Option Care Health Announces Financial Results for The Second Quarter Ended June 30, 2024
Option Care Health (Nasdaq: OPCH) reported its Q2 2024 financial results, showing mixed performance. Net revenue increased 14.8% to $1,227.2 million, but gross profit decreased 0.6% to $249.4 million. Net income fell 53.6% to $53.0 million, or $0.30 per diluted share. Adjusted EBITDA slightly decreased by 1.5% to $108.4 million.
The company updated its full-year 2024 guidance, expecting net revenue between $4.75 billion and $4.85 billion, and Adjusted EBITDA of $435 million to $450 million. Option Care Health maintains its projection for cash flow from operations of at least $300 million.
Notable actions include repurchasing approximately $78.1 million of stock and amending the First Lien Credit Agreement to reduce interest rates and increase liquidity by $50.0 million.
Option Care Health (Nasdaq: OPCH) ha riportato i risultati finanziari del Q2 2024, evidenziando una performance mista. Il fatturato netto è aumentato del 14,8% a $1.227,2 milioni, ma l'utile lordo è diminuito dello 0,6% a $249,4 milioni. Il reddito netto è sceso del 53,6% a $53,0 milioni, ovvero $0,30 per azione diluita. L'EBITDA rettificato è leggermente diminuito dell'1,5% a $108,4 milioni.
La società ha aggiornato le sue previsioni per l'intero anno 2024, aspettandosi un fatturato netto compreso tra $4,75 miliardi e $4,85 miliardi, e un EBITDA rettificato di $435 milioni a $450 milioni. Option Care Health mantiene la sua proiezione per il flusso di cassa dalle operazioni di almeno $300 milioni.
Tra le azioni significative ci sono il riacquisto di circa $78,1 milioni di azioni e la modifica dell'Accordo di Credito di Primo Grado per ridurre i tassi di interesse e aumentare la liquidità di $50,0 milioni.
Option Care Health (Nasdaq: OPCH) reportó sus resultados financieros del Q2 2024, mostrando un desempeño mixto. Los ingresos netos aumentaron un 14,8% a $1.227,2 millones, pero el beneficio bruto disminuyó un 0,6% a $249,4 millones. El ingreso neto cayó un 53,6% a $53,0 millones, o $0,30 por acción diluida. El EBITDA ajustado disminuyó ligeramente un 1,5% a $108,4 millones.
La empresa actualizó su guía para todo el 2024, esperando ingresos netos entre $4,75 mil millones y $4,85 mil millones, y un EBITDA ajustado de $435 millones a $450 millones. Option Care Health mantiene su proyección de flujo de efectivo de operaciones de al menos $300 millones.
Entre las acciones notables se incluyen la recompra de aproximadamente $78,1 millones de acciones y la modificación del Acuerdo de Crédito de Primera Prenda para reducir las tasas de interés y aumentar la liquidez en $50,0 millones.
Option Care Health (Nasdaq: OPCH)는 2024년 2분기 재무 결과를 발표하며 혼합된 실적을 보였습니다. 순수익은 14.8% 증가하여 $12억 2,720만 달러에 도달했지만, 총 이익은 0.6% 감소하여 $2억 4,940만 달러로 집계되었습니다. 순이익은 53.6% 감소하여 $5천 3백만 달러, 즉 희석 주당 $0.30에 달했습니다. 조정 EBITDA는 1.5% 소폭 감소하여 $1억 8천 840만 달러로 나타났습니다.
회사는 2024년 전체 연도 가이던스를 업데이트하며 순수익이 $47억 5천만 달러에서 $48억 5천만 달러 사이일 것으로 예상하고, 조정 EBITDA는 $4억 3천 5백만 달러에서 $4억 5천만 달러에 이를 것으로 보고 있습니다. Option Care Health는 운영으로부터의 현금 흐름 예상치를 최소 $3억 달러로 유지하고 있습니다.
주목할 만한 조치로는 약 $7천 8백 10만 달러의 자사주 매입과 이자율을 인하하고 유동성을 $5천만 달러 증가시키기 위한 첫 번째 담보 대출 계약 수정이 포함됩니다.
Option Care Health (Nasdaq: OPCH) a annoncé ses résultats financiers pour le T2 2024, montrant une performance mitigée. Le chiffre d'affaires net a augmenté de 14,8% pour atteindre 1,227.2 millions de dollars, mais le bénéfice brut a diminué de 0,6% pour s'établir à 249,4 millions de dollars. Le revenu net a chuté de 53,6%, atteignant 53,0 millions de dollars, soit 0,30 dollar par action diluée. Le EBITDA ajusté a légèrement diminué de 1,5% pour atteindre 108,4 millions de dollars.
L'entreprise a mis à jour ses prévisions pour l'ensemble de l'année 2024, s'attendant à un chiffre d'affaires net compris entre 4,75 billions et 4,85 billions de dollars, et un EBITDA ajusté de 435 millions à 450 millions de dollars. Option Care Health maintient sa projection d'un flux de trésorerie d'exploitation d'au moins 300 millions de dollars.
Les actions notables incluent le rachat d'environ 78,1 millions de dollars d'actions et la modification de l'Accord de Crédit de Première Rang pour réduire les taux d'intérêt et augmenter la liquidité de 50,0 millions de dollars.
Option Care Health (Nasdaq: OPCH) hat seine finanziellen Ergebnisse für das zweite Quartal 2024 veröffentlicht, mit gemischter Leistung. Der Nettoumsatz stieg um 14,8 % auf 1.227,2 Millionen Dollar, während der Bruttogewinn um 0,6 % auf 249,4 Millionen Dollar sank. Der Nettogewinn fiel um 53,6 % auf 53,0 Millionen Dollar, bzw. 0,30 Dollar pro verwässerter Aktie. Das angepasste EBITDA reduzierte sich leicht um 1,5 % auf 108,4 Millionen Dollar.
Das Unternehmen hat seine Prognose für das Gesamtjahr 2024 aktualisiert und erwartet Nettoumsätze zwischen 4,75 Milliarden Dollar und 4,85 Milliarden Dollar sowie ein angepasstes EBITDA von 435 Millionen Dollar bis 450 Millionen Dollar. Option Care Health hält an seiner Prognose eines operativen Cashflows von mindestens 300 Millionen Dollar fest.
Zu den bemerkenswerten Maßnahmen gehören der Rückkauf von etwa 78,1 Millionen Dollar eigener Aktien und die Änderung des First-Lien-Kreditvertrags zur Senkung der Zinssätze und zur Erhöhung der Liquidität um 50,0 Millionen Dollar.
- Net revenue increased 14.8% year-over-year to $1,227.2 million
- Cash flow from operations improved to $195.7 million from $169.5 million in Q2 2023
- Strong cash position with $376.9 million in cash and cash equivalents at quarter-end
- Amended credit agreement reducing interest rate and providing $50.0 million additional liquidity
- Gross profit decreased 0.6% year-over-year to $249.4 million
- Net income fell 53.6% to $53.0 million compared to Q2 2023
- Adjusted EBITDA decreased 1.5% to $108.4 million year-over-year
- Gross profit margin declined from 23.5% in Q2 2023 to 20.3% in Q2 2024
Insights
Option Care Health's Q2 2024 results present a mixed picture, with strong revenue growth but declining profitability. The 14.8% increase in net revenue to
The 53.6% drop in net income to
On a positive note, the strong cash flow from operations of
The updated guidance for 2024 indicates management's cautious optimism, with expected revenue growth but potentially compressed margins. Investors should monitor the company's ability to manage costs and maintain profitability in the face of ongoing industry challenges.
Option Care Health's Q2 results reflect the evolving landscape of home healthcare services. The substantial revenue growth underscores the increasing shift towards home-based care, a trend accelerated by the pandemic and aging demographics. However, the margin compression suggests challenges in scaling operations efficiently or potential pricing pressures in a competitive market.
The company's position as the largest independent provider of home and alternate site infusion services gives it a competitive edge, but also exposes it to industry-wide challenges such as labor shortages and reimbursement pressures. The amendment of the First Lien Credit Agreement to reduce interest rates and increase liquidity is a strategic move that could provide additional financial flexibility in a potentially turbulent healthcare environment.
Looking ahead, Option Care Health's ability to leverage its scale and clinical expertise will be crucial. The focus on reimagining the infusion care experience could be a key differentiator, potentially leading to improved patient outcomes and operational efficiencies. However, the company must navigate the delicate balance between growth and profitability in an industry facing ongoing regulatory and economic pressures.
Investors should closely monitor metrics related to patient acquisition, retention and satisfaction, as well as the company's ability to innovate in service delivery and technology adoption. These factors will be critical in maintaining Option Care Health's market leadership and driving long-term value creation in the evolving home healthcare sector.
BANNOCKBURN, Ill., July 31, 2024 (GLOBE NEWSWIRE) -- Option Care Health, Inc. (the “Company” or “Option Care Health”) (Nasdaq: OPCH), the nation’s largest independent provider of home and alternate site infusion services, announced today financial results for the second quarter ended June 30, 2024.
Second Quarter 2024 Financial Results and Highlights
- Net revenue of
$1,227.2 million , up14.8% compared to$1,069.1 million in the second quarter of 2023 - Gross profit of
$249.4 million , or20.3% of net revenue, down0.6% compared to$250.8 million , or23.5% of net revenue, in the second quarter of 2023 - Net income of
$53.0 million , or$0.30 diluted earnings per share, down53.6% compared to net income of$114.4 million , or$0.63 diluted earnings per share, in the second quarter of 2023 - Adjusted EBITDA of
$108.4 million , down1.5% compared to$110.1 million in the second quarter of 2023 - Cash flow from operations of
$195.7 million , compared to$169.5 million in the second quarter of 2023 - Cash and cash equivalents balance of
$376.9 million at the end of the second quarter of 2024 - Repurchased approximately
$78.1 million of stock - Amended the First Lien Credit Agreement reducing the interest rate to Term SOFR plus
2.25% and providing$50.0 million of additional liquidity
Note that the second quarter of 2023 net income and cash flow from operations includes
John C. Rademacher, Chief Executive Officer, commented, “The Option Care Health team continued to demonstrate its resilience in a difficult environment while never losing focus on providing unparalleled care and delivering hope to patients and their families. I am proud of the financial results we executed on this quarter and we remain committed to delivering on our commitments for 2024.”
Updated Full Year 2024 Financial Guidance
For the full year 2024, Option Care Health expects to generate:
- Net revenue of
$4.75 billion to$4.85 billion - Adjusted EBITDA of
$435 million to$450 million - Cash flow from operations of at least
$300 million , consistent with previous guidance - Effective tax rate of
26% -28% , consistent with previous guidance - Net interest expense of approximately
$55 million to$60 million , consistent with previous guidance
Conference Call
Option Care Health will host a conference call to discuss its second quarter 2024 financial results later today at 8:30 a.m. ET. The conference call can be accessed via a live audio webcast that will be available online at https://investors.optioncarehealth.com. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.
About Option Care Health
Option Care Health is the nation’s largest independent provider of home and alternate site infusion services. With over 7,500 team members including more than 4,500 clinicians, we work compassionately to elevate standards of care for patients with acute and chronic conditions in all 50 states. Through our clinical leadership, expertise and national scale, Option Care Health is reimagining the infusion care experience for patients, customers and team members. To learn more, please visit our website at OptionCareHealth.com.
Investor Contacts
| Mike Shapiro | Bob East, Asher Dewhurst, Jordan Kohnstam |
| Chief Financial Officer | Westwicke |
| T: (312) 940-2538 | T: (413) 213-0500 |
| mike.shapiro@optioncare.com | optioncarehealth@westwicke.com |
Forward-Looking Statements - Safe Harbor
This press release may contain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “believe,” “project,” “estimate,” “expect,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we may make regarding future revenues, future earnings, regulatory developments, market developments, new products and growth strategies, integration activities and the effects of any of the foregoing on our future results of operations or financial conditions.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: changes in laws and regulations applicable to our business model; changes in market conditions and receptivity to our services and offerings; pending and future litigation; potential liability for claims not covered by insurance; and loss of relationships with managed care organizations and other non-governmental third party payers. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports as filed with the SEC.
Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
Note Regarding Use of Non-GAAP Financial Measures
In addition to reporting financial information in accordance with generally accepted accounting principles (GAAP), the Company is also reporting Adjusted EBITDA, which is a non-GAAP financial measure. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be used in isolation or as a substitute or alternative to net income, operating income or any other performance measure derived in accordance with GAAP, or as a substitute or alternative to cash flow from operating activities or a measure of the Company’s liquidity. In addition, the Company's definition of Adjusted EBITDA may not be comparable to similarly titled non-GAAP financial measures reported by other companies. Adjusted EBITDA, as defined by the Company, represents net income before net interest expense, income tax expense, depreciation and amortization, stock-based compensation expense, loss on extinguishment of debt, and restructuring, acquisition, integration and other. As part of restructuring, acquisition, integration and other, the Company may incur significant charges such as the write down of certain long‑lived assets, temporary redundant expenses, professional fees, potential retention and severance costs and potential accelerated payments or termination costs for certain of its contractual obligations. Management believes that Adjusted EBITDA provides useful supplemental information regarding the performance of Option Care Health’s business operations and facilitates comparisons to the Company’s historical operating results. We have not reconciled Adjusted EBITDA guidance to net income as management believes creation of this reconciliation would not be practicable due to the uncertainty regarding, and potential variability of, material reconciling items. For a full reconciliation of Adjusted EBITDA to the most comparable GAAP financial measure, please see below.
| Schedule 1 |
| OPTION CARE HEALTH, INC. |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| (IN THOUSANDS)(UNAUDITED) |
| June 30, 2024 | December 31, 2023 | ||||
| ASSETS | |||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | $ | 376,872 | $ | 343,849 | |
| Accounts receivable, net | 468,300 | 377,658 | |||
| Inventories | 281,421 | 274,004 | |||
| Prepaid expenses and other current assets | 100,820 | 98,744 | |||
| Total current assets | 1,227,413 | 1,094,255 | |||
| NONCURRENT ASSETS: | |||||
| Property and equipment, net | 123,931 | 120,630 | |||
| Intangible assets, net | 18,542 | 20,092 | |||
| Referral sources, net | 299,660 | 315,304 | |||
| Goodwill | 1,540,246 | 1,540,246 | |||
| Other noncurrent assets | 138,800 | 126,508 | |||
| Total noncurrent assets | 2,121,179 | 2,122,780 | |||
| TOTAL ASSETS | $ | 3,348,592 | $ | 3,217,035 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| CURRENT LIABILITIES: | |||||
| Accounts payable | $ | 535,688 | $ | 426,513 | |
| Other current liabilities | 159,719 | 191,796 | |||
| Total current liabilities | 695,407 | 618,309 | |||
| NONCURRENT LIABILITIES: | |||||
| Long-term debt, net of discount, deferred financing costs and current portion | 1,105,575 | 1,056,650 | |||
| Other noncurrent liabilities | 136,179 | 120,404 | |||
| Total noncurrent liabilities | 1,241,754 | 1,177,054 | |||
| Total liabilities | 1,937,161 | 1,795,363 | |||
| STOCKHOLDERS’ EQUITY | 1,411,431 | 1,421,672 | |||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 3,348,592 | $ | 3,217,035 | |
| Schedule 2 |
| OPTION CARE HEALTH, INC. |
| CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS |
| (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)(UNAUDITED) |
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| NET REVENUE | $ | 1,227,186 | $ | 1,069,072 | $ | 2,373,238 | $ | 2,084,920 | |||||||
| COST OF REVENUE | 977,821 | 818,243 | 1,885,373 | 1,605,086 | |||||||||||
| GROSS PROFIT | 249,365 | 250,829 | 487,865 | 479,834 | |||||||||||
| OPERATING COSTS AND EXPENSES: | |||||||||||||||
| Selling, general and administrative expenses | 153,783 | 153,564 | 308,525 | 301,430 | |||||||||||
| Depreciation and amortization expense | 14,907 | 14,898 | 29,635 | 29,412 | |||||||||||
| Total operating expenses | 168,690 | 168,462 | 338,160 | 330,842 | |||||||||||
| OPERATING INCOME | 80,675 | 82,367 | 149,705 | 148,992 | |||||||||||
| OTHER INCOME (EXPENSE): | |||||||||||||||
| Interest expense, net | (12,603 | ) | (13,196 | ) | (25,805 | ) | (27,030 | ) | |||||||
| Other, net | 3,969 | 86,332 | 5,096 | 87,770 | |||||||||||
| Total other (expense) income | (8,634 | ) | 73,136 | (20,709 | ) | 60,740 | |||||||||
| INCOME BEFORE INCOME TAXES | 72,041 | 155,503 | 128,996 | 209,732 | |||||||||||
| INCOME TAX EXPENSE | 18,998 | 41,100 | 31,162 | 56,121 | |||||||||||
| NET INCOME | $ | 53,043 | $ | 114,403 | $ | 97,834 | $ | 153,611 | |||||||
| Earnings per share, basic | $ | 0.31 | $ | 0.64 | $ | 0.56 | $ | 0.85 | |||||||
| Earnings per share, diluted | $ | 0.30 | $ | 0.63 | $ | 0.56 | $ | 0.84 | |||||||
| Weighted average common shares outstanding, basic | 172,927 | 179,807 | 173,428 | 180,531 | |||||||||||
| Weighted average common shares outstanding, diluted | 174,090 | 181,241 | 174,831 | 181,931 | |||||||||||
| Schedule 3 |
| OPTION CARE HEALTH, INC. |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
| (IN THOUSANDS)(UNAUDITED) |
| Six Months Ended June 30, | |||||||
| 2024 | 2023 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net income | $ | 97,834 | $ | 153,611 | |||
| Adjustments to reconcile net income to net cash provided by operations: | |||||||
| Depreciation and amortization expense | 30,802 | 30,801 | |||||
| Other non-cash adjustments | 38,874 | 38,498 | |||||
| Changes in operating assets and liabilities: | |||||||
| Accounts receivable, net | (90,642 | ) | (18,619 | ) | |||
| Inventories | (7,417 | ) | (38,643 | ) | |||
| Accounts payable | 107,558 | 88,896 | |||||
| Accrued compensation and employee benefits | (30,206 | ) | (3,949 | ) | |||
| Prepaid expenses and other current assets | (1,745 | ) | 654 | ||||
| Other | (18,187 | ) | 8,039 | ||||
| Net cash provided by operating activities | 126,871 | 259,288 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Acquisition of property and equipment | (15,597 | ) | (13,554 | ) | |||
| Business acquisitions, net of cash acquired | — | (12,855 | ) | ||||
| Net cash used in investing activities | (15,597 | ) | (26,409 | ) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Purchase of company stock | (118,122 | ) | (75,000 | ) | |||
| Proceeds from issuance of debt | 49,959 | — | |||||
| Other financing cash flows | (10,088 | ) | (10,899 | ) | |||
| Net cash used in financing activities | (78,251 | ) | (85,899 | ) | |||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 33,023 | 146,980 | |||||
| Cash and cash equivalents - beginning of the period | 343,849 | 294,186 | |||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 376,872 | $ | 441,166 | |||
| Schedule 4 |
| OPTION CARE HEALTH, INC. |
| QUARTERLY RECONCILIATION BETWEEN GAAP AND NON-GAAP MEASURES |
| (IN THOUSANDS)(UNAUDITED) |
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||
| Net income | $ | 53,043 | $ | 114,403 | $ | 97,834 | $ | 153,611 | |||||
| Interest expense, net | 12,603 | 13,196 | 25,805 | 27,030 | |||||||||
| Income tax expense | 18,998 | 41,100 | 31,162 | 56,121 | |||||||||
| Depreciation and amortization expense | 15,497 | 15,576 | 30,802 | 30,801 | |||||||||
| EBITDA | 100,141 | 184,275 | 185,603 | 267,563 | |||||||||
| EBITDA adjustments | |||||||||||||
| Stock-based incentive compensation | 7,608 | 7,685 | 17,213 | 13,673 | |||||||||
| Loss on extinguishment of debt | 377 | — | 377 | — | |||||||||
| Restructuring, acquisition, integration and other (1) | 231 | (81,910 | ) | 3,454 | (77,412 | ) | |||||||
| Adjusted EBITDA | $ | 108,357 | $ | 110,050 | $ | 206,647 | $ | 203,824 | |||||
(1) Restructuring, acquisition, integration and other for the three and six months ended June 30, 2023 includes the Amedisys merger termination fee, net of merger-related expenses
FAQ
What was Option Care Health's (OPCH) net revenue for Q2 2024?
How much did Option Care Health (OPCH) earn per share in Q2 2024?
What is Option Care Health's (OPCH) updated revenue guidance for full-year 2024?
How much stock did Option Care Health (OPCH) repurchase in Q2 2024?
