Notes to Condensed Consolidated Financial Statements
June 30, 2015
(Unaudited)
1. Description of Business
and Basis of Presentation
Description of Business
Acadia Healthcare Company, Inc. (the Company) develops and operates inpatient psychiatric facilities, residential treatment
centers, group homes, substance abuse facilities and facilities providing outpatient behavioral healthcare services to serve the behavioral health and recovery needs of communities throughout the United States (U.S.), the United Kingdom (U.K.) and
Puerto Rico. At June 30, 2016, the Company operated 591 behavioral healthcare facilities with approximately 17,800 beds in 39 states, the U.K. and Puerto Rico.
Basis of Presentation
The
business of the Company is conducted through limited liability companies, C-corporations and, for the U.K. facilities, their foreign counterparts. The Companys consolidated financial statements include the accounts of the Company and all
subsidiaries controlled by the Company through its direct or indirect ownership of majority interests and exclusive rights granted to the Company as the controlling member of an entity. All intercompany accounts and transactions have been
eliminated in consolidation.
The accompanying consolidated financial statements have been prepared in accordance with U.S. generally
accepted accounting principles (GAAP) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for fair presentation of our financial position and results of operations have been included. The Companys fiscal year ends on December 31 and interim results are not
necessarily indicative of results for a full year or any other interim period. The condensed consolidated balance sheet at December 31, 2015 has been derived from the audited financial statements as of that date. The information contained in
these condensed consolidated financial statements should be read in conjunction with the Companys consolidated financial statements and notes thereto for the fiscal year ended December 31, 2015 included in the Companys Annual Report
on Form 10-K filed with the Securities and Exchange Commission on February 25, 2016. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Actual results could differ from those estimates.
Certain reclassifications
have been made to prior years to conform to the current year presentation.
2. Earnings Per Share
Basic and diluted earnings per share are calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification
Topic 260,
Earnings Per Share
, based on the weighted-average number of shares outstanding in each period and dilutive stock options, unvested shares and warrants, to the extent such securities have a dilutive effect on
earnings per share.
6
The following table sets forth the computation of basic and diluted earnings per share for the
three and six months ended June 30, 2016 and 2015 (in thousands except per share amounts):
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Three Months Ended
June 30,
|
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Six Months Ended
June 30,
|
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2016
|
|
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2015
|
|
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2016
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|
|
2015
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Numerator:
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|
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|
|
|
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Basic and diluted earnings per share attributable to Acadia Healthcare Company, Inc.:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Income from continuing operations
|
|
$
|
56,445
|
|
|
$
|
33,843
|
|
|
$
|
82,133
|
|
|
$
|
48,435
|
|
Income from discontinued operations
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to Acadia Healthcare Company, Inc.
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$
|
56,445
|
|
|
$
|
33,844
|
|
|
$
|
82,133
|
|
|
$
|
48,438
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|
|
|
|
|
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Denominator:
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Weighted average shares outstanding for basic earnings per share
|
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86,553
|
|
|
|
68,296
|
|
|
|
84,748
|
|
|
|
65,429
|
|
Effect of dilutive instruments
|
|
|
323
|
|
|
|
439
|
|
|
|
304
|
|
|
|
353
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|
|
|
|
|
|
|
|
|
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|
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|
|
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Shares used in computing diluted earnings per common share
|
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86,876
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|
|
|
68,735
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|
|
|
85,052
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|
|
|
65,782
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|
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|
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|
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Basic earnings per share:
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|
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|
|
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Income from continuing operations
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$
|
0.65
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|
|
$
|
0.50
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|
|
$
|
0.97
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|
|
$
|
0.74
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Income from discontinued operations
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|
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Net income
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$
|
0.65
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$
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0.50
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|
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$
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0.97
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$
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0.74
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Diluted earnings per share:
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Income from continuing operations
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$
|
0.65
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|
|
$
|
0.49
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|
|
$
|
0.97
|
|
|
$
|
0.74
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|
Income from discontinued operations
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|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
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|
|
|
|
|
|
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|
Net income
|
|
$
|
0.65
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|
|
$
|
0.49
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|
|
$
|
0.97
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|
|
$
|
0.74
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|
|
|
|
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|
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Approximately 1.2 million and 0.3 million shares of common stock issuable upon exercise of
outstanding stock option awards were excluded from the calculation of diluted earnings per share for the three months ended June 30, 2016 and 2015, respectively, because their effect would have been anti-dilutive. Approximately 1.2 million
and 0.9 million shares of common stock issuable upon exercise of outstanding stock option awards were excluded from the calculation of diluted earnings per share for the six months ended June 30, 2016 and 2015, respectively, because their
effect would have been anti-dilutive.
3. Acquisitions
2016 U.S. Acquisitions
On
June 1, 2016, the Company completed the acquisition of Pocono Mountain Recovery Center (Pocono Mountain), an inpatient psychiatric facility with 108 beds located in Henryville, Pennsylvania, for total consideration of approximately
$25.2 million. The Company may make a cash payment of up to $5.0 million under an earn-out agreement, contingent upon achievement by Pocono Mountain of certain operating performance targets for the one-year period ending May 31, 2017.
On May 1, 2016, the Company completed the acquisition of TrustPoint Hospital (TrustPoint), an inpatient psychiatric facility
with 100 beds located in Murfreesboro, Tennessee, for cash consideration of approximately $62.7 million.
On April 1, 2016, the
Company completed the acquisition of Serenity Knolls (Serenity Knolls), an inpatient psychiatric facility with 30 beds located in Forrest Knolls, California, for cash consideration of approximately $9.7 million.
Priory
On February 16, 2016,
the Company completed the acquisition of Priory Group No. 1 Limited (Priory) for a total purchase price of approximately $2.2 billion, including total cash consideration of approximately $1.9 billion and the issuance of 4,033,561
shares of its common stock. Priory is the leading independent provider of behavioral healthcare services in the U.K. At February 16, 2016, Priory operated 324 facilities with approximately 7,100 beds.
7
The Competition and Markets Authority (CMA) in the U.K. has been reviewing the
Companys acquisition of Priory. On July 14, 2016, the CMA announced that the Companys acquisition of Priory will be referred for a phase 2 investigation unless the Company offers undertakings to address the CMAs competition
concerns relating to the provision of behavioral healthcare services in certain markets. On July 28, 2016, the CMA announced that the Company has offered undertakings to address the CMAs concerns and that, in lieu of a phase 2 investigation,
the CMA will consider the Companys undertakings. The Companys undertakings provide for the sale of 19 Priory and Partnerships in Care behavioral healthcare facilities with an aggregate of approximately 750 beds. The Company will not be
allowed to integrate Priorys business until the CMA completes its review process.
2015 U.S. Acquisitions
On December 1, 2015, the Company completed the acquisition of certain facilities from MMO Behavioral Health Systems (MMO),
including two acute inpatient behavioral health facilities with a total of 80 beds located in Jennings and Covington, Louisiana, for cash consideration of approximately $20.2 million.
On November 1, 2015, the Company completed the acquisitions of (i) Discovery House-Group Inc. (Discovery House) for
cash consideration of approximately $118.3 million and (ii) Duffys Napa Valley Rehab (Duffys) for cash consideration of approximately $29.6 million. Discovery House operates 19 comprehensive treatment centers
located in four states. Duffys is a substance abuse facility with 61 beds located in Calistoga, California.
On August 31,
2015, the Company completed the acquisition of a controlling interest in Southcoast Behavioral (Southcoast), an inpatient psychiatric facility located in Fairhaven, Massachusetts. The Company owns 75% of the equity interests in the
facility. The value of the 25% noncontrolling interest approximates $9.2 million.
On July 1, 2015, the Company completed the
acquisition of the assets of Belmont Behavioral Health (Belmont), an inpatient psychiatric facility with 147 beds located in Philadelphia, Pennsylvania for cash consideration of approximately $39.0 million which consists of
$35.0 million base purchase price and a working capital settlement of $4.0 million.
On March 1, 2015, the Company acquired the stock
of Quality Addiction Management, Inc. (QAM) for cash consideration of approximately $54.8 million. QAM operates seven comprehensive treatment centers located in Wisconsin.
On February 11, 2015, the Company completed its acquisition of CRC Health Group, Inc. (CRC) for total consideration of
approximately $1.3 billion. As consideration for the acquisition, the Company issued 5,975,326 shares of its common stock to certain holders of CRC common stock and repaid CRCs outstanding indebtedness of $904.5 million. CRC is a leading
provider of treatment services related to substance abuse and other addiction and behavioral disorders. At the acquisition date, CRC operated 35 inpatient facilities with over 2,400 beds and 81 comprehensive treatment centers located in 30 states.
2015 U.K. Acquisitions
On
November 1, 2015, the Company completed the acquisition of Cleveland House, an inpatient psychiatric facility with 32 beds located in England, for cash consideration of approximately $10.3 million.
On October 1, 2015, the Company completed the acquisition of Meadow View, an inpatient psychiatric facility with 28 beds located in
England, for cash consideration of approximately $6.8 million.
On September 1, 2015, the Company completed the acquisitions of
(i) three facilities from The Danshell Group (Danshell) for approximately $59.8 million, (ii) two facilities from Health and Social Care Partnerships (H&SCP) for approximately $26.2 million and
(iii) Manor Hall for approximately $14.0 million. The inpatient psychiatric facilities acquired from Danshell have an aggregate of 73 beds and are located in England. The inpatient psychiatric facilities acquired from H&SCP have an
aggregate of 50 beds and are located in England. Manor Hall has 26 beds and is located in England.
On July 1, 2015, the Company
completed the acquisition of The Manor Clinic, a substance abuse facility with 15 beds located in England, for cash consideration of approximately $5.9 million.
On June 1, 2015, the Company completed the acquisitions of (i) one facility from Choice Lifestyles (Choice) for cash
consideration of approximately $25.9 million and (ii) 15 facilities from Care UK Limited (Care UK) for approximately $88.2 million. The inpatient psychiatric facility acquired from Choice has 42 beds and is located in England.
The inpatient psychiatric facilities acquired from Care UK have an aggregate of 299 beds and are located in England.
On April 1,
2015, the Company completed the acquisitions of (i) two facilities from Choice for cash consideration of approximately $37.5 million, (ii) Pastoral Care Group (Pastoral) for approximately $34.2 million and
(iii) Mildmay Oaks f/k/a Vista Independent Hospital (Mildmay Oaks) for cash consideration of approximately $14.9 million. The two inpatient psychiatric facilities acquired from Choice have an aggregate of 48 beds and are
located in England. Pastoral operates two inpatient psychiatric facilities with an aggregate of 65 beds located in Wales. Mildmay Oaks is an inpatient psychiatric facility with 67 beds located in England.
8
Summary of Acquisitions
The Company selectively seeks opportunities to expand and diversify its base of operations by acquiring additional facilities. Approximately
$374.4 million of the goodwill associated with domestic acquisitions completed in 2016 and 2015 is deductible for federal income tax purposes. The fair values assigned to certain assets and liabilities assumed by the Company have been estimated
on a preliminary basis and are subject to change as new facts and circumstances emerge that were present at the date of acquisition. Specifically, the Company is further assessing the valuation of certain real property and intangible assets and
certain tax matters as well as certain receivables and assumed liabilities of Pocono Mountain, TrustPoint, Serenity Knolls, Priory, MMO, Discovery House, Duffys, Cleveland House, Meadow View, Danshell, H&SCP, Manor Hall, The Manor Clinic
and Belmont.
The preliminary fair values of assets acquired and liabilities assumed, at the corresponding acquisition dates, during the
six months ended June 30, 2016 in connection with the 2016 acquisitions were as follows (in thousands):
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Priory
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Other
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Total
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Cash
|
|
$
|
10,253
|
|
|
$
|
2,488
|
|
|
$
|
12,741
|
|
Accounts receivable
|
|
|
57,832
|
|
|
|
4,289
|
|
|
|
62,121
|
|
Prepaid expenses and other current assets
|
|
|
7,921
|
|
|
|
75
|
|
|
|
7,996
|
|
Property and equipment
|
|
|
1,603,306
|
|
|
|
35,400
|
|
|
|
1,638,706
|
|
Goodwill
|
|
|
668,915
|
|
|
|
95,274
|
|
|
|
764,189
|
|
Intangible assets
|
|
|
23,200
|
|
|
|
204
|
|
|
|
23,404
|
|
Other assets
|
|
|
7,760
|
|
|
|
47
|
|
|
|
7,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets acquired
|
|
|
2,379,187
|
|
|
|
137,777
|
|
|
|
2,516,964
|
|
Accounts payable
|
|
|
24,203
|
|
|
|
805
|
|
|
|
25,008
|
|
Accrued salaries and benefits
|
|
|
39,588
|
|
|
|
760
|
|
|
|
40,348
|
|
Other accrued expenses
|
|
|
47,016
|
|
|
|
293
|
|
|
|
47,309
|
|
Deferred tax liabilities noncurrent
|
|
|
67,598
|
|
|
|
|
|
|
|
67,598
|
|
Long-term debt
|
|
|
1,348,389
|
|
|
|
|
|
|
|
1,348,389
|
|
Other liabilities
|
|
|
45,162
|
|
|
|
30,242
|
|
|
|
75,404
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities assumed
|
|
|
1,571,956
|
|
|
|
32,100
|
|
|
|
1,604,056
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets acquired
|
|
$
|
807,231
|
|
|
$
|
105,677
|
|
|
$
|
912,908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9
The preliminary fair values of assets acquired and liabilities assumed, at the corresponding
acquisition dates, during the year ended December 31, 2015 in connection with the 2015 acquisitions were as follows (in thousands):
|
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|
|
|
|
|
|
|
|
|
|
|
|
CRC
|
|
|
Other
|
|
|
Total
|
|
Cash
|
|
$
|
19,599
|
|
|
$
|
5,330
|
|
|
$
|
24,929
|
|
Accounts receivable
|
|
|
47,035
|
|
|
|
20,566
|
|
|
|
67,601
|
|
Prepaid expenses and other current assets
|
|
|
26,945
|
|
|
|
2,674
|
|
|
|
29,619
|
|
Property and equipment
|
|
|
136,163
|
|
|
|
273,143
|
|
|
|
409,306
|
|
Goodwill
|
|
|
1,043,601
|
|
|
|
321,387
|
|
|
|
1,364,988
|
|
Intangible assets
|
|
|
37,000
|
|
|
|
204
|
|
|
|
37,204
|
|
Deferred tax assets-noncurrent
|
|
|
74,383
|
|
|
|
|
|
|
|
74,383
|
|
Other assets
|
|
|
6,478
|
|
|
|
51
|
|
|
|
6,529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets acquired
|
|
|
1,391,204
|
|
|
|
623,355
|
|
|
|
2,014,559
|
|
Accounts payable
|
|
|
4,741
|
|
|
|
4,937
|
|
|
|
9,678
|
|
Accrued salaries and benefits
|
|
|
14,827
|
|
|
|
3,321
|
|
|
|
18,148
|
|
Other accrued expenses
|
|
|
38,873
|
|
|
|
5,290
|
|
|
|
44,163
|
|
Deferred tax liabilities noncurrent
|
|
|
|
|
|
|
13,541
|
|
|
|
13,541
|
|
Debt
|
|
|
904,467
|
|
|
|
|
|
|
|
904,467
|
|
Other liabilities
|
|
|
34,720
|
|
|
|
10
|
|
|
|
34,730
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities assumed
|
|
|
997,628
|
|
|
|
27,099
|
|
|
|
1,024,727
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable noncontrolling interests
|
|
|
|
|
|
|
9,132
|
|
|
|
9,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets acquired
|
|
$
|
393,576
|
|
|
$
|
587,124
|
|
|
$
|
980,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
The qualitative factors comprising the goodwill acquired in the CRC, QAM, Choice, Pastoral, Mildmay Oaks, Care UK, The Manor Clinic, Belmont,
Southcoast, Danshell, H&SCP, Manor Hall, Meadow View, Cleveland House, Duffys, Discovery House, MMO, Priory, Serenity Knolls, TrustPoint and Pocono Mountain acquisitions (collectively the 2015 and 2016 Acquisitions) include
efficiencies derived through synergies expected by the elimination of certain redundant corporate functions and expenses, the ability to leverage call center referrals to a broader provider base, coordination of services provided across the combined
network of facilities, achievement of operating efficiencies by benchmarking performance, and applying best practices throughout the combined companies.
Transaction-related expenses comprised the following costs for the three and six months ended June 30, 2016 and 2015 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Advisory and financing commitment fees
|
|
$
|
|
|
|
$
|
|
|
|
$
|
14,850
|
|
|
$
|
10,337
|
|
Legal, accounting and other costs
|
|
|
4,653
|
|
|
|
5,234
|
|
|
|
16,101
|
|
|
|
9,054
|
|
Severance and contract termination costs
|
|
|
1,421
|
|
|
|
1,923
|
|
|
|
1,421
|
|
|
|
6,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
6,074
|
|
|
$
|
7,157
|
|
|
$
|
32,372
|
|
|
$
|
25,573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pro Forma Information
The condensed consolidated statements of income for the three and six months ended June 30, 2016 include revenue of $424.1 million
and $718.7 million, respectively, and income from continuing operations before income taxes of $34.0 million and $81.4 million, respectively, related to the 2015 and 2016 Acquisitions. The condensed consolidated statements of income
for the three and six months ended June 30, 2015 include revenue of $141.2 million and $209.8 million, respectively, and income from continuing operations before income taxes of $34.7 million and $48.1 million, respectively,
related to acquisitions completed in 2015.
10
The following table provides certain pro forma financial information for the Company as if the
2015 and 2016 Acquisitions occurred as of January 1, 2015 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Revenue
|
|
$
|
761,048
|
|
|
$
|
726,929
|
|
|
$
|
1,490,720
|
|
|
$
|
1,423,281
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, before income taxes
|
|
$
|
74,572
|
|
|
$
|
55,320
|
|
|
$
|
87,925
|
|
|
$
|
71,426
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4. Other Intangible Assets
Other identifiable intangible assets and related accumulated amortization consisted of the following as of June 30, 2016 and
December 31, 2015 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Carrying Amount
|
|
|
Accumulated Amortization
|
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract intangible assets
|
|
$
|
2,100
|
|
|
$
|
2,100
|
|
|
$
|
(1,960
|
)
|
|
$
|
(1,750
|
)
|
Non-compete agreements
|
|
|
1,247
|
|
|
|
1,247
|
|
|
|
(1,247
|
)
|
|
|
(1,247
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,347
|
|
|
|
3,347
|
|
|
|
(3,207
|
)
|
|
|
(2,997
|
)
|
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Licenses and accreditations
|
|
|
12,398
|
|
|
|
11,479
|
|
|
|
|
|
|
|
|
|
Trade names
|
|
|
59,224
|
|
|
|
37,800
|
|
|
|
|
|
|
|
|
|
Certificates of need
|
|
|
13,234
|
|
|
|
9,946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
84,856
|
|
|
|
59,225
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
88,203
|
|
|
$
|
62,572
|
|
|
$
|
(3,207
|
)
|
|
$
|
(2,997
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization expense related to definite-lived intangible assets was $0.1 million for both the three months
ended June 30, 2016 and 2015, respectively, and $0.2 million and $0.3 million for the six months ended June 30, 2016 and 2015, respectively. Estimated amortization expense for the years ending December 31, 2016, 2017, 2018, 2019 and
2020 is $0.4 million, $0, $0, $0 and $0, respectively. The Companys licenses and accreditations, trade names and certificate of need intangible assets have indefinite lives and are, therefore, not subject to amortization.
5. Property and Equipment
Property and equipment
consists of the following as of June 30, 2016 and December 31, 2015 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30, 2016
|
|
|
December 31, 2015
|
|
Land
|
|
$
|
529,258
|
|
|
$
|
214,138
|
|
Building and improvements
|
|
|
2,418,108
|
|
|
|
1,277,800
|
|
Equipment
|
|
|
359,728
|
|
|
|
141,543
|
|
Construction in progress
|
|
|
149,374
|
|
|
|
195,042
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,456,468
|
|
|
|
1,828,523
|
|
Less accumulated depreciation
|
|
|
(181,928
|
)
|
|
|
(119,470
|
)
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
$
|
3,274,540
|
|
|
$
|
1,709,053
|
|
|
|
|
|
|
|
|
|
|
11
6. Long-Term Debt
Long-term debt consisted of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30, 2016
|
|
|
December 31, 2015
|
|
Amended and Restated Senior Credit Facility:
|
|
|
|
|
|
|
|
|
Senior Secured Term A Loans
|
|
$
|
613,156
|
|
|
$
|
500,750
|
|
Senior Secured Term B Loans
|
|
|
1,442,725
|
|
|
|
495,000
|
|
Senior Secured Revolving Line of Credit
|
|
|
150,000
|
|
|
|
158,000
|
|
6.125% Senior Notes due 2021
|
|
|
150,000
|
|
|
|
150,000
|
|
5.125% Senior Notes due 2022
|
|
|
300,000
|
|
|
|
300,000
|
|
5.625% Senior Notes due 2023
|
|
|
650,000
|
|
|
|
650,000
|
|
6.500% Senior Notes due 2024
|
|
|
390,000
|
|
|
|
|
|
9.0% and 9.5% Revenue Bonds
|
|
|
22,410
|
|
|
|
22,410
|
|
Less: unamortized debt issuance costs, discount and premium
|
|
|
(66,498
|
)
|
|
|
(35,416
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
3,651,793
|
|
|
|
2,240,744
|
|
Less: current portion
|
|
|
(73,410
|
)
|
|
|
(45,360
|
)
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
$
|
3,578,383
|
|
|
$
|
2,195,384
|
|
|
|
|
|
|
|
|
|
|
Amended and Restated Senior Credit Facility
The Company entered into a senior secured credit facility (the Senior Secured Credit Facility) on April 1, 2011. On
December 31, 2012, the Company entered into an Amended and Restated Credit Agreement (the Amended and Restated Credit Agreement) which amended and restated the Senior Secured Credit Facility (the Amended and Restated Senior
Credit Facility). The Company has amended the Amended and Restated Credit Agreement from time to time as described in the Companys prior filings with the Securities and Exchange Commission.
On February 6, 2015, the Company entered into a Seventh Amendment (the Seventh Amendment) to the Amended and Restated Credit
Agreement. The Seventh Amendment added Citibank, N.A. as an L/C Issuer under the Amended and Restated Credit Agreement in order to permit the rollover of CRCs existing letters of credit into the Amended and Restated Credit
Agreement and increased both the Companys Letter of Credit Sublimit and Swing Line Sublimit to $20.0 million.
On February 11,
2015, the Company entered into a First Incremental Facility Amendment (the First Incremental Amendment) to the Amended and Restated Credit Agreement. The First Incremental Amendment activated a new $500.0 million incremental Term
Loan B facility (the Existing TLB Facility) that was added to the Amended and Restated Senior Credit Facility, subject to limited conditionality provisions. Borrowings under the Existing TLB Facility were used to fund a portion of the
purchase price for the acquisition of CRC.
On April 22, 2015, the Company entered into an Eighth Amendment (the Eighth
Amendment) to the Amended and Restated Credit Agreement. The Eighth Amendment changed the definition of Change of Control in part to remove a provision whose purpose was, when calculating whether a majority of incumbent directors
have approved new directors, that any incumbent director that became a director as a result of a threatened or actual proxy contest was not counted in such calculation.
On January 25, 2016, the Company entered into the Ninth Amendment (the Ninth Amendment) to the Amended and Restated Credit
Agreement. The Ninth Amendment modifies certain definitions and provides increased flexibility to the Company in terms of its financial covenants. The Companys baskets for permitted investments were also increased to provide increased
flexibility for it to invest in non-wholly owned subsidiaries, joint ventures and foreign subsidiaries. The Company may now invest in non-wholly owned subsidiaries and joint ventures up to 10.0% of the Company and its subsidiaries total assets
in any four consecutive fiscal quarter period, and up to 12.5% of the Company and its subsidiaries total assets during the term of the Amended and Restated Credit Agreement. The Company may also invest in foreign subsidiaries that are not loan
parties up to 10% of the Company and its subsidiaries total assets in any consecutive four fiscal quarter period, and up to 15% of the Company and its subsidiaries total assets during the term of the Amended and Restated Credit
Agreement. The foregoing permitted investments are subject to an aggregate cap of 25% of the Company and its subsidiaries total assets in any fiscal year.
On February 16, 2016, the Company entered into a Second Incremental Facility Amendment (the Second Incremental Amendment) to
the Amended and Restated Credit Agreement. The Second Incremental Amendment activated a new $955.0 million
12
incremental Term Loan B facility (the New TLB Facility) and added $135.0 million to the Term Loan A facility (the TLA Facility) to the Amended and Restated Senior Credit
Facility, subject to limited conditionality provisions. Borrowings under the New TLB Facility were used to fund a portion of the purchase price for the acquisition of Priory and the fees and expenses for such acquisition and the related financing
transactions. Borrowings under the TLA Facility were used to pay down the majority of our $300.0 million revolving credit facility.
On
May 26, 2016, the Company entered into a Tranche B-1 Repricing Amendment (the Repricing Amendment) to the Amended and Restated Credit Agreement. The Repricing Amendment reduces the Applicable Rate with respect to the Existing TLB
Facility from 3.5% to 3.0% in the case of Eurodollar Rate loans and 2.5% to 2.0% in the case of Base Rate Loans.
The Company had $141.4
million of availability under the revolving line of credit as of June 30, 2016. Borrowings under the revolving line of credit are subject to customary conditions precedent to borrowing. The Amended and Restated Credit Agreement requires
quarterly term loan principal repayments of our TLA Facility of $12.6 million for June 30, 2016 to December 31, 2016, $16.8 million for March 31, 2017 to December 31, 2017, and $20.9 million for March 31, 2018 to
December 31, 2018, with the remaining principal balance of the TLA Facility due on the maturity date of February 13, 2019. The Company is required to repay the Existing TLB Facility in equal quarterly installments of $1.3 million on the
last business day of each March, June, September and December, with the outstanding principal balance of the Existing TLB Facility due on February 11, 2022. The Company is required to repay the New TLB Facility in equal quarterly installments
of approximately $2.4 million on the last business day of each March, June, September and December, with the outstanding principal balance of the TLB Facility due on February 16, 2023.
Borrowings under the Amended and Restated Senior Credit Facility are guaranteed by each of the Companys wholly-owned domestic
subsidiaries (other than certain excluded subsidiaries) and are secured by a lien on substantially all of the assets of the Company and such subsidiaries. Borrowings with respect to the TLA Facility and the Companys revolving credit facility
(collectively, Pro Rata Facilities) under the Amended and Restated Credit Agreement bear interest at a rate tied to Acadias Consolidated Leverage Ratio (defined as consolidated funded debt net of up to $40.0 million of unrestricted
and unencumbered cash to consolidated EBITDA, in each case as defined in the Amended and Restated Credit Agreement). The Applicable Rate (as defined in the Amended and Restated Credit Agreement) for the Pro Rata Facilities was 3.25% for Eurodollar
Rate Loans (as defined in the Amended and Restated Credit Agreement) and 2.25% for Base Rate Loans (as defined in the Amended and Restated Credit Agreement) at June 30, 2016. Eurodollar Rate Loans with respect to the Pro Rata Facilities bear
interest at the Applicable Rate plus the Eurodollar Rate (as defined in the Amended and Restated Credit Agreement) (based upon the LIBOR Rate (as defined in the Amended and Restated Credit Agreement) prior to commencement of the interest rate
period). Base Rate Loans with respect to the Pro Rata Facilities bear interest at the Applicable Rate plus the highest of (i) the federal funds rate plus 0.50%, (ii) the prime rate and (iii) the Eurodollar Rate plus 1.0%. As of
June 30, 2016, the Pro Rata Facilities bore interest at a rate of LIBOR plus 3.25%. In addition, the Company is required to pay a commitment fee on undrawn amounts under the revolving line of credit.
The Amended and Restated Credit Agreement requires the Company and its subsidiaries to comply with customary affirmative, negative and
financial covenants, including a fixed charge coverage ratio, consolidated leverage ratio and senior secured leverage ratio. The Company may be required to pay all of its indebtedness immediately if it defaults on any of the numerous financial or
other restrictive covenants contained in any of its material debt agreements. As of June 30, 2016, the Company was in compliance with such covenants.
Senior Notes
6.125% Senior
Notes due 2021
On March 12, 2013, the Company issued $150.0 million of 6.125% Senior Notes due 2021 (the 6.125% Senior
Notes). The 6.125% Senior Notes mature on March 15, 2021 and bear interest at a rate of 6.125% per annum, payable semi-annually in arrears on March 15 and September 15 of each year.
5.125% Senior Notes due 2022
On July 1, 2014, the Company issued $300.0 million of 5.125% Senior Notes due 2022 (the 5.125% Senior Notes). The 5.125%
Senior Notes mature on July 1, 2022 and bear interest at a rate of 5.125% per annum, payable semi-annually in arrears on January 1 and July 1 of each year.
5.625% Senior Notes due 2023
On February 11, 2015, the Company issued $375.0 million of 5.625% Senior Notes due 2023 (the 5.625% Senior Notes). The 5.625%
Senior Notes mature on February 15, 2023 and bear interest at a rate of 5.625% per annum, payable semi-annually in arrears on February 15 and August 15 of each year.
13
On September 21, 2015, the Company issued $275.0 million of additional 5.625% Senior Notes.
The additional notes form a single class of debt securities with the existing 5.625% Senior Notes. Giving effect to this issuance, the Company has outstanding an aggregate of $650.0 million of 5.625% Senior Notes.
6.500% Senior Notes due 2024
On February 16, 2016, the Company issued $390.0 million of 6.500% Senior Notes due 2024 (the 6.500% Senior Notes). The 6.500%
Senior Notes mature on March 1, 2024 and bear interest at a rate of 6.500% per annum, payable semi-annually in arrears on March 1 and September 1 of each year, beginning on September 1, 2016.
The indentures governing the 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior Notes and 6.500% Senior Notes (together, the Senior
Notes) contain covenants that, among other things, limit the Companys ability and the ability of its restricted subsidiaries to: (i) pay dividends, redeem stock or make other distributions or investments; (ii) incur additional
debt or issue certain preferred stock; (iii) transfer or sell assets; (iv) engage in certain transactions with affiliates; (v) create restrictions on dividends or other payments by the restricted subsidiaries; (vi) merge,
consolidate or sell substantially all of the Companys assets; and (vii) create liens on assets.
The Senior Notes issued by the
Company are guaranteed by each of the Companys subsidiaries that guarantee the Companys obligations under the Amended and Restated Senior Credit Facility. The guarantees are full and unconditional and joint and several.
The Company may redeem the Senior Notes at its option, in whole or part, at the dates and amounts set forth in the indentures.
9.0% and 9.5% Revenue Bonds
On November 11, 2012, in connection with the acquisition of Park Royal, the Company assumed debt of $23.0 million. The fair market value
of the debt assumed was $25.6 million and resulted in a debt premium balance being recorded as of the acquisition date. The debt consisted of $7.5 million and $15.5 million of Lee County (Florida) Industrial Development Authority Healthcare
Facilities Revenue Bonds, Series 2010 with stated interest rates of 9.0% and 9.5% (9.0% and 9.5% Revenue Bonds), respectively. The 9.0% bonds in the amount of $7.5 million have a maturity date of December 1, 2030 and require yearly
principal payments beginning in 2013. The 9.5% bonds in the amount of $15.5 million have a maturity date of December 1, 2040 and require yearly principal payments beginning in 2031. The principal payments establish a bond sinking fund to be
held with the trustee and shall be sufficient to redeem the principal amounts of the 9.0% and 9.5% Revenue Bonds on their respective maturity dates. As of June 30, 2016 and December 31, 2015, $2.3 million was recorded within other assets
on the balance sheet related to the debt service reserve fund requirements. The yearly principal payments, which establish a bond sinking fund, will increase the debt service reserve fund requirements. The bond premium amount of $2.6 million is
amortized as a reduction of interest expense over the life of the revenue bonds using the effective interest method.
7. Equity Offerings
Common Stock
On March 3,
2016, the Company held a Special Meeting of Stockholders, where the Companys stockholders approved an amendment to the Companys Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock
from 90,000,000 to 180,000,000 (the Amendment). On March 3, 2016, the Company filed the Amendment with the Secretary of State of the State of Delaware.
Equity Offerings
On
February 11, 2015, the Company completed its acquisition of CRC for total consideration of approximately $1.3 billion. As consideration for the acquisition, the Company issued 5,975,326 shares of its common stock to certain holders of CRC
common stock and repaid CRCs outstanding indebtedness.
On May 11, 2015, the Company completed the offering of 5,175,000 shares
of common stock (including shares sold pursuant to the exercise of the over-allotment option that the Company granted to the underwriters as part of the offering) at a price of $66.50 per share. The net proceeds to the Company from the sale of the
shares, after deducting the underwriting discount of $12.0 million and additional offering-related costs of $0.8 million, were $331.3 million. The Company used the net offering proceeds to repay outstanding indebtedness and fund acquisitions.
On January 12, 2016, the Company completed the offering of 11,500,000 shares of common stock (including shares sold pursuant to the
exercise of the over-allotment option that the Company granted to the underwriters as part of the offering) at a price of
14
$61.00 per share. The net proceeds to the Company from the sale of the shares, after deducting the underwriting discount of $15.8 million and additional offering-related costs of $0.7 million,
were $685.0 million. The Company used the net offering proceeds to fund a portion of the purchase price for the acquisition of Priory.
On
February 16, 2016, the Company completed its acquisition of Priory, which included the issuance of 4,033,561 shares of common stock to the former stockholders of Priory.
8. Equity-Based Compensation
Equity Incentive
Plans
The Company issues stock-based awards, including stock options, restricted stock and restricted stock units, to certain
officers, employees and non-employee directors under the Acadia Healthcare Company, Inc. Incentive Compensation Plan (the Equity Incentive Plan). As of June 30, 2016, a maximum of 8,200,000 shares of the Companys common stock
were authorized for issuance as stock options, restricted stock and restricted stock units or other share-based compensation under the Equity Incentive Plan, of which 4,614,085 were available for future grant. Stock options may be granted for terms
of up to ten years. The Company recognizes expense on all share-based awards on a straight-line basis over the requisite service period of the entire award. Grants to employees generally vest in annual increments of 25% each year, commencing one
year after the date of grant. The exercise prices of stock options are equal to the most recent closing price of the Companys common stock on the date of grant.
The Company recognized $6.9 million and $5.4 million in equity-based compensation expense for the three months ended June 30, 2016 and
2015, respectively, and $13.8 million and $9.2 million for the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, there was $60.2 million of unrecognized compensation expense related to unvested options, restricted
stock and restricted stock units, which is expected to be recognized over the remaining weighted average vesting period of 1.4 years. As of June 30, 2016, there were no warrants outstanding. The Company recognized a deferred income tax benefit
of $2.5 million and $2.2 million for the three months ended June 30, 2016 and 2015, respectively, related to equity-based compensation expense. The Company recognized a deferred income tax benefit of $5.3 million and $3.8 million for the six
months ended June 30, 2016 and 2015, respectively, related to equity-based compensation expense. The actual tax benefit realized from stock options exercised during the three and six months ended June 30, 2015 was $2.0 million and $6.3
million, respectively.
Stock option activity during 2015 and 2016 was as follows (aggregate intrinsic value in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
of
Options
|
|
|
Weighted
Average
Exercise Price
|
|
|
Weighted
Average
Remaining
Contractual
Term (in years)
|
|
|
Aggregate
Intrinsic
Value
|
|
Options outstanding at January 1, 2015
|
|
|
737,422
|
|
|
$
|
32.19
|
|
|
|
8.09
|
|
|
$
|
14,512
|
|
Options granted
|
|
|
204,700
|
|
|
|
63.07
|
|
|
|
9.21
|
|
|
|
1,724
|
|
Options exercised
|
|
|
(214,079
|
)
|
|
|
42.75
|
|
|
|
N/A
|
|
|
|
9,890
|
|
Options cancelled
|
|
|
(33,300
|
)
|
|
|
46.53
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options outstanding at December 31, 2015
|
|
|
694,743
|
|
|
|
42.87
|
|
|
|
7.70
|
|
|
|
20,717
|
|
Options granted
|
|
|
456,850
|
|
|
|
59.26
|
|
|
|
9.73
|
|
|
|
|
|
Options exercised
|
|
|
(12,700
|
)
|
|
|
30.98
|
|
|
|
N/A
|
|
|
|
478
|
|
Options cancelled
|
|
|
(39,875
|
)
|
|
|
57.30
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options outstanding at June 30, 2016
|
|
|
1,099,018
|
|
|
$
|
49.36
|
|
|
|
8.24
|
|
|
$
|
11,676
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options exercisable at December 31, 2015
|
|
|
106,330
|
|
|
$
|
36.41
|
|
|
|
5.83
|
|
|
$
|
4,968
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options exercisable at June 30, 2016
|
|
|
317,476
|
|
|
$
|
41.17
|
|
|
|
6.55
|
|
|
$
|
8,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15
Restricted stock activity during 2015 and 2016 was as follows:
|
|
|
|
|
|
|
|
|
|
|
Number of
Shares
|
|
|
Weighted
Average
Grant-Date
Fair Value
|
|
Unvested at January 1, 2015
|
|
|
722,028
|
|
|
$
|
39.77
|
|
Granted
|
|
|
503,052
|
|
|
|
62.67
|
|
Cancelled
|
|
|
(44,900
|
)
|
|
|
49.55
|
|
Vested
|
|
|
(235,618
|
)
|
|
|
34.93
|
|
|
|
|
|
|
|
|
|
|
Unvested at December 31, 2015
|
|
|
944,562
|
|
|
$
|
52.74
|
|
Granted
|
|
|
299,047
|
|
|
|
59.07
|
|
Cancelled
|
|
|
(54,828
|
)
|
|
|
58.02
|
|
Vested
|
|
|
(243,669
|
)
|
|
|
46.79
|
|
|
|
|
|
|
|
|
|
|
Unvested at June 30, 2016
|
|
|
945,112
|
|
|
$
|
55.96
|
|
|
|
|
|
|
|
|
|
|
Restricted stock unit activity during 2015 and 2016 was as follows:
|
|
|
|
|
|
|
|
|
|
|
Number of
Units
|
|
|
Weighted
Average
Grant-Date
Fair Value
|
|
Unvested at January 1, 2015
|
|
|
125,113
|
|
|
$
|
38.73
|
|
Granted
|
|
|
217,994
|
|
|
|
61.77
|
|
Cancelled
|
|
|
|
|
|
|
|
|
Vested
|
|
|
(125,023
|
)
|
|
|
32.38
|
|
|
|
|
|
|
|
|
|
|
Unvested at December 31, 2015
|
|
|
218,084
|
|
|
$
|
56.97
|
|
Granted
|
|
|
230,750
|
|
|
|
56.95
|
|
Cancelled
|
|
|
|
|
|
|
|
|
Vested
|
|
|
(175,235
|
)
|
|
|
52.71
|
|
|
|
|
|
|
|
|
|
|
Unvested at June 30, 2016
|
|
|
273,599
|
|
|
$
|
59.68
|
|
|
|
|
|
|
|
|
|
|
The grant-date fair value of the Companys stock options is estimated using the Black-Scholes option
pricing model. The following table summarizes the grant-date fair value of options and the assumptions used to develop the fair value estimates for options granted during the six months ended June 30, 2016 and year ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
June 30, 2016
|
|
|
December 31, 2015
|
|
Weighted average grant-date fair value of options
|
|
$
|
19.57
|
|
|
$
|
21.78
|
|
Risk-free interest rate
|
|
|
1.4
|
%
|
|
|
1.5
|
%
|
Expected volatility
|
|
|
33
|
%
|
|
|
35
|
%
|
Expected life (in years)
|
|
|
5.5
|
|
|
|
5.5
|
|
The Companys estimate of expected volatility for stock options is based upon the volatility of guideline
companies given the lack of sufficient historical trading experience of the Companys common stock. The risk-free interest rate is the approximate yield on United States Treasury Strips having a life equal to the expected option life on the
date of grant. The expected life is an estimate of the number of years an option will be held before it is exercised.
9. Income Taxes
The provision for income taxes for continuing operations for the three months ended June 30, 2016 and 2015 reflects effective tax rates of
24.7% and 31.4%, respectively. The provision for income taxes for continuing operations for the six months ended June 30, 2016 and 2015 reflects effective tax rates of 23.9% and 31.4%, respectively. The decrease in the tax rate for the three
and six months ended June 30, 2016 was primarily attributable to the acquisition of Priory, which is located in a lower taxing jurisdiction and for which earnings are permanently reinvested.
16
10. Derivative Instruments
The Company entered into foreign currency forward contracts during the three and six months ended June 30, 2016 and 2015 in connection
with (i) acquisitions in the U.K. and (ii) transfers of cash between the U.S. and U.K. under the Companys cash management and foreign currency risk management programs. Foreign currency forward contracts limit the economic risk of
changes in the exchange rate between US Dollars (USD) and British Pounds (GBP) associated with cash transfers. These foreign currency forward contracts did not meet the hedge accounting criteria under Accounting Standards
Codification 815,
Derivatives and Hedging
. As such, changes in fair value resulted in gains of $0.1 million and $0.5 million for the three and six months ended June 30, 2016, respectively, and losses of $1.0 million and $0.9 million for
the three and six months ended June 30, 2015, respectively, which have been recorded in the consolidated statements of income.
In
May 2016, the Company entered into multiple cross currency swap agreements with an aggregate notional amount of $650.0 million to manage foreign currency risk by effectively converting a portion of its fixed-rate USD-denominated senior notes,
including the semi-annual interest payments thereunder, to fixed-rate GBP-denominated debt of £449.3 million. The senior notes effectively converted include $150.0 million aggregate principal amount of 6.125% Senior Notes, $300.0 million
aggregate principal amount of 5.125% Senior Notes and $200.0 million aggregate principal amount of 5.625% Senior Notes. During the term of the swap agreements, the Company will receive semi-annual interest payments in USD from the counterparties at
fixed interest rates, and the Company will make semi-annual interest payments in GBP to the counterparties at fixed interest rates. The interest payments under the cross-currency swap agreements result in £24.7 million of annual cash
flows, from the Companys U.K. business being converted to $35.8 million (at a 1.45 exchange rate). The interest rates applicable to the GBP interest payments are substantially the same as the interest rates in place for the existing
USD-denominated debt. At maturity, the Company will repay the principal amounts listed above in GBP and receive the principal amount in USD.
The Company has designated the cross currency swap agreements as qualifying hedging instruments and is accounting for these as net investment
hedges. The fair value of the cross currency swap agreements of $40.5 million is recorded in derivative instruments on the condensed consolidated balance sheet. The gains and losses resulting from fair value adjustments to the cross currency swap
agreements are recorded in accumulated other comprehensive income as the swaps are effective in hedging the designated risk. Cash flows related to the cross currency swaps are included in operating activities on the consolidated statements of cash
flows.
11. Fair Value Measurements
The carrying amounts reported for cash and cash equivalents, accounts receivable, other current assets, accounts payable and other current
liabilities approximate fair value because of the short-term maturity of these instruments.
The carrying amounts and fair values of the
Companys Amended and Restated Senior Credit Facility, 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior Notes, 6.500% Senior Notes, 9.0% and 9.5% Revenue Bonds, derivative instruments and contingent consideration liabilities as of
June 30, 2016 and December 31, 2015 were as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrying Amount
|
|
|
Fair Value
|
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
Amended and Restated Senior Credit Facility
|
|
$
|
2,164,959
|
|
|
$
|
1,135,861
|
|
|
$
|
2,164,959
|
|
|
$
|
1,135,861
|
|
6.125% Senior Notes due 2021
|
|
$
|
147,324
|
|
|
$
|
147,082
|
|
|
$
|
151,375
|
|
|
$
|
149,288
|
|
5.125% Senior Notes due 2022
|
|
$
|
295,090
|
|
|
$
|
294,749
|
|
|
$
|
286,237
|
|
|
$
|
275,590
|
|
5.625% Senior Notes due 2023
|
|
$
|
639,990
|
|
|
$
|
639,431
|
|
|
$
|
627,190
|
|
|
$
|
604,262
|
|
6.500% Senior Notes due 2024
|
|
$
|
381,173
|
|
|
$
|
|
|
|
$
|
386,891
|
|
|
$
|
|
|
9.0% and 9.5% Revenue Bonds
|
|
$
|
23,407
|
|
|
$
|
23,621
|
|
|
$
|
23,407
|
|
|
$
|
23,621
|
|
Derivative instruments
|
|
$
|
40,459
|
|
|
$
|
|
|
|
$
|
40,459
|
|
|
$
|
|
|
Contingent consideration liabilities
|
|
$
|
667
|
|
|
$
|
667
|
|
|
$
|
667
|
|
|
$
|
667
|
|
The Companys Amended and Restated Senior Credit Facility, 6.125% Senior Notes, 5.125% Senior Notes,
5.625% Senior Notes, 6.500% Senior Notes and 9.0% and 9.5% Revenue Bonds were categorized as Level 2 in the GAAP fair value hierarchy. Fair values were based on trading activity among the Companys lenders and the average bid and ask price as
determined using published rates.
The fair values of the derivative instruments were categorized as Level 2 in the GAAP fair value
hierarchy and were based on observable market inputs including applicable exchange rates and interest rates.
17
The fair value of the contingent consideration liabilities were categorized as Level 3 in
the GAAP fair value hierarchy. The contingent consideration liabilities were valued using a probability-weighted discounted cash flow method. This analysis reflected the contractual terms of the purchase agreements and utilized assumptions with
regard to future earnings, probabilities of achieving such future earnings and a discount rate.
12. Commitments and Contingencies
The Company is, from time to time, subject to various claims and legal actions that arise in the ordinary course of the Companys
business, including claims for damages for personal injuries, medical malpractice, breach of contract, tort and employment related claims. In these actions, plaintiffs request a variety of damages, including, in some instances, punitive and other
types of damages that may not be covered by insurance. In the opinion of management, the Company is not currently a party to any proceeding that would individually or in the aggregate have a material adverse effect on the Companys business,
financial condition or results of operations.
13. Noncontrolling Interests
On May 2, 2016, the Company opened Crestwyn Behavioral Health, a de novo inpatient psychiatric facility located in Memphis,
Tennessee. The Company owns 60% of the equity interests in the facility, and two noncontrolling partners each own 20%. The value of the 40% noncontrolling interests approximates $6.0 million and is based on the fair value of contributions. The
Company consolidates the operations of the facility based on its 60% equity ownership and its management of the entity. The noncontrolling interests are reflected as redeemable noncontrolling interests on the accompanying condensed consolidated
balance sheet based on a put right that could require the Company to purchase the noncontrolling interests upon the occurrence of a change in control.
On August 31, 2015, the Company completed the acquisition of a controlling interest in Southcoast, an inpatient psychiatric facility
located in Fairhaven, Massachusetts. The Company owns 75% of the equity interests in the facility. The value of the 25% noncontrolling interest approximates $9.2 million. The Company considered an income approach and other valuation
methodologies to value the noncontrolling interests. The Company consolidates the operations of the facility based on its 75% equity ownership and its management of the entity. The noncontrolling interests are reflected as redeemable noncontrolling
interests on the accompanying condensed consolidated balance sheet based on a put right that could require the Company to purchase the noncontrolling interests upon the occurrence of a change in control.
14. Other Current Assets
Other current
assets consisted of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
Prepaid expenses
|
|
$
|
27,970
|
|
|
$
|
21,817
|
|
Other receivables
|
|
|
22,456
|
|
|
|
17,518
|
|
Insurance receivable current portion
|
|
|
5,290
|
|
|
|
5,290
|
|
Workers compensation deposits current portion
|
|
|
7,500
|
|
|
|
7,500
|
|
Income taxes receivable
|
|
|
4,873
|
|
|
|
6,540
|
|
Inventory
|
|
|
4,819
|
|
|
|
4,681
|
|
Other
|
|
|
3,611
|
|
|
|
3,549
|
|
|
|
|
|
|
|
|
|
|
Other current assets
|
|
$
|
76,519
|
|
|
$
|
66,895
|
|
|
|
|
|
|
|
|
|
|
18
15. Other Accrued Liabilities
Other accrued liabilities consisted of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30,
2016
|
|
|
December 31,
2015
|
|
Accrued expenses
|
|
$
|
40,568
|
|
|
$
|
17,921
|
|
Accrued interest
|
|
|
35,919
|
|
|
|
26,132
|
|
Unearned income
|
|
|
23,313
|
|
|
|
446
|
|
Insurance liability current portion
|
|
|
10,490
|
|
|
|
10,490
|
|
Income taxes payable
|
|
|
4,677
|
|
|
|
7,367
|
|
Accrued property taxes
|
|
|
3,829
|
|
|
|
2,951
|
|
Other current liabilities
|
|
|
5,992
|
|
|
|
7,499
|
|
|
|
|
|
|
|
|
|
|
Other accrued liabilities
|
|
$
|
124,788
|
|
|
$
|
72,806
|
|
|
|
|
|
|
|
|
|
|
16. Segment Information
The Company operates in one line of business, which is operating acute inpatient psychiatric facilities, specialty treatment facilities,
residential treatment centers and facilities providing outpatient behavioral healthcare services. As management reviews the operating results of its facilities in the U.S. (the U.S. Facilities) and its facilities in the U.K. (the
U.K. Facilities) separately to assess performance and make decisions, the Companys operating segments include its U.S. Facilities and U.K. Facilities. At June 30, 2016, the U.S. Facilities included 211 behavioral healthcare
facilities with approximately 8,400 beds in 39 states and Puerto Rico, and the U.K. Facilities included 380 behavioral healthcare facilities with approximately 9,400 beds in the U.K. The following tables set forth the financial information by
operating segment, including a reconciliation of Segment EBITDA to income from continuing operations before income taxes (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Facilities
|
|
$
|
430,209
|
|
|
$
|
366,886
|
|
|
$
|
838,473
|
|
|
$
|
657,393
|
|
U.K. Facilities
|
|
|
325,883
|
|
|
|
84,927
|
|
|
|
532,858
|
|
|
|
158,242
|
|
Corporate and Other
|
|
|
456
|
|
|
|
1,847
|
|
|
|
2,030
|
|
|
|
3,808
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
756,548
|
|
|
$
|
453,660
|
|
|
$
|
1,373,361
|
|
|
$
|
819,443
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITDA (1):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Facilities
|
|
$
|
118,580
|
|
|
$
|
102,342
|
|
|
$
|
225,420
|
|
|
$
|
178,706
|
|
U.K. Facilities
|
|
|
72,938
|
|
|
|
20,371
|
|
|
|
117,869
|
|
|
|
39,182
|
|
Corporate and Other
|
|
|
(19,292
|
)
|
|
|
(16,910
|
)
|
|
|
(40,051
|
)
|
|
|
(33,373
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
172,226
|
|
|
$
|
105,803
|
|
|
$
|
303,238
|
|
|
$
|
184,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Segment EBITDA (1)
|
|
$
|
172,226
|
|
|
$
|
105,803
|
|
|
$
|
303,238
|
|
|
$
|
184,515
|
|
Plus (less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity-based compensation expense
|
|
|
(6,888
|
)
|
|
|
(5,355
|
)
|
|
|
(13,844
|
)
|
|
|
(9,249
|
)
|
Gain (loss) on foreign currency derivatives
|
|
|
98
|
|
|
|
(961
|
)
|
|
|
508
|
|
|
|
(908
|
)
|
Transaction-related expenses
|
|
|
(6,074
|
)
|
|
|
(7,157
|
)
|
|
|
(32,372
|
)
|
|
|
(25,573
|
)
|
Interest expense, net
|
|
|
(48,758
|
)
|
|
|
(28,049
|
)
|
|
|
(86,472
|
)
|
|
|
(50,195
|
)
|
Depreciation and amortization
|
|
|
(36,752
|
)
|
|
|
(14,926
|
)
|
|
|
(64,727
|
)
|
|
|
(28,030
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes
|
|
$
|
73,852
|
|
|
$
|
49,355
|
|
|
$
|
106,331
|
|
|
$
|
70,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Facilities
|
|
|
U.K. Facilities
|
|
|
Corporate
and Other
|
|
|
Consolidated
|
|
Goodwill:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2016
|
|
$
|
1,941,873
|
|
|
$
|
186,342
|
|
|
$
|
|
|
|
$
|
2,128,215
|
|
Increase from 2016 acquisitions
|
|
|
95,274
|
|
|
|
668,915
|
|
|
|
|
|
|
|
764,189
|
|
Foreign currency translation
|
|
|
|
|
|
|
(68,990
|
)
|
|
|
|
|
|
|
(68,990
|
)
|
Purchase price allocation and other
|
|
|
8,748
|
|
|
|
39
|
|
|
|
|
|
|
|
8,787
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2016
|
|
$
|
2,045,895
|
|
|
$
|
786,306
|
|
|
$
|
|
|
|
$
|
2,832,201
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2016
|
|
|
December 31, 2015
|
|
Assets (2):
|
|
|
|
|
|
|
|
|
U.S. Facilities
|
|
$
|
3,330,105
|
|
|
$
|
3,061,519
|
|
U.K. Facilities
|
|
|
3,179,240
|
|
|
|
1,045,922
|
|
Corporate and Other
|
|
|
175,154
|
|
|
|
171,767
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
6,684,499
|
|
|
$
|
4,279,208
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Segment EBITDA is defined as income from continuing operations before provision for income taxes, equity-based compensation expense, gain/loss on foreign currency derivatives, transaction-related expenses, interest
expense and depreciation and amortization. The Company uses Segment EBITDA as an analytical indicator to measure the performance of the Companys segments and to develop strategic objectives and operating plans for those segments. Segment
EBITDA is commonly used as an analytical indicator within the health care industry, and also serves as a measure of leverage capacity and debt service ability. Segment EBITDA should not be considered as a measure of financial performance under
generally accepted accounting principles, and the items excluded from Segment EBITDA are significant components in understanding and assessing financial performance. Because Segment EBITDA is not a measurement determined in accordance with generally
accepted accounting principles and is thus susceptible to varying calculations, Segment EBITDA, as presented, may not be comparable to other similarly titled measures of other companies.
|
(2)
|
Assets include property and equipment for the U.S. Facilities of $963.5 million, U.K. Facilities of $2.3 billion and corporate and other of $46.0 million at June 30, 2016. Assets include property and equipment for
the U.S. Facilities of $832.2 million, U.K. Facilities of $824.4 million and corporate and other of $52.4 million at December 31, 2015.
|
17. Recently Issued Accounting Standards
In March 2016, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) 2016-09,
Improvements to Employee Share-Based Payment Accounting
(ASU 2016-09). ASU 2016-09 includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. ASU 2016-09 is effective
for fiscal years, and interim periods within those years, beginning after December 15, 2016. Additionally, ASU 2016-09 would permit both public and nonpublic organizations to adopt the new standard early. Management is evaluating the impact of
ASU 2016-09 on the Companys consolidated financial statements.
In March 2016, FASB issued ASU 2016-02,
Leases
(ASU 2016-02). ASU 2016-02s core principle is to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information. ASU 2016-02 is effective
for fiscal years, and interim periods within those years, beginning after December 15, 2018. Additionally, ASU 2016-02 would permit both public and nonpublic organizations to adopt the new standard early. Management is evaluating the impact of
ASU 2016-02 on the Companys consolidated financial statements.
In May 2014, the FASB and the International Accounting Standards
Board issued ASU 2014-09,
Revenue from Contracts with Customers (Topic 606)
(ASU 2014-09). ASU 2014-09s core principal is that a company will recognize revenue when it transfers promised goods or services to
customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after
December 15, 2017. Additionally, ASU 2014-09 would permit both public and nonpublic organizations to adopt the new revenue standard early, but not before the original public organization effective date (that is, annual periods beginning after
December 15, 2016). Management is evaluating the impact of ASU 2014-09 on the Companys consolidated financial statements.
18. Subsequent
Events
The CMA has been reviewing the Companys acquisition of Priory. On July 14, 2016, the CMA announced that the
Companys acquisition of Priory will be referred for a phase 2 investigation unless the Company offers undertakings to address the CMAs competition concerns relating to the provision of behavioral healthcare services in certain markets.
On July 28, 2016, the CMA announced that the Company has offered undertakings to address the CMAs concerns and that, in lieu of a phase 2 investigation, the CMA will consider the Companys undertakings. The Companys undertakings
provide for the sale of 19 Priory and Partnerships in Care healthcare facilities with an aggregate of approximately 750 beds. The Company will not be allowed to integrate Priorys business until the CMA completes its review process.
20
19. Financial Information for the Company and Its Subsidiaries
The Company conducts substantially all of its business through its subsidiaries. The 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior
Notes and 6.500% Senior Notes are jointly and severally guaranteed on an unsecured senior basis by all of the Companys subsidiaries that guarantee the Companys obligations under the Amended and Restated Senior Credit Facility. Presented
below is condensed consolidating financial information for the Company and its subsidiaries as of June 30, 2016 and December 31, 2015, and for the three and six months ended June 30, 2016 and 2015. The information segregates the
parent company (Acadia Healthcare Company, Inc.), the combined wholly-owned subsidiary guarantors, the combined non-guarantor subsidiaries and eliminations.
Acadia Healthcare Company, Inc.
Condensed Consolidating Balance Sheets
June 30, 2016
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
|
|
|
$
|
10,048
|
|
|
$
|
20,668
|
|
|
$
|
|
|
|
$
|
30,716
|
|
Accounts receivable, net
|
|
|
|
|
|
|
209,194
|
|
|
|
75,938
|
|
|
|
|
|
|
|
285,132
|
|
Other current assets
|
|
|
|
|
|
|
59,452
|
|
|
|
20,862
|
|
|
|
(3,795
|
)
|
|
|
76,519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
|
|
278,694
|
|
|
|
117,468
|
|
|
|
(3,795
|
)
|
|
|
392,367
|
|
Property and equipment, net
|
|
|
|
|
|
|
907,277
|
|
|
|
2,367,263
|
|
|
|
|
|
|
|
3,274,540
|
|
Goodwill
|
|
|
|
|
|
|
1,939,361
|
|
|
|
892,840
|
|
|
|
|
|
|
|
2,832,201
|
|
Intangible assets, net
|
|
|
|
|
|
|
56,574
|
|
|
|
28,422
|
|
|
|
|
|
|
|
84,996
|
|
Deferred tax assets noncurrent
|
|
|
3,579
|
|
|
|
9,671
|
|
|
|
4,679
|
|
|
|
|
|
|
|
17,929
|
|
Derivative instruments
|
|
|
40,459
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,459
|
|
Investment in subsidiaries
|
|
|
5,210,634
|
|
|
|
|
|
|
|
|
|
|
|
(5,210,634
|
)
|
|
|
|
|
Other assets
|
|
|
845,914
|
|
|
|
33,523
|
|
|
|
5,764
|
|
|
|
(843,194
|
)
|
|
|
42,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
6,100,586
|
|
|
$
|
3,225,100
|
|
|
$
|
3,416,436
|
|
|
$
|
(6,057,623
|
)
|
|
$
|
6,684,499
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current portion of long-term debt
|
|
$
|
73,175
|
|
|
$
|
|
|
|
$
|
235
|
|
|
$
|
|
|
|
$
|
73,410
|
|
Accounts payable
|
|
|
|
|
|
|
68,294
|
|
|
|
39,917
|
|
|
|
|
|
|
|
108,211
|
|
Accrued salaries and benefits
|
|
|
|
|
|
|
75,872
|
|
|
|
37,520
|
|
|
|
|
|
|
|
113,392
|
|
Other accrued liabilities
|
|
|
35,919
|
|
|
|
|
|
|
|
92,664
|
|
|
|
(3,795
|
)
|
|
|
124,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
109,094
|
|
|
|
144,166
|
|
|
|
170,336
|
|
|
|
(3,795
|
)
|
|
|
419,801
|
|
Long-term debt
|
|
|
3,555,212
|
|
|
|
|
|
|
|
866,365
|
|
|
|
(843,194
|
)
|
|
|
3,578,383
|
|
Deferred tax liabilities noncurrent
|
|
|
|
|
|
|
|
|
|
|
85,526
|
|
|
|
|
|
|
|
85,526
|
|
Other liabilities
|
|
|
|
|
|
|
108,574
|
|
|
|
43,054
|
|
|
|
|
|
|
|
151,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
3,664,306
|
|
|
|
252,740
|
|
|
|
1,165,281
|
|
|
|
(846,989
|
)
|
|
|
4,235,338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
12,881
|
|
|
|
|
|
|
|
12,881
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
2,436,280
|
|
|
|
2,972,360
|
|
|
|
2,238,274
|
|
|
|
(5,210,634
|
)
|
|
|
2,436,280
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
$
|
6,100,586
|
|
|
$
|
3,225,100
|
|
|
$
|
3,416,436
|
|
|
$
|
(6,057,623
|
)
|
|
$
|
6,684,499
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21
Acadia Healthcare Company, Inc.
Condensed Consolidating Balance Sheets
December 31, 2015
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
|
|
|
$
|
1,987
|
|
|
$
|
9,228
|
|
|
$
|
|
|
|
$
|
11,215
|
|
Accounts receivable, net
|
|
|
|
|
|
|
187,546
|
|
|
|
29,080
|
|
|
|
|
|
|
|
216,626
|
|
Other current assets
|
|
|
|
|
|
|
57,968
|
|
|
|
8,927
|
|
|
|
|
|
|
|
66,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
|
|
247,501
|
|
|
|
47,235
|
|
|
|
|
|
|
|
294,736
|
|
Property and equipment, net
|
|
|
|
|
|
|
805,439
|
|
|
|
903,614
|
|
|
|
|
|
|
|
1,709,053
|
|
Goodwill
|
|
|
|
|
|
|
1,835,339
|
|
|
|
292,876
|
|
|
|
|
|
|
|
2,128,215
|
|
Intangible assets, net
|
|
|
|
|
|
|
57,024
|
|
|
|
2,551
|
|
|
|
|
|
|
|
59,575
|
|
Deferred tax assets noncurrent
|
|
|
3,946
|
|
|
|
40,587
|
|
|
|
4,581
|
|
|
|
|
|
|
|
49,114
|
|
Investment in subsidiaries
|
|
|
3,495,067
|
|
|
|
|
|
|
|
|
|
|
|
(3,495,067
|
)
|
|
|
|
|
Other assets
|
|
|
427,270
|
|
|
|
32,947
|
|
|
|
2,322
|
|
|
|
(424,024
|
)
|
|
|
38,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
3,926,283
|
|
|
$
|
3,018,837
|
|
|
$
|
1,253,179
|
|
|
$
|
(3,919,091
|
)
|
|
$
|
4,279,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current portion of long-term debt
|
|
$
|
45,125
|
|
|
$
|
|
|
|
$
|
235
|
|
|
$
|
|
|
|
$
|
45,360
|
|
Accounts payable
|
|
|
|
|
|
|
75,015
|
|
|
|
16,326
|
|
|
|
|
|
|
|
91,341
|
|
Accrued salaries and benefits
|
|
|
|
|
|
|
66,249
|
|
|
|
14,447
|
|
|
|
|
|
|
|
80,696
|
|
Other accrued liabilities
|
|
|
26,132
|
|
|
|
10,886
|
|
|
|
35,788
|
|
|
|
|
|
|
|
72,806
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
71,257
|
|
|
|
152,150
|
|
|
|
66,796
|
|
|
|
|
|
|
|
290,203
|
|
Long-term debt
|
|
|
2,171,998
|
|
|
|
|
|
|
|
447,410
|
|
|
|
(424,024
|
)
|
|
|
2,195,384
|
|
Deferred tax liabilities noncurrent
|
|
|
|
|
|
|
|
|
|
|
23,936
|
|
|
|
|
|
|
|
23,936
|
|
Other liabilities
|
|
|
|
|
|
|
75,159
|
|
|
|
3,443
|
|
|
|
|
|
|
|
78,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
2,243,255
|
|
|
|
227,309
|
|
|
|
541,585
|
|
|
|
(424,024
|
)
|
|
|
2,588,125
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
8,055
|
|
|
|
|
|
|
|
8,055
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
1,683,028
|
|
|
|
2,791,528
|
|
|
|
703,539
|
|
|
|
(3,495,067
|
)
|
|
|
1,683,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
$
|
3,926,283
|
|
|
$
|
3,018,837
|
|
|
$
|
1,253,179
|
|
|
$
|
(3,919,091
|
)
|
|
$
|
4,279,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Comprehensive Income
Three Months Ended June 30, 2016
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Revenue before provision for doubtful accounts
|
|
$
|
|
|
|
$
|
422,232
|
|
|
$
|
344,822
|
|
|
$
|
|
|
|
$
|
767,054
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
(9,593
|
)
|
|
|
(913
|
)
|
|
|
|
|
|
|
(10,506
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
412,639
|
|
|
|
343,909
|
|
|
|
|
|
|
|
756,548
|
|
Salaries, wages and benefits
|
|
|
6,888
|
|
|
|
212,944
|
|
|
|
188,455
|
|
|
|
|
|
|
|
408,287
|
|
Professional fees
|
|
|
|
|
|
|
23,150
|
|
|
|
27,142
|
|
|
|
|
|
|
|
50,292
|
|
Supplies
|
|
|
|
|
|
|
19,527
|
|
|
|
11,682
|
|
|
|
|
|
|
|
31,209
|
|
Rents and leases
|
|
|
|
|
|
|
8,521
|
|
|
|
11,946
|
|
|
|
|
|
|
|
20,467
|
|
Other operating expenses
|
|
|
|
|
|
|
51,100
|
|
|
|
29,855
|
|
|
|
|
|
|
|
80,955
|
|
Depreciation and amortization
|
|
|
|
|
|
|
14,216
|
|
|
|
22,536
|
|
|
|
|
|
|
|
36,752
|
|
Interest expense, net
|
|
|
10,631
|
|
|
|
22,043
|
|
|
|
16,084
|
|
|
|
|
|
|
|
48,758
|
|
Gain on foreign currency derivatives
|
|
|
(98
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(98
|
)
|
Transaction-related expenses
|
|
|
|
|
|
|
4,189
|
|
|
|
1,885
|
|
|
|
|
|
|
|
6,074
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
17,421
|
|
|
|
355,690
|
|
|
|
309,585
|
|
|
|
|
|
|
|
682,696
|
|
(Loss) income from continuing operations before income taxes
|
|
|
(17,421
|
)
|
|
|
56,949
|
|
|
|
34,324
|
|
|
|
|
|
|
|
73,852
|
|
Equity in earnings of subsidiaries
|
|
|
67,943
|
|
|
|
|
|
|
|
|
|
|
|
(67,943
|
)
|
|
|
|
|
(Benefit from) provision for income taxes
|
|
|
(5,069
|
)
|
|
|
16,186
|
|
|
|
7,144
|
|
|
|
|
|
|
|
18,261
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
55,591
|
|
|
|
40,763
|
|
|
|
27,180
|
|
|
|
(67,943
|
)
|
|
|
55,591
|
|
Income from discontinued operations, net of income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
55,591
|
|
|
|
40,763
|
|
|
|
27,180
|
|
|
|
(67,943
|
)
|
|
|
55,591
|
|
Net loss attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
854
|
|
|
|
|
|
|
|
854
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to Acadia Healthcare Company, Inc.
|
|
$
|
55,591
|
|
|
$
|
40,763
|
|
|
$
|
28,034
|
|
|
$
|
(67,943
|
)
|
|
$
|
56,445
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation loss
|
|
|
|
|
|
|
|
|
|
|
(213,468
|
)
|
|
|
|
|
|
|
(213,468
|
)
|
Gain on derivative instruments
|
|
|
23,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss
|
|
|
23,919
|
|
|
|
|
|
|
|
(213,468
|
)
|
|
|
|
|
|
|
(189,549
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc.
|
|
$
|
79,510
|
|
|
$
|
40,763
|
|
|
$
|
(185,434
|
)
|
|
$
|
(67,943
|
)
|
|
$
|
(133,104
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Comprehensive Income
Three Months Ended June 30, 2015
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Revenue before provision for doubtful accounts
|
|
$
|
|
|
|
$
|
363,851
|
|
|
$
|
97,947
|
|
|
$
|
|
|
|
$
|
461,798
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
(7,566
|
)
|
|
|
(572
|
)
|
|
|
|
|
|
|
(8,138
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
356,285
|
|
|
|
97,375
|
|
|
|
|
|
|
|
453,660
|
|
Salaries, wages and benefits
|
|
|
5,355
|
|
|
|
183,490
|
|
|
|
54,457
|
|
|
|
|
|
|
|
243,302
|
|
Professional fees
|
|
|
|
|
|
|
22,579
|
|
|
|
7,450
|
|
|
|
|
|
|
|
30,029
|
|
Supplies
|
|
|
|
|
|
|
16,929
|
|
|
|
3,613
|
|
|
|
|
|
|
|
20,542
|
|
Rents and leases
|
|
|
|
|
|
|
7,402
|
|
|
|
809
|
|
|
|
|
|
|
|
8,211
|
|
Other operating expenses
|
|
|
|
|
|
|
43,145
|
|
|
|
7,983
|
|
|
|
|
|
|
|
51,128
|
|
Depreciation and amortization
|
|
|
|
|
|
|
10,551
|
|
|
|
4,375
|
|
|
|
|
|
|
|
14,926
|
|
Interest expense, net
|
|
|
18,106
|
|
|
|
5,882
|
|
|
|
4,061
|
|
|
|
|
|
|
|
28,049
|
|
Loss on foreign currency derivatives
|
|
|
961
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
961
|
|
Transaction-related expenses
|
|
|
|
|
|
|
2,946
|
|
|
|
4,211
|
|
|
|
|
|
|
|
7,157
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
24,422
|
|
|
|
292,924
|
|
|
|
86,959
|
|
|
|
|
|
|
|
404,305
|
|
(Loss) income from continuing operations before income taxes
|
|
|
(24,422
|
)
|
|
|
63,361
|
|
|
|
10,416
|
|
|
|
|
|
|
|
49,355
|
|
Equity in earnings of subsidiaries
|
|
|
50,281
|
|
|
|
|
|
|
|
|
|
|
|
(50,281
|
)
|
|
|
|
|
(Benefit from) provision for income taxes
|
|
|
(7,985
|
)
|
|
|
20,734
|
|
|
|
2,763
|
|
|
|
|
|
|
|
15,512
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
33,844
|
|
|
|
42,627
|
|
|
|
7,653
|
|
|
|
(50,281
|
)
|
|
|
33,843
|
|
Income from discontinued operations, net of income taxes
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
33,844
|
|
|
$
|
42,628
|
|
|
$
|
7,653
|
|
|
$
|
(50,281
|
)
|
|
$
|
33,844
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation gain
|
|
|
|
|
|
|
|
|
|
|
46,173
|
|
|
|
|
|
|
|
46,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
46,173
|
|
|
|
|
|
|
|
46,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
$
|
33,844
|
|
|
$
|
42,628
|
|
|
$
|
53,826
|
|
|
$
|
(50,281
|
)
|
|
$
|
80,017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Comprehensive Income
Six Months Ended June 30, 2016
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Revenue before provision for doubtful accounts
|
|
$
|
|
|
|
$
|
825,166
|
|
|
$
|
569,071
|
|
|
$
|
|
|
|
$
|
1,394,237
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
(18,935
|
)
|
|
|
(1,941
|
)
|
|
|
|
|
|
|
(20,876
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
806,231
|
|
|
|
567,130
|
|
|
|
|
|
|
|
1,373,361
|
|
Salaries, wages and benefits
|
|
|
13,844
|
|
|
|
423,977
|
|
|
|
311,494
|
|
|
|
|
|
|
|
749,315
|
|
Professional fees
|
|
|
|
|
|
|
45,827
|
|
|
|
44,456
|
|
|
|
|
|
|
|
90,283
|
|
Supplies
|
|
|
|
|
|
|
37,989
|
|
|
|
19,905
|
|
|
|
|
|
|
|
57,894
|
|
Rents and leases
|
|
|
|
|
|
|
17,098
|
|
|
|
18,175
|
|
|
|
|
|
|
|
35,273
|
|
Other operating expenses
|
|
|
|
|
|
|
99,949
|
|
|
|
51,253
|
|
|
|
|
|
|
|
151,202
|
|
Depreciation and amortization
|
|
|
|
|
|
|
26,967
|
|
|
|
37,760
|
|
|
|
|
|
|
|
64,727
|
|
Interest expense, net
|
|
|
24,064
|
|
|
|
38,136
|
|
|
|
24,272
|
|
|
|
|
|
|
|
86,472
|
|
Gain on foreign currency derivatives
|
|
|
(508
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(508
|
)
|
Transaction-related expenses
|
|
|
|
|
|
|
25,624
|
|
|
|
6,748
|
|
|
|
|
|
|
|
32,372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
37,400
|
|
|
|
715,567
|
|
|
|
514,063
|
|
|
|
|
|
|
|
1,267,030
|
|
(Loss) income from continuing operations before income taxes
|
|
|
(37,400
|
)
|
|
|
90,664
|
|
|
|
53,067
|
|
|
|
|
|
|
|
106,331
|
|
Equity in earnings of subsidiaries
|
|
|
108,812
|
|
|
|
|
|
|
|
|
|
|
|
(108,812
|
)
|
|
|
|
|
(Benefit from) provision for income taxes
|
|
|
(9,548
|
)
|
|
|
23,593
|
|
|
|
11,326
|
|
|
|
|
|
|
|
25,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
80,960
|
|
|
|
67,071
|
|
|
|
41,741
|
|
|
|
(108,812
|
)
|
|
|
80,960
|
|
Income from discontinued operations, net of income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
80,960
|
|
|
|
67,071
|
|
|
|
41,741
|
|
|
|
(108,812
|
)
|
|
|
80,960
|
|
Net loss attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
1,173
|
|
|
|
|
|
|
|
1,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to Acadia Healthcare Company, Inc.
|
|
$
|
80,960
|
|
|
$
|
67,071
|
|
|
$
|
42,914
|
|
|
$
|
(108,812
|
)
|
|
$
|
82,133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation loss
|
|
|
|
|
|
|
|
|
|
|
(261,883
|
)
|
|
|
|
|
|
|
(261,883
|
)
|
Gain on derivative instruments
|
|
|
23,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss
|
|
|
23,919
|
|
|
|
|
|
|
|
(261,883
|
)
|
|
|
|
|
|
|
(237,964
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc.
|
|
$
|
104,879
|
|
|
$
|
67,071
|
|
|
$
|
(218,969
|
)
|
|
$
|
(108,812
|
)
|
|
$
|
(155,831
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Comprehensive Income
Six Months Ended June 30, 2015
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Revenue before provision for doubtful accounts
|
|
$
|
|
|
|
$
|
651,616
|
|
|
$
|
184,340
|
|
|
$
|
|
|
|
$
|
835,956
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
(14,985
|
)
|
|
|
(1,528
|
)
|
|
|
|
|
|
|
(16,513
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
636,631
|
|
|
|
182,812
|
|
|
|
|
|
|
|
819,443
|
|
Salaries, wages and benefits
|
|
|
9,249
|
|
|
|
339,189
|
|
|
|
100,735
|
|
|
|
|
|
|
|
449,173
|
|
Professional fees
|
|
|
|
|
|
|
39,064
|
|
|
|
13,392
|
|
|
|
|
|
|
|
52,456
|
|
Supplies
|
|
|
|
|
|
|
29,938
|
|
|
|
6,858
|
|
|
|
|
|
|
|
36,796
|
|
Rents and leases
|
|
|
|
|
|
|
12,519
|
|
|
|
1,578
|
|
|
|
|
|
|
|
14,097
|
|
Other operating expenses
|
|
|
|
|
|
|
75,392
|
|
|
|
16,263
|
|
|
|
|
|
|
|
91,655
|
|
Depreciation and amortization
|
|
|
|
|
|
|
19,262
|
|
|
|
8,768
|
|
|
|
|
|
|
|
28,030
|
|
Interest expense, net
|
|
|
31,054
|
|
|
|
11,603
|
|
|
|
7,538
|
|
|
|
|
|
|
|
50,195
|
|
Loss on foreign currency derivatives
|
|
|
908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
908
|
|
Transaction-related expenses
|
|
|
|
|
|
|
21,362
|
|
|
|
4,211
|
|
|
|
|
|
|
|
25,573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
41,211
|
|
|
|
548,329
|
|
|
|
159,343
|
|
|
|
|
|
|
|
748,883
|
|
(Loss) income from continuing operations before income taxes
|
|
|
(41,211
|
)
|
|
|
88,302
|
|
|
|
23,469
|
|
|
|
|
|
|
|
70,560
|
|
Equity in earnings of subsidiaries
|
|
|
76,268
|
|
|
|
|
|
|
|
|
|
|
|
(76,268
|
)
|
|
|
|
|
(Benefit from) provision for income taxes
|
|
|
(13,381
|
)
|
|
|
29,251
|
|
|
|
6,255
|
|
|
|
|
|
|
|
22,125
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
48,438
|
|
|
|
59,051
|
|
|
|
17,214
|
|
|
|
(76,268
|
)
|
|
|
48,435
|
|
Income from discontinued operations, net of income taxes
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
48,438
|
|
|
$
|
59,054
|
|
|
$
|
17,214
|
|
|
$
|
(76,268
|
)
|
|
$
|
48,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation gain
|
|
|
|
|
|
|
|
|
|
|
16,784
|
|
|
|
|
|
|
|
16,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
16,784
|
|
|
|
|
|
|
|
16,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
$
|
48,438
|
|
|
$
|
59,054
|
|
|
$
|
33,998
|
|
|
$
|
(76,268
|
)
|
|
$
|
65,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Cash Flows
Six Months Ended June 30, 2016
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
80,960
|
|
|
$
|
67,071
|
|
|
$
|
41,741
|
|
|
$
|
(108,812
|
)
|
|
$
|
80,960
|
|
Adjustments to reconcile net income (loss) to net cash (used in) provided by continuing
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of subsidiaries
|
|
|
(108,812
|
)
|
|
|
|
|
|
|
|
|
|
|
108,812
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
26,967
|
|
|
|
37,760
|
|
|
|
|
|
|
|
64,727
|
|
Amortization of debt issuance costs
|
|
|
5,171
|
|
|
|
|
|
|
|
(215
|
)
|
|
|
|
|
|
|
4,956
|
|
Equity-based compensation expense
|
|
|
13,844
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,844
|
|
Deferred income tax (benefit) expense
|
|
|
|
|
|
|
18,420
|
|
|
|
(1,599
|
)
|
|
|
|
|
|
|
16,821
|
|
Loss from discontinued operations, net of taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss (gain) on foreign currency derivatives
|
|
|
(508
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(508
|
)
|
Other
|
|
|
|
|
|
|
720
|
|
|
|
(16
|
)
|
|
|
|
|
|
|
704
|
|
Change in operating assets and liabilities, net of effect of acquisitions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
|
|
|
|
(24,072
|
)
|
|
|
5,090
|
|
|
|
|
|
|
|
(18,982
|
)
|
Other current assets
|
|
|
|
|
|
|
(1,459
|
)
|
|
|
(5,797
|
)
|
|
|
|
|
|
|
(7,256
|
)
|
Other assets
|
|
|
(775
|
)
|
|
|
1,327
|
|
|
|
255
|
|
|
|
755
|
|
|
|
1,582
|
|
Accounts payable and other accrued liabilities
|
|
|
|
|
|
|
21,943
|
|
|
|
7,158
|
|
|
|
|
|
|
|
29,101
|
|
Accrued salaries and benefits
|
|
|
|
|
|
|
9,230
|
|
|
|
(13,076
|
)
|
|
|
|
|
|
|
(3,846
|
)
|
Other liabilities
|
|
|
|
|
|
|
7,208
|
|
|
|
(3,480
|
)
|
|
|
|
|
|
|
3,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by continuing operating activities
|
|
|
(10,120
|
)
|
|
|
127,355
|
|
|
|
67,821
|
|
|
|
775
|
|
|
|
185,831
|
|
Net cash used in discontinued operating activities
|
|
|
|
|
|
|
(2,973
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,973
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by operating activities
|
|
|
(10,120
|
)
|
|
|
124,382
|
|
|
|
67,821
|
|
|
|
775
|
|
|
|
182,858
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for acquisitions, net of cash acquired
|
|
|
|
|
|
|
(103,189
|
)
|
|
|
(580,096
|
)
|
|
|
|
|
|
|
(683,285
|
)
|
Cash paid for capital expenditures
|
|
|
|
|
|
|
(99,157
|
)
|
|
|
(78,561
|
)
|
|
|
|
|
|
|
(177,718
|
)
|
Cash paid for real estate acquisitions
|
|
|
|
|
|
|
(16,638
|
)
|
|
|
(11,801
|
)
|
|
|
|
|
|
|
(28,439
|
)
|
Settlement of foreign currency derivatives
|
|
|
|
|
|
|
508
|
|
|
|
|
|
|
|
|
|
|
|
508
|
|
Other
|
|
|
|
|
|
|
(1,084
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,084
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
|
|
|
(219,560
|
)
|
|
|
(670,458
|
)
|
|
|
|
|
|
|
(890,018
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings on long-term debt
|
|
|
1,480,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,480,000
|
|
Borrowings on revolving credit facility
|
|
|
158,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
158,000
|
|
Principal payments on revolving credit facility
|
|
|
(166,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(166,000
|
)
|
Principal payments on long-term debt
|
|
|
(29,869
|
)
|
|
|
|
|
|
|
(775
|
)
|
|
|
775
|
|
|
|
(29,869
|
)
|
Repayment of assumed debt
|
|
|
(1,348,389
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,348,389
|
)
|
Payment of debt issuance costs
|
|
|
(35,511
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(35,511
|
)
|
Issuance of Common Stock
|
|
|
685,097
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
685,097
|
|
Common stock withheld for minimum statutory taxes, net
|
|
|
(7,365
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7,365
|
)
|
Excess tax benefit from equity awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
|
(823
|
)
|
|
|
|
|
|
|
|
|
|
|
(823
|
)
|
Cash (used in) provided by intercompany activity
|
|
|
(725,843
|
)
|
|
|
104,062
|
|
|
|
623,331
|
|
|
|
(1,550
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
10,120
|
|
|
|
103,239
|
|
|
|
622,556
|
|
|
|
(775
|
)
|
|
|
735,140
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
|
|
|
|
|
|
|
|
(8,479
|
)
|
|
|
|
|
|
|
(8,479
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents
|
|
|
|
|
|
|
8,061
|
|
|
|
11,440
|
|
|
|
|
|
|
|
19,501
|
|
Cash and cash equivalents at beginning of the period
|
|
|
|
|
|
|
1,987
|
|
|
|
9,228
|
|
|
|
|
|
|
|
11,215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of the period
|
|
$
|
|
|
|
$
|
10,048
|
|
|
$
|
20,668
|
|
|
$
|
|
|
|
$
|
30,716
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27
Acadia Healthcare Company, Inc.
Condensed Consolidating Statement of Cash Flows
Six Months Ended June 30, 2015
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Combined
Subsidiary
Guarantors
|
|
|
Combined
Non-
Guarantors
|
|
|
Consolidating
Adjustments
|
|
|
Total
Consolidated
Amounts
|
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
48,438
|
|
|
$
|
59,054
|
|
|
$
|
17,214
|
|
|
$
|
(76,268
|
)
|
|
$
|
48,438
|
|
Adjustments to reconcile net income (loss) to net cash (used in) provided by continuing
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of subsidiaries
|
|
|
(76,268
|
)
|
|
|
|
|
|
|
|
|
|
|
76,268
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
19,262
|
|
|
|
8,768
|
|
|
|
|
|
|
|
28,030
|
|
Amortization of debt issuance costs
|
|
|
|
|
|
|
3,438
|
|
|
|
(220
|
)
|
|
|
|
|
|
|
3,218
|
|
Equity-based compensation expense
|
|
|
9,249
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,249
|
|
Deferred income tax (benefit) expense
|
|
|
(798
|
)
|
|
|
22,964
|
|
|
|
2,516
|
|
|
|
|
|
|
|
24,682
|
|
Loss from discontinued operations, net of taxes
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
Loss (gain) on foreign currency derivatives
|
|
|
908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
908
|
|
Other
|
|
|
|
|
|
|
662
|
|
|
|
30
|
|
|
|
|
|
|
|
692
|
|
Change in operating assets and liabilities, net of effect of acquisitions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
|
|
|
|
(11,409
|
)
|
|
|
967
|
|
|
|
|
|
|
|
(10,442
|
)
|
Other current assets
|
|
|
|
|
|
|
(12,026
|
)
|
|
|
(1,022
|
)
|
|
|
|
|
|
|
(13,048
|
)
|
Other assets
|
|
|
(300
|
)
|
|
|
(1,220
|
)
|
|
|
2
|
|
|
|
300
|
|
|
|
(1,218
|
)
|
Accounts payable and other accrued liabilities
|
|
|
|
|
|
|
5,991
|
|
|
|
(10,304
|
)
|
|
|
|
|
|
|
(4,313
|
)
|
Accrued salaries and benefits
|
|
|
|
|
|
|
791
|
|
|
|
(1,016
|
)
|
|
|
|
|
|
|
(225
|
)
|
Other liabilities
|
|
|
|
|
|
|
5,442
|
|
|
|
(823
|
)
|
|
|
|
|
|
|
4,619
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by continuing operating activities
|
|
|
(18,771
|
)
|
|
|
92,946
|
|
|
|
16,112
|
|
|
|
300
|
|
|
|
90,587
|
|
Net cash provided by discontinued operating activities
|
|
|
|
|
|
|
554
|
|
|
|
|
|
|
|
|
|
|
|
554
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by operating activities
|
|
|
(18,771
|
)
|
|
|
93,500
|
|
|
|
16,112
|
|
|
|
300
|
|
|
|
91,141
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for acquisitions, net of cash acquired
|
|
|
|
|
|
|
(89,041
|
)
|
|
|
(197,693
|
)
|
|
|
|
|
|
|
(286,734
|
)
|
Cash paid for capital expenditures
|
|
|
|
|
|
|
(62,101
|
)
|
|
|
(59,934
|
)
|
|
|
|
|
|
|
(122,035
|
)
|
Cash paid for real estate acquisitions
|
|
|
|
|
|
|
(3,428
|
)
|
|
|
|
|
|
|
|
|
|
|
(3,428
|
)
|
Settlement of foreign currency derivatives
|
|
|
|
|
|
|
(908
|
)
|
|
|
|
|
|
|
|
|
|
|
(908
|
)
|
Other
|
|
|
|
|
|
|
(481
|
)
|
|
|
|
|
|
|
|
|
|
|
(481
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
|
|
|
(155,959
|
)
|
|
|
(257,627
|
)
|
|
|
|
|
|
|
(413,586
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings on long-term debt
|
|
|
875,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
875,000
|
|
Borrowings on revolving credit facility
|
|
|
180,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
180,000
|
|
Principal payments on revolving credit facility
|
|
|
(180,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(180,000
|
)
|
Repayment of assumed CRC debt
|
|
|
(904,467
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(904,467
|
)
|
Principal payments on long-term debt
|
|
|
(15,875
|
)
|
|
|
|
|
|
|
(300
|
)
|
|
|
300
|
|
|
|
(15,875
|
)
|
Payment of debt issuance costs
|
|
|
|
|
|
|
(22,775
|
)
|
|
|
|
|
|
|
|
|
|
|
(22,775
|
)
|
Issuance of Common Stock
|
|
|
|
|
|
|
331,530
|
|
|
|
|
|
|
|
|
|
|
|
331,530
|
|
Common stock withheld for minimum statutory taxes, net
|
|
|
|
|
|
|
(7,826
|
)
|
|
|
|
|
|
|
|
|
|
|
(7,826
|
)
|
Excess tax benefit from equity awards
|
|
|
|
|
|
|
6,327
|
|
|
|
|
|
|
|
|
|
|
|
6,327
|
|
Other
|
|
|
|
|
|
|
(150
|
)
|
|
|
|
|
|
|
|
|
|
|
(150
|
)
|
Cash provided by (used in) intercompany activity
|
|
|
64,113
|
|
|
|
(305,366
|
)
|
|
|
241,853
|
|
|
|
(600
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
18,771
|
|
|
|
1,740
|
|
|
|
241,553
|
|
|
|
(300
|
)
|
|
|
261,764
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
|
|
|
|
1,213
|
|
|
|
|
|
|
|
|
|
|
|
1,213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
|
|
|
|
(59,506
|
)
|
|
|
38
|
|
|
|
|
|
|
|
(59,468
|
)
|
Cash and cash equivalents at beginning of the period
|
|
|
|
|
|
|
76,685
|
|
|
|
17,355
|
|
|
|
|
|
|
|
94,040
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of the period
|
|
$
|
|
|
|
$
|
17,179
|
|
|
$
|
17,393
|
|
|
$
|
|
|
|
$
|
34,572
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28