8-K
Acadia Healthcare Company, Inc. (ACHC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
______________________________
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): October 28, 2021
______________________________
Acadia Healthcare Company, Inc.
(Exact Name of Registrant as Specified in Its Charter)
| Delaware | 001-35331 | 45-2492228 |
|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| 6100 Tower Circle,<br> Suite 1000<br><br> <br>Franklin, Tennessee<br><br> <br>(Address of Principal Executive Offices) | 37067<br><br> <br>(Zip Code) | |
| --- | --- |
(615) 861-6000
(Registrant’s Telephone Number, including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | ACHC | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| Emerging growth company ☐ | |
|---|---|
| If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with<br> any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
| --- | --- |
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On October 28, 2021, Acadia Healthcare Company, Inc. (“Acadia”) issued a press release announcing, among other things, Acadia’s operating and financial results for the third quarter ended September 30, 2021. The press release is furnished herewith as Exhibit 99 hereto and is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
|---|---|
| (d) | Exhibits. |
| 99 | Press Release of Acadia Healthcare Company, Inc., dated October 28, 2021. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ACADIA HEALTHCARE COMPANY, INC. | |||
|---|---|---|---|
| Date: October 28, 2021 | By: | /s/ Christopher L. Howard | |
| Christopher L. Howard | |||
| Executive Vice President and General Counsel |
Exhibit 99
Acadia Healthcare Reports Third Quarter 2021 Results
Same Facility Revenue Grows 7.9%
FRANKLIN, Tenn.--(BUSINESS WIRE)--October 28, 2021--Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced financial results for the third quarter ended September 30, 2021.
Third Quarter 2021 Results
The Company reported revenue of $587.6 million for the third quarter of 2021, compared with $548.0 million for the third quarter of 2020. Adjusted EBITDA was $141.9 million for the third quarter of 2021, compared with $116.0 million for the same period last year. Results for the third quarter of 2020 included a reversal of the $18.1 million in other income that had been recorded in the second quarter of 2020 related to the Provider Relief Fund established by the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. Net income attributable to Acadia stockholders for the third quarter of 2021 was $66.1 million, or $0.73 per diluted share, compared to net income of $37.0 million, or $0.42 per diluted share, for the third quarter of 2020. Adjusted income from continuing operations attributable to Acadia stockholders was $0.72 per diluted share for the third quarter of 2021. Adjustments to income include transaction-related expenses, debt extinguishment costs, loss on impairment and the income tax effect of adjustments to income. A reconciliation of all non-GAAP financial results in this press release begins on page 9.
For the third quarter of 2021, Acadia’s same facility revenue increased 7.9% compared with the third quarter of 2020, including an increase in revenue per patient day of 5.6% and an increase in patient days of 2.2%. Same facility adjusted EBITDA margin was 29.0%.
Debbie Osteen, Chief Executive Officer of Acadia Healthcare Company, remarked, “We continue to see favorable momentum in our business as demand for our behavioral health services remains strong, especially within our acute and specialty service lines. Our teams faced some challenges during the third quarter related to Hurricane Ida and the surge of the Delta variant of COVID-19. We are extremely proud of them and applaud their dedication and caring for our patients under extraordinary conditions. Above all, the safety of our patients is our top priority, and we remain focused on providing consistent care for those seeking treatment for mental health and substance use issues.
“Our financial results for the third quarter were adversely affected by disruptions from Hurricane Ida in Louisiana, including temporary evacuation of one facility. The hurricane had a negative 0.3% impact on our revenue growth rate and a $0.01 impact on Adjusted EPS. In addition, our facilities in certain markets managed through an elevated level of COVID-19 cases during the third quarter. Despite these challenges, we continued to manage our operations safely and efficiently while maintaining our same high standards of patient care.”
Strategic Investments for Long-Term Growth
“We have made significant progress this year in executing on key strategic initiatives across our service lines as we have continued to make the right investments to support sustained, long-term growth. During the third quarter, we added 104 beds to our operations, bringing our total to 282 bed additions to existing facilities this year. We believe facility expansions offer the highest return on investment for Acadia, and we expect to meet our goal of adding approximately 300 beds to existing facilities by the end of the year.
“We also opened two new comprehensive treatment centers (CTCs) in the third quarter, located in Tennessee and Florida. CTCs are designed to address the growing and critical need for addiction treatment, especially for patients dealing with opioid use disorder. Through the end of the third quarter, we have opened five CTCs and expect to open six additional CTCs in underserved markets by the end of 2021.
“Forming strategic partnerships with leading healthcare systems across the country has been another important pathway for growth for Acadia. With the growing recognition and acceptance of behavioral health services driving demand, established providers are looking for ways to leverage their market presence and provide more treatment options in the communities they serve. We are proud of our 13 partnerships across the country, and we are excited about the opportunities to expand our reach into more communities. During the third quarter, we broke ground on new facilities with two of our JV partners – Geisinger and Lutheran Health Network of Indiana.
“Our success to date in 2021 confirms the strength of our operating model and our ability to execute our strategy. Looking ahead, we will continue to expand our network and serve more patients through our four distinct pathways for growth – bed expansions, wholly owned de novo facilities, strategic joint ventures and acquisitions,” added Osteen.
Cash and Liquidity
Acadia’s balance sheet remains strong with ample liquidity and capital to support its growth strategy. As of September 30, 2021, the Company had $196.3 million in cash and cash equivalents. During the third quarter, the Company repaid $25 million on its senior secured revolving credit facility, reducing the outstanding balance to $100 million as of September 30, 2021. The Company had $500 million available under its $600 million revolving credit facility as of September 30, 2021, and its net leverage ratio was approximately 2.2x.
During the third quarter, the Company continued its repayment of amounts received pursuant to the Medicare Accelerated and Advanced Payment Program under the CARES Act. In the third quarter of 2021, the Company repaid $10 million of the $45 million of advance payments received in 2020 under the Medicare Accelerated and Advanced Payment Program and will continue to repay the remaining balance on a monthly basis through September 2022. Also in the third quarter of 2021, the Company repaid half of the approximately $39 million of 2020 payroll tax deferrals with the remaining portion to be paid in 2022.
Financial Guidance
Acadia today narrowed its financial guidance for 2021, within previously announced ranges, as follows:
- Revenue in a range of $2.295 billion to $2.315 billion;
- Adjusted EBITDA in a range of $537 million to $547 million;
- Adjusted earnings per diluted share in a range of $2.51 to $2.59, which reflects a revised estimate of stock compensation expense for the fourth quarter of 2021 in a range of $11 million to $13 million;
- Operating cash flows in a range of $290 million to $325 million; and
- Total capital expenditures in a range of $210 million to $230 million, which includes approximately $45 million for maintenance capital expenditures.
The Company’s guidance does not include the impact of any future acquisitions or transaction-related expenses.
Looking Ahead
“We are excited about the opportunities ahead for Acadia, as we focus on our primary objective to expand our market reach and support more patients with safe and quality care. We are especially pleased to see the growing acceptance and additional funding support for mental health and substance abuse issues. We have a unique opportunity to capitalize on these promising trends and meet the critical and growing demand for behavioral health services. Importantly, we have the capital structure to support our strategic growth initiatives and further enhance our position as the leading pure-play behavioral healthcare provider,” concluded Osteen.
Acadia will hold a conference call to discuss its third quarter financial results at 9:00 a.m. Eastern Time on Friday, October 29, 2021. A live webcast of the conference call will be available at www.acadiahealthcare.com in the “Investors” section of the website. The webcast of the conference call will be available for 30 days.
About Acadia
Acadia is a leading provider of behavioral healthcare services across the United States. As of September 30, 2021, Acadia operated a network of 230 behavioral healthcare facilities with approximately 10,200 beds in 40 states and Puerto Rico. With more than 20,000 employees serving approximately 70,000 patients daily, Acadia is the largest stand-alone behavioral health company in the U.S. Acadia provides behavioral healthcare services to its patients in a variety of settings, including inpatient psychiatric hospitals, specialty treatment facilities, residential treatment centers and outpatient clinics.
Forward-Looking Information
This press release contains forward-looking statements. Generally, words such as “may,” “will,” “should,” “could,” “anticipate,” “expect,” “intend,” “estimate,” “plan,” “continue,” and “believe” or the negative of or other variation on these and other similar expressions identify forward-looking statements. These forward-looking statements are made only as of the date of this press release. We do not undertake to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are based on current expectations and involve risks and uncertainties and our future results could differ significantly from those expressed or implied by our forward-looking statements. Factors that may cause actual results to differ materially include, without limitation, (i) the impact of the COVID-19 pandemic, including, without limitation, disruption to the U.S. economy and financial markets; reduced admissions and patient volumes; increased costs relating to labor, supply chain and other expenditures; and difficulty in collecting patient accounts receivable due to increases in the unemployment rate and the number of underinsured and uninsured patients; (ii) the impact of vaccine and other pandemic-related mandates imposed by local, state and federal authorities; (iii) potential difficulties in successfully integrating the operations of acquired facilities or realizing the expected benefits and synergies of our acquisitions, joint ventures and de novo transactions; (iv) Acadia’s ability to add beds, expand services, enhance marketing programs and improve efficiencies at its facilities; (v) potential reductions in payments received by Acadia from government and third-party payors; (vi) the occurrence of patient incidents, governmental investigations, litigation and adverse regulatory actions, which could adversely affect the price of our common stock and result in substantial payments and incremental regulatory burdens; (vii) the risk that Acadia may not generate sufficient cash from operations to service its debt and meet its working capital and capital expenditure requirements; and (viii) potential operating difficulties, labor costs, client preferences, changes in competition and general economic or industry conditions that may prevent Acadia from realizing the expected benefits of its business strategies. These factors and others are more fully described in Acadia’s periodic reports and other filings with the SEC.
| Acadia Healthcare Company, Inc. | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Condensed Consolidated Statements of Operations | |||||||||||
| (Unaudited) | |||||||||||
| Nine Months Ended September 30, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||
| Revenue | 587,559 | $ | 547,961 | $ | 1,720,914 | $ | 1,548,653 | ||||
| Salaries, wages and benefits (including equity-based compensation expense of<br> 8,923, 5,471, 24,988 and 16,258, respectively) | 309,118 | 290,619 | 922,684 | 852,864 | |||||||
| Professional fees | 35,602 | 29,372 | 101,915 | 91,009 | |||||||
| Supplies | 23,743 | 21,773 | 67,698 | 65,028 | |||||||
| Rents and leases | 9,658 | 9,365 | 28,690 | 27,975 | |||||||
| Other operating expenses | 76,502 | 68,213 | 222,263 | 202,540 | |||||||
| Other income | - | 18,070 | - | - | |||||||
| Depreciation and amortization | 27,805 | 24,132 | 78,349 | 70,298 | |||||||
| Interest expense, net | 15,706 | 37,315 | 61,420 | 118,398 | |||||||
| Debt extinguishment costs | - | - | 24,650 | 3,271 | |||||||
| Loss on impairment | 1,079 | - | 24,293 | - | |||||||
| Transaction-related expenses | 3,035 | 3,024 | 9,320 | 9,558 | |||||||
| Total expenses | 502,248 | 501,883 | 1,541,282 | 1,440,941 | |||||||
| Income from continuing operations before income taxes | 85,311 | 46,078 | 179,632 | 107,712 | |||||||
| Provision for income taxes | 17,411 | 9,191 | 42,948 | 24,174 | |||||||
| Income from continuing operations | 67,900 | 36,887 | 136,684 | 83,538 | |||||||
| Income (loss) from discontinued operations, net of taxes | - | 674 | (12,641 | ) | 29,804 | ||||||
| Net income | 67,900 | 37,561 | 124,043 | 113,342 | |||||||
| Net income attributable to noncontrolling interests | (1,774 | ) | (563 | ) | (3,686 | ) | (1,802 | ) | |||
| Net income attributable to Acadia Healthcare Company, Inc. | 66,126 | $ | 36,998 | $ | 120,357 | $ | 111,540 | ||||
| Basic earnings per share attributable to Acadia Healthcare Company, Inc.<br> stockholders: | |||||||||||
| Income from continuing operations attributable to Acadia Healthcare<br> Company, Inc. | 0.74 | $ | 0.41 | $ | 1.50 | $ | 0.93 | ||||
| Income (loss) from discontinued operations | - | $ | 0.01 | $ | (0.14 | ) | $ | 0.34 | |||
| Net income attributable to Acadia Healthcare Company, Inc. | 0.74 | $ | 0.42 | $ | 1.36 | $ | 1.27 | ||||
| Diluted earnings per share attributable to Acadia Healthcare Company, Inc.<br> stockholders: | |||||||||||
| Income from continuing operations attributable to Acadia Healthcare<br> Company, Inc. | 0.73 | $ | 0.41 | $ | 1.47 | $ | 0.92 | ||||
| Income (loss) from discontinued operations | - | $ | 0.01 | $ | (0.14 | ) | $ | 0.34 | |||
| Net income attributable to Acadia Healthcare Company, Inc. | 0.73 | $ | 0.42 | $ | 1.33 | $ | 1.26 | ||||
| Weighted-average shares outstanding: | |||||||||||
| Basic | 88,962 | 87,911 | 88,684 | 87,849 | |||||||
| Diluted | 90,889 | 88,856 | 90,604 | 88,449 |
All values are in US Dollars.
| Acadia Healthcare Company, Inc. | ||||||
|---|---|---|---|---|---|---|
| Condensed Consolidated Balance Sheets | ||||||
| (Unaudited) | ||||||
| September 30, | December 31, | |||||
| 2021 | 2020 | |||||
| (In thousands) | ||||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 196,313 | $ | 378,697 | ||
| Accounts receivable, net | 282,161 | 273,551 | ||||
| Other current assets | 88,685 | 61,332 | ||||
| Current assets held for sale | - | 1,809,815 | ||||
| Total current assets | 567,159 | 2,523,395 | ||||
| Property and equipment, net | 1,665,025 | 1,622,896 | ||||
| Goodwill | 2,103,503 | 2,105,264 | ||||
| Intangible assets, net | 69,366 | 68,535 | ||||
| Deferred tax assets | 3,112 | 3,209 | ||||
| Operating lease right-of-use assets | 103,162 | 96,937 | ||||
| Other assets | 83,400 | 79,126 | ||||
| Total assets | $ | 4,594,727 | $ | 6,499,362 | ||
| LIABILITIES AND EQUITY | ||||||
| Current liabilities: | ||||||
| Current portion of long-term debt | $ | 15,938 | $ | 153,478 | ||
| Accounts payable | 85,924 | 87,815 | ||||
| Accrued salaries and benefits | 124,164 | 124,912 | ||||
| Current portion of operating lease liabilities | 20,062 | 18,916 | ||||
| Other accrued liabilities | 157,204 | 178,453 | ||||
| Derivative instrument liabilities | - | 84,584 | ||||
| Current liabilities held for sale | - | 660,027 | ||||
| Total current liabilities | 403,292 | 1,308,185 | ||||
| Long-term debt | 1,413,407 | 2,968,948 | ||||
| Deferred tax liabilities | 73,673 | 50,017 | ||||
| Operating lease liabilities | 89,952 | 84,029 | ||||
| Other liabilities | 117,883 | 133,412 | ||||
| Total liabilities | 2,098,207 | 4,544,591 | ||||
| Redeemable noncontrolling interests | 62,074 | 55,315 | ||||
| Equity: | ||||||
| Common stock | 890 | 880 | ||||
| Additional paid-in capital | 2,623,585 | 2,580,327 | ||||
| Accumulated other comprehensive loss | - | (371,365 | ) | |||
| Accumulated deficit | (190,029 | ) | (310,386 | ) | ||
| Total equity | 2,434,446 | 1,899,456 | ||||
| Total liabilities and equity | $ | 4,594,727 | $ | 6,499,362 |
| Acadia Healthcare Company, Inc. | ||||||
|---|---|---|---|---|---|---|
| Condensed Consolidated Statements of Cash Flows | ||||||
| (Unaudited) | ||||||
| Nine Months Ended September 30, | ||||||
| 2021 | 2020 | |||||
| (In thousands) | ||||||
| Operating activities: | ||||||
| Net income | $ | 124,043 | $ | 113,342 | ||
| Adjustments to reconcile net income to net cash provided by continuing operating activities: | ||||||
| Depreciation and amortization | 78,349 | 70,298 | ||||
| Amortization of debt issuance costs | 3,265 | 9,696 | ||||
| Equity-based compensation expense | 24,988 | 16,258 | ||||
| Deferred income taxes | 8,995 | 45,105 | ||||
| Loss (income) from discontinued operations, net of taxes | 12,641 | (29,804 | ) | |||
| Debt extinguishment costs | 24,650 | 3,271 | ||||
| Loss on impairment | 24,293 | - | ||||
| Other | 881 | 1,024 | ||||
| Change in operating assets and liabilities: | ||||||
| Accounts receivable, net | (8,610 | ) | 7,364 | |||
| Other current assets | (2,758 | ) | (4,942 | ) | ||
| Other assets | (15,846 | ) | (880 | ) | ||
| Accounts payable and other accrued liabilities | 6,358 | 19,854 | ||||
| Accrued salaries and benefits | 18,820 | 14,150 | ||||
| Other liabilities | (11,633 | ) | (2,256 | ) | ||
| Government relief funds | (12,058 | ) | 103,908 | |||
| Net cash provided by continuing operating activities | 276,378 | 366,388 | ||||
| Net cash provided by discontinued operating activities | 253 | 105,852 | ||||
| Net cash provided by operating activities | 276,631 | 472,240 | ||||
| Investing activities: | ||||||
| Cash paid for capital expenditures | (156,624 | ) | (168,804 | ) | ||
| Proceeds from U.K. Sale | 1,511,020 | - | ||||
| Settlement of foreign currency derivatives | (84,795 | ) | - | |||
| Proceeds from sale of property and equipment | 1,792 | 72 | ||||
| Cash paid for purchase of finance lease | (31,401 | ) | - | |||
| Other | 4,906 | (10,734 | ) | |||
| Net cash provided by (used in) continuing investing activities | 1,244,898 | (179,466 | ) | |||
| Net cash used in discontinued investing activities | - | (30,188 | ) | |||
| Net cash provided by (used in) investing activities | 1,244,898 | (209,654 | ) | |||
| Financing activities: | ||||||
| Borrowings on long-term debt | 425,000 | 450,000 | ||||
| Borrowings on revolving credit facility | 430,000 | 100,000 | ||||
| Principal payments on revolving credit facility | (330,000 | ) | (100,000 | ) | ||
| Principal payments on long-term debt | (5,313 | ) | (31,863 | ) | ||
| Repayment of long-term debt | (2,227,935 | ) | (450,000 | ) | ||
| Payment of debt issuance costs | (7,964 | ) | (11,220 | ) | ||
| Common stock withheld for minimum statutory taxes, net | 16,072 | (1,311 | ) | |||
| Distributions to noncontrolling interests | (926 | ) | (653 | ) | ||
| Other | (6,914 | ) | (1,291 | ) | ||
| Net cash used in continuing financing activities | (1,707,980 | ) | (46,338 | ) | ||
| Net cash used in discontinued financing activities | - | (2,226 | ) | |||
| Net cash used in financing activities | (1,707,980 | ) | (48,564 | ) | ||
| Effect of exchange rate changes on cash | 4,067 | 488 | ||||
| Net (decrease) increase in cash and cash equivalents, including cash classified within<br><br> current assets held for sale | (182,384 | ) | 214,510 | |||
| Less: cash classified within current assets held for sale | - | (50,568 | ) | |||
| Net (decrease) increase in cash and cash equivalents | (182,384 | ) | 163,942 | |||
| Cash and cash equivalents at beginning of the period | 378,697 | 124,192 | ||||
| Cash and cash equivalents at end of the period | $ | 196,313 | $ | 288,134 |
| Acadia Healthcare Company, Inc. | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating Statistics | |||||||||||||||||
| (Unaudited, Revenue in thousands) | |||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
| 2021 | 2020 | % Change | 2021 | 2020 | % Change | ||||||||||||
| U.S. Same Facility Results ^(1)^ | |||||||||||||||||
| Revenue | $ | 586,420 | $ | 543,402 | 7.9 | % | $ | 1,708,389 | $ | 1,539,923 | 10.9 | % | |||||
| Patient Days | 699,344 | 684,326 | 2.2 | % | 2,075,197 | 1,979,267 | 4.8 | % | |||||||||
| Admissions | 45,070 | 44,781 | 0.6 | % | 135,377 | 129,234 | 4.8 | % | |||||||||
| Average Length of Stay ^(2)^ | 15.5 | 15.3 | 1.5 | % | 15.3 | 15.3 | 0.1 | % | |||||||||
| Revenue per Patient Day | $ | 839 | $ | 794 | 5.6 | % | $ | 823 | $ | 778 | 5.8 | % | |||||
| Adjusted EBITDA margin | 29.0 | % | 25.4 | % | 360 bps | 28.3 | % | 25.5 | % | 280 bps | |||||||
| U.S. Facility Results | |||||||||||||||||
| Revenue | $ | 587,559 | $ | 547,961 | 7.2 | % | $ | 1,720,914 | $ | 1,548,653 | 11.1 | % | |||||
| Patient Days | 701,352 | 689,402 | 1.7 | % | 2,088,477 | 1,995,922 | 4.6 | % | |||||||||
| Admissions | 45,246 | 44,877 | 0.8 | % | 136,384 | 129,638 | 5.2 | % | |||||||||
| Average Length of Stay^(2)^ | 15.5 | 15.4 | 0.9 | % | 15.3 | 15.4 | -0.5 | % | |||||||||
| Revenue per Patient Day | $ | 838 | $ | 795 | 5.4 | % | $ | 824 | $ | 776 | 6.2 | % | |||||
| Adjusted EBITDA margin | 28.3 | % | 25.3 | % | 300 bps | 27.7 | % | 25.4 | % | 230 bps | |||||||
| ^(1)^ Same facility results for the periods presented include facilities we have operated for more than one year and exclude certain<br> closed services. | |||||||||||||||||
| --- | |||||||||||||||||
| ^(2)^Average length of stay is defined as patient days divided by admissions. |
| Acadia Healthcare Company, Inc. | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reconciliation of Net Income Attributable to Acadia Healthcare Company, Inc. to Adjusted EBITDA | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| (in thousands) | ||||||||||||
| Net income attributable to Acadia Healthcare Company, Inc. | $ | 66,126 | $ | 36,998 | $ | 120,357 | $ | 111,540 | ||||
| Net income attributable to noncontrolling interests | 1,774 | 563 | 3,686 | 1,802 | ||||||||
| (Income) loss from discontinued operations, net of taxes | - | (674 | ) | 12,641 | (29,804 | ) | ||||||
| Provision for income taxes | 17,411 | 9,191 | 42,948 | 24,174 | ||||||||
| Interest expense, net | 15,706 | 37,315 | 61,420 | 118,398 | ||||||||
| Depreciation and amortization | 27,805 | 24,132 | 78,349 | 70,298 | ||||||||
| EBITDA | 128,822 | 107,525 | 319,401 | 296,408 | ||||||||
| Adjustments: | ||||||||||||
| Equity-based compensation expense (a) | 8,923 | 5,471 | 24,988 | 16,258 | ||||||||
| Transaction-related expenses (b) | 3,035 | 3,024 | 9,320 | 9,558 | ||||||||
| Debt extinguishment costs (c) | - | - | 24,650 | 3,271 | ||||||||
| Loss on impairment (d) | 1,079 | - | 24,293 | - | ||||||||
| Adjusted EBITDA | $ | 141,859 | $ | 116,020 | $ | 402,652 | $ | 325,495 | ||||
| Adjusted EBITDA margin | 24.1 | % | 21.2 | % | 23.4 | % | 21.0 | % | ||||
| See footnotes on page 12. |
| Acadia Healthcare Company, Inc. | ||||||
|---|---|---|---|---|---|---|
| Reconciliation of Net Income Attributable to Acadia Healthcare Company, Inc. to | ||||||
| Adjusted Income Attributable to Acadia Healthcare Company, Inc. | ||||||
| (Unaudited) | ||||||
| Three Months Ended September 30, 2021 | Nine Months Ended September 30, 2021 | |||||
| (in thousands, except per share amounts) | ||||||
| Net income attributable to Acadia Healthcare Company, Inc. | $ | 66,126 | $ | 120,357 | ||
| Loss from discontinued operations, net of taxes | - | 12,641 | ||||
| Adjustments to income: | ||||||
| Transaction-related expenses (b) | 3,035 | 9,320 | ||||
| Debt extinguishment costs (c) | - | 24,650 | ||||
| Loss on impairment (d) | 1,079 | 24,293 | ||||
| Provision for income taxes | 17,411 | 42,948 | ||||
| Adjusted income from continuing operations before income taxes attributable to<br><br> Acadia Healthcare Company, Inc. | 87,651 | 234,209 | ||||
| Income tax effect of adjustments to income (e) | 22,508 | 62,709 | ||||
| Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. | $ | 65,143 | $ | 171,500 | ||
| Weighted-average shares outstanding - diluted | 90,889 | 90,604 | ||||
| Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc.<br><br> per diluted share | $ | 0.72 | $ | 1.89 | ||
| Three Months Ended September 30, 2020 | Nine Months Ended September 30, 2020 | |||||
| (in thousands, except per share amounts) | ||||||
| Net income attributable to Acadia Healthcare Company, Inc. | $ | 36,998 | $ | 111,540 | ||
| Income from discontinued operations, net of taxes | (674 | ) | (29,804 | ) | ||
| Adjustments to income: | ||||||
| Transaction-related expenses (b) | 3,024 | 9,558 | ||||
| Debt extinguishment costs (c) | - | 3,271 | ||||
| Provision for income taxes | 9,191 | 24,174 | ||||
| Adjusted income from continuing operations before income taxes attributable to<br><br> Acadia Healthcare Company, Inc. | 48,539 | 118,739 | ||||
| Adjusted income from discontinued operations before income taxes | 24,367 | 54,775 | ||||
| Adjusted income before income taxes attributable to Acadia Healthcare Company, Inc. | 72,906 | 173,514 | ||||
| Income tax effect of adjustments to income (e) | 12,562 | 28,372 | ||||
| Adjusted income attributable to Acadia Healthcare Company, Inc. | $ | 60,344 | $ | 145,142 | ||
| Weighted-average shares outstanding - diluted | 88,856 | 88,449 | ||||
| Adjusted income attributable to Acadia Healthcare Company, Inc. per diluted share ^(3)^ | $ | 0.68 | $ | 1.64 | ||
| ^(3)^ For the three and nine months ended September 30, 2020, Adjusted income attributable to Acadia Healthcare Company, Inc. per diluted share includes Adjusted<br> income from discontinued operations before income taxes and is not directly comparable to Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. per diluted share for the three and nine months ended<br> September 30, 2021. Interest expense, which has been significantly reduced following debt repayments in the first quarter of 2021, is recorded in income from continuing operations and not allocated to discontinued operations because<br> such allocation would not be meaningful. Therefore, 2020 reflects consolidated results inclusive of discontinued operations, and 2021 reflects only continuing operations. | ||||||
| --- | ||||||
| See footnotes on page 12. |
| Acadia Healthcare Company, Inc. | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Discontinued Operations Supplemental Financial Information | |||||||||||
| (Unaudited) | |||||||||||
| Statements of Discontinued Operations | |||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||
| (in thousands) | |||||||||||
| Revenue | $ | - | $ | 285,343 | $ | 62,520 | $ | 817,772 | |||
| Salaries, wages and benefits | - | 159,840 | 35,937 | 465,514 | |||||||
| Professional fees | - | 31,987 | 6,815 | 92,264 | |||||||
| Supplies | - | 9,434 | 2,217 | 28,274 | |||||||
| Rents and leases | - | 11,817 | 2,509 | 34,858 | |||||||
| Other operating expenses | - | 28,880 | 6,682 | 85,682 | |||||||
| Depreciation and amortization | - | 18,780 | - | 55,739 | |||||||
| Interest expense, net | - | 238 | 10 | 666 | |||||||
| Loss on sale | - | - | 14,254 | - | |||||||
| Loss on impairment | - | 20,239 | - | 20,239 | |||||||
| Transaction-related expenses | - | 5,479 | 6,265 | 7,735 | |||||||
| Total expenses | - | 286,694 | 74,689 | 790,971 | |||||||
| (Loss) income from discontinued operations before income taxes | - | (1,351 | ) | (12,169 | ) | 26,801 | |||||
| (Benefit from) provision for income taxes | - | (2,025 | ) | 472 | (3,003 | ) | |||||
| Income (loss) from discontinued operations, net of taxes | - | 674 | (12,641 | ) | 29,804 | ||||||
| Reconciliation of Income (Loss) from Discontinued Operations to Adjusted Income from Discontinued Operations before Income Taxes | |||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||
| (in thousands) | |||||||||||
| Income (loss) from discontinued operations, net of taxes | $ | - | $ | 674 | $ | (12,641 | ) | $ | 29,804 | ||
| Adjustments to income: | |||||||||||
| Transaction-related expenses (b) | - | 5,479 | 6,265 | 7,735 | |||||||
| Loss on sale (f) | - | - | 14,254 | - | |||||||
| Loss on impairment (g) | - | 20,239 | - | 20,239 | |||||||
| Provision for (benefit from) income taxes | - | (2,025 | ) | 472 | (3,003 | ) | |||||
| Adjusted income from discontinued operations before income taxes | $ | - | $ | 24,367 | $ | 8,350 | $ | 54,775 | |||
| See footnotes on page 12. |
| Acadia Healthcare Company, Inc. |
|---|
| Footnotes |
| We have included certain financial measures in this press release, including EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted income from continuing<br> operations before income taxes attributable to Acadia Healthcare Company, Inc., Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc., Adjusted income from discontinued operations before income taxes<br> and Adjusted income attributable to Acadia Healthcare Company, Inc., which are “non-GAAP financial measures” as defined under the rules and regulations promulgated by the SEC. |
| We define EBITDA as net income adjusted for net income attributable to noncontrolling interests, loss (income) from discontinued operations, net of taxes, provision<br> for income taxes, net interest expense and depreciation and amortization. We define Adjusted EBITDA as EBITDA adjusted for equity-based compensation expense, transaction-related expenses, debt extinguishment costs and loss on impairment.<br> We define Adjusted EBITDA margin as Adjusted EBITDA divided by revenue. We define Adjusted income from continuing operations before income taxes attributable to Acadia Healthcare Company, Inc. as net income adjusted for loss from<br> discontinued operations, net of taxes, transaction-related expenses, debt extinguishment costs, loss on impairment and provision for income taxes. We define Adjusted income from continuing operations attributable to Acadia Healthcare<br> Company, Inc. as net income attributable to Acadia Healthcare Company, Inc. adjusted for loss from discontinued operations, net of taxes, transaction-related expenses, debt extinguishment costs, loss on impairment, provision for income<br> taxes and income tax effect of adjustments to income. We define Adjusted income from discontinued operations before income taxes as (loss) income from discontinued operations, net of taxes, adjusted for transaction-related expenses, loss<br> on sale, loss on impairment and provision for (benefit from) income taxes. |
| We define Adjusted income attributable to Acadia Healthcare Company, Inc. as the sum of Adjusted income from continuing operations before income taxes attributable<br> to Acadia Healthcare Company, Inc., Adjusted income from discontinued operations before income taxes and income tax effect of adjustments to income. |
| The non-GAAP financial measures presented herein are supplemental measures of our performance and are not required by, or presented in accordance with, generally<br> accepted accounting principles in the United States (“GAAP”). The non-GAAP financial measures presented herein are not measures of our financial performance under GAAP and should not be considered as alternatives to net income or any<br> other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as measures of our liquidity. Our measurements of these non-GAAP financial measures may not be comparable to similarly<br> titled measures of other companies. We have included information concerning the non-GAAP financial measures in this press release because we believe that such information is used by certain investors as measures of a company’s historical<br> performance. We believe these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of issuers of equity securities, many of which present similar non-GAAP financial measures when<br> reporting their results. Because the non-GAAP financial measures are not measurements determined in accordance with GAAP and are thus susceptible to varying calculations, the non-GAAP financial measures, as presented, may not be<br> comparable to other similarly titled measures of other companies. Our presentation of these non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. |
| (a) Represents the equity-based compensation expense of Acadia. |
| (b) Represents transaction-related expenses incurred by Acadia primarily related to termination, restructuring, strategic review, acquisition and other similar<br> costs. |
| (c) Represents debt extinguishment costs recorded during the first quarter of 2021 in connection with the redemption of the 5.625% Senior Notes and 6.500% Senior<br> Notes and the termination of the Prior Credit Facility and during the second quarter of 2020 in connection with the redemption of the 6.125% Senior Notes and 5.125% Senior Notes. |
| (d) The Company opened a 260-bed replacement hospital in Pennsylvania and recorded a non-cash property impairment charge of $23.2 million for the existing facility<br> during the second quarter of 2021. Additionally, during the third quarter of 2021, the Company recorded a $1.1 million non-cash property impairment charge for one facility in Louisiana resulting from hurricane damage. |
| (e) Represents the income tax effect of adjustments to income based on tax rates of 25.7% and 17.2% for the three months ended September 30, 2021 and 2020,<br> respectively, and 26.8% and 16.4% for the nine months ended September 30, 2021 and 2020, respectively. During the three and nine months ended September 30, 2021, the Company recorded a tax benefit of $0.2 million and $1.9 million,<br> respectively, from ASU 2016-09 “Improvements to Employee Share-Based Payment Accounting”. During the three and nine months ended September 30, 2021, the Company recorded a tax benefit of $3.1 million related to the release of a valuation<br> allowance placed on capital gains for certain facilities disposed of in prior periods. Both tax benefits were excluded from the adjusted tax provision for the three and nine months ended September 30, 2021. |
| (f) Represents the adjustments to the loss on sale recorded in connection with the sale of our U.K. operations in January 2021 to reflect an increase in the U.K.<br> carrying value. |
| (g) For the three and nine months ended September 30, 2020, represents a non-cash lease impairment charge of $16.4 million and a non-cash long-lived asset<br> impairment charge of $3.8 million related to the decision to close certain U.K. elderly care facilities. |
Contacts
Gretchen Hommrich
Director, Investor Relations
\(615\) 861-6000