusted income from continuing operations are supplemental measures of our performance and are not required by, or presented in accordance with, generally accepted accounting principles in the United States (“GAAP”). EBITDA, Adjusted EBITDA and Adjusted income from continuing operations are not measures of our financial performance under GAAP and should not be considered as alternatives to net income or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as measures of our liquidity. Our measurements of EBITDA, Adjusted EBITDA and Adjusted income from continuing operations may not be comparable to similarly titled measures of other companies. We have included information concerning EBITDA, Adjusted EBITDA and Adjusted income from continuing operations in this press release because we believe that such information is used by certain investors as measures of a company’s historical performance. We believe these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of issuers of equity securities, many of which present EBITDA, Adjusted EBITDA and Adjusted income from continuing operations when reporting their results. Our presentation of EBITDA, Adjusted EBITDA and Adjusted income from continuing operations should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. | ||
(a) Represents the equity-based compensation expense of Acadia. | ||
(b) Represents debt extinguishment costs related to the repayment of $52.5 million of the Company's 12.875% Senior Notes due 2018 on March 12, 2013, including a prepayment premium of $6.8 million and the write-off of $2.6 million of deferred financing costs. | ||
(c) Represents the change in fair value of foreign currency derivatives purchased by Acadia related to its acquisition of Partnerships in Care on July 1, 2014. | ||
(d) Represents transaction-related expenses incurred by Acadia related to acquisitions. | ||
(e) Represents the income tax provision adjusted to reflect the tax effect of the adjustments to income from continuing operations based on effective tax rates excluding the impact of non-deductible transaction-related expenses. |
Source:
Acadia Healthcare Company, Inc.
Brent Turner, 615-861-6000
President