Full Press Release Details
Astrana Health, Inc. Reports Third Quarter
Company to Host Conference Call on Thursday,
November 7, 2024, at 2:30 p.m. PT/5:30 p.m. ET
ALHAMBRA, Calif., November 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 third quarter ended September 30, 2024.
"Astrana's strong third quarter continues
to reflect the outcomes we are driving with the Astrana care model and value-based care enablement platform. We continued to see strong
organic and inorganic growth across our businesses while delivering high-quality care and managing costs effectively in the quarter. We
are confident in our platform's ability to continue improving access, quality, and coordination of care for around 1.1 million patients
in local communities nationwide," said President and CEO of Astrana, Brandon K. Sim.
Financial Highlights for three months ended
All comparisons are to the three months ended
September 30, 2023 unless otherwise stated.
Financial Highlights for the nine months ended
All comparisons are to the nine months ended
September 30, 2023 unless otherwise stated.
Recent Operating Highlights
Segment Results for three months ended September 30,
| Three Months Ended September 30, 2024 | ||||||||||||||||||||||||||||
| (in thousands) | Care Partners | Care Delivery | Care Enablement | Other | Intersegment Elimination | Corporate Costs | Consolidated Total | |||||||||||||||||||||
| Total revenues | $ | 455,760 | $ | 34,728 | $ | 40,930 | $ | - | $ | (52,708 | ) | $ | - | $ | 478,710 | |||||||||||||
| % change vs. prior year quarter | 42 | % | 20 | % | 11 | % | ||||||||||||||||||||||
| Cost of services | 369,835 | 29,114 | 19,604 | - | (13,335 | ) | - | 405,218 | ||||||||||||||||||||
| General and administrative (1) | 47,139 | 6,971 | 15,012 | - | (39,370 | ) | 15,315 | 45,067 | ||||||||||||||||||||
| Total expenses | 416,974 | 36,085 | 34,616 | - | (52,705 | ) | 15,315 | 450,285 | ||||||||||||||||||||
| Income (loss) from operations | $ | 38,786 | $ | (1,357 | ) | $ | 6,314 | $ | - | $ | (3 | ) (2) | $ | (15,315 | ) | $ | 28,425 | |||||||||||
| % change vs. prior year quarter | (4 | )% | 31 | % | (2 | )% |
includes general and administrative expenses and depreciation and amortization.
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.
As we adjust our full-year outlook to incorporate
CHS's financial contribution, we are raising our revenue guidance and narrowing our net income attributable to Astrana, Adjusted EBITDA,
and EPS guidance for the year ending December 31, 2024.
| 2024 Guidance Range | ||||||||
| ($ in millions, except per share amounts) | Low | High | ||||||
| Total revenue | $ | 1,950 | $ | 2,030 | ||||
| Net income attributable to Astrana Health, Inc. | $ | 52 | $ | 58 | ||||
| Adjusted EBITDA | $ | 165 | $ | 175 | ||||
| EPS - diluted | $ | 1.06 | $ | 1.19 |
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 (Thursday, November 7, 2024), during which management will discuss the results of the third quarter ended September 30,
2024. To participate in the conference call, please use the following dial-in numbers about 5 minutes prior to the scheduled conference
| U.S. & Canada (Toll-Free): | +1 (888) 272-8703 |
| International (Toll): | +1 (713) 481-1320 |
conference call can also be accessed via webcast at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=qeu83NWd
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.
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 and warrants 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 physician-centric, technology-powered,
risk-bearing healthcare management company. Leveraging its proprietary population health management and healthcare delivery platform,
Astrana operates an integrated, value-based healthcare model, which aims to empower the providers in its network to deliver the highest
quality of care to its patients in a cost-effective manner. Together with our affiliated physician groups and consolidated entities, we
provide coordinated outcomes-based medical care in a cost-effective manner.
Headquartered in Alhambra, California, Astrana
serves over 12,000 providers and approximately 1.1 million patients in value-based care arrangements. Its subsidiaries and affiliates
include management services organizations (MSOs), a network of risk-bearing organizations ("RBOs") that encompasses independent
practice associations ("IPAs"), accountable care organizations ("ACOs"), and state-specific entities such as Restricted
Knox-Keene licensed health plans in California, 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 filed or furnished with the Securities
and Exchange Commission, 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.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
| September 30, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 347,994 | $ | 293,807 | ||||
| Investment in marketable securities | 2,354 | 2,498 | ||||||
| Receivables, net | 132,237 | 76,780 | ||||||
| Receivables, net - related parties | 76,568 | 58,980 | ||||||
| Income taxes receivable | 16,211 | 10,657 | ||||||
| Other receivables | 1,120 | 1,335 | ||||||
| Prepaid expenses and other current assets | 20,506 | 17,450 | ||||||
| Total current assets | 596,990 | 461,507 | ||||||
| Non-current assets | ||||||||
| Land, property and equipment, net | 12,172 | 7,171 | ||||||
| Intangible assets, net | 109,108 | 71,648 | ||||||
| Goodwill | 409,711 | 278,831 | ||||||
| Income taxes receivable | 15,943 | 15,943 | ||||||
| Loans receivable, non-current | 55,284 | 26,473 | ||||||
| Investments in other entities - equity method | 34,629 | 25,774 | ||||||
| Investments in privately held entities | 8,896 | 6,396 | ||||||
| Restricted cash | 646 | 345 | ||||||
| Operating lease right-of-use assets | 33,119 | 37,396 | ||||||
| Other assets | 8,878 | 1,877 | ||||||
| Total non-current assets | 688,386 | 471,854 | ||||||
| Total assets (1) | $ | 1,285,376 | $ | 933,361 | ||||
| Liabilities, mezzanine equity and equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 94,811 | $ | 59,949 | ||||
| Fiduciary accounts payable | 6,041 | 7,737 | ||||||
| Medical liabilities | 160,279 | 106,657 | ||||||
| Dividend payable | 638 | 638 | ||||||
| Finance lease liabilities | 554 | 646 | ||||||
| Operating lease liabilities | 5,241 | 4,607 | ||||||
| Current portion of long-term debt | 15,000 | 19,500 | ||||||
| Other liabilities | 30,364 | 18,940 | ||||||
| Total current liabilities | 312,928 | 218,674 | ||||||
| Non-current liabilities | ||||||||
| Deferred tax liability | 2,857 | 4,072 | ||||||
| Finance lease liabilities, net of current portion | 743 | 1,033 | ||||||
| Operating lease liabilities, net of current portion | 31,162 | 36,289 | ||||||
| Long-term debt, net of current portion and deferred financing costs | 423,119 | 258,939 | ||||||
| Other long-term liabilities | 7,460 | 3,586 | ||||||
| Total non-current liabilities | 465,341 | 303,919 | ||||||
| Total liabilities (1) | 778,269 | 522,593 | ||||||
| Commitments and contingencies | ||||||||
| Mezzanine equity | ||||||||
| Noncontrolling interest in Allied Physicians of California, a Professional Medical Corporation ("APC") | (202,512 | ) | (205,883 | ) | ||||
| Stockholders' equity | ||||||||
| Preferred stock, $0.001 par value per share; 5,000,000 shares authorized as of September 30, 2024 and December 31, 2023 | ||||||||
| Series A Preferred stock, zero authorized and issued and zero outstanding as of September 30, 2024 and 1,111,111 authorized and issued and zero outstanding as of December 31, 2023 | - | - | ||||||
| Series B Preferred stock, zero authorized and issued and zero outstanding as of September 30, 2024 and 555,555 authorized and issued and zero outstanding as of December 31, 2023 | - | - | ||||||
| Common stock, $0.001 par value per share; 100,000,000 shares authorized, 47,780,523 and 46,843,743 shares issued and outstanding, excluding 10,598,749 and 10,584,340 treasury shares, as of September 30, 2024 and December 31, 2023, respectively | 48 | 47 | ||||||
| Additional paid-in capital | 411,334 | 371,037 | ||||||
| Retained earnings | 293,234 | 243,134 | ||||||
| Total stockholders' equity | 704,616 | 614,218 | ||||||
| Non-controlling interest | 5,003 | 2,433 | ||||||
| Total equity | 709,619 | 616,651 | ||||||
| Total liabilities, mezzanine equity and equity | $ | 1,285,376 | $ | 933,361 |
Company's condensed consolidated balance sheets include the assets and liabilities of its consolidated VIEs. The condensed consolidated
balance sheets include total assets that can be used only to settle obligations of the Company's consolidated VIEs totaling $701.1
million and $540.8 million as of September 30, 2024 and December 31, 2023, respectively, and total liabilities of the Company's
consolidated VIEs for which creditors do not have recourse to the general credit of the primary beneficiary of $194.1 million and $146.0