AMN Healthcare Services, Inc. (NYSE: AMN), the leader and innovator
in total talent solutions for healthcare organizations across the
United States, today announced its fourth quarter and full year
2023 financial results. Financial highlights are as follows:
Dollars in millions, except per share amounts.
|
Q4 2023 |
% Change Q4 2022 |
Full Year 2023 |
% Change Full Year 2022 |
Revenue |
$818.3 |
(27%) |
$3,789.3 |
(28%) |
Gross profit |
$260.9 |
(30%) |
$1,249.6 |
(27%) |
Net income |
$12.5 |
(85%) |
$210.7 |
(53%) |
Diluted EPS |
$0.33 |
(83%) |
$5.36 |
(46%) |
Adjusted diluted EPS* |
$1.32 |
(47%) |
$8.21 |
(31%) |
Adjusted EBITDA* |
$104.0 |
(40%) |
$579.1 |
(32%) |
* See “Non-GAAP
Measures” below for a discussion of our use of non-GAAP items and
the table entitled “Non-GAAP Reconciliation Tables” for a
reconciliation of non-GAAP items. |
|
2023 & Recent
Highlights
- AMN worked through the largest
cyclical reset in industry history in 2023 while also accelerating
innovation and building a stronger position in technology-enabled
total talent solutions.
- We achieved our most transformative
year for our technology, both in platforms that support corporate
operations and those dedicated to our clients and healthcare
professionals.
- In Q4, we continued the tech
momentum with Market Insights and Analytics for ShiftWise Flex
vendor management, powered by our robust dataset, plus the first
mobile apps for ShiftWise Flex and Smart Square scheduling, and
AI-empowered self-service in AMN Passport for healthcare
professionals.
- Our One AMN branding and an
integrated go-to-market platform and experience are adding momentum
to our sales pipeline while also bringing candidate traffic and
applicants that exceeded our expectations. In the quarter, we
signed our largest MSP client win since 2019.
- Q4 2023 financial results were
consistent with our expectations, with strength in language
services and our organic locum tenens business.
- Our MSDR acquisition brings our
annualized revenue run rate in locum tenens to more than $600
million.
- AMN was named one of America's
Greatest Workplaces for Diversity by Newsweek, recognizing our
commitment to inclusion and our values-based culture.
"Our healthcare professionals and corporate team
members were resilient in 2023, working through the largest
cyclical reset of staffing demand in industry history," said Cary
Grace, AMN President and Chief Executive Officer. "While partnering
with clients to help them rebuild sustainable workforces, our team
simultaneously accelerated innovation, enabling AMN to enter this
year better positioned to deliver the technology-centric total
talent solutions that healthcare needs now.
"We invested heavily in our growth opportunities
with more than $100 million of capex while rigorously managing
financial discipline in operations," Ms. Grace added. "We are
consolidating our businesses under our One AMN branding and
platform initiative and building a unified, client-centric sales
and service organization. Our service lines are infused with new
technology that speeds our operations, better integrates us with
clients, and delivers powerful mobile tools that give clients and
healthcare professionals more control and flexibility. Further, we
strengthened our capabilities in locum tenens with the acquisition
of MSDR. These accomplishments were enabled by our strong cash
flow, the talent and passion of our team members, the uniquely
strong AMN culture, and a commitment to performing for our
stakeholders."
Fourth Quarter 2023 Results
Consolidated revenue for the quarter was $818
million, a 27% decrease over prior year and 4% lower than prior
quarter. Net income was $12 million (1.5% of revenue), or $0.33 per
diluted share, compared with $82 million (7.3% of revenue), or
$1.88 per diluted share, in the same quarter last year. Adjusted
diluted EPS was $1.32 compared with $2.48 in the year-ago
quarter.
Revenue for the Nurse and Allied Solutions
segment was $538 million, lower by 35% year over year and down 6%
sequentially. Travel Nurse revenue was down 40% year over year and
8% sequentially. Allied division revenue declined 16% year over
year and 2% versus prior quarter.
The Physician and Leadership Solutions segment
reported revenue of $168 million, flat year over year and up 5%
sequentially. Organic locum tenens revenue grew 7% year over year
and was down 2% versus the prior quarter. Interim leadership
revenue was down 35% year over year and 5% sequentially. Search
revenue was lower by 20% year over year and 6% quarter over
quarter. The MSDR acquisition closed in late November and
contributed revenue of $13 million for the quarter.
Technology and Workforce Solutions segment
revenue was $113 million reflecting a decrease of 16% year over
year and 7% sequentially. Language services revenue was $68 million
in the quarter, up 18% year over year and 3% compared with the
prior quarter. Vendor management systems revenue was $31 million,
45% lower year over year and down 20% sequentially.
Consolidated gross margin was 31.9%, lower by
140 basis points year over year and lower by 200 basis points
sequentially. The year-over-year decline in gross margin was
primarily driven by lower margin in Nurse and Allied Solutions and
lower VMS revenue. On a sequential basis, gross margin decreased
due to the same factors and benefits in the third quarter gross
margin that did not recur in the fourth quarter.
SG&A expenses were $185 million or 22.7% of
revenue, compared with $219 million, or 19.5% of revenue, in the
same quarter last year. SG&A was $163 million, or 19.1% of
revenue, in the previous quarter. The year-over-year decrease in
SG&A costs was primarily due to lower employee expenses given
lower revenue. The quarter-over-quarter increase was driven
primarily by increased acquisition, integration and other costs,
including MSDR acquisition costs, and the absence of favorable
items included in the third quarter results.
Income from operations was $34 million, or 4.2%
of revenue, compared with $119 million, or 10.6% of revenue, in the
same quarter last year. Adjusted EBITDA was $104 million, with a
year-over-year decrease of 40%. Adjusted EBITDA margin was 12.7%,
lower by 280 basis points year over year and a decrease of 300
basis points sequentially.
Full Year 2023 Results
Full year 2023 consolidated revenue was $3.789
billion, a 28% decrease from prior year. Full year net income was
$211 million (5.6% of revenue), or $5.36 per diluted share,
compared with $444 million (8.5% of revenue), or $9.90 per diluted
share, in the prior year. Adjusted diluted EPS was $8.21 compared
with $11.90 in 2022.
Nurse and Allied Solutions segment revenue was
$2.625 billion, a year-over-year decrease of 34%. The Physician and
Leadership Solutions segment recorded revenue of $670 million, 4%
lower compared with the prior year. Technology and Workforce
Solutions segment revenue was $495 million, 12% lower year over
year.
Full year consolidated gross margin was 33.0%
compared with 32.7% for the prior year. The slight increase in
gross margin year over year is primarily attributable to a
favorable revenue mix shift and higher margin in Nurse and Allied
Solutions, partially offset by lower margin in Technology and
Workforce Solutions.
Full year consolidated SG&A expenses were
$756 million, representing 20.0% of revenue as compared to $937
million, representing 17.9% of revenue, for the prior year. The
year-over-year decrease in SG&A expenses was primarily due to
lower employee compensation and benefits.
Full year income from operations was $338
million, or 8.9% of revenue, compared with $647 million, or 12.3%
of revenue, in the prior year. Adjusted EBITDA was $579 million, a
year-over-year decrease of 32%. Adjusted EBITDA margin was 15.3%,
80 basis points lower year over year.
At December 31, 2023, cash and cash
equivalents totaled $33 million. Cash flow from operations was a
use of $41 million for the quarter. Cash flow from operations for
the full year was $372 million. Capital expenditures were $30
million in the quarter and $104 million for the year. The Company
ended the year with total debt outstanding of $1,310 million and a
net leverage ratio of 2.2 to 1.
First Quarter 2024 Outlook
|
Metric |
Guidance* |
|
|
Consolidated revenue |
$810 - $830 million |
|
|
Gross margin |
31.0% - 31.5% |
|
|
SG&A as percentage of revenue |
21.0% - 21.5% |
|
|
Operating margin |
4.2% - 4.9% |
|
|
Adjusted EBITDA margin |
11.2% - 11.7% |
|
|
*Note: Guidance percentage metrics are approximate. For a
reconciliation of adjusted EBITDA margin, see the table entitled
“Reconciliation of Guidance Operating Margin to Guidance Adjusted
EBITDA Margin” below. |
|
|
|
|
Consolidated revenue in the first quarter of
2024 is projected to be 26-28% lower than the year-ago period.
Nurse and Allied Solutions segment revenue is expected to be down
36-38% below prior year. We expect Physician and Leadership
Solutions segment revenue in the first quarter to be 11-14% higher
year over year. Technology and Workforce Solutions segment revenue
is projected to be down 18-20% year over year.
Other first quarter estimates include
depreciation expense of $17 million, depreciation in cost of
services of $2 million, non-cash amortization expense of $25
million, stock-based compensation expense of $7 million, interest
expense of $16 million, integration and other expenses of $6
million, an adjusted tax rate of 30%, and 38.2 million weighted
average diluted shares.
Conference Call on February 15,
2024
AMN Healthcare Services, Inc. (NYSE: AMN), the
leader and innovator in total talent solutions for healthcare, will
host a conference call to discuss its fourth quarter and full year
2023 financial results and first quarter 2024 outlook on Thursday,
February 15, 2024, at 5:00 p.m. Eastern Time. A live webcast
of the call can be accessed through this webcast link, which also
will be available at AMN Healthcare’s investor relations website.
Interested parties may participate live via telephone by
registering at this conference call link. Please follow the link
and register with a valid e-mail address. A PIN will be provided to
you with dial-in instructions. If you lose track of these details,
please re-register at the conference call link above.
About AMN Healthcare
AMN Healthcare is the leader and innovator in
total talent solutions for healthcare organizations across the
United States. The Company provides access to the most
comprehensive network of quality healthcare professionals through
its innovative recruitment strategies and breadth of career
opportunities. With insights and expertise, AMN Healthcare helps
providers optimize their workforce to successfully reduce
complexity, increase efficiency and improve patient outcomes. AMN
total talent solutions include managed services programs, clinical
and interim healthcare leaders, temporary staffing, direct higher
and retained search solutions, vendor management systems,
recruitment process outsourcing, predictive modeling, language
interpretation services, revenue cycle solutions, credentialing,
and other services. Clients include acute-care hospitals, community
health centers and clinics, physician practice groups, retail and
urgent care centers, home health facilities, schools, and many
other healthcare settings. AMN Healthcare is committed to fostering
and maintaining a diverse team that reflects the communities we
serve. Our commitment to the inclusion of many different
backgrounds, experiences and perspectives enables our innovation
and leadership in the healthcare services industry.The Company’s
common stock is listed on the New York Stock Exchange under the
symbol “AMN.” For more information about AMN Healthcare, visit
www.amnhealthcare.com, where the Company posts news releases,
investor presentations, webcasts, SEC filings and other material
information. The Company also utilizes email alerts and Really
Simple Syndication (“RSS”) as routine channels to supplement
distribution of this information. To register for email alerts and
RSS, visit http://ir.amnhealthcare.com.
Non-GAAP Measures
This earnings release and the non-GAAP
reconciliation tables included with the earnings release contain
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, (3) adjusted net
income, and (4) 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, adjusted EBITDA margin, adjusted net income, and adjusted
diluted EPS serve as industry-wide financial measures. The Company
uses adjusted EBITDA for making financial decisions, allocating
resources and for determining certain incentive compensation
objectives. The non-GAAP measures in this release are not in
accordance with, or an alternative to, GAAP measures and may be
different from non-GAAP measures, or may be calculated differently
than other similarly titled 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 “Non-GAAP Reconciliation Tables” under
the caption entitled “Reconciliation of Non-GAAP Items” and the
footnotes thereto or on the Company’s website at
https://ir.amnhealthcare.com/financials/quarterly-results/default.aspx.
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. Forward-looking statements include, among
others, statements concerning our capital deployment strategy, the
potential for acquisitions or stock repurchases, healthcare
utilization, the duration and severity of the labor shortage, and
the demand and supply imbalance of healthcare professionals, our
position in technology-enabled total talent solutions, our ability
to offer attractive work opportunities, our ability to develop new
technology that will speed our operations, better integrate us with
clients, or deliver tools that give clients and healthcare
professionals more control and flexibility, our branding
initiatives and their ability to add momentum to our sales pipeline
and/or increase candidate traffic and applications, our ability to
integrate MSDR and the results of such acquisition and integration,
demand for our services, and our outlook for 2024 consolidated
revenue, gross margin, SG&A expenses as a percentage of
revenue, operating margin, adjusted EBITDA margin, first quarter
year-over-year revenue performance for each of our Nurse and
Allied, Physician and Leadership, and Technology and Workforce
Solutions reporting segments, depreciation expense, stock-based
compensation expense, interest expense, integration and other
expenses, adjusted tax rate, amortization expense and weighted
average diluted shares. In addition, the financial results set
forth in this press release reflect the Company's current
preliminary financial results prior to completion of the Company's
audit process and are subject to change. The Company bases 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.
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. Actual
results could differ materially from those discussed in, or implied
by, these forward-looking statements as a result of a variety of
factors, including consummating and incorporating acquisitions into
our business, complying with extensive federal and state
regulations related to the conduct of our operations, and
continuing to recruit and retain sufficient quality healthcare
professionals at reasonable costs.
The targets and expectations noted in this
release depend upon, among other factors, (i) the magnitude and
duration of the effects of the COVID-19 pandemic on demand trends,
our business, its financial condition and our results of
operations, (ii) the duration of the period that hospitals and
other healthcare entities decrease their utilization of temporary
employees, physicians, leaders and other workforce technology
applications as a result of the suspension of or restrictions
placed on non-essential and elective healthcare as a result of the
COVID-19 pandemic, (iii) the duration of the period that
individuals may continue to forego non-essential and elective
healthcare as “safer at home” restrictions and recommendations
lift, (iv) the extent to which the extent and duration challenging
economic times will cause an increase in under- and uninsured
patients and a corresponding reduction in overall healthcare
utilization and demand for our services, (v) our ability to
effectively address client demand by attracting and placing nurses
and other clinicians, (vi) our ability to anticipate and quickly
respond to changing marketplace conditions, such as alternative
modes of healthcare delivery, reimbursement, or client needs, (vii)
our ability to manage the pricing impact that the COVID-19 pandemic
and consolidation of healthcare delivery organizations may have on
our business, (viii) the extent to which challenging economic times
will have on the financial condition and cash flow of many
hospitals and healthcare systems such that it impairs their ability
to make payments to us, timely or otherwise, for services rendered,
(ix) our ability to recruit and retain sufficient quality
healthcare professionals at reasonable costs (x) our ability to
develop and evolve our current technology offerings and
capabilities and implement new infrastructure and technology
systems to optimize our operating results and manage our business
effectively, (xiii) our ability to comply with extensive and
complex federal and state laws and regulations related to the
conduct of our operations, costs and payment for services and
payment for referrals as well as laws regarding employment
practices, and (xi) our ability to consummate and effectively
incorporate acquisitions into our business.
For a discussion of additional risk factors and
a more complete discussion of some of the cautionary statements
noted above that could cause actual results to differ from those
implied by the forward-looking statements contained in this press
release, please refer to “Risk Factors” under Item 1A of our most
recent Annual Report on Form 10-K for the year ended
December 31, 2022, our subsequent Quarterly Reports on Form
10-Q and our Current Reports on Form 8-K. Be advised that
developments subsequent to this press release are likely to cause
these statements to become outdated and the Company is under no
obligation (and expressly disclaims any such obligation) to update
or revise any forward-looking statements whether as a result of new
information, future events, or otherwise.
Contact:Randle ReeceSenior
Director, Investor Relations 866.861.3229
AMN Healthcare Services, Inc.Condensed
Consolidated Statements of Comprehensive Income(in
thousands, except per share
amounts)(unaudited) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
Sept 30, |
|
December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
818,269 |
|
|
$ |
1,125,511 |
|
|
$ |
853,463 |
|
|
$ |
3,789,254 |
|
|
$ |
5,243,242 |
|
Cost of
revenue |
|
557,321 |
|
|
|
750,258 |
|
|
|
563,957 |
|
|
|
2,539,673 |
|
|
|
3,526,558 |
|
Gross
profit |
|
260,948 |
|
|
|
375,253 |
|
|
|
289,506 |
|
|
|
1,249,581 |
|
|
|
1,716,684 |
|
Gross
margin |
|
31.9 |
% |
|
|
33.3 |
% |
|
|
33.9 |
% |
|
|
33.0 |
% |
|
|
32.7 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
Selling,
general and administrative (SG&A) |
|
185,463 |
|
|
|
219,148 |
|
|
|
163,405 |
|
|
|
756,238 |
|
|
|
936,576 |
|
SG&A as a % of revenue |
|
22.7 |
% |
|
|
19.5 |
% |
|
|
19.1 |
% |
|
|
20.0 |
% |
|
|
17.9 |
% |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization (exclusive of depreciation included
in cost of revenue) |
|
41,315 |
|
|
|
36,838 |
|
|
|
39,175 |
|
|
|
154,914 |
|
|
|
133,007 |
|
Total
operating expenses |
|
226,778 |
|
|
|
255,986 |
|
|
|
202,580 |
|
|
|
911,152 |
|
|
|
1,069,583 |
|
Income
from operations |
|
34,170 |
|
|
|
119,267 |
|
|
|
86,926 |
|
|
|
338,429 |
|
|
|
647,101 |
|
Operating margin (1) |
|
4.2 |
% |
|
|
10.6 |
% |
|
|
10.2 |
% |
|
|
8.9 |
% |
|
|
12.3 |
% |
|
|
|
|
|
|
|
|
|
|
Interest
expense, net, and other (2) |
|
20,165 |
|
|
|
11,768 |
|
|
|
11,541 |
|
|
|
54,140 |
|
|
|
40,398 |
|
|
|
|
|
|
|
|
|
|
|
Income
before income taxes |
|
14,005 |
|
|
|
107,499 |
|
|
|
75,385 |
|
|
|
284,289 |
|
|
|
606,703 |
|
|
|
|
|
|
|
|
|
|
|
Income
tax expense |
|
1,516 |
|
|
|
25,702 |
|
|
|
22,211 |
|
|
|
73,610 |
|
|
|
162,653 |
|
Net
income |
$ |
12,489 |
|
|
$ |
81,797 |
|
|
$ |
53,174 |
|
|
$ |
210,679 |
|
|
$ |
444,050 |
|
Net
income as a % of revenue |
|
1.5 |
% |
|
|
7.3 |
% |
|
|
6.2 |
% |
|
|
5.6 |
% |
|
|
8.5 |
% |
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss): |
|
|
|
|
|
|
|
|
|
Unrealized gains (losses) on available-for-sale securities, net,
and other |
|
187 |
|
|
|
150 |
|
|
|
133 |
|
|
|
516 |
|
|
|
(644 |
) |
Other
comprehensive income (loss) |
|
187 |
|
|
|
150 |
|
|
|
133 |
|
|
|
516 |
|
|
|
(644 |
) |
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
$ |
12,676 |
|
|
$ |
81,947 |
|
|
$ |
53,307 |
|
|
$ |
211,195 |
|
|
$ |
443,406 |
|
|
|
|
|
|
|
|
|
|
|
Net income per common share |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.33 |
|
|
$ |
1.89 |
|
|
$ |
1.39 |
|
|
$ |
5.38 |
|
|
$ |
9.96 |
|
Diluted |
$ |
0.33 |
|
|
$ |
1.88 |
|
|
$ |
1.39 |
|
|
$ |
5.36 |
|
|
$ |
9.90 |
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
38,063 |
|
|
|
43,211 |
|
|
|
38,147 |
|
|
|
39,173 |
|
|
|
44,591 |
|
Diluted |
|
38,167 |
|
|
|
43,470 |
|
|
|
38,325 |
|
|
|
39,341 |
|
|
|
44,870 |
|
|
|
|
|
|
|
|
|
|
|
AMN Healthcare Services, Inc.Condensed
Consolidated Balance Sheets(dollars in
thousands)(unaudited) |
|
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
Assets |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
32,935 |
|
$ |
29,377 |
|
$ |
64,524 |
|
Accounts receivable, net |
|
623,488 |
|
|
565,724 |
|
|
675,650 |
|
Accounts receivable, subcontractor |
|
117,703 |
|
|
175,976 |
|
|
268,726 |
|
Prepaid and other current assets |
|
67,559 |
|
|
60,043 |
|
|
84,745 |
|
Total current assets |
|
841,685 |
|
|
831,120 |
|
|
1,093,645 |
|
Restricted cash, cash equivalents
and investments |
|
68,845 |
|
|
69,995 |
|
|
61,218 |
|
Fixed assets, net |
|
191,385 |
|
|
187,557 |
|
|
149,276 |
|
Other assets |
|
236,796 |
|
|
220,512 |
|
|
172,016 |
|
Goodwill |
|
1,111,549 |
|
|
935,779 |
|
|
935,364 |
|
Intangible assets, net |
|
474,134 |
|
|
409,803 |
|
|
476,832 |
|
Total assets |
$ |
2,924,394 |
|
$ |
2,654,766 |
|
$ |
2,888,351 |
|
|
|
|
|
|
|
Liabilities and stockholders’
equity |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable and accrued expenses |
$ |
343,847 |
|
$ |
362,907 |
|
$ |
476,452 |
|
Accrued compensation and benefits |
|
278,536 |
|
|
263,697 |
|
|
333,244 |
|
Other current liabilities |
|
33,738 |
|
|
80,522 |
|
|
48,237 |
|
Total current liabilities |
|
656,121 |
|
|
707,126 |
|
|
857,933 |
|
|
|
|
|
|
|
Revolving credit facility |
|
460,000 |
|
|
95,000 |
|
|
— |
|
Notes payable, net |
|
844,688 |
|
|
844,393 |
|
|
843,505 |
|
Deferred income taxes, net |
|
23,350 |
|
|
31,296 |
|
|
22,713 |
|
Other long-term liabilities |
|
108,979 |
|
|
159,782 |
|
|
120,566 |
|
Total liabilities |
|
2,093,138 |
|
|
1,837,597 |
|
|
1,844,717 |
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
831,256 |
|
|
817,169 |
|
|
1,043,634 |
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity |
$ |
2,924,394 |
|
$ |
2,654,766 |
|
$ |
2,888,351 |
|
|
|
|
|
|
|
AMN Healthcare Services, Inc.Summary
Condensed Consolidated Statements of Cash
Flows(dollars in
thousands)(unaudited) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
Sept 30, |
|
December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
Net cash
provided by (used in) operating activities |
$ |
(41,130 |
) |
|
$ |
115,328 |
|
|
$ |
172,194 |
|
|
$ |
372,165 |
|
|
$ |
653,733 |
|
Net cash
used in investing activities |
|
(323,731 |
) |
|
|
(22,643 |
) |
|
|
(33,903 |
) |
|
|
(412,493 |
) |
|
|
(170,710 |
) |
Net cash
provided by (used in) financing activities |
|
363,495 |
|
|
|
(176,342 |
) |
|
|
(105,022 |
) |
|
|
10,729 |
|
|
|
(591,865 |
) |
Net
increase (decrease) in cash, cash equivalents and restricted
cash |
|
(1,366 |
) |
|
|
(83,657 |
) |
|
|
33,269 |
|
|
|
(29,599 |
) |
|
|
(108,842 |
) |
Cash,
cash equivalents and restricted cash at beginning of period |
|
109,639 |
|
|
|
221,529 |
|
|
|
76,370 |
|
|
|
137,872 |
|
|
|
246,714 |
|
Cash,
cash equivalents and restricted cash at end of period |
$ |
108,273 |
|
|
$ |
137,872 |
|
|
$ |
109,639 |
|
|
$ |
108,273 |
|
|
$ |
137,872 |
|
|
AMN Healthcare Services, Inc.Non-GAAP
Reconciliation Tables(dollars in thousands, except
per share data)(unaudited) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
Sept 30, |
|
December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of Non-GAAP Items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
12,489 |
|
|
$ |
81,797 |
|
|
$ |
53,174 |
|
|
$ |
210,679 |
|
|
$ |
444,050 |
|
Income
tax expense |
|
1,516 |
|
|
|
25,702 |
|
|
|
22,211 |
|
|
|
73,610 |
|
|
|
162,653 |
|
Income
before income taxes |
|
14,005 |
|
|
|
107,499 |
|
|
|
75,385 |
|
|
|
284,289 |
|
|
|
606,703 |
|
Interest
expense, net, and other (2) |
|
20,165 |
|
|
|
11,768 |
|
|
|
11,541 |
|
|
|
54,140 |
|
|
|
40,398 |
|
Income from operations |
|
34,170 |
|
|
|
119,267 |
|
|
|
86,926 |
|
|
|
338,429 |
|
|
|
647,101 |
|
Depreciation and amortization |
|
41,315 |
|
|
|
36,838 |
|
|
|
39,175 |
|
|
|
154,914 |
|
|
|
133,007 |
|
Depreciation (included in cost of revenue) (3) |
|
1,817 |
|
|
|
1,186 |
|
|
|
1,552 |
|
|
|
6,013 |
|
|
|
4,104 |
|
Share-based compensation |
|
2,578 |
|
|
|
5,396 |
|
|
|
306 |
|
|
|
18,020 |
|
|
|
30,066 |
|
Acquisition, integration, and
other costs (4) |
|
24,124 |
|
|
|
11,877 |
|
|
|
5,771 |
|
|
|
40,740 |
|
|
|
32,409 |
|
Legal settlement accrual
changes (5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
21,000 |
|
|
|
— |
|
Adjusted
EBITDA (6) |
$ |
104,004 |
|
|
$ |
174,564 |
|
|
$ |
133,730 |
|
|
$ |
579,116 |
|
|
$ |
846,687 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA margin
(7) |
|
12.7 |
% |
|
|
15.5 |
% |
|
|
15.7 |
% |
|
|
15.3 |
% |
|
|
16.1 |
% |
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
12,489 |
|
|
$ |
81,797 |
|
|
$ |
53,174 |
|
|
$ |
210,679 |
|
|
$ |
444,050 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of intangible assets |
|
23,416 |
|
|
|
22,235 |
|
|
|
22,563 |
|
|
|
89,756 |
|
|
|
83,078 |
|
Acquisition, integration, and other costs (4) |
|
24,124 |
|
|
|
11,877 |
|
|
|
5,771 |
|
|
|
40,740 |
|
|
|
32,409 |
|
Legal settlement accrual changes (5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
21,000 |
|
|
|
— |
|
Fair value changes of equity investments and instruments (2) |
|
6,701 |
|
|
|
3,429 |
|
|
|
— |
|
|
|
6,701 |
|
|
|
3,429 |
|
Cumulative effect of change in accounting principle (8) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,974 |
|
|
|
— |
|
Tax effect on above adjustments |
|
(14,103 |
) |
|
|
(9,761 |
) |
|
|
(7,367 |
) |
|
|
(41,905 |
) |
|
|
(30,918 |
) |
Tax effect of COLI fair value changes (9) |
|
(3,446 |
) |
|
|
(1,823 |
) |
|
|
1,227 |
|
|
|
(5,770 |
) |
|
|
4,665 |
|
Excess tax deficiencies (benefits) related to equity awards
(10) |
|
1,174 |
|
|
|
(139 |
) |
|
|
134 |
|
|
|
(1,172 |
) |
|
|
(2,971 |
) |
Adjusted
net income (11) |
$ |
50,355 |
|
|
$ |
107,615 |
|
|
$ |
75,502 |
|
|
$ |
323,003 |
|
|
$ |
533,742 |
|
|
|
|
|
|
|
|
|
|
|
GAAP
diluted net income per share (EPS) |
$ |
0.33 |
|
|
$ |
1.88 |
|
|
$ |
1.39 |
|
|
$ |
5.36 |
|
|
$ |
9.90 |
|
Adjustments |
|
0.99 |
|
|
|
0.60 |
|
|
|
0.58 |
|
|
|
2.85 |
|
|
|
2.00 |
|
Adjusted
diluted EPS (12) |
$ |
1.32 |
|
|
$ |
2.48 |
|
|
$ |
1.97 |
|
|
$ |
8.21 |
|
|
$ |
11.90 |
|
|
AMN Healthcare Services,
Inc.Supplemental Segment Financial and Operating
Data(dollars in thousands, except operating
data)(unaudited) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
Sept 30, |
|
December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
|
|
|
|
|
|
|
|
|
Nurse and allied solutions |
$ |
537,588 |
|
|
$ |
824,619 |
|
|
$ |
573,426 |
|
|
$ |
2,624,509 |
|
|
$ |
3,982,453 |
|
Physician and leadership solutions |
|
168,161 |
|
|
|
167,591 |
|
|
|
159,554 |
|
|
|
669,701 |
|
|
|
697,946 |
|
Technology and workforce solutions |
|
112,520 |
|
|
|
133,301 |
|
|
|
120,483 |
|
|
|
495,044 |
|
|
|
562,843 |
|
|
$ |
818,269 |
|
|
$ |
1,125,511 |
|
|
$ |
853,463 |
|
|
$ |
3,789,254 |
|
|
$ |
5,243,242 |
|
|
|
|
|
|
|
|
|
|
|
Segment
operating income (13) |
|
|
|
|
|
|
|
|
|
Nurse and allied solutions |
$ |
62,838 |
|
|
$ |
105,085 |
|
|
$ |
82,882 |
|
|
$ |
362,158 |
|
|
$ |
576,226 |
|
Physician and leadership solutions |
|
21,801 |
|
|
|
28,051 |
|
|
|
21,609 |
|
|
|
94,966 |
|
|
|
92,331 |
|
Technology and workforce solutions |
|
41,439 |
|
|
|
66,864 |
|
|
|
50,664 |
|
|
|
214,736 |
|
|
|
299,390 |
|
|
|
126,078 |
|
|
|
200,000 |
|
|
|
155,155 |
|
|
|
671,860 |
|
|
|
967,947 |
|
Unallocated corporate overhead (14) |
|
22,074 |
|
|
|
25,436 |
|
|
|
21,425 |
|
|
|
92,744 |
|
|
|
121,260 |
|
Adjusted EBITDA (6) |
$ |
104,004 |
|
|
$ |
174,564 |
|
|
$ |
133,730 |
|
|
$ |
579,116 |
|
|
$ |
846,687 |
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin |
|
|
|
|
|
|
|
|
|
Nurse and allied solutions |
|
25.5 |
% |
|
|
26.6 |
% |
|
|
27.5 |
% |
|
|
26.4 |
% |
|
|
26.3 |
% |
Physician and leadership solutions |
|
33.3 |
% |
|
|
35.0 |
% |
|
|
33.4 |
% |
|
|
34.3 |
% |
|
|
34.5 |
% |
Technology and workforce solutions |
|
60.5 |
% |
|
|
73.3 |
% |
|
|
65.0 |
% |
|
|
66.2 |
% |
|
|
76.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Data: |
|
|
|
|
|
|
|
|
|
Nurse
and allied solutions |
|
|
|
|
|
|
|
|
|
Average travelers on assignment (15) |
|
11,869 |
|
|
|
15,183 |
|
|
|
11,990 |
|
|
|
13,144 |
|
|
|
15,859 |
|
|
|
|
|
|
|
|
|
|
|
Physician and leadership solutions |
|
|
|
|
|
|
|
|
|
Days filled (16) |
|
49,645 |
|
|
|
45,801 |
|
|
|
45,981 |
|
|
|
192,502 |
|
|
|
196,351 |
|
Revenue per day filled (17) |
$ |
2,491 |
|
|
$ |
2,259 |
|
|
$ |
2,447 |
|
|
$ |
2,415 |
|
|
$ |
2,180 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
September 30, |
|
|
|
|
|
2023 |
|
2022 |
|
2023 |
Leverage ratio (18) |
|
|
|
|
2.2 |
|
1.0 |
|
1.4 |
AMN Healthcare Services, Inc.Additional
Supplemental Non-GAAP DisclosuresReconciliation of
Guidance Operating Margin toGuidance Adjusted
EBITDA Margin(unaudited) |
|
|
|
Three Months Ended |
|
|
|
March 31, 2024 |
|
|
|
|
|
|
|
Low(19) |
|
High(19) |
|
|
|
|
|
|
|
|
Operating margin |
4.2 |
% |
|
4.9 |
% |
|
|
Depreciation and amortization (total) |
5.4 |
% |
|
5.3 |
% |
|
|
EBITDA margin |
9.6 |
% |
|
10.2 |
% |
|
|
Share-based compensation |
0.9 |
% |
|
0.8 |
% |
|
|
Acquisition, integration, and other costs |
0.7 |
% |
|
0.7 |
% |
|
|
Adjusted EBITDA margin |
11.2 |
% |
|
11.7 |
% |
|
(1) |
Operating margin represents income from operations divided by
revenue. |
(2) |
Changes in the fair value of
equity investments and instruments are recognized in interest
expense, net, and other. Since the changes in fair value are
unrelated to the Company’s operating performance, we exclude the
impact from the calculation of adjusted net income and adjusted
diluted EPS. |
(3) |
A portion of depreciation expense
for AMN Language Services is included in cost of revenue. We
exclude the impact of depreciation included in cost of revenue from
the calculation of adjusted EBITDA. |
(4) |
Acquisition, integration, and
other costs include acquisition and integration costs, net changes
in the fair value of contingent consideration liabilities for
recently acquired companies, certain legal expenses, restructuring
expenses and other costs associated with exit or disposal
activities, and certain nonrecurring expenses, which we exclude
from the calculation of adjusted EBITDA, adjusted net income, and
adjusted diluted EPS because we believe that these expenses are not
indicative of the Company’s operating performance. For the three
and twelve months ended December 31, 2023, acquisition and
integration costs were approximately $10.4 million and
$13.7 million, respectively, expenses related to the closures
of certain office leases were approximately $1.1 million and
$4.8 million, respectively, certain legal expenses were
approximately $(0.1) million and $2.1 million,
respectively, restructuring expenses and other costs associated
with exit or disposal activities were approximately
$10.2 million and $13.9 million, respectively, and other
nonrecurring expenses were approximately $2.5 million and
$3.7 million, respectively. Additionally, acquisition,
integration, and other costs for the twelve month ended December
31, 2023 included increases in contingent consideration liabilities
for recently acquired companies of approximately $2.4 million.
For the three and twelve months ended December 31, 2022,
acquisition and integration costs were approximately
$1.4 million and $4.4 million, respectively, expenses
related to the closures of certain office leases were approximately
$2.6 million and $15.3 million, respectively, certain
legal expenses were approximately $9.0 million and
$13.8 million, respectively, and other nonrecurring expenses
were approximately $0.6 million and $1.8 million,
respectively. Additionally, the aforementioned costs for the three
and twelve months ended December 31, 2022 were partially offset by
net decreases in contingent consideration liabilities for recently
acquired companies of approximately $1.7 million and
$2.9 million, respectively. |
(5) |
During the three months ended
June 30, 2023, the Company recorded an increase to its legal
accrual for a wage and hour claim in connection with reaching an
agreement to settle the matter in its entirety. Since the
settlement is largely unrelated to the Company’s operating
performance for the year ended December 31, 2023, we excluded its
impact in the calculations of adjusted EBITDA, adjusted net income,
and adjusted diluted EPS. |
(6) |
Adjusted EBITDA represents net
income plus interest expense (net of interest income) and other,
income tax expense (benefit), depreciation and amortization,
depreciation (included in cost of revenue), acquisition,
integration, and other costs, restructuring expenses, certain legal
expenses, and share-based compensation. Management believes that
adjusted EBITDA provides an effective measure of the Company’s
results, as it excludes certain items that management believes are
not indicative of the Company’s operating performance. Adjusted
EBITDA is not intended to represent cash flows for the period, nor
has it been presented as an alternative to income from operations
or net income as an indicator of operating performance. Although
management believes that some of the items excluded from adjusted
EBITDA are not indicative of the Company’s operating performance,
these items do impact the statement of comprehensive income, and
management therefore utilizes adjusted EBITDA as an operating
performance measure in conjunction with GAAP measures such as net
income. |
(7) |
Adjusted EBITDA margin represents
adjusted EBITDA divided by revenue. |
(8) |
As a result of a change in
accounting principle on January 1, 2023 related to forfeitures of
share-based awards, the Company recognized the cumulative effect of
the change in share-based compensation expense during the three
months ended March 31, 2023. The cumulative effect of the change in
accounting principle is immaterial to prior periods and, therefore,
was recognized in the current period. Since the cumulative effect
is unrelated to the Company’s operating performance for the year
ended December 31, 2023, we excluded its impact in the calculation
of adjusted net income and adjusted diluted EPS. |
(9) |
The Company records net tax
expense (benefit) related to the income tax treatment of the fair
value changes in the cash surrender value of its company owned life
insurance. Since this change in fair value is unrelated to the
Company’s operating performance, we excluded the impact on adjusted
net income and adjusted diluted EPS. |
(10) |
The consolidated effective tax
rate is affected by the recording of excess tax benefits and tax
deficiencies relating to equity awards vested during the period. As
a result of the adoption of a new accounting pronouncement on
January 1, 2017, the Company no longer records excess tax benefits
and tax deficiencies to additional paid-in capital, but such excess
tax benefits and tax deficiencies are now recognized in income tax
expense. The magnitude of the impact of excess tax benefits and tax
deficiencies generated in the future, which may be favorable or
unfavorable, is dependent upon the Company’s future grants of
share-based compensation and the Company’s future stock price on
the date awards vest in relation to the fair value of the awards on
the grant date. Since these excess tax benefits and tax
deficiencies are largely unrelated to our income before taxes and
are unrepresentative of our normal effective tax rate, we excluded
their impact in the calculation of adjusted net income and adjusted
diluted EPS. |
(11) |
Adjusted net income represents
GAAP net income excluding the impact of the (A) amortization of
intangible assets, (B) acquisition, integration, and other costs,
(C) certain legal expenses, (D) changes in fair value of equity
investments and instruments, (E) deferred financing related costs,
(F) tax effect, if any, of the foregoing adjustments, (G) excess
tax benefits and tax deficiencies relating to equity awards vested
and exercised since January 1, 2017, (H) net tax expense (benefit)
related to the income tax treatment of fair value changes in the
cash surrender value of its company owned life insurance, and (I)
restructuring tax benefits. Management included this non-GAAP
measure to provide investors and prospective investors with an
alternative method for assessing the Company’s operating results in
a manner that is focused on its operating performance and to
provide a more consistent basis for comparison between periods.
However, investors and prospective investors should note that this
non-GAAP measure involves judgment by management (in particular,
judgment as to what is classified as a special item to be excluded
in the calculation of adjusted net income). Although management
believes the items in the calculation of adjusted net income are
not indicative of the Company’s operating performance, these items
do impact the statement of comprehensive income, and management
therefore utilizes adjusted net income as an operating performance
measure in conjunction with GAAP measures such as GAAP net
income. |
(12) |
Adjusted diluted EPS represents
adjusted net income divided by diluted weighted average common
shares outstanding. Management included this non-GAAP measure to
provide investors and prospective investors with an alternative
method for assessing the Company’s operating results in a manner
that is focused on its operating performance and to provide a more
consistent basis for comparison between periods. However, investors
and prospective investors should note that this non-GAAP measure
involves judgment by management (in particular, judgment as to what
is classified as a special item to be excluded in the calculation
of adjusted net income). Although management believes the items in
the calculation of adjusted net income are not indicative of the
Company’s operating performance, these items do impact the
statement of comprehensive income, and management therefore
utilizes adjusted diluted EPS as an operating performance measure
in conjunction with GAAP measures such as GAAP diluted EPS. |
(13) |
Segment operating income
represents net income plus interest expense (net of interest
income) and other, income tax expense, depreciation and
amortization, depreciation (included in cost of revenue),
unallocated corporate overhead, acquisition, integration, and other
costs, and share-based compensation. |
(14) |
Unallocated corporate overhead
(as presented in the tables above) consists of unallocated
corporate overhead (as reflected in our quarterly and annual
financial statements filed with the SEC) less acquisition,
integration, and other costs and legal settlement accrual
changes. |
(15) |
Average travelers on assignment
represents the average number of nurse and allied healthcare
professionals on assignment during the period presented. |
(16) |
Days filled is calculated by
dividing the locum tenens hours filled during the period by eight
hours. |
(17) |
Revenue per day filled represents
revenue of the Company’s locum tenens business divided by days
filled for the period presented. |
(18) |
Leverage ratio represents the
ratio of the Company’s debt outstanding (including the outstanding
letters of credit collateralized by the senior credit facility)
minus cash and cash equivalents at the end of the subject period to
adjusted EBITDA for the twelve-month period ended at the end of the
subject period. |
(19) |
Guidance percentage metrics are
approximate. |
|
|
AMN Healthcare Services (NYSE:AMN)
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AMN Healthcare Services (NYSE:AMN)
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