Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced
financial results for the first quarter ended March 31, 2012.
Revenue for the first quarter was $91.3 million compared with $16.8
million for the first quarter of 2011. Adjusted net income from
continuing operations was $3.5 million, or $0.11 per diluted share,
for the first quarter of 2012, which excludes transaction related
fees, compared with $1.3 million, or $0.07 per diluted share, for
the first quarter last year, which excludes transaction related
fees and sponsor management fees. Including these costs, income
from continuing operations was $3.4 million, or $0.10 per diluted
share, for the latest quarter compared with a loss from continuing
operations for the first quarter of 2011 of $0.3 million, or $0.01
per diluted share. A reconciliation of all GAAP and non-GAAP
financial results in this release is on pages 7 and 8.
“The strong profitable growth Acadia produced for the first
quarter of 2012 represents a solid step toward achieving our
financial guidance for the full year,” remarked Joey Jacobs,
Chairman and Chief Executive Officer of Acadia. “With the
acquisition of three facilities with 166 acute inpatient
psychiatric beds during the first quarter, we completed the quarter
operating 33 facilities with over 2,100 beds in 19 states, up from
six facilities and approximately 400 beds in five states at the end
the first quarter of 2011.
“While we will continue to evaluate select acquisition
opportunities in a highly fragmented market, we are focused on
producing organic revenue growth and margin expansion within our
existing facilities through the addition of beds, the broadening of
services, enhanced marketing programs and efficiency improvement
initiatives. The margin opportunity in executing these initiatives
well is reflected in a 24.6% same-facility EBITDA margin for the
first quarter of 2012 for our six legacy facilities compared with
the 20.7% EBITDA margin for all facilities. With improving
operating leverage, we also expect to expand our consolidated
EBITDA margin, which increased to 16.7% of revenue for the latest
quarter from 15.4% for the first quarter last year.
“Our profitable growth supports our ability to fund our organic
growth initiatives and acquisition strategy, as well as our
relatively low annual maintenance capital expenditures of
approximately 2% of revenues. In addition to our substantial cash
flow from operations, we also have availability of approximately
$68 million under our revolving line of credit at the end of the
first quarter.
“We are pleased to announce that Brent Turner, formerly
Co-President of the Company, has been named President of Acadia and
that Steve Davidson has joined Acadia as Chief Development Officer.
Both of these men are experienced, highly capable leaders, who were
instrumental in the successful development of Psychiatric
Solutions, Inc., among other business achievements. I am confident
of their ability to excel in their new positions, and we
congratulate them on their appointments.”
Acadia today confirmed its guidance for 2012 earnings per
diluted share in a range of $0.65 to $0.67. The Company’s guidance
does not include the impact of any future acquisitions.
Acadia will hold a conference call to discuss its first quarter
financial results at 9:00 a.m. Eastern Time on Friday, April
27, 2012. A live webcast of the conference call will be available
at www.acadiahealthcare.com in the “Investors” section of the
website or at www.earnings.com. The webcast of the conference call
will be available through May 11, 2012.
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 the acquired 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 risk that Acadia may not generate
sufficient cash from operations to service its debt and meet its
working capital and capital expenditure requirements; and (v)
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 SEC.
About Acadia
Acadia is a provider of inpatient behavioral health care
services. Acadia operates a network of 33 behavioral health
facilities with over 2,100 licensed beds in 19 states. Acadia
provides psychiatric and chemical dependency services to its
patients in a variety of settings, including inpatient psychiatric
hospitals, residential treatment centers, outpatient clinics and
therapeutic school-based programs.
Acadia Healthcare Company, Inc. Consolidated Statements
of Operations (Unaudited) Three Months
Ended March 31, 2012 2011
(in thousands, except per share amounts) Revenue
before provision for doubtful accounts $ 93,021 $ 17,584 Provision
for doubtful accounts (1,723 ) (738 ) Revenue 91,298
16,846 Salaries, wages and benefits (including equity-based
compensation expense of $578 and $0 for the three months ended
March 31, 2012 and 2011, respectively) 56,540 10,712
Professional fees 4,216 375 Supplies 4,457 933 Rents and leases
2,320 351 Other operating expenses 9,140 1,886 Depreciation and
amortization 1,615 243 Interest expense, net 7,282 223 Sponsor
management fees - 45 Transaction-related expenses 695
2,606 Total expenses 86,265
17,374 Income (loss) from continuing operations before
income taxes 5,033 (528 ) Provision (benefit) for income taxes
1,665 (271 ) Income (loss) from continuing
operations 3,368 (257 ) Income from discontinued operations, net of
income taxes 311 8 Net income (loss) $
3,679 $ (249 ) Basic earnings per share: Income
(loss) from continuing operations $ 0.10 $ (0.01 ) Income from
discontinued operations $ 0.01 $ - Net income (loss)
$ 0.11 $ (0.01 ) Diluted earnings per share: Income
(loss) from continuing operations $ 0.10 $ (0.01 ) Income from
discontinued operations $ 0.01 $ - Net income (loss)
$ 0.11 $ (0.01 ) Shares outstanding: Basic 32,120
17,633 Diluted 32,333 17,633
Acadia Healthcare Company, Inc.
Consolidated Balance Sheets (Unaudited)
March 31, 2012 December 31, 2011 (In thousands,
except share and per share amounts) ASSETS
Current assets: Cash and cash equivalents $ 840 $ 61,118
Accounts receivable, net of allowance for
doubtful accounts of $3,575 and $2,424, respectively
43,802 35,127 Deferred tax asset 5,683 6,239 Other current assets
11,897 10,121 Total current assets
62,222 112,605 Property and equipment, net 98,290 82,972 Goodwill
261,421 186,815 Intangible assets, net 9,381 8,232 Deferred tax
asset - long-term 5,016 6,006 Other assets 16,922
16,366 Total assets $ 453,252 $ 412,996
LIABILITIES AND EQUITY Current liabilities:
Current portion of long-term debt $ 8,000 $ 6,750 Accounts payable
8,074 8,642 Accrued salaries and benefits 16,542 16,195 Other
accrued liabilities 14,110 9,081 Total
current liabilities 46,726 40,668 Long-term debt 299,514 270,709
Other liabilities 6,332 5,254 Total
liabilities 352,572 316,631 Equity: Preferred stock, $0.01 par
value; 10,000,000 shares authorized; no shares issued - - Common
stock, $0.01 par value; 100,000,000 shares authorized; 32,128,474
and 32,115,929 issued and outstanding at March 31, 2012 and
December 31, 2011, respectively 321 321 Additional paid-in capital
141,260 140,624 Accumulated deficit (40,901 ) (44,580
) Total equity 100,680 96,365 Total
liabilities and equity $ 453,252 $ 412,996
Acadia Healthcare Company, Inc.
Consolidated Statements of Cash Flows (Unaudited)
Three Months Ended March 31, 2012
2011 (In thousands) Operating
activities: Net income (loss) $ 3,679 $ (249 )
Adjustments
to reconcile net income (loss) to net cash provided by
continuing operating
activities:
Depreciation and amortization 1,615 243 Provision for bad debts
1,723 738 Amortization of debt issuance costs 587 - Equity-based
compensation expense 578 - Deferred income tax expense 1,546 233
Other 19 - Income from discontinued operations, net of taxes (311 )
(8 ) Change in operating assets and liabilities, net of effect of
acquisitions: Accounts receivable (6,354 ) (2,009 ) Other current
assets (644 ) (866 ) Other assets (40 ) - Accounts payable and
other accrued liabilities 3,491 2,848 Accrued salaries and benefits
(1,312 ) (406 ) Other liabilities 874 48
Net cash provided by continuing operating activities 5,451
572 Net cash (used in) provided by discontinued operating
activities (516 ) 18 Net cash provided by
operating activities 4,935 590
Investing activities:
Cash paid for acquisitions, net of cash acquired (90,400 ) - Cash
paid for capital expenditures (3,911 ) (784 ) Other 88
- Net cash used in investing activities
(94,223 ) (784 )
Financing activities: Borrowings on
long-term debt 25,000 - Net increase in revolving credit facility
7,000 - Principal payments on long-term debt (2,000 ) (23 ) Payment
of debt issuance costs (1,048 ) - Proceeds from stock option
exercises 58 - Distributions to equity holders -
(375 ) Net cash provided by (used in) financing activities
29,010 (398 ) Net decrease in cash and
cash equivalents (60,278 ) (592 ) Cash and cash equivalents at
beginning of the period 61,118 8,614
Cash and cash equivalents at end of the period $ 840 $ 8,022
Effect of acquisitions: Assets acquired,
excluding cash $ 93,131 $ - Liabilities assumed (2,731 )
- Cash paid for acquisitions, net of cash acquired $
90,400 $ -
Acadia Healthcare Company, Inc.
Operating Statistics (Unaudited) (Revenue in
thousands) Three months ended March
31, 2012 2011 % Change Same
Facility Results Revenue $ 19,165 $ 16,846 13.8 % Patient Days
29,015 25,214 15.1 % Admissions 2,145 1,864 15.1 % Average Length
of Stay (a) 13.5 13.5 0.0 % Revenue per Patient Day $ 661 $
668 -1.1 % EBITDA margin 24.6 % 24.3 % 30 bps Total Facility
Results Revenue $ 91,298 $ 16,846 442.0 % Patient Days 152,645
25,214 505.4 % Admissions 6,718 1,864 260.4 % Average Length of
Stay (a) 22.7 13.5 68.0 % Revenue per Patient Day $ 598 $
668 -10.5 % EBITDA margin 20.7 % 24.3 % -360 bps
(a) Average length of stay is defined as
patient days divided by admissions
Acadia Healthcare Company, Inc. Reconciliation of Net
Income (Loss) to Adjusted EBITDA (Unaudited)
Three Months Ended
March 31, 2012
Three Months Ended
March 31, 2011
(in thousands) Net income (loss) $ 3,679 $ (249 )
Income from discontinued operations (311 ) (8 ) Provision (benefit)
from income taxes 1,665 (271 ) Interest expense, net 7,282 223
Depreciation and amortization 1,615 243
EBITDA 13,930 (62 ) Adjustments: Equity-based compensation
expense (a) 578 - Transaction-related expenses (b) 695 2,606
Sponsor management fees (c) - 45
Adjusted EBITDA $ 15,203 $ 2,589 See footnotes
on page 9.
Acadia Healthcare Company, Inc. Reconciliation
of Adjusted Income from Continuing Operations to Income (Loss)
from Continuing Operations (Unaudited)
Three Months Ended
March 31, 2012
Three Months Ended
March 31, 2011
(in thousands, except per share amounts) Income
(loss) from continuing operations $ 3,368 $ (257 ) Provision
(benefit) from income taxes 1,665 (271 )
Income (loss) from continuing operations before income taxes 5,033
(528 ) Adjustments to income (loss) from continuing
operations: Transaction-related expenses (b) 695 2,606 Sponsor
management fees (c) - 45 Tax effect of adjustments to net loss from
continuing operations (d) (2,234 ) (849 ) Adjusted
income from continuing operations $ 3,494 $ 1,274
Weighted-average shares outstanding - diluted 32,333 17,633
Adjusted income from continuing operations per diluted share $ 0.11
$ 0.07 See footnotes on page 9.
Footnotes We have included certain financial measures
in this press release, including EBITDA, Adjusted EBITDA and
Adjusted net 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 (loss)
adjusted for income from discontinued operations, net interest
expense, income tax provision (benefit) and depreciation and
amortization. We define Adjusted EBITDA as EBITDA adjusted for
equity-based compensation expense, transaction-related expenses,
and sponsor management fees. EBITDA, Adjusted EBITDA and
Adjusted net 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 net
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 net 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 net 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 net income from continuing
operations when reporting their results. Our presentation of
EBITDA, Adjusted EBITDA and Adjusted net 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 transaction-related expenses incurred by
Acadia related to the acquisitions of Youth and Family Centered
Services, Inc. (“YFCS”) in April 2011, PHC, Inc. (“PHC”) in
November 2011 and three facilities from Haven Behavioral Healthcare
Holdings, LLC (the "Haven Facilities") in March 2012. (c)
Represents the management fees paid by Acadia to its equity sponsor
prior to the termination of the professional services agreement
between Acadia and its equity sponsor on November 1, 2011.
(d) Represents the aggregate tax effect of the adjustments to the
income (loss) from continuing operations described above based on
expected combined federal and state tax rates.
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