Full Press Release Details
| Contact: |
| Amy C. Chang Vice President, Investor Relations 866.861.3229 |
AMN HEALTHCARE ANNOUNCES THIRD QUARTER 2014 RESULTS
Quarterly revenue of $265 million, above the high end of guidance, EPS of $0.18
SAN DIEGO (October 30, 2014) AMN Healthcare Services, Inc. (NYSE: AHS), healthcare s innovator in workforce solutions and staffing
services, today announced third quarter 2014 financial results exceeded the Company s guidance for revenue. Third quarter financial highlights are as follows:
Dollars in millions, except per share amounts.
| Q3 2014 | % Change Q3 2013 | YTD September 30, 2014 | % Change YTD September 30, 2013 | |||||||||||||
| Revenue | $ | 264.6 | 3 | % | $ | 756.4 | (1 | %) | ||||||||
| Gross profit | $ | 80.3 | 6 | % | $ | 231.4 | 4 | % | ||||||||
| Net income | $ | 8.5 | (1 | %) | $ | 23.3 | (5 | %) | ||||||||
| Diluted EPS | $ | 0.18 | 0 | % | $ | 0.49 | (4 | %) | ||||||||
| Adjusted Diluted EPS* | N/A | N/A | $ | 0.53 | 2 | % | ||||||||||
| Adjusted EBITDA* | $ | 21.8 | 1 | % | $ | 66.2 | 3 | % |
segments experienced stronger market trends, resulting in better than anticipated revenue growth in the third quarter. The continued strengthening in travel nurse and allied
demand is expected to fuel volume growth in the future. These trends, combined with new MSP clients and expansions, have bolstered our leadership position in workforce solutions and give us a
positive outlook going into the new year, said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. To ensure the delivery of a best-in-class client and clinician experience, we continue to make long-term strategic
investments to innovate our workforce solution offerings and our recruitment and infrastructure technologies.
Third Quarter 2014 Results
For the third quarter of 2014 consolidated revenue was $265 million, an increase of 3% from the same quarter last year and an
increase of 5% sequentially. Third quarter revenue for the Nurse and Allied Healthcare Staffing segment was $174 million, up 2% from the same quarter last year and 5% sequentially. Locum Tenens Staffing segment revenue in the third quarter was $79
million, an increase of 5% from the same quarter last year and 6% sequentially. Third quarter Physician Permanent Placement Services segment revenue was $11 million, an increase of 5% from the same quarter last year and 7% sequentially.
Third quarter gross margin of 30.4% was 100 basis points higher than the same quarter last year and 40 basis points lower sequentially. The
year-over-year increase was due to gross margin improvements in our Nurse and Allied Healthcare Staffing and Physician Permanent Placement Services segments. The sequential decrease was due primarily to an unfavorable workers compensation
actuarial adjustment recorded in the third quarter.
SG&A expenses for the third quarter were $60 million, representing 22.8% of
revenue, compared to $56 million in both the same quarter last year and the prior quarter. The year-over-year increase in SG&A expenses was due to the inclusion of ShiftWise, which was acquired in November of last year, higher expenses
associated with our information technology initiatives, and higher expenses to support our current demand and future growth initiatives. The sequential increase in SG&A expenses was due primarily to a favorable professional liability actuarial
adjustment recorded in the second quarter, increased commission and bonus expenses associated with higher revenue, and other expenses to support growth.
Third quarter net income was $8 million and net income per diluted share was $0.18. Third quarter adjusted EBITDA was $22 million, compared to
$22 million in the same quarter
last year and $23 million in the prior quarter. Adjusted EBITDA margin of 8.2% was 20 basis points lower than the same quarter last year and 110 basis points lower sequentially. The
year-over-year decrease was due primarily to the unfavorable workers compensation actuarial adjustment recorded in the third quarter of 2014, and the sequential decrease was due primarily to that same adjustment as well as a favorable
professional liability adjustment in the second quarter of 2014.
At September 30, 2014, cash and cash equivalents totaled $10
million. Third quarter cash flow provided by operations was $15 million and capital expenditures were $4 million. The Company ended the quarter with total debt outstanding of $146 million, with a leverage ratio of 1.7 to 1.
Business Trends and Outlook
Company expects consolidated fourth quarter 2014 revenue of $265 million to $269 million. Gross margin is expected to be seasonally lower at approximately 30.0%. SG&A expenses as a percentage of revenue are expected to be approximately 22.5%.
Adjusted EBITDA margin is expected to be between 8.0% and 8.5%.
About AMN Healthcare
AMN Healthcare is the innovator in healthcare workforce solutions and staffing services to healthcare facilities across the nation. AMN
Healthcare s workforce solutions - including managed services programs, vendor management systems, and recruitment process outsourcing - enable providers to successfully reduce complexity, increase efficiency and improve patient outcomes within
the rapidly evolving healthcare environment. The Company provides unparalleled access to the most comprehensive network of quality healthcare professionals through its innovative recruitment strategies and breadth of career opportunities. Clients
include acute-care hospitals, community health centers and clinics, physician practice groups, retail and urgent care centers, home health facilities, and many other healthcare settings. AMN Healthcare disseminates news and information about the
Company through its website, which can be found at www.amnhealthcare.com.
Conference Call on October 30, 2014
AMN Healthcare Services, Inc. s third quarter 2014 conference call will be held on Thursday, October 30, 2014, at 5:00 p.m. Eastern
Time. A live webcast of the call can be accessed through AMN Healthcare s website at http://amnhealthcare.investorroom.com/presentations. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio
software. Interested parties may participate live via telephone by dialing (800) 288-8975 in the U.S. or (612) 332-0228 internationally. Following the conclusion of the call, a replay of the webcast will be available at the Company s
website. A telephonic replay of the call will be available at 7:30 p.m. Eastern Time on October 30, 2014, and can be accessed until 11:59 p.m. Eastern Time on November 13, 2014, by calling (800) 475-6701 in the
U.S. or (320) 365-3844 internationally, with access code 338051.
This earnings release contains certain non-GAAP financial information, which the Company provides as additional information, and not as an alternative, to the
Company s condensed consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures include (1) adjusted EBITDA, (2) adjusted EBITDA margin, and (3) adjusted diluted EPS. The Company
provides such non-GAAP financial measures because management believes that they are useful both to management and investors as a supplement, and not as a substitute, when evaluating the Company s operating performance. Additionally, management
believes that adjusted EBITDA and adjusted EBITDA margin serve as industry-wide financial measures, and it uses adjusted EBITDA for making financial decisions and allocating resources. The non-GAAP measures in this release are not in accordance
with, or an alternative to, GAAP, and may be different from non-GAAP measures, or may be calculated differently than other similarly title captioned non-GAAP measures, reported by other companies. They should not be used in isolation to evaluate the
Company s performance. A reconciliation of non-GAAP measures identified in this release, along with further detail about the use and limitations of certain of these non-GAAP measures, may be found below in the table entitled Supplemental
Financial and Operating Data under the caption entitled Reconciliation of Non-GAAP Items or on the Company s website at http://amnhealthcare.investorroom.com/financialreports. Additionally, from time to time, additional
information regarding non-GAAP financial measures, including pro forma measures, may be made available on the Company s website.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include expectations regarding future volume growth and 2014 fourth quarter revenue, gross margin, SG&A expenses and adjusted EBITDA margin. The Company based
these forward-looking statements on its current expectations, estimates and projections about future events and the industry in which it operates using information currently available to it. Actual results could differ materially from those
discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as believe, anticipate, expect, intend, plan, will,
may, estimates, variations of such words and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking
statements. Factors that could cause actual results to differ from those implied by the forward-looking statements contained in this press release are set forth in the Company s Annual Report on Form 10-K for the year ended December 31,
2013 and its other periodic reports as well as the Company s current and other reports filed from time to time with the Securities and Exchange Commission. Be advised that developments subsequent to this press release are likely to cause these
statements to become outdated with the passage of time.
Vice President, Investor Relations
AMN Healthcare Services, Inc.
Condensed Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2014 | 2013 | 2014 | 2014 | 2013 | ||||||||||||||||
| Revenue | $ | 264,584 | $ | 257,095 | $ | 250,913 | $ | 756,378 | $ | 763,158 | ||||||||||
| Cost of revenue | 184,278 | 181,428 | 173,754 | 524,957 | 540,071 | |||||||||||||||
| Gross profit | 80,306 | 75,667 | 77,159 | 231,421 | 223,087 | |||||||||||||||
| 30.4 | % | 29.4 | % | 30.8 | % | 30.6 | % | 29.2 | % | |||||||||||
| Operating expenses: | ||||||||||||||||||||
| Selling, general and administrative | 60,319 | 55,605 | 55,567 | 170,553 | 163,763 | |||||||||||||||
| 22.8 | % | 21.6 | % | 22.1 | % | 22.5 | % | 21.5 | % | |||||||||||
| Depreciation and amortization | 4,086 | 3,317 | 4,010 | 11,916 | 9,847 | |||||||||||||||
| Total operating expenses | 64,405 | 58,922 | 59,577 | 182,469 | 173,610 | |||||||||||||||
| Income from operations | 15,901 | 16,745 | 17,582 | 48,952 | 49,477 | |||||||||||||||
| Interest expense, net, and other | 1,433 | 1,840 | 4,629 | 7,908 | 7,829 | |||||||||||||||
| Income before income taxes | 14,468 | 14,905 | 12,953 | 41,044 | 41,648 | |||||||||||||||
| Income tax expense | 5,969 | 6,290 | 5,760 | 17,722 | 17,071 | |||||||||||||||
| Net income | $ | 8,499 | $ | 8,615 | $ | 7,193 | $ | 23,322 | $ | 24,577 | ||||||||||
| Other comprehensive income (loss) | 75 | (84 | ) | (37 | ) | 29 | (19 | ) | ||||||||||||
| Comprehensive income | $ | 8,574 | $ | 8,531 | $ | 7,156 | $ | 23,351 | $ | 24,558 | ||||||||||
| Net income per common share: | ||||||||||||||||||||
| Basic | $ | 0.18 | $ | 0.19 | $ | 0.15 | $ | 0.50 | $ | 0.53 | ||||||||||
| Diluted | $ | 0.18 | $ | 0.18 | $ | 0.15 | $ | 0.49 | $ | 0.51 | ||||||||||
| Weighted average common shares outstanding: | ||||||||||||||||||||
| Basic | 46,546 | 45,986 | 46,479 | 46,460 | 45,947 | |||||||||||||||
| Diluted | 48,122 | 47,810 | 47,836 | 47,959 | 47,776 |
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except per share data)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2014 | 2013 | 2014 | 2014 | 2013 | ||||||||||||||||
| Revenue | ||||||||||||||||||||
| Nurse and allied healthcare staffing | $ | 174,292 | $ | 170,955 | $ | 165,894 | $ | 503,636 | $ | 517,858 | ||||||||||
| Locum tenens staffing | 78,816 | 75,253 | 74,309 | 219,996 | 213,417 | |||||||||||||||
| Physician permanent placement services | 11,476 | 10,887 | 10,710 | 32,746 | 31,883 | |||||||||||||||
| $ | 264,584 | $ | 257,095 | $ | 250,913 | $ | 756,378 | $ | 763,158 | |||||||||||
| Reconciliation of Non-GAAP Items: | ||||||||||||||||||||
| Segment operating income(1) | ||||||||||||||||||||
| Nurse and allied healthcare staffing | $ | 21,279 | $ | 20,392 | $ | 22,032 | $ | 63,283 | $ | 62,994 | ||||||||||
| Locum tenens staffing | 8,139 | 7,547 | 7,818 | 22,830 | 17,347 | |||||||||||||||
| Physician permanent placement services | 2,756 | 2,205 | 2,187 | 7,074 | 6,735 | |||||||||||||||
| 32,174 | 30,144 | 32,037 | 93,187 | 87,076 | ||||||||||||||||
| Unallocated corporate overhead | 10,396 | 8,595 | 8,694 | 26,958 | 23,085 | |||||||||||||||
| Adjusted EBITDA(2) | 21,778 | 21,549 | 23,343 | 66,229 | 63,991 | |||||||||||||||
| Adjusted EBITDA margin(3) | 8.2 | % | 8.4 | % | 9.3 | % | 8.8 | % | 8.4 | % | ||||||||||
| Depreciation and amortization | 4,086 | 3,317 | 4,010 | 11,916 | 9,847 | |||||||||||||||
| Share-based compensation | 1,791 | 1,487 | 1,751 | 5,361 | 4,667 | |||||||||||||||
| Interest expense, net, and other | 1,433 | 1,840 | 4,629 | 7,908 | 7,829 | |||||||||||||||
| Income before income taxes | 14,468 | 14,905 | 12,953 | 41,044 | 41,648 | |||||||||||||||
| Income tax expense | 5,969 | 6,290 | 5,760 | 17,722 | 17,071 | |||||||||||||||
| Net income | $ | 8,499 | $ | 8,615 | $ | 7,193 | $ | 23,322 | $ | 24,577 | ||||||||||
| GAAP based diluted net income per share (EPS) | $ | 0.18 | $ | 0.18 | $ | 0.15 | $ | 0.49 | $ | 0.51 | ||||||||||
| Adjustments: | ||||||||||||||||||||
| Loss on debt extinguishment | 0.00 | 0.00 | 0.04 | 0.04 | 0.01 | |||||||||||||||
| Adjusted diluted EPS (4) | N/A | N/A | $ | 0.19 | $ | 0.53 | $ | 0.52 |
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2014 | 2013 | 2014 | 2014 | 2013 | ||||||||||||||||
| Gross Margin | ||||||||||||||||||||
| Nurse and allied healthcare staffing | 28.7 | % | 27.4 | % | 29.1 | % | 28.9 | % | 27.4 | % | ||||||||||
| Locum tenens staffing | 29.0 | % | 29.3 | % | 29.8 | % | 29.5 | % | 28.8 | % | ||||||||||
| Physician permanent placement services | 64.9 | % | 62.6 | % | 63.5 | % | 63.8 | % | 62.6 | % | ||||||||||
| Operating Data: | ||||||||||||||||||||
| Nurse and allied healthcare staffing | ||||||||||||||||||||
| Average clinicians on assignment (5) | 5,632 | 5,771 | 5,565 | 5,610 | 5,970 | |||||||||||||||
| Locum tenens staffing | ||||||||||||||||||||
| Days filled (6) | 49,982 | 50,993 | 49,049 | 143,780 | 146,477 | |||||||||||||||
| As of September 30, | As of June 30, | |||||||||||||||||||
| 2014 | 2013 | 2014 | ||||||||||||||||||
| Leverage Ratio (7) | 1.7 | 1.9 | 1.9 |
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)
| September 30, | June 30, | December 31, | ||||||||||
| 2014 | 2014 | 2013 (8) | ||||||||||
| Assets | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 9,663 | $ | 5,501 | $ | 15,580 | ||||||
| Accounts receivable, net | 164,078 | 151,505 | 147,477 | |||||||||
| Accounts receivable, subcontractor | 21,569 | 22,512 | 18,271 | |||||||||
| Deferred income taxes, net | 24,970 | 27,983 | 24,938 | |||||||||
| Prepaid and other current assets | 28,844 | 27,662 | 26,631 | |||||||||
| Total current assets | 249,124 | 235,163 | 232,897 | |||||||||
| Restricted cash, cash equivalents and investments | 21,012 | 20,606 | 23,115 | |||||||||
| Fixed assets, net | 29,202 | 27,066 | 21,158 | |||||||||
| Other assets | 40,045 | 37,502 | 32,279 | |||||||||
| Goodwill | 144,937 | 144,937 | 144,642 | |||||||||
| Intangible assets, net | 144,498 | 146,418 | 150,197 | |||||||||
| Total assets | $ | 628,818 | $ | 611,692 | $ | 604,288 | ||||||
| Liabilities and stockholders equity | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable and accrued expenses | $ | 66,949 | $ | 65,130 | $ | 71,081 | ||||||
| Accrued compensation and benefits | 64,574 | 56,046 | 55,949 | |||||||||
| Revolving credit facility | 0 | 6,500 | 10,000 | |||||||||
| Current portion of notes payable | 7,500 | 7,500 | 0 | |||||||||
| Other current liabilities | 8,746 | 4,097 | 6,060 | |||||||||
| Total current liabilities | 147,769 | 139,273 | 143,090 | |||||||||
| Notes payable, net of discount | 138,750 | 140,625 | 148,672 | |||||||||
| Other long-term liabilities | 96,881 | 98,188 | 94,784 | |||||||||
| Total liabilities | 383,400 | 378,086 | 386,546 | |||||||||
| Commitments and contingencies | ||||||||||||
| Stockholders equity | 245,418 | 233,606 | 217,742 | |||||||||
| Total liabilities and stockholders equity | $ | 628,818 | $ | 611,692 | $ | 604,288 |
AMN Healthcare Services, Inc.
Summary Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2014 | 2013 (8) | 2014 | 2014 | 2013 (8) | ||||||||||||||||
| Net cash provided by operating activities | $ | 15,489 | $ | 27,092 | $ | 6,159 | $ | 22,639 | $ | 44,349 | ||||||||||
| Net cash used in investing activities | (4,511 | ) | (1,018 | ) | (1,100 | ) | (10,320 | ) | (7,050 | ) | ||||||||||
| Net cash used in financing activities | (6,891 | ) | (4,856 | ) | (8,790 | ) | (18,265 | ) | (11,308 | ) | ||||||||||
| Effect of exchange rates on cash | 75 | (84 | ) | (37 | ) | 29 | (19 | ) | ||||||||||||
| Net increase (decrease) in cash and cash equivalents | 4,162 | 21,134 | (3,768 | ) | (5,917 | ) | 25,972 | |||||||||||||
| Cash and cash equivalents at beginning of period | 5,501 | 10,519 | 9,269 | 15,580 | 5,681 | |||||||||||||||
| Cash and cash equivalents at end of period | $ | 9,663 | $ | 31,653 | $ | 5,501 | $ | 9,663 | $ | 31,653 |