NeueHealth Reports Second Quarter 2024 Results
NeueHealth (NYSE: NEUE) reported solid Q2 2024 results, delivering positive Adjusted EBITDA for the second consecutive quarter. The company reaffirmed its full-year Adjusted EBITDA guidance and expects to reach the high end of its guidance range for consumers served by year-end. Key metrics include:
- Revenue: $225,991,000 (Q2 2024) vs $297,982,000 (Q2 2023)
- Net Loss: $57,698,000 (Q2 2024) vs $88,627,000 (Q2 2023)
- Adjusted EBITDA: $3,962,000 (Q2 2024) vs $7,797,000 (Q2 2023)
For 2024, NeueHealth projects:
- Revenue: ~$950 million
- NeueCare Revenue: ~$320 million
- NeueSolutions Revenue: ~$640 million
- Adjusted EBITDA: $15-25 million
The company continues to focus on advancing its value-driven model and delivering high-quality, consumer-centric care across ACA Marketplace, Medicare, and Medicaid populations.
NeueHealth (NYSE: NEUE) ha riportato risultati solidi per il secondo trimestre del 2024, evidenziando un EBITDA rettificato positivo per il secondo trimestre consecutivo. L'azienda ha confermato le sue previsioni di EBITDA rettificato per l'intero anno e si aspetta di raggiungere il limite superiore delle sue previsioni per il numero di consumatori serviti entro la fine dell'anno. I principali indicatori includono:
- Ricavi: $225,991,000 (Q2 2024) contro $297,982,000 (Q2 2023)
- Perdita netta: $57,698,000 (Q2 2024) contro $88,627,000 (Q2 2023)
- EBITDA rettificato: $3,962,000 (Q2 2024) contro $7,797,000 (Q2 2023)
Per il 2024, NeueHealth prevede:
- Ricavi: ~$950 milioni
- Ricavi di NeueCare: ~$320 milioni
- Ricavi di NeueSolutions: ~$640 milioni
- EBITDA rettificato: $15-25 milioni
L'azienda continua a concentrarsi sull'avanzamento del suo modello orientato al valore e sulla fornitura di assistenza di alta qualità e incentrata sul consumatore tra le popolazioni del Marketplace ACA, Medicare e Medicaid.
NeueHealth (NYSE: NEUE) reportó resultados sólidos para el segundo trimestre de 2024, presentando un EBITDA ajustado positivo por segundo trimestre consecutivo. La empresa reafirmó su guía de EBITDA ajustado para todo el año y espera alcanzar el extremo superior de su rango de guía para los consumidores atendidos para fin de año. Los indicadores clave incluyen:
- Ingresos: $225,991,000 (Q2 2024) frente a $297,982,000 (Q2 2023)
- Pérdida neta: $57,698,000 (Q2 2024) frente a $88,627,000 (Q2 2023)
- EBITDA ajustado: $3,962,000 (Q2 2024) frente a $7,797,000 (Q2 2023)
Para 2024, NeueHealth proyecta:
- Ingresos: ~$950 millones
- Ingresos de NeueCare: ~$320 millones
- Ingresos de NeueSolutions: ~$640 millones
- EBITDA ajustado: $15-25 millones
La empresa sigue enfocándose en avanzar su modelo orientado al valor y en proporcionar atención de alta calidad centrada en el consumidor en las poblaciones del Marketplace de ACA, Medicare y Medicaid.
NeueHealth (NYSE: NEUE)는 2024년 2분기 강력한 실적을 발표하며 두 번째 분기 연속으로 긍정적인 조정된 EBITDA를 기록했습니다. 회사는 연간 조정 EBITDA 가이던스를 재확인했으며 연말까지 소비자 수 기준으로 가이던스 범위의 상한에 도달할 것으로 예상하고 있습니다. 주요 지표는 다음과 같습니다:
- 수익: $225,991,000 (Q2 2024) 대 $297,982,000 (Q2 2023)
- 순손실: $57,698,000 (Q2 2024) 대 $88,627,000 (Q2 2023)
- 조정 EBITDA: $3,962,000 (Q2 2024) 대 $7,797,000 (Q2 2023)
2024년을 위해 NeueHealth는:
- 수익: ~$950 백만
- NeueCare 수익: ~$320 백만
- NeueSolutions 수익: ~$640 백만
- 조정 EBITDA: $15-25 백만
회사는 가치 중심 모델을 발전시키고 ACA 시장, Medicare 및 Medicaid 인구를 대상으로 소비자 중심의 고품질 치료를 제공하는 데 계속 집중하고 있습니다.
NeueHealth (NYSE: NEUE) a rapporté des résultats solides pour le deuxième trimestre 2024, affichant un EBITDA ajusté positif pour le deuxième trimestre consécutif. L'entreprise a réaffirmé ses prévisions d'EBITDA ajusté pour l'année entière et s'attend à atteindre le haut de sa fourchette de prévisions pour le nombre de consommateurs servis d'ici la fin de l'année. Les indicateurs clés comprennent :
- Revenus : 225,991,000 $ (Q2 2024) contre 297,982,000 $ (Q2 2023)
- Perte nette : 57,698,000 $ (Q2 2024) contre 88,627,000 $ (Q2 2023)
- EBITDA ajusté : 3,962,000 $ (Q2 2024) contre 7,797,000 $ (Q2 2023)
Pour 2024, NeueHealth projette :
- Revenus : ~$950 millions
- Revenus de NeueCare : ~$320 millions
- Revenus de NeueSolutions : ~$640 millions
- EBITDA ajusté : 15-25 millions de dollars
L'entreprise continue de se concentrer sur le développement de son modèle axé sur la valeur et sur la fourniture de soins de haute qualité centrés sur le consommateur dans les populations du marché ACA, de Medicare et de Medicaid.
NeueHealth (NYSE: NEUE) berichtete über starke Ergebnisse für das zweite Quartal 2024 und erzielte zum zweiten Mal in Folge ein positives bereinigtes EBITDA. Das Unternehmen bekräftigte seine Prognose für das bereinigte EBITDA für das Gesamtjahr und erwartet, bis zum Jahresende den oberen Bereich seiner Prognose für die bedienten Verbraucher zu erreichen. Wichtige Kennzahlen umfassen:
- Umsatz: $225,991,000 (Q2 2024) gegenüber $297,982,000 (Q2 2023)
- Nettoverlust: $57,698,000 (Q2 2024) gegenüber $88,627,000 (Q2 2023)
- Bereinigtes EBITDA: $3,962,000 (Q2 2024) gegenüber $7,797,000 (Q2 2023)
Für 2024 prognostiziert NeueHealth:
- Umsatz: ~$950 Millionen
- NeueCare Umsatz: ~$320 Millionen
- NeueSolutions Umsatz: ~$640 Millionen
- Bereinigtes EBITDA: $15-25 Millionen
Das Unternehmen konzentriert sich weiterhin darauf, sein wertorientiertes Modell voranzutreiben und qualitativ hochwertige, verbraucherorientierte Pflege für die ACA Marketplace-, Medicare- und Medicaid-Bevölkerungsgruppen bereitzustellen.
- Delivered positive Adjusted EBITDA for the second consecutive quarter in 2024
- Reaffirmed full-year Adjusted EBITDA guidance
- Expecting to reach high end of guidance range for consumers served by year-end
- Net loss decreased from $88,627,000 in Q2 2023 to $57,698,000 in Q2 2024
- Projecting revenue of approximately $950 million for 2024
- Revenue decreased from $297,982,000 in Q2 2023 to $225,991,000 in Q2 2024
- Adjusted EBITDA declined from $7,797,000 in Q2 2023 to $3,962,000 in Q2 2024
- Value-Based Consumers served decreased from 373,000 in 2023 to 364,000 in 2024
Insights
NeueHealth's Q2 2024 results show mixed signals. On the positive side, the company achieved positive Adjusted EBITDA for the second consecutive quarter, reaching
The company's guidance for 2024 suggests cautious optimism, with expected revenue of
NeueHealth's strategy of focusing on value-driven healthcare across ACA Marketplace, Medicare and Medicaid appears to be gaining traction. The company's Value-Based Consumers metric stands at 364,000, slightly down from 373,000 in 2023. However, the Enablement Services Lives have significantly increased from 31,000 to 113,000, indicating strong growth in their NeueSolutions segment.
The company's emphasis on building relationships with consumers, providers and payors is important in the evolving healthcare landscape. The expected high-end reach of guidance for consumers served by year-end suggests potential market share growth. However, the declining revenue amidst growing service lives warrants closer examination of pricing strategies and market dynamics.
- Drove solid Q2 ‘24 results with continued focus on advancing value-driven model and delivering high-quality, consumer-centric care to all populations across the ACA Marketplace, Medicare, and Medicaid
- Delivered positive Adjusted EBITDA for the second consecutive quarter in 2024; reaffirming Adjusted EBITDA guidance for the full year
- Positioned for continued strong performance this year and beyond, expecting to reach high end of guidance range for consumers served by year-end
“We continued to build momentum in the second quarter, driving solid results in both our NeueCare and NeueSolutions segments as we deliver a seamless, more coordinated care experience to all populations,” said Mike Mikan, President and CEO of NeueHealth. “We have built strong, ongoing relationships with consumers, providers, and payors across the healthcare industry, and this is a testament to our ability to align interests and create a better care experience for all. We believe we are well-positioned for the future with a strong pipeline in place to drive capital-efficient, sustainable growth in 2024 and beyond.”
Key Metrics |
|||
|
As of June 30, |
||
|
2024 |
|
2023 |
Consumer and Patient Metrics |
|
|
|
Value-Based Consumers served |
364,000 |
|
373,000 |
Enablement Services Lives |
113,000 |
|
31,000 |
($ in thousands) |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Financial Metrics |
|
|
|
|
|
|
|
||||||||
Revenue |
$ |
225,991 |
|
|
$ |
297,982 |
|
|
$ |
471,086 |
|
|
$ |
598,532 |
|
Net Income (Loss) |
$ |
(57,698 |
) |
|
$ |
(88,627 |
) |
|
$ |
(61,875 |
) |
|
$ |
(258,088 |
) |
Net Income (Loss) from Continuing Operations |
$ |
(39,259 |
) |
|
$ |
(31,692 |
) |
|
$ |
(33,571 |
) |
|
$ |
(85,610 |
) |
Adjusted EBITDA (non-GAAP) |
$ |
3,962 |
|
|
$ |
7,797 |
|
|
$ |
7,618 |
|
|
$ |
2,480 |
|
See the table at the end of this release for additional information and a reconciliation of the non-GAAP measures used in the table above.
Financial Outlook
For 2024, we are providing the following guidance, which has been updated slightly to reflect revised Revenue forecasts:
-
NeueHealth’s Revenue is expected to be approximately
$950 million -
On a segment basis, NeueCare Revenue is expected to be approximately
, while NeueSolutions Revenue is expected to be approximately$320 million $640 million -
Adjusted Operating Cost Ratio is expected to be between
15% and16% , excluding corporate costs. Including corporate costs, this is expected to be between19% and20% † -
Adjusted EBITDA is expected to be between
and$15 million in 2024†$25 million
† Reconciliations of projected Adjusted EBITDA and projected Adjusted Operating Cost Ratio to the most directly comparable GAAP financial measures are not provided because the Company is unable to provide such reconciliations without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. With respect to Adjusted EBITDA, these GAAP measures may include the impact of such items as loss from discontinued operations, interest expense, income tax expense, depreciation and amortization, transaction costs, share-based and other long-term incentive compensation expense, gain on troubled debt restructuring, changes in the fair value of equity securities and other derivatives, restructuring and contract termination costs, held-for-sale operations, financial solvency of contractual counterparties, and impairment of goodwill or long-lived assets, and the tax effect of all such items. Historically, the Company has often excluded these items from non-GAAP financial measures. With respect to Adjusted Operating Cost Ratio, these GAAP measures may include the impact of such items as share-based compensation and held-for-sale operations. The Company currently expects to continue to exclude these items in future disclosures of non-GAAP financial measures and may also exclude other items that may arise (collectively, “non-GAAP adjustments”). The decisions and events that typically lead to the recognition of non-GAAP adjustments, such as a decision to exit part of the business, are inherently unpredictable as to if or when they may occur. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.
Earnings Conference Call
As previously announced, NeueHealth will discuss the Company’s results, strategy, and outlook on a conference call with investors at 8:00 a.m. Eastern Time today. NeueHealth will host a live webcast of this conference call which can be accessed from the Investor Relations page of the company’s website (investors.neuehealth.com). Following the call, a webcast replay will be available on the same site. This earnings release and the Form 8-K filed August 7, 2024 can be accessed on the Investor Relations page of the Company’s website. We routinely post important information on our website, including corporate and investor presentations and financial information. We intend to use our website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included in the Investor Relations section of our website. Accordingly, investors should monitor this portion of our website, in addition to following our press releases,
About NeueHealth
NeueHealth is a value-driven healthcare company grounded in the belief that all health consumers are entitled to high-quality, coordinated care. By uniquely aligning the interests of health consumers, providers, and payors, NeueHealth helps to make healthcare accessible and affordable to all populations across the ACA Marketplace, Medicare, and Medicaid. NeueHealth delivers high-quality clinical care to over 470,000 health consumers through owned clinics and unique partnerships with over 3,000 affiliated providers. We also enable independent providers and medical groups to thrive in performance-based arrangements through a suite of technology and services scaled centrally and deployed locally. We believe our value-driven, consumer-centric care model can transform the healthcare experience and maximize value across the healthcare system. For more information, visit: www.neuehealth.com.
Forward-Looking Statements
Statements made in this release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements and should be evaluated as such. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business plan and strategies. These statements often include words such as “anticipate,” “expect,” “plan,” “believe,” “intend,” “project,” “forecast,” “estimates,” “projections,” “outlook,” “ensure,” and other similar expressions. These forward-looking statements include any statements regarding our plans, expectations and financial guidance. Such forward-looking statements are subject to various risks, uncertainties and assumptions. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Factors that might materially affect such forward-looking statements include: our ability to continue as a going concern; our ability to comply with the terms of our credit facilities or any credit facility into which we enter in the future; our ability to receive the remaining proceeds from the sale of our Medicare Advantage business in
NeueHealth, Inc. and Subsidiaries |
|||||||
Consolidated Balance Sheets |
|||||||
(in thousands, except share and per share data) |
|||||||
(Unaudited) |
|||||||
|
June 30,
|
|
December 31,
|
||||
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
133,425 |
|
|
$ |
87,299 |
|
Short-term investments |
|
8,735 |
|
|
|
6,265 |
|
Accounts receivable, net of allowance of |
|
35,926 |
|
|
|
39,084 |
|
ACO REACH performance year receivable |
|
425,517 |
|
|
|
115,878 |
|
Current assets of discontinued operations |
|
142,375 |
|
|
|
822,570 |
|
Current assets of held-for-sale operations |
|
8,158 |
|
|
|
— |
|
Prepaids and other current assets |
|
31,455 |
|
|
|
17,831 |
|
Total current assets |
|
785,591 |
|
|
|
1,088,927 |
|
Other assets: |
|
|
|
||||
Property, equipment and capitalized software, net |
|
12,028 |
|
|
|
14,499 |
|
Intangible assets, net |
|
76,040 |
|
|
|
93,238 |
|
Other non-current assets |
|
23,606 |
|
|
|
28,816 |
|
Total other assets |
|
111,674 |
|
|
|
136,553 |
|
Total assets |
$ |
897,265 |
|
|
$ |
1,225,480 |
|
Liabilities, Redeemable Noncontrolling Interest, Redeemable Preferred Stock and Shareholders’ Equity (Deficit) |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Medical costs payable |
$ |
137,044 |
|
|
$ |
157,903 |
|
Accounts payable |
|
8,603 |
|
|
|
11,841 |
|
Short-term borrowings |
|
— |
|
|
|
303,947 |
|
ACO REACH performance year obligation |
|
325,599 |
|
|
|
— |
|
Current liabilities of discontinued operations |
|
343,985 |
|
|
|
699,758 |
|
Current liabilities of held-for-sale operations |
|
3,981 |
|
|
|
— |
|
Risk share payable to deconsolidated entity |
|
123,981 |
|
|
|
123,981 |
|
Warrant liability |
|
21,792 |
|
|
|
13,971 |
|
Other current liabilities |
|
79,222 |
|
|
|
79,856 |
|
Total current liabilities |
|
1,044,207 |
|
|
|
1,391,257 |
|
Long-term borrowings |
|
117,670 |
|
|
|
66,400 |
|
Other liabilities |
|
17,926 |
|
|
|
22,441 |
|
Total liabilities |
|
1,179,803 |
|
|
|
1,480,098 |
|
Commitments and contingencies |
|
|
|
||||
Redeemable noncontrolling interests |
|
103,867 |
|
|
|
88,908 |
|
Redeemable Series A preferred stock, 0.0001 par value; 750,000 shares authorized in 2024 and 2023; 750,000 shares issued and outstanding in 2024 and 2023 |
|
747,481 |
|
|
|
747,481 |
|
Redeemable Series B preferred stock,0.0001 par value; 175,000 shares authorized in 2024 and 2023; 175,000 shares issued and outstanding in 2024 and 2023 |
|
172,936 |
|
|
|
172,936 |
|
Shareholders’ equity (deficit): |
|
|
|
||||
Common stock, 0.0001 par value; 3,000,000,000 shares authorized in 2024 and 2023; 8,279,173 and 8,053,576 shares issued and outstanding in 2024 and 2023, respectively |
|
1 |
|
|
|
1 |
|
Additional paid-in capital |
|
3,087,570 |
|
|
|
3,056,027 |
|
Accumulated deficit |
|
(4,382,393 |
) |
|
|
(4,307,849 |
) |
Accumulated other comprehensive loss |
|
— |
|
|
|
(122 |
) |
Treasury Stock, at cost, 31,526 shares at June 30, 2024, and December 31, 2023, respectively |
|
(12,000 |
) |
|
|
(12,000 |
) |
Total shareholders’ equity (deficit) |
|
(1,306,822 |
) |
|
|
(1,263,943 |
) |
Total liabilities, redeemable noncontrolling interests, redeemable preferred stock and shareholders’ equity (deficit) |
$ |
897,265 |
|
|
$ |
1,225,480 |
|
NeueHealth, Inc. and Subsidiaries |
|||||||||||||||
Consolidated Statements of Income (Loss) |
|||||||||||||||
(in thousands, except share and per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenue: |
|
|
|
|
|
|
|
||||||||
Capitated revenue |
$ |
64,005 |
|
|
$ |
49,764 |
|
|
$ |
125,471 |
|
|
$ |
99,312 |
|
ACO REACH revenue |
|
149,802 |
|
|
|
236,994 |
|
|
|
321,613 |
|
|
|
476,801 |
|
Service revenue |
|
12,076 |
|
|
|
11,222 |
|
|
|
23,691 |
|
|
|
22,409 |
|
Investment income |
|
108 |
|
|
|
2 |
|
|
|
311 |
|
|
|
10 |
|
Total revenue |
|
225,991 |
|
|
|
297,982 |
|
|
|
471,086 |
|
|
|
598,532 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Medical costs |
|
177,681 |
|
|
|
245,160 |
|
|
|
374,555 |
|
|
|
505,280 |
|
Operating costs |
|
70,217 |
|
|
|
70,280 |
|
|
|
137,039 |
|
|
|
149,798 |
|
Bad debt expense |
|
14 |
|
|
|
— |
|
|
|
11 |
|
|
|
— |
|
Restructuring charges |
|
239 |
|
|
|
1,285 |
|
|
|
181 |
|
|
|
1,586 |
|
Intangible assets impairment |
|
11,411 |
|
|
|
— |
|
|
|
11,411 |
|
|
|
— |
|
Depreciation and amortization |
|
3,978 |
|
|
|
4,671 |
|
|
|
8,540 |
|
|
|
10,154 |
|
Total operating expenses |
|
263,540 |
|
|
|
321,396 |
|
|
|
531,737 |
|
|
|
666,818 |
|
Operating loss |
|
(37,549 |
) |
|
|
(23,414 |
) |
|
|
(60,651 |
) |
|
|
(68,286 |
) |
Interest expense |
|
4,110 |
|
|
|
9,170 |
|
|
|
7,040 |
|
|
|
16,957 |
|
Warrant income |
|
(2,213 |
) |
|
|
— |
|
|
|
(4,285 |
) |
|
|
— |
|
Gain on troubled debt restructuring |
|
— |
|
|
|
— |
|
|
|
(30,311 |
) |
|
|
— |
|
Loss from continuing operations before income taxes |
|
(39,446 |
) |
|
|
(32,584 |
) |
|
|
(33,095 |
) |
|
|
(85,243 |
) |
Income tax (benefit) expense |
|
(187 |
) |
|
|
(892 |
) |
|
|
476 |
|
|
|
367 |
|
Net income (loss) from continuing operations |
|
(39,259 |
) |
|
|
(31,692 |
) |
|
|
(33,571 |
) |
|
|
(85,610 |
) |
Loss from discontinued operations, net of tax (including loss on disposal of |
|
(18,439 |
) |
|
|
(56,935 |
) |
|
|
(28,304 |
) |
|
|
(172,478 |
) |
Net Loss |
|
(57,698 |
) |
|
|
(88,627 |
) |
|
|
(61,875 |
) |
|
|
(258,088 |
) |
Net (income) loss from continuing operations attributable to noncontrolling interests |
|
(932 |
) |
|
|
(24,205 |
) |
|
|
(12,669 |
) |
|
|
(29,755 |
) |
Series A preferred stock dividend accrued |
|
(10,422 |
) |
|
|
(9,942 |
) |
|
|
(20,716 |
) |
|
|
(19,656 |
) |
Series B preferred stock dividend accrued |
|
(2,338 |
) |
|
|
(2,231 |
) |
|
|
(4,648 |
) |
|
|
(4,411 |
) |
Net loss attributable to NeueHealth, Inc. common shareholders |
$ |
(71,390 |
) |
|
$ |
(125,005 |
) |
|
$ |
(99,908 |
) |
|
$ |
(311,910 |
) |
|
|
|
|
|
|
|
|
||||||||
Basic and diluted loss per share attributable to NeueHealth, Inc. common shareholders |
|
|
|
|
|
|
|
||||||||
Continuing operations |
$ |
(6.42 |
) |
|
$ |
(8.55 |
) |
|
$ |
(8.77 |
) |
|
$ |
(17.59 |
) |
Discontinued operations |
|
(2.23 |
) |
|
|
(7.15 |
) |
|
|
(3.46 |
) |
|
|
(21.76 |
) |
Basic and diluted loss per share |
|
(8.65 |
) |
|
|
(15.70 |
) |
|
|
(12.23 |
) |
|
|
(39.35 |
) |
|
|
|
|
|
|
|
|
||||||||
Basic and diluted weighted-average common shares outstanding |
|
8,253 |
|
|
|
7,962 |
|
|
|
8,166 |
|
|
|
7,928 |
|
NeueHealth, Inc. and Subsidiaries |
|||||||
Consolidated Statements of Cash Flows |
|||||||
(in thousands) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended June 30, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
||||
Net loss |
$ |
(61,875 |
) |
|
$ |
(258,088 |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
8,540 |
|
|
|
16,026 |
|
Impairment of intangible assets |
|
11,411 |
|
|
|
— |
|
Share-based and other long-term incentive compensation |
|
37,407 |
|
|
|
49,095 |
|
Deferred income taxes |
|
— |
|
|
|
873 |
|
Gain on troubled debt restructuring |
|
(30,311 |
) |
|
|
— |
|
Net accretion of investments |
|
(72 |
) |
|
|
(14,173 |
) |
Loss on disposal of property, equipment, and capitalized software |
|
595 |
|
|
|
— |
|
Other, net |
|
(469 |
) |
|
|
3,891 |
|
Changes in assets and liabilities, net of acquired assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(4,872 |
) |
|
|
6,284 |
|
ACO REACH performance year receivable |
|
(309,639 |
) |
|
|
(524,428 |
) |
Other assets |
|
(7,889 |
) |
|
|
57,846 |
|
Medical cost payable |
|
(35,998 |
) |
|
|
(567,932 |
) |
Risk adjustment payable |
|
(4,155 |
) |
|
|
10,925 |
|
Accounts payable and other liabilities |
|
(14,387 |
) |
|
|
(111,174 |
) |
Unearned revenue |
|
(11 |
) |
|
|
132,129 |
|
Warrant liability |
|
8,978 |
|
|
|
— |
|
ACO Reach performance year obligation |
|
325,599 |
|
|
|
474,700 |
|
Net cash used in operating activities |
|
(77,148 |
) |
|
|
(724,026 |
) |
Cash flows from investing activities: |
|
|
|
||||
Purchases of investments |
|
(9,544 |
) |
|
|
(828,546 |
) |
Proceeds from sales, paydowns, and maturities of investments |
|
2,581 |
|
|
|
988,749 |
|
Purchases of property and equipment |
|
(877 |
) |
|
|
(2,394 |
) |
Proceeds from sale of business, net |
|
197,121 |
|
|
|
(682 |
) |
Net cash provided by investing activities |
|
189,281 |
|
|
|
157,127 |
|
Cash flows from financing activities: |
|
|
|
||||
Proceeds from issuance of common stock |
|
— |
|
|
|
2 |
|
Proceeds from long-term borrowings |
|
52,411 |
|
|
|
— |
|
Repayments of short-term borrowings |
|
(273,636 |
) |
|
|
— |
|
Distributions to noncontrolling interest holders |
|
(4,730 |
) |
|
|
(4,952 |
) |
Net cash used in financing activities |
|
(225,955 |
) |
|
|
(4,950 |
) |
Net (decrease) increase in cash and cash equivalents |
|
(113,822 |
) |
|
|
(571,849 |
) |
Cash and cash equivalents of continuing and discontinued operations – beginning of year |
|
375,280 |
|
|
|
1,932,290 |
|
Cash and cash equivalents of continuing and discontinued operations – end of period |
$ |
261,458 |
|
|
$ |
1,360,441 |
|
NeueHealth, Inc. and Subsidiaries |
||||||||||||
Segment Information |
||||||||||||
(in thousands) |
||||||||||||
(Unaudited) |
||||||||||||
NeueCare |
|
|
|
|
|
|
|
|||||
($ in thousands) |
Three Months Ended
|
|
Six Months Ended
|
|||||||||
Statement of income (loss) and operating data: |
|
2024 |
|
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
|||||
Revenue: |
|
|
|
|
|
|
|
|||||
Capitated revenue |
$ |
64,005 |
|
|
$ |
49,764 |
|
$ |
125,471 |
|
$ |
99,312 |
Service revenue |
|
9,803 |
|
|
|
10,530 |
|
|
19,333 |
|
|
21,466 |
Investment income |
|
21 |
|
|
|
— |
|
|
21 |
|
|
— |
Total unaffiliated revenue |
|
73,829 |
|
|
|
60,294 |
|
|
144,825 |
|
|
120,778 |
Affiliated revenue |
|
3,156 |
|
|
|
5,774 |
|
|
5,783 |
|
|
7,969 |
Total segment revenue |
|
76,985 |
|
|
|
66,068 |
|
|
150,608 |
|
|
128,747 |
Operating expenses |
|
|
|
|
|
|
|
|||||
Medical Costs |
|
33,579 |
|
|
|
19,720 |
|
|
61,015 |
|
|
43,442 |
Operating Costs |
|
34,676 |
|
|
|
32,139 |
|
|
67,265 |
|
|
61,328 |
Depreciation and amortization |
|
3,221 |
|
|
|
3,178 |
|
|
7,007 |
|
|
6,310 |
Intangible asset impairment |
|
11,411 |
|
|
|
— |
|
|
11,411 |
|
|
— |
Total operating expenses |
|
82,887 |
|
|
|
55,037 |
|
|
146,698 |
|
|
111,080 |
Operating income (loss) |
$ |
(5,902 |
) |
|
$ |
11,031 |
|
$ |
3,910 |
|
$ |
17,667 |
NeueSolutions |
|
|
|
|
|
|
|
|||||
($ in thousands) |
Three Months Ended
|
|
Six Months Ended
|
|||||||||
Statement of income (loss) and operating data: |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|||||
Revenue: |
|
|
|
|
|
|
|
|||||
ACO REACH revenue |
$ |
149,802 |
|
$ |
236,994 |
|
$ |
321,613 |
|
|
$ |
476,801 |
Service revenue |
|
2,273 |
|
|
692 |
|
|
4,358 |
|
|
|
943 |
Total segment revenue |
|
152,075 |
|
|
237,686 |
|
|
325,971 |
|
|
|
477,744 |
Operating expenses |
|
|
|
|
|
|
|
|||||
Medical Costs |
|
147,258 |
|
|
231,279 |
|
|
319,323 |
|
|
|
469,874 |
Operating Costs |
|
4,406 |
|
|
3,411 |
|
|
9,172 |
|
|
|
6,383 |
Bad debt expense |
|
14 |
|
|
— |
|
|
11 |
|
|
|
— |
Total operating expenses |
|
151,678 |
|
|
234,690 |
|
|
328,506 |
|
|
|
476,257 |
Operating income (loss) |
$ |
397 |
|
$ |
2,996 |
|
$ |
(2,535 |
) |
|
$ |
1,487 |
Non-GAAP Financial Measures
We use the non-GAAP financial measures Adjusted EBITDA, Adjusted Operating Cost Ratio, NeueCare Adjusted EBITDA, and NeueSolutions Adjusted EBITDA. We define Adjusted EBITDA as Net Loss excluding loss from discontinued operations, interest expense, income taxes, depreciation and amortization, transaction costs, share-based and other long-term compensation expense, gains on troubled debt restructuring, changes in the fair value of equity securities and derivatives, restructuring and contract termination costs, held-for-sale operations, losses related to the bankruptcy of contractual counterparties, impairment of goodwill and long-lived assets, and the tax effect of all such items. We define Adjusted Operating Cost Ratio as Operating Cost Ratio excluding share-based compensation expense and held-for-sale operations. We define NeueCare Adjusted EBITDA as NeueCare Net Income excluding interest expense, income taxes, depreciation and amortization, transaction costs, share-based and other long-term compensation expense, gains on troubled debt restructuring, changes in the fair value of equity securities and derivatives, restructuring and contract termination costs, held-for-sale operations, losses related to the bankruptcy of contractual counterparties, impairment of goodwill and long-lived assets, and the tax effect of all such items. We define NeueSolutions Adjusted EBITDA as NeueSolutions Net Loss excluding interest expense, income taxes, depreciation and amortization, transaction costs, share-based and other long-term compensation expense, gains on troubled debt restructuring, changes in the fair value of equity securities and derivatives, restructuring and contract termination costs, held-for-sale operations, losses related to the bankruptcy of contractual counterparties, impairment of goodwill and long-lived assets, and the tax effect of all such items. These non-GAAP measures have been presented in this quarterly Earnings Release or in the earnings conference call as supplemental measures of financial performance that are not required by or presented in accordance with GAAP because we believe they assist management and investors in comparing our operating performance across reporting periods on a consistent basis by excluding and including items that we do not believe are indicative of our core operating performance. Management believes these measures are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Management uses Adjusted EBITDA, Adjusted Operating Cost Ratio, NeueCare Adjusted EBITDA, and NeueSolutions Adjusted EBITDA to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish discretionary annual incentive compensation and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone.
Adjusted EBITDA is not a recognized term under GAAP and should not be considered as an alternative to Net income (loss) as a measure of financial performance or any other performance measure derived in accordance with GAAP. Additionally, Adjusted EBITDA is not intended to be a measure of free cash flow available for management’s discretionary use as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements. The presentation of Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentation of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company.
Adjusted Operating Cost Ratio is not a recognized term under GAAP and should not be considered as an alternative to Operating Cost Ratio as a measure of financial performance or any other performance measure derived in accordance with GAAP. The presentation of Adjusted Operating Cost Ratio has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentation of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company.
Neither NeueCare Adjusted EBITDA nor NeueSolutions Adjusted EBITDA are recognized terms under GAAP and should not be considered as alternatives to NeueCare Net Loss or NeueSolutions Net Loss, respectively, as a measure of financial performance or any other performance measure derived in accordance with GAAP. The presentation of NeueCare Adjusted EBITDA and NeueSolutions Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentation of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company.
The following table provides a reconciliation of net loss to Adjusted EBITDA for the periods presented:
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
($ in thousands) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net loss |
$ |
(57,698 |
) |
|
$ |
(88,627 |
) |
|
$ |
(61,875 |
) |
|
$ |
(258,088 |
) |
Loss from Discontinued Operations |
|
18,439 |
|
|
|
56,935 |
|
|
|
28,304 |
|
|
|
172,478 |
|
EBITDA adjustments from continuing operations |
|
|
|
|
|
|
|
||||||||
Interest expense |
|
4,110 |
|
|
|
9,170 |
|
|
|
7,040 |
|
|
|
16,957 |
|
Income tax (benefit) expense |
|
(187 |
) |
|
|
(892 |
) |
|
|
476 |
|
|
|
367 |
|
Depreciation and amortization (h) |
|
3,484 |
|
|
|
4,176 |
|
|
|
7,551 |
|
|
|
9,163 |
|
Transaction costs (a) |
|
844 |
|
|
|
8,096 |
|
|
|
1,965 |
|
|
|
9,948 |
|
Share-based and other long-term incentive compensation expense (b) |
|
21,236 |
|
|
|
15,775 |
|
|
|
39,862 |
|
|
|
49,095 |
|
Gain on troubled debt restructuring (c) |
|
— |
|
|
|
— |
|
|
|
(30,311 |
) |
|
|
— |
|
Change in fair value of warrant liability (d) |
|
(2,213 |
) |
|
|
— |
|
|
|
(4,285 |
) |
|
|
— |
|
Restructuring and contract termination costs (e) |
|
239 |
|
|
|
1,285 |
|
|
|
181 |
|
|
|
1,586 |
|
Held-for-sale operations (f) |
|
16,671 |
|
|
|
1,879 |
|
|
|
18,294 |
|
|
|
974 |
|
ACO REACH care partner bankruptcy (g) |
|
(963 |
) |
|
|
— |
|
|
|
285 |
|
|
|
— |
|
Impairment of goodwill and long-lived assets (h) |
|
— |
|
|
|
— |
|
|
|
131 |
|
|
|
— |
|
EBITDA adjustments from continuing operations |
$ |
43,221 |
|
|
$ |
39,489 |
|
|
$ |
41,189 |
|
|
$ |
88,090 |
|
Adjusted EBITDA |
$ |
3,962 |
|
|
$ |
7,797 |
|
|
$ |
7,618 |
|
|
$ |
2,480 |
|
(a) |
Transaction costs include accounting, tax, valuation, consulting, legal and investment banking fees directly relating to financing initiatives and acquisitions or dispositions. These costs can vary from period to period and impact comparability, and we do not believe such transaction costs reflect the ongoing performance of our business. |
|
(b) |
Represents non-cash compensation expense related to stock option and restricted stock unit award grants, which can vary from period to period based on a number of factors, including the timing, quantity and grant date fair value of the awards. Also includes estimated compensation expense that the Company has the option to pay in cash or shares of |
|
(c) |
Beginning in the first quarter of 2024, Adjusted EBITDA excludes the impact of gains on troubled debt restructuring. The comparable periods in 2023 have been recast to exclude these impacts. |
|
(d) |
Represents the non-cash change in the fair value of the warrant liability established for warrants included in our financing arrangements, which are remeasured at fair value each reporting period. |
|
(e) |
Restructuring and contract termination costs represent severance costs as part of a workforce reduction, amounts paid for early termination of leases, and impairment of certain long-lived assets primarily relating to our decision to exit the Commercial business for the 2023 plan year. |
|
(f) |
Beginning in the second quarter of 2024, Adjusted EBITDA excludes the impact of our operations classified as held-for-sale. For the three and six months ended June 30, 2024, |
|
(g) |
Represents the costs expected to be incurred as a result of one of our ACO REACH care partners filing for bankruptcy; includes the full allowance established for the outstanding receivable and ongoing costs incurred to manage and provide service to members attributed to the care partner that would have otherwise been reimbursed prior to the care partner’s bankruptcy. |
|
(h) |
Adjustment has been updated to remove the impact of our held-for-sale operations that are adjusted for in their entirety as described in (g). |
The following table provides a reconciliation of Adjusted Operating Cost Ratio for the periods presented:
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Operating Cost Ratio |
31.1 |
% |
|
23.6 |
% |
|
29.1 |
% |
|
25.0 |
% |
Impact of share-based compensation expense (a) |
(9.4 |
)% |
|
(5.3 |
)% |
|
(8.5 |
)% |
|
(8.2 |
)% |
Impact of held-for-sale operations (b) |
(3.7 |
)% |
|
(2.2 |
)% |
|
(3.1 |
)% |
|
(1.9 |
)% |
Adjusted Operating Cost Ratio (c) |
18.0 |
% |
|
16.1 |
% |
|
17.5 |
% |
|
14.9 |
% |
(a) |
Represents non-cash compensation expense related to stock option and restricted stock unit award grants, which can vary from period to period based on a number of factors, including the timing, quantity and grant date fair value of the awards. Also includes estimated compensation expense that the company has the option to pay in cash or shares of |
|
(b) |
Represents the impact of revenue and operating costs related to our operations classified as held-for-sale during the quarter ended June 30, 2024. The comparable periods in 2023 have been recast to exclude these impacts. |
|
(c) |
The three and six months ended June 30, 2024 are higher than the equivalent periods ended June 30, 2023 by |
The following table provides a reconciliation of NeueCare net income to NeueCare Adjusted EBITDA for the periods presented:
NeueCare |
|
|
|
|
|
|
||||||
|
Three Months Ended
|
|
Six Months Ended
|
|||||||||
($ in thousands) |
|
2024 |
|
|
|
2023 |
|
|
2024 |
|
|
2023 |
NeueCare Net Income (Loss) |
$ |
(5,902 |
) |
|
$ |
11,031 |
|
$ |
3,910 |
|
$ |
17,667 |
Interest expense |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Income tax (benefit) expense |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Depreciation and amortization (h) |
|
2,727 |
|
|
|
2,683 |
|
|
6,018 |
|
|
5,319 |
Transaction costs (a) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Share-based and other long-term incentive compensation expense (b) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Gain on troubled debt restructuring (c) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Change in fair value of warrant liability (d) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Restructuring and contract termination costs (e) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Held-for-sale operations (f) |
|
16,671 |
|
|
|
1,879 |
|
|
18,294 |
|
|
974 |
ACO REACH care partner bankruptcy (g) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
Impairment of goodwill and long-lived assets (h) |
$ |
— |
|
|
$ |
— |
|
$ |
— |
|
$ |
— |
NeueCare Adjusted EBITDA |
$ |
13,496 |
|
|
$ |
15,593 |
|
$ |
28,222 |
|
$ |
23,960 |
The following table provides a reconciliation of NeueSolutions net loss to NeueSolutions Adjusted EBITDA for the periods presented:
NeueSolutions |
|
|
|
|
|
|
|||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||
($ in thousands) |
|
2024 |
|
|
|
2023 |
|
|
2024 |
|
|
|
2023 |
NeueSolutions Net income (loss) |
$ |
397 |
|
|
$ |
2,996 |
|
$ |
(2,535 |
) |
|
$ |
1,487 |
Interest expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Income tax (benefit) expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Depreciation and amortization (h) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Transaction costs (a) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Share-based and other long-term incentive compensation expense (b) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Gain on troubled debt restructuring (c) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Change in fair value of warrant liability (d) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Restructuring and contract termination costs (e) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
Held-for-sale operations (f) |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
ACO REACH care partner bankruptcy (g) |
|
(963 |
) |
|
|
— |
|
|
285 |
|
|
|
— |
Impairment of goodwill and long-lived assets (h) |
$ |
— |
|
|
$ |
— |
|
$ |
— |
|
|
$ |
— |
NeueSolutions Adjusted EBITDA |
$ |
(566 |
) |
|
$ |
2,996 |
|
$ |
(2,250 |
) |
|
$ |
1,487 |
(a) |
Transaction costs include accounting, tax, valuation, consulting, legal and investment banking fees directly relating to financing initiatives. These costs can vary from period to period and impact comparability, and we do not believe such transaction costs reflect the ongoing performance of our business. |
|
(b) |
Represents non-cash compensation expense related to stock option and restricted stock unit award grants, which can vary from period to period based on a number of factors, including the timing, quantity and grant date fair value of the awards. Also includes estimated compensation expense that the company has the option to pay in cash or shares of |
|
(c) |
Beginning in the first quarter of 2024, Adjusted EBITDA excludes the impact of gains on troubled debt restructuring. The comparable periods in 2023 have been recast to exclude these impacts. |
|
(d) |
Represents the non-cash change in the fair value of the warrant liability established for warrants included in our financing arrangements, which are remeasured at fair value each reporting period. |
|
(e) |
Restructuring and contract termination costs represent severance costs as part of a workforce reduction, amounts paid for early termination of leases, and impairment of certain long-lived assets primarily relating to our decision to exit the Commercial business for the 2023 plan year. |
|
(f) |
Beginning in the second quarter of 2024, Adjusted EBITDA excludes the impact of our operations classified as held-for-sale. For the 3 and 6 months ended June 30, 2024, |
|
(g) |
Represents the costs expected to be incurred as a result of one of our ACO REACH care partners filing for bankruptcy; includes the full allowance established for the outstanding receivable and ongoing costs incurred to manage and provide service to members attributed to the care partner that would have otherwise been reimbursed prior to the care partner’s bankruptcy. |
|
(h) |
Adjustment has been updated to remove the impact of our held-for-sale operations that are adjusted for in there entirety as described at (f). |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240807512796/en/
Investor Contact:
IR@neuehealth.com
Media Contact:
media@neuehealth.com
Source: NeueHealth
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