Produces Record Quarterly Same Facility
EBITDA Margin of 27.1% on Same Facility Revenue Growth of
9.2%
Affirms Guidance for 2016 Adjusted Earnings
per Diluted Share in Range of $2.81 to $2.86
Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced
financial results for the first quarter ended March 31, 2016.
Revenue was $616.8 million for the first quarter, an increase of
68.6% from $365.8 million for the first quarter of 2015. Income
from continuing operations attributable to Acadia stockholders was
$25.7 million, or $0.31 per diluted share, for the first quarter of
2016 compared with $14.6 million, or $0.23 per diluted share, for
the first quarter last year. Adjusted income from continuing
operations attributable to Acadia stockholders was $45.8 million
for the first quarter of 2016, up 69.1% from $27.1 million for the
first quarter of 2015, and adjusted EPS increased 27.9% to $0.55
from $0.43. Weighted average diluted shares outstanding increased
32.6% for the first quarter of 2016 from the first quarter of 2015,
primarily due to the issuance of common stock in February and May
2015, the net proceeds of which have primarily been used to fund
acquisitions, and in January and February 2016 related to the
acquisition of Priory Group. A reconciliation of all non-GAAP
financial results in this release appears on pages 7 and 8.
“We are pleased to report that Acadia had a very successful
first quarter of 2016,” said Joey Jacobs, Chairman and Chief
Executive Officer of Acadia. “In addition to producing an increase
in adjusted EPS of 27.9%, we completed the acquisition of Priory
Group, the leading independent provider of behavioral health in the
United Kingdom. We also added 330 new beds in the U.S. and the U.K.
during the quarter. As a result of this substantial expansion of
our inpatient facilities and licensed beds, as well as our
continued strong financial performance during the quarter, we
believe Acadia is well-positioned to produce further significant
profitable growth in 2016 and beyond.”
The Company’s first quarter revenue growth was driven by the
full-quarter inclusion of approximately 4,100 beds added through
acquisition or to existing or de novo facilities during 2015. With
the addition of Priory’s approximately 7,100 beds in 324 inpatient
facilities, as well as the beds added during the first quarter,
Acadia has increased its beds by approximately 9,000 over the
trailing 12 months ended March 31, 2016.
Acadia’s consolidated same facility revenue rose 9.2% for the
first quarter of 2016 compared with the same prior-year quarter,
reflecting an 8.6% increase in patient days and a 0.5% increase in
revenue per patient day. This increase was primarily driven by new
beds added to facilities in the same facility base, as well as by
continuing initiatives at each of these facilities to expand their
revenue. With increased same-facility revenue leveraging the fixed
cost operations of these facilities, and with ongoing productivity
and efficiency efforts in individual facilities, consolidated same
facility EBITDA margin expanded 80 basis points for the first
quarter to a quarterly record of 27.1% from 26.3% for the first
quarter last year. Acadia’s consolidated adjusted EBITDA for the
first quarter increased 66.4% to $131.0 million, or 21.2% of
revenue, compared with $78.7 million, or 21.5% of revenue, for the
first quarter of 2015.
Mr. Jacobs added, “Our strong operating and financial results
for the first quarter demonstrate highly effective execution of our
acquisition and organic growth strategies. While the Priory
acquisition gives us more new beds in a single transaction than we
have acquired in a previous year, we expect to continue to evaluate
additional, accretive transactions during 2016. We continue to have
significant availability under our $300 million revolving credit
facility, and we also expect to continue generating substantial
operating cash flow, which for the first quarter of 2016 increased
to $59.3 million from $18.1 million for the first quarter of
2015.”
Acadia today affirmed its guidance for 2016 adjusted earnings
per diluted share in a range of $2.81 to $2.86, an increase of
approximately 26% to 28% over 2015. The Company’s guidance assumes
an exchange rate of $1.45 per British Pound Sterling and a tax rate
of 23%. The Company’s guidance does not include the impact of any
future acquisitions or transaction-related expenses.
Acadia will hold a conference call to discuss its fourth quarter
financial results at 9:00 a.m. Eastern Time on Friday, April
29, 2016. A live webcast of the conference call will be available
at www.acadiahealthcare.com in the “Investors” section of the
website. The webcast of the conference call will be available
through May 14, 2016.
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 Priory
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 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 SEC.
About Acadia
Acadia is a provider of inpatient behavioral healthcare
services. Acadia operates a network of 587 behavioral healthcare
facilities with approximately 17,400 beds in 39 states, the United
Kingdom and Puerto Rico. Acadia provides behavioral health and
addiction 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.
Condensed Consolidated Statements of Income
(Unaudited) Three Months Ended March 31,
2016 2015 (In thousands, except per share
amounts) Revenue before provision for doubtful accounts
$ 627,183 $ 374,158 Provision for doubtful accounts (10,370
) (8,375 ) Revenue 616,813 365,783
Salaries, wages and benefits (including
equity-based compensation expense of $6,956 and $3,894,
respectively)
341,028 205,871 Professional fees 39,991 22,427 Supplies 26,685
16,254 Rents and leases 14,806 5,886 Other operating expenses
70,247 40,527 Depreciation and amortization 27,975 13,104 Interest
expense, net 37,714 22,146 Gain on foreign currency derivatives
(410 ) (53 ) Transaction-related expenses 26,298
18,416 Total expenses 584,334
344,578 Income from continuing operations before income
taxes 32,479 21,205 Provision for income taxes 7,110
6,613 Income from continuing operations 25,369 14,592
Income from discontinued operations, net of income taxes -
2 Net income 25,369 14,594 Net loss
attributable to noncontrolling interests 319 -
Net income attributable to Acadia Healthcare Company, Inc. $
25,688 $ 14,594 Basic earnings attributable to
Acadia Healthcare Company, Inc. stockholders: Income from
continuing operations $ 0.31 $ 0.23 Income from discontinued
operations - - Net income $ 0.31
$ 0.23 Diluted earnings attributable to Acadia
Healthcare Company, Inc. stockholders: Income from continuing
operations $ 0.31 $ 0.23 Income from discontinued operations
- - Net income $ 0.31 $ 0.23
Weighted-average shares outstanding: Basic 82,943 62,530
Diluted 83,420 62,894
Acadia
Healthcare Company, Inc. Condensed Consolidated Balance
Sheets (Unaudited) March 31,
2016
December 31,
2015
(In thousands) ASSETS Current assets: Cash and
cash equivalents $ 36,582 $ 11,215
Accounts receivable, net of allowance for
doubtful accounts of $32,565 and $29,332, respectively
276,880 216,626 Other current assets 79,803
66,895 Total current assets 393,265 294,736 Property and
equipment, net 3,337,765 1,709,053 Goodwill 2,771,365 2,128,215
Intangible assets, net 102,593 59,575 Deferred tax assets -
noncurrent 41,753 49,114 Other assets 49,618
38,515 Total assets $ 6,696,359 $ 4,279,208
LIABILITIES AND EQUITY Current liabilities:
Current portion of long-term debt $ 69,223 $ 45,360 Accounts
payable 118,210 91,341 Accrued salaries and benefits 112,714 80,696
Other accrued liabilities 108,663 72,806
Total current liabilities 408,810 290,203 Long-term debt
3,497,569 2,195,384 Deferred tax liabilities - noncurrent 94,882
23,936 Other liabilities 124,492 78,602
Total liabilities 4,125,753 2,588,125 Redeemable noncontrolling
interests 7,736 8,055 Equity: Common stock 865 707 Additional
paid-in capital 2,475,383 1,572,972 Accumulated other comprehensive
loss (153,062 ) (104,647 ) Retained earnings 239,684
213,996 Total equity 2,562,870
1,683,028 Total liabilities and equity $ 6,696,359 $
4,279,208
Acadia Healthcare Company,
Inc. Condensed Consolidated Statements of Cash Flows
(Unaudited) Three Months
Ended March 31, 2016 2015 (In thousands)
Operating activities: Net income $ 25,369 $ 14,594
Adjustments to reconcile net income to
net cash provided by continuing operating activities:
Depreciation and amortization 27,975 13,104 Amortization of debt
issuance costs 2,147 1,468 Equity-based compensation expense 6,956
3,894 Deferred income tax expense 9,085 19,224 Income from
discontinued operations, net of taxes - (2 ) Gain on foreign
currency derivatives (410 ) (53 ) Other 882 378 Change in operating
assets and liabilities, net of effect of acquisitions: Accounts
receivable, net (3,749 ) (6,957 ) Other current assets (8,075 )
(23,758 ) Other assets (2,402 ) (636 ) Accounts payable and other
accrued liabilities 7,498 1,274 Accrued salaries and benefits
(6,347 ) (5,022 ) Other liabilities 354 580
Net cash provided by continuing operating activities 59,283
18,088 Net cash (used in) provided by discontinued operating
activities (619 ) 134 Net cash provided by
operating activities 58,664 18,222
Investing
activities: Cash paid for acquisitions, net of cash acquired
(580,096 ) (49,618 ) Cash paid for capital expenditures (90,089 )
(52,879 ) Cash paid for real estate acquisitions (14,799 ) (1,722 )
Settlement of foreign currency derivatives 745 - Other
(1,208 ) (383 ) Net cash used in investing activities
(685,447 ) (104,602 )
Financing activities:
Borrowings on long-term debt 1,480,000 875,000 Borrowings on
revolving credit facility 58,000 93,000 Principal payments on
revolving credit facility (166,000 ) - Principal payments on
long-term debt (13,669 ) (7,938 ) Repayment of assumed debt
(1,348,389 ) (904,467 ) Payment of debt issuance costs (34,167 )
(22,191 ) Issuance of common stock, net 685,097 - Common stock
withheld for minimum statutory taxes, net (6,679 ) (5,110 ) Excess
tax benefit from equity awards - 4,310 Other (224 ) -
Net cash provided by financing activities 653,969
32,604 Effect of exchange rate
changes on cash (1,819 ) (2,232 ) Net increase
(decrease) in cash and cash equivalents 25,367 (56,008 ) Cash and
cash equivalents at beginning of the period 11,215
94,040 Cash and cash equivalents at end of the period
$ 36,582 $ 38,032
Effect of
acquisitions: Assets acquired, excluding cash $ 2,372,358 $
1,428,566 Liabilities assumed (1,575,380 ) (998,738 ) Issuance of
common stock in connection with acquisition (216,882 )
(380,210 ) Cash paid for acquisitions, net of cash acquired
$ 580,096 $ 49,618
Acadia Healthcare
Company, Inc. Operating Statistics (Unaudited,
Revenue in thousands)
Three Months Ended March 31, 2016 2015 %
Change Same Facility Results (a,c) Revenue $ 391,412 $ 358,593
9.2% Patient Days 573,701 528,248 8.6% Admissions 28,615 25,693
11.4% Average Length of Stay (b) 20.0 20.6 -2.5% Revenue per
Patient Day $ 682 $ 679 0.5% EBITDA margin 27.1% 26.3% 80 bps
U.S. Same Facility Results (a) Revenue $ 317,986 $ 289,298
9.9% Patient Days 457,691 424,413 7.8% Admissions 28,356 25,444
11.4% Average Length of Stay (b) 16.1 16.7 -3.2% Revenue per
Patient Day $ 695 $ 682 1.9% EBITDA margin 27.5% 26.4% 110 bps
U.K. Same Facility Results (c) Revenue $ 73,426 $ 69,295
6.0% Patient Days 116,010 103,835 11.7% Admissions 259 249 4.0%
Average Length of Stay (b) 447.9 417.0 7.4% Revenue per Patient Day
$ 633 $ 667 -5.2% EBITDA margin 25.3% 25.7% -40 bps U.S.
Facility Results Revenue $ 408,264 $ 290,507 40.5% Patient Days
561,323 424,413 32.3% Admissions 34,465 25,444 35.5% Average Length
of Stay (b) 16.3 16.7 -2.4% Revenue per Patient Day $ 727 $ 684
6.3% EBITDA margin 26.2% 26.3% -10 bps U.K. Facility Results
(c) Revenue $ 206,975 $ 69,295 198.7% Patient Days 454,016 103,835
337.2% Admissions 1,591 249 539.0% Average Length of Stay (b) 285.4
417.0 -31.6% Revenue per Patient Day $ 456 $ 667 -31.7% EBITDA
margin 21.7% 25.7% -400 bps Total Facility Results (c)
Revenue $ 615,239 $ 359,802 71.0% Patient Days 1,015,339 528,248
92.2% Admissions 36,056 25,693 40.3% Average Length of Stay (b)
28.2 20.6 37.0% Revenue per Patient Day $ 606 $ 681 -11.0% EBITDA
margin 24.7% 26.2% -150 bps (a) Same-facility results for
the three months ended March 31, 2015 exclude five outpatient
programs that have been closed. (b) Average length of stay is
defined as patient days divided by admissions. (c) Revenue and
revenue per patient day for the three months ended March 31, 2015
are adjusted to reflect the foreign currency exchange rate for the
comparable period of 2016 in order to eliminate the effect of
changes in the exchange rate. The exchange rate used in the
adjusted revenue and revenue per patient day amounts for the three
months ended March 31, 2015 is 1.43.
Acadia
Healthcare Company, Inc. Reconciliation of Net Income
Attributable to Acadia Healthcare Company, Inc. to Adjusted
EBITDA (Unaudited) Three
Months Ended March 31, 2016 2015 (in
thousands) Net income attributable to Acadia Healthcare
Company, Inc. $ 25,688 $ 14,594 Income from discontinued
operations, net of income taxes - (2 ) Net loss attributable to
noncontrolling interests (319 ) - Provision for income taxes 7,110
6,613 Interest expense, net 37,714 22,146 Depreciation and
amortization 27,975 13,104 EBITDA
98,168 56,455 Adjustments: Equity-based compensation expense
(a) 6,956 3,894 Gain on foreign currency derivatives (b) (410 ) (53
) Transaction-related expenses (c) 26,298
18,416 Adjusted EBITDA $ 131,012 $ 78,712
See footnotes on page 9.
Acadia Healthcare
Company, Inc. Reconciliation of Adjusted Income from
Continuing Operations Attributable to Acadia Healthcare Company,
Inc. to Net Income Attributable to Acadia Healthcare
Company, Inc. (Unaudited)
Three Months Ended March 31, 2016 2015 (in
thousands, except per share amounts) Net income
attributable to Acadia Healthcare Company, Inc. $ 25,688 $ 14,594
Income from discontinued operations, net of income taxes - (2 )
Provision for income taxes 7,110 6,613
Income from continuing operations
attributable to Acadia Healthcare Company, Inc. before income
taxes
32,798 21,205 Adjustments to income from continuing
operations: Gain on foreign currency derivatives (b) (410 ) (53 )
Transaction-related expenses (c) 26,298 18,416
Income tax provision reflecting tax effect
of adjustments to income from continuing operations (d)
(12,852 ) (12,464 )
Adjusted income from continuing operations
attributable to Acadia Healthcare Company, Inc.
$ 45,834 $ 27,104 Weighted-average shares outstanding -
diluted 83,420 62,894
Adjusted income from continuing operations
attributable to Acadia Healthcare Company, Inc. per diluted
share
$ 0.55 $ 0.43 See footnotes on page 9.
Acadia Healthcare Company, Inc. 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 income from
discontinued operations, net loss attributable to noncontrolling
interests, net interest expense, income tax provision and
depreciation and amortization. We define Adjusted EBITDA as EBITDA
adjusted for equity-based compensation expense, 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 the change in
fair value of foreign currency derivatives purchased by Acadia
related to acquisitions in the U.K. (c) Represents
transaction-related expenses incurred by Acadia related to
acquisitions. (d) Represents the income tax provision
adjusted to reflect the tax effect of the adjustments to income
from continuing operations based on tax rates of 21.9% and 31.5%
for the three months ended March 31, 2016 and 2015, respectively.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160428006879/en/
Acadia Healthcare Company, Inc.Brent Turner,
615-861-6000President
Acadia Healthcare (NASDAQ:ACHC)
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