Full Press Release Details
Astrana Health, Inc. Reports First Quarter
Company to Host Conference Call on Tuesday,
May 7, 2024, at 2:30 p.m. PT/5:30 p.m. ET
ALHAMBRA, Calif., May 7, 2024 /PRNewswire/
-- Astrana Health, Inc. ("Astrana," and together with its subsidiaries and affiliated entities, the "Company")
(NASDAQ: ASTH), a leading provider-centric, technology-powered healthcare company enabling providers to deliver accessible, high-quality,
and high-value care to all, today announced its consolidated financial results for the first quarter ended March 31, 2024.
"We believe our strong first quarter
performance continues to demonstrate the uniqueness of our platform, care model, and technology. Revenue growth of 20%, net income
attributable to Astrana growth of 13% and adjusted EBITDA growth of 42% relative to the prior year quarter were primarily driven by
solid membership growth across all lines of business and successful management of total cost of care for our members. Additionally,
organic membership growth of 10% year-to-date increased our total number of lives managed to approximately one million. We also made
further progress transitioning our members into full-risk arrangements, which expect to account for approximately 60% of our total
capitation revenue as of April 1, 2024. We believe our consistent execution against our strategic roadmap has set the stage for
continued growth this year as we bring high-quality, high-value care to the communities we serve," said Brandon K. Sim,
President and Chief Executive Officer of Astrana Health.
Financial Highlights for First Quarter Ended
All comparisons are to the quarter ended March 31,
2023 unless otherwise stated.
Recent Operating Highlights
Segment Results for the First Quarter Ended
| Three Months Ended March 31, 2024 | ||||||||||||||||||||||||||||
| (in thousands) | Care Partners | Care Delivery | Care Enablement | Other | Intersegment Elimination | Corporate Costs | Consolidated Total | |||||||||||||||||||||
| Total revenues | $ | 397,095 | $ | 30,719 | $ | 33,274 | $ | - | $ | (56,732 | ) | $ | - | $ | 404,356 | |||||||||||||
| % change vs. prior year quarter | 26 | % | 21 | % | 9 | % | 20 | % | ||||||||||||||||||||
| Cost of services | 314,966 | 24,794 | 17,373 | - | (26,734 | ) | - | 330,399 | ||||||||||||||||||||
| General and administrative (1) | 38,933 | 6,163 | 12,397 | - | (30,075 | ) | 16,400 | 43,818 | ||||||||||||||||||||
| Total expenses | 353,899 | 30,957 | 29,770 | - | (56,809 | ) | 16,400 | 374,217 | ||||||||||||||||||||
| Income (loss) from operations | $ | 43,196 | $ | (238 | ) | $ | 3,504 | $ | - | $ | 77 | (2) | $ | (16,400 | ) | $ | 30,139 | |||||||||||
| % change vs. prior year quarter | 94 | % | (75 | )% | (39 | )% | 35 | % |
(1) Balance includes general and administrative
expenses and depreciation and amortization.
(2) Income from operations for the
intersegment elimination represents rental income from segments renting from other segments. Rental income is presented within other
income which is not presented in the table.
Astrana is reiterating the following guidance
for total revenue, net income attributable to Astrana, Adjusted EBITDA, and EPS - diluted, based on the Company's existing business,
current view of existing market conditions and assumptions for the year ending December 31, 2024.
| 2024 Guidance Range | ||||||||
| ($ in millions) | Low | High | ||||||
| Total revenue | $ | 1,650.0 | $ | 1,850.0 | ||||
| Net income attributable to Astrana Health, Inc. | $ | 61.0 | $ | 73.0 | ||||
| Adjusted EBITDA | $ | 165.0 | $ | 185.0 | ||||
| EPS - diluted | $ | 1.28 | $ | 1.52 |
See "Guidance Reconciliation of Net Income
to EBITDA and Adjusted EBITDA" and "Use of Non-GAAP Financial Measures" below for additional information. There can
be no assurance that actual amounts will not be materially higher or lower than these expectations. See "Forward-Looking Statements"
below for additional information.
Conference Call and Webcast Information:
Astrana will host a conference call at 2:30 p.m. PT/5:30 p.m. ET today
(Tuesday, May 7, 2024), during which management will discuss the results of the first quarter ended March 31, 2024. To participate
in the conference call, please use the following dial-in numbers about 5 minutes prior to the scheduled conference call time:
| U.S. & Canada (Toll-Free): | +1 (888) 437-3179 |
| International (Toll): | +1 (862) 298-0702 |
The conference call can also be accessed via webcast at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=y3Hig4E8.
An accompanying slide presentation will be available
in PDF format on the "IR Calendar" page of the Company's website (https://ir.astranahealth.com/news-events/ir-calendar)
after issuance of the earnings release and will be furnished as an exhibit to Astrana's current report on Form 8-K to be filed
with the SEC, accessible at www.sec.gov.
Those who are unable to attend the live conference
call may access the recording at the above webcast link, which will be made available shortly after the conclusion of the call.
Note About Consolidated Entities
The Company consolidates entities in which it
has a controlling financial interest. The Company consolidates subsidiaries in which it holds, directly or indirectly, more than 50%
of the voting rights, and variable interest entities ("VIEs") in which the Company is the primary beneficiary. Noncontrolling
interests represent third party equity ownership interests in the Company's consolidated entities (including certain VIEs). The
amount of net income attributable to noncontrolling interests is disclosed in the Company's consolidated statements of income.
Note About Stockholders' Equity,
Certain Treasury Stock and Earnings Per Share
As of the date of this press release, 41,048
holdback shares have not been issued to certain former shareholders of the Company's subsidiary, Astrana Health Management, Inc.
("AHM"), formerly known as Network Medical Management, Inc., who were AHM shareholders at the time of closing of the merger,
as they have yet to submit properly completed letters of transmittal to Astrana in order to receive their pro rata portion of Astrana's
common stock as contemplated under that certain Agreement and Plan of Merger, dated December 21, 2016, among Astrana, AHM, Apollo Acquisition
Corp. ("Merger Subsidiary") and Kenneth Sim, M.D., as amended, pursuant to which Merger Subsidiary merged with and into AHM,
with AHM as the surviving corporation. Pending such receipt, such former AHM shareholders have the right to receive, without interest,
their pro rata share of dividends or distributions with a record date after the effectiveness of the merger. The Company's consolidated
financial statements have treated such shares of common stock as outstanding, given the receipt of the letter of transmittal is considered
perfunctory and Astrana is legally obligated to issue these shares in connection with the merger.
Shares of Astrana's common stock owned
by Allied Physicians of California, a Professional Medical Corporation ("APC"), a VIE of the Company, are legally issued
and outstanding but excluded from shares of common stock outstanding in the Company's consolidated financial statements, as such
shares are treated as treasury shares for accounting purposes. Such shares, therefore, are not included in the number of shares of common
stock outstanding used to calculate the Company's earnings per share.
About Astrana Health, Inc.
Astrana is a leading provider-centric, technology-powered
healthcare company enabling providers to deliver accessible, high-quality, and high-value care to all. Leveraging its proprietary end-to-end
technology solutions, Astrana operates an integrated healthcare delivery platform that enables providers to successfully participate
in value-based care arrangements, thus empowering them to deliver high quality care to patients in a cost-effective manner.
Headquartered in Alhambra, California, Astrana
serves over 10,000 providers and 1.0 million patients in value-based care arrangements. Its subsidiaries and affiliates include
management services organizations (MSOs), affiliated independent practice associations (IPAs), accountable care organizations (ACOs),
and care delivery entities across primary, multi-specialty, and ancillary care. For more information, please visit www.astranahealth.com.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements about the Company's
guidance for the year ending December 31, 2024, ability to meet operational goals, ability to meet expectations in deployment of
care coordination and management capabilities, ability to decrease cost of care while improving quality and outcomes, ability to deliver
sustainable revenue and EBITDA growth as well as long-term value, ability to respond to the changing environment, and successful implementation
of strategic growth plans, acquisition strategy, and merger integration efforts. Forward-looking statements reflect current views
with respect to future events and financial performance and therefore cannot be guaranteed. Such statements are based on the
current expectations and certain assumptions of the Company's management, and some or all of such expectations and assumptions
may not materialize or may vary significantly from actual results. Actual results may also vary materially from forward-looking
statements due to risks, uncertainties and other factors, known and unknown, including the risk factors described from time to time in
the Company's reports to the SEC, including, without limitation the risk factors discussed in the Company's Annual
Report on Form 10-K for the year ended December 31, 2023, and any subsequent quarterly reports on Form 10-Q.
FOR MORE INFORMATION, PLEASE CONTACT:
ASTRANA HEALTH, INC.
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
| March 31, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 334,796 | $ | 293,807 | ||||
| Investment in marketable securities | 2,490 | 2,498 | ||||||
| Receivables, net | 120,106 | 76,780 | ||||||
| Receivables, net - related parties | 62,354 | 58,980 | ||||||
| Income taxes receivable | - | 10,657 | ||||||
| Other receivables | 1,783 | 1,335 | ||||||
| Prepaid expenses and other current assets | 17,281 | 17,450 | ||||||
| Total current assets | 538,810 | 461,507 | ||||||
| Non-current assets | ||||||||
| Land, property and equipment, net | 7,985 | 7,171 | ||||||
| Intangible assets, net | 119,707 | 71,648 | ||||||
| Goodwill | 410,267 | 278,831 | ||||||
| Income taxes receivable | 15,943 | 15,943 | ||||||
| Loans receivable, non-current | 47,412 | 26,473 | ||||||
| Investments in other entities - equity method | 35,893 | 25,774 | ||||||
| Investments in privately held entities | 6,396 | 6,396 | ||||||
| Restricted cash | 645 | 345 | ||||||
| Operating lease right-of-use assets | 39,152 | 37,396 | ||||||
| Other assets | 4,067 | 1,877 | ||||||
| Total non-current assets | 687,467 | 471,854 | ||||||
| Total assets (1) | $ | 1,226,277 | $ | 933,361 | ||||
| Liabilities, mezzanine equity and equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 146,473 | $ | 59,949 | ||||
| Fiduciary accounts payable | 7,792 | 7,737 | ||||||
| Medical liabilities | 136,494 | 106,657 | ||||||
| Income taxes payable | 5,522 | - | ||||||
| Dividend payable | 638 | 638 | ||||||
| Finance lease liabilities | 636 | 646 | ||||||
| Operating lease liabilities | 5,007 | 4,607 | ||||||
| Current portion of long-term debt | 20,750 | 19,500 | ||||||
| Other liabilities | 31,960 | 18,940 | ||||||
| Total current liabilities | 355,272 | 218,674 |
| March 31, 2024 | December 31, 2023 | |||||||
| Non-current liabilities | ||||||||
| Deferred tax liability | 3,756 | 4,072 | ||||||
| Finance lease liabilities, net of current portion | 1,015 | 1,033 | ||||||
| Operating lease liabilities, net of current portion | 37,716 | 36,289 | ||||||
| Long-term debt, net of current portion and deferred financing costs | 368,448 | 258,939 | ||||||
| Other long-term liabilities | 7,652 | 3,586 | ||||||
| Total non-current liabilities | 418,587 | 303,919 | ||||||
| Total liabilities (1) | 773,859 | 522,593 | ||||||
| Mezzanine equity | ||||||||
| Noncontrolling interest in Allied Physicians of California, a Professional Medical Corporation ("APC") | (205,557 | ) | (205,883 | ) | ||||
| Stockholders' equity | ||||||||
| Series A Preferred stock, par value $0.001; 5,000,000 shares authorized (inclusive of Series B Preferred stock); 1,111,111 issued and zero outstanding | - | - | ||||||
| Series B Preferred stock, par value $0.001; 5,000,000 shares authorized (inclusive of Series A Preferred stock); 555,555 issued and zero outstanding | - | - | ||||||
| Common stock, par value $0.001; 100,000,000 shares authorized, 47,458,264 and 46,843,743 shares outstanding, excluding 10,584,340 and 10,584,340 Treasury shares, at March 31, 2024 and December 31, 2023, respectively | 48 | 47 | ||||||
| Additional paid-in capital | 395,473 | 371,037 | ||||||
| Retained earnings | 257,969 | 243,134 | ||||||
| Total Stockholders' equity | 653,490 | 614,218 | ||||||
| Non-controlling interest | 4,485 | 2,433 | ||||||
| Total equity | 657,975 | 616,651 | ||||||
| Total liabilities, mezzanine equity, and stockholders' equity | $ | 1,226,277 | $ | 933,361 |
consolidated balance sheets include the assets and liabilities of its consolidated VIEs. The consolidated balance sheets include
total assets that can be used only to settle obligations of the Company's consolidated VIEs totaling $717.5 million and