Full Press Release Details
Healthcare Reports Fourth Quarter 2018 Results
Full Year and First Quarter 2019 Financial Guidance
FRANKLIN, Tenn.--(BUSINESS WIRE)--February 28, 2019--Acadia Healthcare
Company, Inc. (NASDAQ: ACHC) today announced financial results for the
fourth quarter and year ended December 31, 2018. Revenue for the quarter
was $743.5 million, an increase of 2.6% compared with $724.5 million for
the fourth quarter of 2017. Net loss attributable to Acadia stockholders
was $331.6 million, or $3.80 per diluted share, for the fourth quarter
of 2018 compared with net income of $69.6 million, or $0.80 per diluted
share, for the fourth quarter of 2017.
Adjusted income attributable to Acadia stockholders for the fourth
quarter of 2018 was $40.8 million, or $0.47 per diluted share, excluding:
A total loss on impairment of $337.9 million, which includes a
non-cash goodwill impairment charge of $325.9 million and a non-cash
long-lived asset impairment charge of $12.0 million on the Company's
U.K. facilities related to the decline in estimated fair values.
Transaction-related expenses of $24.5 million, which includes Chief
Executive Officer transition costs of $14.0 million.
Legal settlements expense of $22.1 million, which is primarily
attributable to the establishment of a reserve related to the
Company's billing for lab services in West Virginia.
Debt extinguishment costs of $0.9 million.
For the fourth quarter of 2017, adjusted income attributable to Acadia
stockholders was $52.9 million, or $0.61 per diluted share, excluding:
A tax benefit of $20.2 million due to the Tax Cuts and Jobs Act of
Transaction-related expenses of $5.4 million.
A reconciliation of all non-GAAP financial results in this press release
appears beginning on page 8.
Debbie Osteen, Chief Executive Officer of Acadia, commented, "Our
results for the fourth quarter reflect the consistent revenue
improvement we achieved throughout 2018 in spite of some operational
challenges, primarily in the U.K. We have continued to drive organic
revenue growth within our existing facilities by expanding our services
and adding more bed capacity. While we have focused on addressing the
factors affecting our operations, we have also looked for opportunities
to acquire new facilities and enter into strategic partnerships and
joint ventures to develop additional behavioral healthcare facilities.
During the fourth quarter, we added 243 beds to existing facilities. In
2018, we added 651 total beds, increasing our size and geographic scale
and further enhancing our position as a leading provider of behavior
healthcare facilities. We expect to add approximately 700 beds to
existing and new facilities in 2019. Thus far in 2019, we have opened
two de novo facilities: Mount Carmel Behavioral Health, a joint venture
with 80 beds located in Columbus, Ohio; and Rio Vista Behavioral Health,
an 80-bed facility located in El Paso, Texas."
On February 15, 2019, the Company closed two previously announced
acquisitions, Mission Treatment and The Whittier Pavilion. Mission
Treatment operates nine comprehensive treatment centers that provide
medication-assisted treatment and counseling for people struggling with
narcotics addiction in California, Nevada, Arizona and Oklahoma. The
Whittier Pavilion, a 71-bed inpatient psychiatric hospital located in
Haverhill, Massachusetts, is part of the Whittier Health Network, a
family owned and operated healthcare system that has provided hospital
and community services since 1982.
Same facility revenue for the fourth quarter of 2018 increased 3.8%,
with a 2.6% increase in patient days and a 1.2% increase in revenue per
patient day. Same facility EBITDA margin was 22.0% for the fourth
quarter of 2018 compared with 24.4% for the fourth quarter of 2017.
Same facility revenue in the U.S. increased 3.5% for the fourth
quarter of 2018 from the fourth quarter of 2017, with a 3.5% increase
in patient days and flat revenue per patient day. U.S. same facility
revenue was impacted by a fourth quarter 2018 accounts receivable
adjustment of approximately $8.0 million, primarily related to the
Comprehensive Treatment Centers (CTCs) and the state Medicaid programs
in Wisconsin. U.S. same facility EBITDA margin was 24.9% compared with
26.2% in the fourth quarter of 2017.
Same facility revenue in the U.K. increased 4.4% for the fourth
quarter of 2018 compared with the fourth quarter of 2017, with a 1.5%
increase in patient days and a 2.8% increase in revenue per patient
day. U.K. same facility EBITDA margin was 16.4% for the fourth quarter
compared with 21.0% in the fourth quarter of 2017.
Osteen added, "Our fourth quarter results for the U.K. operations were
as expected. We continue to focus on addressing challenges related to a
lower census and higher agency labor expense, primarily for nurses and
other clinical staff, due to tightening in the U.K. labor market."
The Company recently amended its Senior Secured Credit Facility to
modify certain definitions and provide increased flexibility in terms of
its financial covenants. As of December 31, 2018, the Company had
significant availability under its $500 million revolving credit
facility and its leverage ratio was approximately 5.3. Net cash provided
by continuing operations increased 3.8% to $416.6 million for 2018,
compared with the same prior-year period.
Acadia today established its financial and operational guidance for full
year 2019 and the first quarter of 2019, as follows:
Revenue for 2019 in a range of $3.15 billion to $3.2 billion;
Adjusted EBITDA for 2019 in a range of $610 million to $630 million;
Adjusted earnings per diluted share for 2019 in a range of $2.15 to
Adjusted earnings per diluted share for the first quarter of 2019 in a
range of $0.35 to $0.36; and
An exchange rate of $1.30 per British Pound Sterling and a tax rate of
The Company's guidance does not include the impact of any future
acquisitions or transaction-related expenses.
EBITDA is defined as net income (loss) adjusted for net income (loss)
attributable to noncontrolling interests, (benefit from) provision for
income taxes, net interest expense and depreciation and amortization.
Adjusted EBITDA is defined as EBITDA adjusted for equity-based
compensation expense, transaction-related expenses, debt extinguishment
costs, legal settlements expense and loss on impairment. Adjusted income
is defined as net income (loss) adjusted for transaction-related
expenses, tax reform impact, debt extinguishment costs, legal