Company to Host Conference Call on
Tuesday, November 7, 2023, at
2:30 p.m. PT/5:30 p.m. ET
ALHAMBRA, Calif., Nov. 7, 2023
/PRNewswire/ -- Apollo Medical Holdings, Inc. ("ApolloMed," and
together with its subsidiaries and affiliated entities, the
"Company") (NASDAQ: AMEH), a leading physician-centric,
technology-powered healthcare company focused on enabling providers
in the successful delivery of value-based care, today announced its
consolidated financial results for the third quarter ended
September 30, 2023.
"I'm pleased to report strong third quarter performance with
total revenue up 10% and capitated revenue up 34% compared to a
year ago. We delivered a 15% adjusted EBITDA margin, we narrowed
our guidance range for the full year, and we ended the third
quarter well-positioned to generate sustainable and profitable
growth going forward," said Brandon
Sim, Co-Chief Executive Officer of ApolloMed.
"Today, we also announced our intent to acquire assets relating
to Community Family Care Medical Group, which currently manages
total cost of care for over 200,000 members, diversifying our
membership mix and providing us a pathway to expand our value-based
Care Partners business. Additionally, we announced two other
provider group partnerships this quarter, which bring a combined
membership of approximately 30,000, and our total number of
provider group partnerships signed this year so far to five,"
continued Mr. Sim.
Mr. Sim concluded, "During the third quarter, we continued to
make strong progress against our key operational goals,
successfully managing our value-based care population, and
delivering high-quality care. Our platform's momentum is
accelerating as we work towards our mission of ensuring that
everyone across the country has access to high-quality and
high-value healthcare, and I am very excited about our
opportunities ahead."
Financial Highlights for Third Quarter Ended
September 30, 2023:
All comparisons are to the quarter ended September 30,
2022 unless otherwise stated.
- Total revenue of $348.2 million,
up 10% from $317.0 million
- Care Partners revenue of $326.5
million, up 11% from $293.6
million
- Net income attributable to ApolloMed of $22.1 million, compared to $23.2 million
- Earnings per share - diluted ("EPS - diluted") of $0.47, compared to $0.50 per share
- Adjusted EBITDA of $52.0 million,
compared to $57.1 million
Financial Highlights for Nine Months Ended September 30, 2023:
All comparisons are to the nine months ended
September 30, 2022 unless otherwise stated.
- Total revenue of $1,033.6
million, up 22% from $850.0
million
- Care Partners revenue of $966.4
million, up 24% from $782.2
million
- Net income attributable to ApolloMed of $48.4 million, compared to $48.9 million
- EPS-diluted of $1.03, compared to
$1.06 per share
- Adjusted EBITDA of $117.6
million, compared to $116.4
million
Recent Operating Highlights:
- On November 3, 2023, the Company
entered into a Third Amendment to the Amended and Restated Credit
Agreement which provides a new term loan to the Company in an
aggregate amount of up to $300.0
million. This increases the Company's facility to
$700.0 million with our existing
$400.0 million revolver. Pursuant to
the Third Amendment, among other changes, ApolloMed (i) increased
the maximum levels of certain forms of permitted indebtedness, (ii)
increased the maximum levels of certain forms of restricted
payments, including the ability to pursue certain specified share
repurchases (up to $300 million)
subject to certain conditions and (iii) increased the maximum
levels for certain permitted investments.
- On November 6, 2023, the Company
entered into a stock repurchase agreement with Allied Physicians of
California, a Professional Medical
Corporation ("APC"), to repurchase approximately $100.0 million of the Company's common stock from
APC. The Company intends to finance the share repurchase with
borrowings under its Third Amendment to the Amended and Restated
Credit Agreement.
- On November 7, 2023, the Company
announced that it and its affiliated professional entity have
entered into an agreement to acquire assets relating to Community
Family Care Medical Group IPA, Inc. ("CFC"), including the CFC
independent physician association, the CFC Health Plan and CFC's
management services organization entities. CFC manages the
healthcare of over 200,000 members in the Los Angeles, California area, serving patients
across Medicare, Medicaid, and Commercial payers and has a
Restricted Knox Keene ("RKK") license for Medicaid members. The
Company intends to finance the acquisition with cash on hand and
borrowings under its Third Amendment to the Amended and Restated
Credit Agreement. The CFC acquisition remains subject to customary
closing conditions.
- On November 7, 2023, the Company
announced a partnership with Associated Hispanic Physicians, a
group of over 150 primary care providers and over 450 specialists
in Los Angeles with around 25,000
Medicaid, Medicare, and Commercial members in value-based care
arrangements, in order to support their group with our Care
Enablement offering. We expect Associated Hispanic Physicians'
providers will be onboarded onto our Care Enablement platform by
March of 2024.
- On November 7, 2023, the Company
announced its expanded relationship with Advantage Health Network,
a group of approximately 15 primary care providers and several
hundred specialists in Los Angeles
which supports around 4,500 Medicaid, Medicare, and Commercial
members in value-based care arrangements. As part of the
partnership, Advantage's providers are slated to join our Care
Partners business. We also acquired five primary care clinics in
the Advantage Health Network, which will be integrated into our
Care Delivery business.
- On November 7, 2023, the Company
announced its strategic partnership with Wider Circle, a peer-based community health
organization working with payers and providers to connect neighbors
for better health. Under this partnership, the two organizations
will provide comprehensive patient-centered care and Enhanced Care
Management for Medicaid members with complex needs, an integral
component of the California Advancing and Innovating Medi-Cal, or
CalAIM, initiative.
Segment Results for the Third Quarter Ended
September 30, 2023:
|
Three Months Ended
September 30, 2023
|
($ in
thousands)
|
Care
Partners
|
|
Care
Delivery
|
|
Care
Enablement
|
|
Other
|
|
Intersegment
Elimination
|
|
|
Corporate
Costs
|
|
Consolidated
Total
|
Total
revenues
|
$
326,499
|
|
$ 29,261
|
|
$ 36,910
|
|
$
294
|
|
$
(44,791)
|
|
|
$
—
|
|
$
348,173
|
% change vs. prior
year quarter
|
11 %
|
|
18 %
|
|
22 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
services
|
279,769
|
|
25,647
|
|
13,658
|
|
76
|
|
(43,775)
|
|
|
—
|
|
275,375
|
General and
administrative(1)
|
6,390
|
|
4,649
|
|
16,804
|
|
875
|
|
(2,086)
|
|
|
7,083
|
|
33,715
|
Total
expenses
|
286,159
|
|
30,296
|
|
30,462
|
|
951
|
|
(45,861)
|
|
|
7,083
|
|
309,090
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
$ 40,340
|
|
$ (1,035)
|
|
$
6,448
|
|
$
(657)
|
|
$
1,070
|
(2)
|
|
$
(7,083)
|
|
$
39,083
|
% change vs. prior
year quarter
|
(13) %
|
|
(133) %
|
|
27 %
|
|
|
|
|
|
|
|
|
|
|
(1) Balance includes general and
administrative expenses and depreciation and
amortization.
|
(2) Income from operations for the
intersegment elimination represents rental income from segments
renting from other segments. Rental income is presented within
other income which is not presented in the table.
|
Guidance:
ApolloMed is narrowing its full-year 2023 guidance. The net
income and EBITDA guidance ranges below include the impact of the
excluded assets held by APC, which are solely for the benefit of
APC and its shareholders. Any gains or losses associated with these
excluded assets do not have an impact on Adjusted EBITDA and
earnings per share — diluted. These guidance ranges are based on
the Company's existing business, current view of existing market
conditions, and assumptions for the year ending December 31, 2023.
($ in
millions)
|
2023 Guidance
Range
|
|
2023 Guidance
Range
|
|
(as of November 7,
2023)
|
|
(as of February 23,
2023)
|
|
Low
|
|
High
|
|
Low
|
|
High
|
Total
revenue
|
$
1,340.0
|
|
$
1,390.0
|
|
$
1,300.0
|
|
$
1,500.0
|
Net income
|
$
59.5
|
|
$
71.5
|
|
$
49.5
|
|
$
71.5
|
EBITDA
|
$
114.5
|
|
$
129.5
|
|
$
89.5
|
|
$
129.5
|
Adjusted
EBITDA
|
$
135.0
|
|
$
150.0
|
|
$
120.0
|
|
$
160.0
|
EPS –
diluted
|
$
1.10
|
|
$
1.20
|
|
$
0.95
|
|
$
1.20
|
See "Guidance Reconciliation of Net Income to EBITDA and
Adjusted EBITDA" and "Use of Non-GAAP Financial Measures" below for
additional information. There can be no assurance that actual
amounts will not be materially higher or lower than these
expectations. See "Forward-Looking Statements" below for additional
information.
Conference Call and Webcast Information:
ApolloMed will host a conference call at 2:30 p.m. PT/5:30 p.m.
ET today (Tuesday, November 7, 2023), during which
management will discuss the results of the third quarter ended
September 30, 2023. To participate in the conference call,
please use the following dial-in numbers about 5 minutes prior to
the scheduled conference call time:
U.S. & Canada
(Toll-Free):
|
+1 (866)
682-6100
|
International
(Toll):
|
+1 (862)
298-0702
|
The conference call can also be accessed via webcast at:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=woZLVfk8.
An accompanying slide presentation will be available in PDF
format on the "IR Calendar" page of the Company's website
(https://www.apollomed.net/investors/news-events/ir-calendar) after
issuance of the earnings release and will be furnished as an
exhibit to ApolloMed's current report on Form 8-K to be filed with
the SEC, accessible at www.sec.gov.
Those who are unable to attend the live conference call may
access the recording at the above webcast link, which will be made
available shortly after the conclusion of the call.
Note About Consolidated Entities
The Company consolidates entities in which it has a controlling
financial interest. The Company consolidates subsidiaries in which
it holds, directly or indirectly, more than 50% of the voting
rights, and variable interest entities ("VIEs") in which the
Company is the primary beneficiary. Noncontrolling interests
represent third party equity ownership interests in the Company's
consolidated entities (including certain VIEs). The amount of net
income attributable to noncontrolling interests is disclosed in the
Company's consolidated statements of income.
Note About Stockholders' Equity, Certain Treasury
Stock and Earnings Per Share
As of the date of this press release, 41,048 holdback shares
have not been issued to certain former shareholders of the
Company's subsidiary, Network Medical Management, Inc. ("NMM"), who
were NMM shareholders at the time of closing of the merger, as they
have yet to submit properly completed letters of transmittal to
ApolloMed in order to receive their pro rata portion of ApolloMed's
common stock and warrants as contemplated under that certain
Agreement and Plan of Merger, dated December
21, 2016, among ApolloMed, NMM, Apollo Acquisition Corp.
("Merger Subsidiary") and Kenneth
Sim, M.D., as amended, pursuant to which Merger Subsidiary
merged with and into NMM, with NMM as the surviving corporation.
Pending such receipt, such former NMM shareholders have the right
to receive, without interest, their pro rata share of dividends or
distributions with a record date after the effectiveness of the
merger. The Company's consolidated financial statements have
treated such shares of common stock as outstanding, given the
receipt of the letter of transmittal is considered perfunctory and
ApolloMed is legally obligated to issue these shares in connection
with the merger.
Shares of ApolloMed's common stock owned by Allied Physicians of
California, a Professional Medical
Corporation d.b.a. Allied Pacific of California ("APC"), a VIE of the Company, are
legally issued and outstanding but excluded from shares of common
stock outstanding in the Company's consolidated financial
statements, as such shares are treated as treasury shares for
accounting purposes. Such shares, therefore, are not included in
the number of shares of common stock outstanding used to calculate
the Company's earnings per share.
About Apollo Medical Holdings, Inc.
ApolloMed is a leading physician-centric, technology-powered,
risk-bearing healthcare company. Leveraging its proprietary
end-to-end technology solutions, ApolloMed operates an integrated
healthcare delivery platform that enables providers to successfully
participate in value-based care arrangements, thus empowering them
to deliver outcomes-based medical care to patients in a
cost-effective manner.
Headquartered in Alhambra,
California, ApolloMed's subsidiaries and affiliates include
management services organizations (MSOs), affiliated independent
practice associations (IPAs), and entities participating in the
Centers for Medicare & Medicaid Services Innovation Center
(CMMI) innovation models. For more information, please visit
www.apollomed.net.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, such as statements about the Company's guidance for the year
ending December 31, 2023, ability to
meet operational goals, ability to meet expectations in deployment
of care coordination and management capabilities, ability to
decrease cost of care while improving quality and outcomes, ability
to deliver sustainable revenue and EBITDA growth as well as
long-term value, ability to respond to the changing environment,
and successful implementation of strategic growth plans,
acquisition strategy, and merger integration efforts.
Forward-looking statements reflect current views with respect to
future events and financial performance and therefore cannot be
guaranteed. Such statements are based on the current expectations
and certain assumptions of the Company's management, and some or
all of such expectations and assumptions may not materialize or may
vary significantly from actual results. Actual results may also
vary materially from forward-looking statements due to risks,
uncertainties and other factors, known and unknown, including the
risk factors described from time to time in the Company's reports
to the SEC, including, without limitation, the risk factors
discussed in the Company's Annual Report on Form 10-K/A for the
year ended December 31, 2022, and any
subsequent quarterly reports on Form 10-Q. Any forward-looking
statement made by the Company in this release speaks only as of the
date on which it is made. The Company undertakes no obligation to
publicly update any forward-looking statement, whether as a result
of new information, future developments or otherwise, except as may
be required by any applicable securities laws.
Restatement
In connection with a review of the Company's income tax
filing structure, the Company identified unintentional errors in
its accounting for the income tax effects of certain intercompany
dividends and certain net operating losses, which resulted in an
understatement of income tax expense in prior periods and also had
an impact on purchase accounting (goodwill) as a portion of the net
operating losses affected by the errors pertained to acquisitions
in prior periods. As a result of the errors, the Company has
restated the December 31, 2022
consolidated balance sheet and the consolidated statement of
operations for each of the three and nine months ended September 30, 2022.
FOR MORE INFORMATION, PLEASE CONTACT:
Investor Relations
(626) 943-6491
investors@apollomed.net
Asher Dewhurst, ICR Westwicke
ApolloMedIR@westwicke.com
APOLLO MEDICAL
HOLDINGS, INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(IN THOUSANDS, EXCEPT
SHARE AND PER SHARE DATA)
|
|
|
|
|
|
|
|
|
September
30,
2023
|
|
December 31,
2022
|
|
|
(Unaudited)
|
|
As
restated
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
273,941
|
|
$
288,027
|
Investments in
marketable securities
|
|
3,021
|
|
5,567
|
Receivables,
net
|
|
95,892
|
|
49,631
|
Receivables, net –
related parties
|
|
86,948
|
|
65,147
|
Other
receivables
|
|
1,501
|
|
1,834
|
Prepaid expenses and
other current assets
|
|
13,953
|
|
14,798
|
Loans
receivable
|
|
973
|
|
996
|
Loan receivable –
related party
|
|
—
|
|
2,125
|
|
|
|
|
|
Total current
assets
|
|
476,229
|
|
428,125
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Land, property, and
equipment, net
|
|
128,575
|
|
108,536
|
Intangible assets,
net
|
|
74,209
|
|
76,861
|
Goodwill
|
|
275,528
|
|
269,053
|
Income taxes
receivable, non-current
|
|
15,943
|
|
15,943
|
Loan receivable,
non-current
|
|
25,040
|
|
—
|
Investments in other
entities – equity method
|
|
44,428
|
|
40,299
|
Investments in
privately held entities
|
|
2,896
|
|
896
|
Restricted cash,
non-current
|
|
345
|
|
—
|
Operating lease
right-of-use assets
|
|
21,482
|
|
20,444
|
Other
assets
|
|
8,586
|
|
6,056
|
|
|
|
|
|
Total non-current
assets
|
|
597,032
|
|
538,088
|
|
|
|
|
|
Total
assets(1)
|
|
$
1,073,261
|
|
$
966,213
|
|
|
|
|
|
Liabilities,
mezzanine equity and equity
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
|
Accounts payable and
accrued expenses
|
|
$
53,136
|
|
$
49,562
|
Fiduciary accounts
payable
|
|
6,257
|
|
8,065
|
Medical
liabilities
|
|
97,519
|
|
81,255
|
Income taxes
payable
|
|
30,112
|
|
4,279
|
Dividend
payable
|
|
638
|
|
664
|
Finance lease
liabilities
|
|
655
|
|
594
|
Operating lease
liabilities
|
|
3,528
|
|
3,572
|
Current portion of
long-term debt
|
|
2,991
|
|
619
|
Other
liabilities
|
|
8,121
|
|
—
|
Total current
liabilities
|
|
202,957
|
|
148,610
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
Deferred tax
liability
|
|
12,145
|
|
14,217
|
Finance lease
liabilities, net of current portion
|
|
1,195
|
|
1,275
|
Operating lease
liabilities, net of current portion
|
|
21,006
|
|
19,915
|
Long-term debt, net of
current portion and deferred financing costs
|
|
206,213
|
|
203,389
|
Other long-term
liabilities
|
|
14,105
|
|
20,260
|
|
|
|
|
|
Total non-current
liabilities
|
|
254,664
|
|
259,056
|
|
|
|
|
|
Total
liabilities(1)
|
|
457,621
|
|
407,666
|
|
|
|
|
|
Mezzanine
equity
|
|
|
|
|
Non-controlling
interest in Allied Physicians of California, a Professional Medical
Corporation
|
|
17,931
|
|
14,237
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
Series A Preferred
stock, par value $0.001; 5,000,000 shares authorized (inclusive
of
Series B Preferred stock); 1,111,111 issued and zero
outstanding
|
|
—
|
|
—
|
Series B Preferred
stock, par value $0.001; 5,000,000 shares authorized (inclusive
of
Series A Preferred stock); 555,555 issued and zero
outstanding
|
|
—
|
|
—
|
Common stock, $0.001
par value per share; 100,000,000 shares authorized,
46,607,356 and 46,575,699 shares issued and outstanding,
excluding 10,569,340 and
10,299,259 treasury shares, at September 30, 2023, and
December 31, 2022,
respectively
|
|
47
|
|
47
|
Additional paid-in
capital
|
|
362,889
|
|
360,097
|
Retained
earnings
|
|
230,778
|
|
182,417
|
Total
stockholders' equity
|
|
593,714
|
|
542,561
|
|
|
|
|
|
Non-controlling
interest
|
|
3,995
|
|
1,749
|
|
|
|
|
|
Total equity
|
|
597,709
|
|
544,310
|
|
|
|
|
|
Total liabilities,
mezzanine equity and equity
|
|
$
1,073,261
|
|
$
966,213
|
|
(1) The
Company's consolidated balance sheets include the assets and
liabilities of its consolidated variable interest entities
("VIEs"). The consolidated balance sheets include total assets that
can be used only to settle obligations of the Company's
consolidated VIEs totaling $554.0 million and
$523.7 million as of September 30, 2023 and
December 31, 2022, respectively, and total liabilities of the
Company's consolidated VIEs for which creditors do not have
recourse to the general credit of the primary beneficiary of
$142.4 million and $131.8 million as of
September 30, 2023 and December 31, 2022, respectively.
The VIE balances do not include $317.7 million of investment
in affiliates and $16.3 million of amounts due to affiliates
as of September 30, 2023 and $304.8 million of investment
in affiliates and $30.3 million of amounts due from affiliates
as of December 31, 2022 as these are eliminated upon
consolidation and not presented within the consolidated balance
sheets.
|
APOLLO MEDICAL
HOLDINGS, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(IN THOUSANDS, EXCEPT
SHARE AND PER SHARE AMOUNTS)
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
(Restated)
|
|
|
|
(Restated)
|
Revenue
|
|
|
|
|
|
|
|
|
Capitation,
net
|
|
$ 305,678
|
|
$ 227,571
|
|
$ 906,430
|
|
$ 677,253
|
Risk pool settlements
and incentives
|
|
15,022
|
|
64,849
|
|
48,605
|
|
101,717
|
Management fee
income
|
|
9,898
|
|
10,030
|
|
32,287
|
|
30,487
|
Fee-for-service,
net
|
|
15,892
|
|
12,859
|
|
41,216
|
|
35,694
|
Other
revenue
|
|
1,683
|
|
1,692
|
|
5,087
|
|
4,804
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
|
348,173
|
|
317,001
|
|
1,033,625
|
|
849,955
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
Cost of services,
excluding depreciation and amortization
|
|
275,375
|
|
240,768
|
|
857,648
|
|
691,566
|
General and
administrative expenses
|
|
29,410
|
|
21,388
|
|
74,648
|
|
53,224
|
Depreciation and
amortization
|
|
4,305
|
|
4,754
|
|
12,846
|
|
13,480
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
309,090
|
|
266,910
|
|
945,142
|
|
758,270
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
39,083
|
|
50,091
|
|
88,483
|
|
91,685
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
(Loss) income from
equity method investments
|
|
(2,104)
|
|
1,452
|
|
3,104
|
|
4,397
|
Interest
expense
|
|
(3,779)
|
|
(2,422)
|
|
(10,680)
|
|
(5,348)
|
Interest
income
|
|
3,281
|
|
223
|
|
9,617
|
|
690
|
Unrealized loss on
investments
|
|
(342)
|
|
(6,763)
|
|
(5,875)
|
|
(17,591)
|
Other income
(expense)
|
|
1,876
|
|
(1,318)
|
|
4,265
|
|
2,328
|
|
|
|
|
|
|
|
|
|
Total other (expense)
income, net
|
|
(1,068)
|
|
(8,828)
|
|
431
|
|
(15,524)
|
|
|
|
|
|
|
|
|
|
Income before
provision for income taxes
|
|
38,015
|
|
41,263
|
|
88,914
|
|
76,161
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
10,042
|
|
17,366
|
|
30,971
|
|
29,537
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
27,973
|
|
23,897
|
|
57,943
|
|
46,624
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to non-controlling interest
|
|
5,914
|
|
712
|
|
9,582
|
|
(2,275)
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Apollo Medical Holdings, Inc.
|
|
$
22,059
|
|
$
23,185
|
|
$
48,361
|
|
$
48,899
|
|
|
|
|
|
|
|
|
|
Earnings per share –
basic
|
|
$
0.47
|
|
$
0.52
|
|
$
1.04
|
|
$
1.09
|
|
|
|
|
|
|
|
|
|
Earnings per share –
diluted
|
|
$
0.47
|
|
$
0.50
|
|
$
1.03
|
|
$
1.06
|
|
|
|
|
|
|
|
|
|
Weighted average shares
used in computing earnings per share:
|
|
|
|
|
|
|
|
|
Basic
|
|
46,547,502
|
|
44,946,725
|
|
46,527,350
|
|
44,795,295
|
Diluted
|
|
46,920,607
|
|
46,152,536
|
|
46,881,567
|
|
45,993,001
|
Reconciliation of
Net Income to EBITDA and Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
(in
thousands)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
(Restated)
|
|
|
|
(Restated)
|
|
Net income
|
|
$
27,973
|
|
$
23,897
|
|
$
57,943
|
|
$
46,624
|
|
Interest
expense
|
|
3,779
|
|
2,422
|
|
10,680
|
|
5,348
|
|
Interest
income
|
|
(3,281)
|
|
(223)
|
|
(9,617)
|
|
(690)
|
|
Provision for income
taxes
|
|
10,042
|
|
17,366
|
|
30,971
|
|
29,537
|
|
Depreciation and
amortization
|
|
4,305
|
|
4,754
|
|
12,846
|
|
13,480
|
|
EBITDA
|
|
42,818
|
|
48,216
|
|
102,823
|
|
94,299
|
|
|
|
|
|
|
|
|
|
|
|
Income from equity
method investments
|
|
2,016
|
|
(1,469)
|
|
(3,160)
|
|
(4,358)
|
|
Other, net
|
|
1,723
|
(1)
|
1,382
|
(2)
|
1,507
|
(1)
|
1,382
|
(2)
|
Stock-based
compensation
|
|
5,706
|
|
3,502
|
|
13,364
|
|
10,477
|
|
APC excluded assets
costs
|
|
(289)
|
(3)
|
5,505
|
|
3,039
|
(3)
|
14,574
|
|
Adjusted
EBITDA
|
|
$
51,974
|
|
$
57,136
|
|
$
117,573
|
|
$
116,374
|
|
|
(1) Other, net for the three and nine
months ended September 30, 2023 relates to transaction costs
incurred for our investments and tax restructuring fees and
non-cash changes related to change in the fair value of our
financing obligation to purchase the remaining equity interests,
changes in the fair value of our contingent liabilities, and
changes in the fair value of the Company's Collar
Agreement.
|
(2) Other, net for the three and nine
months ended September 30, 2022 relates to transaction costs
incurred, net of the write-off related to APCMG contingent
consideration to reflect the fair value as of September 30,
2022.
|
(3) Certain APC minority interests
where APC owns the asset but not the right to the dividends is
reclassified from APC excluded asset costs to income from equity
method investments
|
Guidance
Reconciliation of Net Income to EBITDA and Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
2023 Guidance
Range
|
|
2023 Guidance
Range
|
|
(as of November 7,
2023)
|
|
(as of February 23,
2023)
|
(in
thousands)
|
Low
|
|
High
|
|
Low
|
|
High
|
Net income
|
$
59,500
|
|
$
71,500
|
|
$
49,500
|
|
$
71,500
|
Interest
expense
|
1,500
|
|
1,500
|
|
1,000
|
|
1,000
|
Provision for income
taxes
|
36,500
|
|
39,500
|
|
23,000
|
|
38,000
|
Depreciation and
amortization
|
17,000
|
|
17,000
|
|
16,000
|
|
19,000
|
EBITDA
|
114,500
|
|
129,500
|
|
89,500
|
|
129,500
|
|
|
|
|
|
|
|
|
Loss (income) from
equity method investments
|
(4,500)
|
|
(4,500)
|
|
(750)
|
|
(750)
|
Other, net
|
1,000
|
|
1,000
|
|
3,250
|
|
3,250
|
Stock-based
compensation
|
20,000
|
|
20,000
|
|
16,000
|
|
16,000
|
APC excluded assets
costs
|
4,000
|
|
4,000
|
|
12,000
|
|
12,000
|
Adjusted
EBITDA
|
$
135,000
|
|
$
150,000
|
|
$
120,000
|
|
$
160,000
|
Use of Non-GAAP Financial Measures
This Quarterly Report on Form 10-Q contains the non-GAAP
financial measures EBITDA and Adjusted EBITDA, of which the most
directly comparable financial measure presented in accordance with
U.S. generally accepted accounting principles ("GAAP") is net
income. These measures are not in accordance with, or alternatives
to GAAP, and may be different from other non-GAAP financial
measures used by other companies. The Company uses Adjusted EBITDA
as a supplemental performance measure of our operations, for
financial and operational decision-making, and as a supplemental
means of evaluating period-to-period comparisons on a consistent
basis. Adjusted EBITDA is calculated as earnings before interest,
taxes, depreciation, and amortization, excluding income or loss
from equity method investments, non-recurring and non-cash
transactions, stock-based compensation, and APC excluded assets
costs. Beginning in the third quarter ended September 30, 2022, the Company has revised the
calculation for Adjusted EBITDA to exclude provider bonus payments
and losses from recently acquired IPAs, which it believes to be
more reflective of its business.
The Company believes the presentation of these non-GAAP
financial measures provides investors with relevant and useful
information, as it allows investors to evaluate the operating
performance of the business activities without having to account
for differences recognized because of non-core or non-recurring
financial information. When GAAP financial measures are viewed in
conjunction with non-GAAP financial measures, investors are
provided with a more meaningful understanding of the Company's
ongoing operating performance. In addition, these non-GAAP
financial measures are among those indicators the Company uses as a
basis for evaluating operational performance, allocating resources,
and planning and forecasting future periods. Non-GAAP financial
measures are not intended to be considered in isolation, or as a
substitute for, GAAP financial measures. Other companies may
calculate both EBITDA and Adjusted EBITDA differently, limiting the
usefulness of these measures for comparative purposes. To the
extent this release contains historical or future non-GAAP
financial measures, the Company has provided corresponding GAAP
financial measures for comparative purposes. The reconciliation
between certain GAAP and non-GAAP measures is provided above.
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SOURCE Apollo Medical Holdings, Inc.