Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced
financial results for the first quarter ended March 31, 2013.
Revenue increased 80.0% for the first quarter to $161.2 million
from $89.6 million for the first quarter of 2012. Income from
continuing operations was $4.1 million, or $0.08 per diluted share,
for the first quarter of 2013 compared with $3.3 million, or $0.10
per diluted share, for the first quarter of 2012. Adjusted income
from continuing operations increased 178.9% to $10.6 million for
the first quarter of 2013 from $3.8 million for the first quarter
of 2012. The adjusted results for the first quarter of 2013 exclude
debt extinguishment costs of $9.4 million and transaction-related
expenses of $1.5 million and, for the first quarter of 2012,
exclude transaction-related expenses of $0.7 million. Adjusted
income from continuing operations per diluted share increased 75.0%
to $0.21 for the first quarter of 2013 from $0.12 for the first
quarter of 2012, which reflected a 55.4% increase in weighted
average shares outstanding for the comparable quarters, primarily
due to Acadia’s public equity offerings in May 2012 and December
2012. A reconciliation of all GAAP and non-GAAP financial results
in this release is on pages 7 and 8.
Joey Jacobs, Chairman and Chief Executive Officer of Acadia,
commented, “Acadia’s strong revenue and margin performance
continued in the first quarter of 2013. Our revenue growth
reflected an increase of over 1,200 beds in the 12 months preceding
the end of the quarter, primarily through the acquisition of 12
facilities and the addition of approximately 200 beds to existing
facilities. The addition of new beds in our same-facility base
contributed to an 8.8% increase in patient days for the quarter,
which drove an 8.8% increase in same facility revenue. Our growth
continued to generate increased same facility operating leverage,
in addition to the positive impact of our increased productivity,
as reflected in the same facility EBITDA margin increase of 390
basis points to 25.0% for the first quarter of 2013 from 21.1% for
the first quarter last year. Adjusted consolidated EBITDA more than
doubled compared to the prior year period for the third consecutive
quarter, to $30.5 million, or 18.9% of consolidated revenue, from
$15.2 million for the first quarter of 2012.
“At the end of the first quarter, the Company had cash and cash
equivalents of $99.8 million and approximately $100 million of
availability under our revolving credit facility. Our ratio of
total net debt to trailing 12 months adjusted EBITDA at the end of
the quarter was 3.8. We remain confident of our ability to fund our
growth strategies for 2013.”
Acadia also today announced that it has completed the previously
announced acquisition of two acute inpatient psychiatric facilities
in San Juan, Puerto Rico and Tampa, Florida. The San Juan facility,
which produced 2012 revenues of approximately $25 million, is
licensed for 108 beds and has a certificate of need to build 100
additional beds. The Tampa facility, with 75 beds, is under
construction with a scheduled opening in the third quarter of
2013.
Based on the Company’s performance for the first quarter and the
completion of this acquisition, Acadia increased its guidance for
2013 adjusted earnings per diluted share to a range of $1.00 to
$1.03 from the prior range of $0.96 to $1.00. This updated guidance
also incorporates the impact of the Company’s recent debt issuance,
as well as the estimated impact of sequestration on the Company’s
Medicare reimbursement for the balance of 2013. The Company’s
guidance does not include the impact of any future
acquisitions.
Acadia will hold a conference call to discuss its second quarter
financial results at 9:00 a.m. Eastern Time on Thursday, May
2, 2013. 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 16, 2013.
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 healthcare
services. Acadia operates a network of 46 behavioral healthcare
facilities with approximately 3,700 licensed beds in 21 states and
Puerto Rico. 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, 2013 2012
(in thousands, except per share amounts) Revenue
before provision for doubtful accounts $ 165,705 $ 91,268 Provision
for doubtful accounts (4,492 ) (1,705 ) Revenue
161,213 89,563 Salaries, wages and benefits (including
equity-based compensation expense of
$601 and $578, respectively)
94,351 55,143 Professional fees 9,014 4,173 Supplies 8,598 4,445
Rents and leases 2,327 2,242 Other operating expenses 16,983 8,981
Depreciation and amortization 3,622 1,610 Interest expense, net
8,762 7,282 Debt extinguishment costs 9,350 - Transaction-related
expenses 1,474 695 Total expenses
154,481 84,571 Income from continuing
operations before income taxes 6,732 4,992 Provision for income
taxes 2,678 1,665 Income from
continuing operations 4,054 3,327 (Loss) income from discontinued
operations, net of income taxes (316 ) 352 Net
income $ 3,738 $ 3,679 Basic earnings per
share: Income from continuing operations $ 0.08 $ 0.10 (Loss)
income from discontinued operations (0.01 ) 0.01
Net income $ 0.07 $ 0.11 Diluted
earnings per share: Income from continuing operations $ 0.08 $ 0.10
(Loss) income from discontinued operations (0.01 )
0.01 Net income $ 0.07 $ 0.11
Weighted-average shares outstanding: Basic 49,911 32,120 Diluted
50,250 32,333
Acadia Healthcare Company,
Inc. Consolidated Balance Sheets (Unaudited)
March 31, 2013 December 31, 2012 (In
thousands) ASSETS Current assets: Cash and cash
equivalents $ 99,775 $ 49,399
Accounts receivable, net of allowance for
doubtful accounts of $10,998 and $7,484, respectively
78,780 63,870 Deferred tax assets 12,573 11,380 Other current
assets 21,164 16,332 Total current
assets 212,292 140,981 Property and equipment, net 268,531 236,942
Goodwill 565,586 557,402 Intangible assets, net 16,247 15,988 Other
assets 22,521 32,100 Total assets $
1,085,177 $ 983,413
LIABILITIES AND
EQUITY Current liabilities: Current portion of long-term debt $
9,555 $ 7,680 Accounts payable 20,116 19,081 Accrued salaries and
benefits 23,647 28,749 Other accrued liabilities 17,452
16,341 Total current liabilities 70,770 71,851
Long-term debt 560,098 465,638 Deferred tax liabilities -
noncurrent 3,822 998 Other liabilities 13,628
12,376 Total liabilities 648,318 550,863 Equity: Common
stock 500 499 Additional paid-in capital 456,798 456,228
Accumulated deficit (20,439 ) (24,177 ) Total equity
436,859 432,550 Total liabilities and
equity $ 1,085,177 $ 983,413
Acadia Healthcare Company, Inc. Consolidated Statements
of Cash Flows (Unaudited) Three Months Ended
March 31, 2013 2012 (In thousands)
Operating activities: Net income $ 3,738 $ 3,679
Adjustments to reconcile net income to
net cash provided by continuing operating activities:
Depreciation and amortization 3,622 1,610 Amortization of debt
issuance costs 540 587 Equity-based compensation expense 601 578
Deferred income tax expense 2,455 1,546 Loss (income) from
discontinued operations, net of taxes 316 (352 ) Debt
extinguishment costs 9,350 - Other 15 19 Change in operating assets
and liabilities, net of effect of acquisitions: Accounts receivable
(9,522 ) (4,686 ) Other current assets (1,072 ) (714 ) Other assets
(850 ) (50 ) Accounts payable and other accrued liabilities (997 )
3,484 Accrued salaries and benefits (7,491 ) (1,244 ) Other
liabilities (271 ) 960 Net cash provided by
continuing operating activities 434 5,417 Net cash used in
discontinued operating activities (267 ) (482 ) Net
cash provided by operating activities 167 4,935
Investing
activities: Cash paid for acquisitions, net of cash acquired
(22,375 ) (90,400 ) Cash paid for capital expenditures (12,764 )
(3,911 ) Other (133 ) 88 Net cash used in
investing activities (35,272 ) (94,223 )
Financing
activities: Borrowings on long-term debt 150,000 25,000 Net
increase in revolving credit facility - 7,000 Principal payments on
long-term debt (1,875 ) (2,000 ) Repayment of long-term debt
(52,500 ) - Payment of debt issuance costs (4,153 ) (1,048 )
Payment of premium on note redemption (6,759 ) - Proceeds from
stock option exercises 133 58 Excess tax benefit from equity awards
635 - Net cash provided by financing
activities 85,481 29,010 Net
increase (decrease) in cash and cash equivalents 50,376 (60,278 )
Cash and cash equivalents at beginning of the period 49,399
61,118 Cash and cash equivalents at end of the
period $ 99,775 $ 840
Effect of
acquisitions: Assets acquired, excluding cash $ 43,330 $ 93,131
Liabilities assumed (9,271 ) (2,731 ) Prior year deposits paid for
acquisitions (11,684 ) - Cash paid for
acquisitions, net of cash acquired $ 22,375 $ 90,400
Acadia Healthcare Company, Inc. Operating
Statistics (Unaudited) (Revenue in thousands)
Three Months Ended March 31,
2013 2012 % Change Same Facility Results
Revenue $ 97,473 $ 89,563 8.8% Patient Days 166,050 152,645 8.8%
Admissions 7,206 6,718 7.3% Average Length of Stay (a) 23.0 22.7
1.4% Revenue per Patient Day $ 587 $ 587 0.0% EBITDA margin
25.0% 21.1% 390 bps Total Facility Results Revenue $ 160,554
$ 89,563 79.3% Patient Days 246,276 152,645 61.3% Admissions 12,869
6,718 91.6% Average Length of Stay (a) 19.1 22.7 -15.8%
Revenue per Patient Day $ 652 $ 587 11.1% EBITDA margin 23.1% 21.1%
200 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 March 31, 2013 2012 (in
thousands) Net income $ 3,738 $ 3,679 Loss (income) from
discontinued operations 316 (352 ) Provision for income taxes 2,678
1,665 Interest expense, net 8,762 7,282 Depreciation and
amortization 3,622 1,610 EBITDA 19,116 13,884
Adjustments: Equity-based compensation expense (a) 601 578
Debt extinguishment costs (b) 9,350 - Transaction-related expenses
(c) 1,474 695 Adjusted EBITDA $ 30,541 $
15,157
See footnotes on page 9.
Acadia Healthcare Company, Inc.
Reconciliation of Adjusted Income from Continuing Operations to
Income from Continuing Operations (Unaudited)
Three Months Ended March 31, 2013
2012 (in thousands, except per share amounts)
Income from continuing operations $ 4,054 $ 3,327 Provision for
income taxes 2,678 1,665 Income from
continuing operations before income taxes 6,732 4,992
Adjustments to income from continuing operations: Debt
extinguishment costs (b) 9,350 - Transaction-related expenses (c)
1,474 695
Income tax provision/benefit reflecting
tax effect of adjustments to income from continuing operations
(d)
(6,984 ) (1,897 ) Adjusted income from continuing
operations $ 10,572 $ 3,790 Weighted-average shares
outstanding - diluted 50,250 32,333 Adjusted income from
continuing operations per diluted share $ 0.21 $ 0.12
See footnotes on page 9.
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, transaction-related expenses,
and debt extinguishment costs.
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 transaction-related expenses
incurred by Acadia related to acquisitions. (d) Represents
the income tax provision adjusted to reflect the aggregate tax
effect of the adjustments to income from continuing operations
described above based on effective tax rates.
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