AMN Healthcare Announces Fourth Quarter and Full Year 2023 Results
- Significant tech advancements and a large MSP client win in Q4 2023.
- Recognition for workplace diversity by Newsweek.
- Decrease in net income and diluted EPS due to lower revenue.
- Acquisition of MSDR boosted locum tenens revenue.
- SG&A expenses decreased year-over-year.
- Outlook for 2024 anticipates lower revenue but higher revenue in Physician and Leadership Solutions.
- Strong cash flow with total debt of $1.31 billion and a net leverage ratio of 2.2 to 1.
- Significant revenue declines in Q4 and full year 2023.
- Decrease in gross margin primarily driven by lower margin in Nurse and Allied Solutions.
- Year-over-year decrease in adjusted EBITDA and adjusted EBITDA margin.
- Cash flow from operations was a use of $41 million for the quarter.
- Consolidated revenue in Q1 2024 projected to be 26-28% lower than the year-ago period.
Insights
The reported quarterly revenue decline of 27% and the full year revenue dip of 28% at AMN Healthcare Services indicate a significant contraction in the company's business operations, particularly within the Nurse and Allied Solutions segment. The gross profit margin contraction and the substantial 85% decrease in net income year over year reflect intense margin pressures and possibly increased operational costs or decreased demand for staffing services.
From a financial perspective, the adjusted EBITDA margin decline is also notable as it suggests that the company's earnings, before interest, taxes, depreciation and amortization, have become less profitable. This could be indicative of a challenging operating environment or inefficiencies that have yet to be addressed. Investors and stakeholders should consider these factors when assessing the company's financial health and future profitability.
Moreover, the acquisition of MSDR and the investment in technology and branding under the One AMN initiative represent strategic moves to diversify and strengthen the company's service offerings. However, the financial benefits of these initiatives will need to be closely monitored to ensure they contribute positively to the bottom line in the long-term.
AMN's reported results reflect a broader trend in the healthcare staffing industry, which is experiencing a cyclical reset in staffing demand. This reset has likely been influenced by the normalization of healthcare services post-pandemic and the adjustment of temporary staffing levels. The company's focus on technology and innovation, specifically through the development of mobile apps and AI-empowered self-service platforms, is a strategic response to the evolving needs of the healthcare industry.
It is also worth noting the positive growth in language services, which contrasts with the overall decline in other segments. This suggests that there are niche areas within the company's portfolio that are expanding, potentially offering avenues for growth amidst broader market challenges. The company's branding and platform consolidation efforts under the One AMN initiative could streamline operations and improve client engagement, but the impact of these changes on sales and revenue growth will require further analysis over subsequent quarters.
The financial results of AMN Healthcare Services reflect underlying economic factors affecting the healthcare staffing industry. The decrease in demand for travel nurses, as indicated by the 40% year-over-year revenue decline in that segment, could be a result of budgetary constraints within healthcare institutions or a shift towards permanent hiring practices. The increase in locum tenens business suggests a continued reliance on temporary physician staffing, which may be due to ongoing shortages in certain medical specialties.
Additionally, the company's capital expenditures of over $100 million indicate a significant investment in growth opportunities, which could either position the company favorably for future market demands or strain financial resources if not managed effectively. The net leverage ratio of 2.2 to 1 is an important metric indicating the company's debt level in relation to its EBITDA and stakeholders should monitor this in relation to industry norms and the company's ability to service its debt.
Quarterly revenue of
GAAP EPS of
DALLAS, Feb. 15, 2024 (GLOBE NEWSWIRE) -- 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 | ( | ( | ||
| Gross profit | ( | ( | ||
| Net income | ( | ( | ||
| Diluted EPS | ( | ( | ||
| Adjusted diluted EPS* | ( | ( | ||
| Adjusted EBITDA* | ( | ( | ||
| * 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
Fourth Quarter 2023 Results
Consolidated revenue for the quarter was
Revenue for the Nurse and Allied Solutions segment was
The Physician and Leadership Solutions segment reported revenue of
Technology and Workforce Solutions segment revenue was
Consolidated gross margin was
SG&A expenses were
Income from operations was
Full Year 2023 Results
Full year 2023 consolidated revenue was
Nurse and Allied Solutions segment revenue was
Full year consolidated gross margin was
Full year consolidated SG&A expenses were
Full year income from operations was
At December 31, 2023, cash and cash equivalents totaled
First Quarter 2024 Outlook
| Metric | Guidance* | ||
| Consolidated revenue | |||
| Gross margin | |||
SG&A as percentage of revenue | |||
| Operating margin | |||
| Adjusted EBITDA margin | |||
| *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
Other first quarter estimates include depreciation expense of
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 Reece
Senior 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 Disclosures Reconciliation of Guidance Operating Margin to Guidance 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 |
| (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. |
FAQ
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