AMN Healthcare Announces Second Quarter 2013 Results Reports quarterly revenue of $254 million, up 8% year-over-year

Diluted EPS from continuing operations of $0.18 vs. $0.00 in prior year

SAN DIEGO, Aug. 1, 2013 /PRNewswire/ -- AMN Healthcare Services, Inc. (NYSE: AHS), healthcare's innovator in workforce solutions and staffing services, today announced second quarter 2013 financial results which were in line with the Company's guidance for revenue and exceeded the Company's guidance for adjusted EBITDA. Financial highlights are as follows:

Dollars in millions, except per share amounts.


Q2 2013

% Change

Q2 2012

YTD June 30, 2013

% Change

YTD June 30, 2012*

Revenue

$253.9

8%

$506.1

9%

Gross profit

$74.4

11%

$147.4

13%

Net income

$8.4

NM

$16.0

373%

Diluted EPS

$0.18

NM

$0.33

371%

Adjusted EBITDA**

$21.3

17%

$42.4

19%

Percentage change in this column excludes the impact of the discontinued operations associated with the disposal of the Home Healthcare Services segment in January 2012.

**

See "Non-GAAP Measures" below for a discussion of our use of non-GAAP items and the table entitled "Supplemental Financial and Operating Data" for a reconciliation of non-GAAP items.

NM - Not meaningful

  • Second quarter consolidated revenue increased 8% year-over-year with growth across all business segments
  • On a segment basis, second quarter revenue was up year-over-year by 7% in Nurse and Allied Healthcare Staffing, 8% in Locum Tenens Staffing, and 16% in Physician Permanent Placement Services
  • Second quarter consolidated gross margin of 29.3% was higher year-over-year by 90 basis points
  • Adjusted EBITDA margin in the second quarter of 8.4% reflected a year-over-year improvement of 70 basis points
  • Cash flow from operations in the second quarter was $19 million, enabling the Company to further reduce its long-term debt and lower its leverage ratio to 2.1 to 1 as of June 30, 2013.

"AMN's solid execution in the second quarter resulted in year-over-year growth in revenue and gross margin across all business segments. We are particularly pleased with the improvements achieved in our Locum Tenens business and the very strong growth in Physician Permanent Placement. The benefit of our MSP leadership position enabled our Nurse and Allied segment to perform well, despite lower hospital census and a softer demand environment," said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. "We continue to make good progress in AMN's key strategic initiatives such as investments in innovative recruitment technologies, expansion of our workforce solutions offerings, and technology infrastructure improvements to create a better client experience and enable more efficient delivery of our services."    

Second Quarter 2013 Results

For the second quarter of 2013, consolidated revenue was $254 million, an increase of 8% from the same quarter last year and 1% sequentially. Second quarter revenue for the Nurse and Allied Healthcare Staffing segment was $170 million, up 7% from the same quarter last year and down 4% sequentially. Locum Tenens Staffing segment revenue in the second quarter was $73 million, an increase of 8% from the same quarter last year and 11% sequentially. Second quarter Physician Permanent Placement Services segment revenue was $11 million, an increase of 16% from the same quarter last year and 12% sequentially.

Second quarter gross margin of 29.3% was higher by 90 basis points than the same quarter last year and higher by 30 basis points sequentially. The year-over-year increase was due to gross margin improvement in all business segments. The sequential increase was due primarily to gross margin improvement in the Locum Tenens Staffing segment and faster growth in our higher gross margin Physician Permanent Placement Services segment.

SG&A expenses for the second quarter were $55 million, representing 21.5% of revenue, compared to 21.3% of revenue in both the prior year and prior quarter.

Second quarter adjusted EBITDA grew 17% year-over-year to $21 million. Adjusted EBITDA margin of 8.4% represented a 70 basis points increase over prior year and was driven by the improvement in gross margin. Second quarter net income was $8 million and net income per diluted share was $0.18

As of June 30, 2013, cash and cash equivalents totaled $11 million and total debt outstanding, net of discount, was $154 million, with a leverage ratio of 2.1 to 1. Second quarter cash flow from operations was $19 million and capital expenditures were $3 million.

Business Trends and Outlook

The Company expects third quarter consolidated revenue to be between $253 million and $257 million, representing year-over-year revenue growth of 4% to 5%. Gross margin is expected to be 29.0% to 29.5%. SG&A expenses as a percentage of revenue are expected to be approximately 21.5%. Adjusted EBITDA margin is expected to be approximately 8.0%.

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 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 largest network of quality clinicians and physicians through its innovative recruitment strategies and breadth of career opportunities.  Clients include acute-care hospitals, government facilities, community health centers and clinics, physician practice groups and many other healthcare settings. For more information, visit www.amnhealthcare.com.

Conference Call on August 1, 2013

AMN Healthcare Services, Inc.'s second quarter 2013 conference call will be held on Thursday, August 1, 2013, 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) 230-1059 in the U.S. or (612) 234-9959 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 also be available at 7:30 p.m. Eastern Time on August 1, 2013, and can be accessed until 11:59 p.m. Eastern Time on August 15, 2013, by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 296808.

Non-GAAP Measures

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 consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures include (1) adjusted EBITDA, and (2) adjusted EBITDA margin.  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 2013 third 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, 2012 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.

Contact:
Amy C. Chang
Vice President, Investor Relations
866.861.3229


AMN Healthcare Services, Inc.


Condensed Consolidated Statements of Comprehensive Income (Loss)


(in thousands, except per share amounts)


(unaudited)











Three Months Ended


Six Months Ended



June 30,


March 31,


June 30,



2013

2012


2013


2013

2012


Revenue

$     253,943

$     235,786


$     252,120


$     506,063

$     462,198


Cost of revenue

179,530

168,813


179,113


358,643

332,011


Gross profit

74,413

66,973


73,007


147,420

130,187



29.3%

28.4%


29.0%


29.1%

28.2%


Operating expenses:









Selling, general and administrative

54,551

50,304


53,607


108,158

97,480












21.5%

21.3%


21.3%


21.4%

21.1%


Depreciation and amortization

3,240

3,552


3,290


6,530

7,247


Total operating expenses

57,791

53,856


56,897


114,688

104,727


Income from operations

16,622

13,117


16,110


32,732

25,460











Interest expense, net

3,130

13,590


2,859


5,989

19,123


Income (loss) from continuing operations before income taxes

 

13,492

 

(473)


 

13,251


 

26,743

 

6,337


Income tax expense (benefit)

5,093

(392)


5,688


10,781

2,965


Income (loss) from continuing operations

 

8,399

 

(81)


 

7,563


 

15,962

 

3,372


Income from discontinued operations, net of tax

 

0

 

0


 

0


 

0

 

823


Net income (loss)

$         8,399

$            (81)


$         7,563


$       15,962

$         4,195











Basic income (loss) per common share from:









Continuing operations

$           0.18

$           0.00


$           0.17


$           0.35

$           0.07


Discontinued operations

0.00

0.00


0.00


0.00

0.02


Net income (loss)

$           0.18

$           0.00


$           0.17


$           0.35

$           0.09











Diluted income (loss) per common share from:









Continuing operations

$           0.18

$           0.00


$           0.16


$           0.33

$           0.07


Discontinued operations

0.00

0.00


0.00


0.00

0.02


Net income (loss)

$           0.18

$           0.00


$           0.16


$           0.33

$           0.09











Weighted average common shares outstanding:









Basic

46,039

40,810


45,813


45,927

40,695


Diluted

47,837

40,810


47,679


47,759

46,317











Other comprehensive income (loss) – foreign currency translation

(28)

33


93


65

(10)


Comprehensive income (loss)

$         8,371

$            (48)


$         7,656


$       16,027

$         4,185



















 



AMN Healthcare Services, Inc.


Supplemental Financial and Operating Data


(dollars in thousands, except operating data)


(unaudited)

















Three Months Ended


Six Months Ended


June  30,


March 31,


June 30,



2013


2012



2013



2013


2012

Revenue













  Nurse and allied healthcare staffing

$

170,138

$

158,615


$

176,765


$

346,903

$

312,501

  Locum tenens staffing


72,708


67,592



65,456



138,164


131,101

  Physician permanent placement services


11,097


9,579



9,899



20,996


18,596


$

253,943

$

235,786


$

252,120


$

506,063

$

462,198














Reconciliation of Non-GAAP Items:


























Segment operating income(1)













  Nurse and allied healthcare staffing

$

20,128

$

18,444


$

22,474


$

42,602

$

35,521

  Locum tenens staffing


4,908


6,091



4,892



9,800


10,507

  Physician permanent placement services


2,289


1,890



2,241



4,530


3,596



27,325


26,425



29,607



56,932


49,624

   Unallocated corporate overhead


5,985


8,179



8,505



14,490


13,911

Adjusted EBITDA(2)


21,340


18,246



21,102



42,442


35,713

Adjusted EBITDA margin(3)


8.4%


7.7%



8.4%



8.4%


7.7%














Depreciation and amortization


3,240


3,552



3,290



6,530


7,247

Share-based compensation


1,478


1,577



1,702



3,180


3,006

Interest expense, net


3,130


13,590



2,859



5,989


19,123

Income (loss) from continuing operations before income taxes


13,492


(473)



13,251



26,743


6,337

Income tax expense (benefit)  


5,093


(392)



5,688



10,781


2,965

Net income (loss) from continuing operations


8,399


(81)



7,563



15,962


3,372

Net income from discontinued operations


0


0



0



0


823

Net income (loss)

$

8,399

$

(81)


$

7,563


$

15,962

$

4,195
















































 















Three Months Ended



Six Months Ended



June 30,



March 31,



June 30,



2013


2012



2013



2013


2012

Gross Margin













   Nurse and allied healthcare staffing


27.2%


26.7%



27.5%



27.4%


26.6%

   Locum tenens staffing


29.0%


27.9%



27.9%



28.5%


27.5%

   Physician permanent placement services


62.7%


59.9%



62.6%



62.6%


59.7%














Operating Data:













Nurse and allied healthcare staffing













    Average clinicians on assignment (4)


5,924


5,592



6,215



6,070


5,518

    Revenue per clinician per day(5)

$

315.61

$

311.70


$

316.02


$

315.75

$

311.20

    Gross profit per clinician per day(5)

$

85.96

$

83.32


$

86.80


$

86.37

$

82.66














Locum tenens  staffing













    Days filled (6)


50,127


46,752



45,357



95,484


92,742

    Revenue per day filled(6)

$

1,450.48

$

1,445.76


$

1,443.11


$

1,446.99

$

1,413.61

    Gross profit per day filled(6)

$

421.35

$

402.84


$

402.62


$

412.45

$

388.99



























As of June 30


As of March 31,






2013


2012



2013





Leverage ratio (7)


2.1


3.1



2.3



























(1)

Segment operating income represents net income (loss) plus interest expense (net of interest income), income tax expense (benefit), depreciation and amortization, unallocated corporate overhead, share-based compensation expense, and net income from discontinued operations, net of tax.

(2)

Adjusted EBITDA represents net income (loss) plus interest expense (net of interest income), income tax expense (benefit), depreciation and amortization, share-based compensation expense and net income from discontinued operations, net of tax. 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 and considers measures used in credit facilities. 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 (loss) 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 (loss), and management therefore utilizes adjusted EBITDA as an operating performance measure in conjunction with GAAP measures such as net income (loss).

(3)

Adjusted EBITDA margin represents adjusted EBITDA divided by revenue.

(4)

Average clinicians on assignment represents the average number of nurse and allied healthcare professionals on assignment during the period presented.

(5)

Revenue per clinician per day and gross profit per clinician per day represent the revenue and gross profit of the Company's nurse and allied healthcare staffing segment divided by average clinicians on assignment, divided by the number of days in the period presented.

(6)

 Days filled is calculated by dividing the locum tenens hours filled during the period by eight hours. Revenue per day filled and gross profit per day filled represent revenue and gross profit of the Company's locum tenens staffing segment divided by days filled for the period presented.

(7)

Leverage ratio represents the ratio of the consolidated funded indebtedness (as calculated per the Company's credit agreement) at the end of the period to the consolidated adjusted EBITDA for the last twelve months.

 



AMN Healthcare Services, Inc.

Condensed Consolidated Balance Sheets

(dollars in thousands)

(unaudited)








June 30,


March 31,


December 31,


2013


2013


2012

Assets






Current assets:






Cash and cash equivalents

$         10,519


$           1,939


$           5,681

Accounts receivable, net

149,798


156,750


142,510

Accounts receivable, subcontractor

15,728


19,332


18,467

Deferred income taxes, net

18,683


17,794


18,123

Prepaid and other current assets

15,502


21,399


18,963

Total current assets

210,230


217,214


203,744

Restricted cash, cash equivalents and investments

20,960


18,801


18,861

Fixed assets, net

16,826


15,336


14,815

Deposits and other assets

22,536


21,186


19,732

Goodwill

123,324


123,324


123,324

Intangible assets, net

133,708


135,304


136,910







Total assets

$       527,584


$       531,165


$       517,386







Liabilities and stockholders' equity






Current liabilities:






Accounts payable and accrued expenses

52,374


56,721


52,619

Accrued compensation and benefits

46,871


49,393


49,443

Revolving credit facility

0


1,000


0

Current portion of notes payable

5,000


0


0

Other current liabilities

6,924


7,056


7,463

    Total current liabilities

111,169


114,170


109,525







Notes payable, less current portion and discount

148,524


158,246


158,178

Other long-term liabilities

69,967


67,279


67,572

Total liabilities

329,660


339,695


335,275







Commitments and contingencies












Stockholders' equity

197,924


191,470


182,111







Total liabilities and stockholders' equity

$       527,584


$       531,165


$       517,386







 

AMN Healthcare Services, Inc.

Condensed Consolidated Statements of Cash Flows

(dollars in thousands)

(unaudited)











Three Months Ended


Six Months Ended



June 30,


March 31


June 30,



2013

2012


2013


2013

2012











Net cash provided by (used in) operating activities

$       19,221

$       20,997


$       (2,699)


$       16,522

$       30,550











Net cash (used in) provided by investing activities

(3,142)

(1,031)


(2,155)


(5,297)

6,321











Net cash (used in) provided by financing activities

(7,471)

(9,402)


1,019


(6,452)

(25,325)











Effect of exchange rates on cash

(28)

33


93


65

(10)











Net increase (decrease) in cash and cash equivalents

8,580

10,597


(3,742)


4,838

11,536











Cash and cash equivalents at beginning of period

 

1,939

 

4,901


 

5,681


 

5,681

 

3,962











Cash and cash equivalents at end of period

 

$       10,519

 

$       15,498


 

$         1,939


 

$       10,519

 

$       15,498











 

 

SOURCE AMN Healthcare Services, Inc.



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