Provides Updated Guidance for 2024
Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced
financial results for the third quarter and nine months ended
September 30, 2024.
Third Quarter Highlights
- Revenue totaled $815.6 million, an increase of 8.7% over the
third quarter of 2023
- Same facility revenue increased 8.6% compared with the third
quarter of 2023, including an increase in revenue per patient day
of 3.6% and an increase in patient days of 4.7%
- Net income attributable to Acadia totaled $68.1 million, or
$0.74 per diluted share
- Adjusted income attributable to Acadia totaled $84.1 million,
or $0.91 per diluted share
- Adjusted EBITDA totaled $194.3 million, an increase of 10.5%
over the third quarter of 2023, excluding provider relief
funds
- Same facility adjusted EBITDA margin increased 100 bps to 29.7%
over the third quarter of 2023
Adjusted income attributable to Acadia and Adjusted EBITDA are
non-GAAP financial measures. A reconciliation of all non-GAAP
financial measures in this press release begins on page 8.
Third Quarter Results Chris Hunter, Chief Executive
Officer of Acadia Healthcare Company, remarked, “Our financial
results for the third quarter of 2024 reflect continued execution
of our growth strategy. We have the scale and expertise to support
patients across the continuum of care. We are proud of the
important work we are doing and are committed to providing safe,
quality care for the patients, families and communities we serve
while creating long-term value for our stockholders.”
Strategic Investments for Long-Term Growth During the
third quarter of 2024, the Company continued to make progress in
meeting its strategic growth objectives. This includes the addition
of 15 beds to existing facilities and the addition of five new CTCs
during the quarter. With these additions, Acadia now operates 164
CTCs across 32 states treating over 72,000 patients daily and
remains on track to open up to 14 new CTCs for the full year.
In the first nine months of the year, the Company opened 79 new
beds at existing facilities. For the full year, the Company expects
to open over 400 new beds at existing facilities, including over
300 beds expected in the fourth quarter.
In the first nine months of the year, the Company also opened
two new facilities, totaling 120 beds. The Company remains on pace
to complete construction on several additional new wholly owned and
joint venture facilities, totaling nearly 700 new beds in the
fourth quarter, including joint venture hospitals in partnership
with Henry Ford Health in Detroit, Michigan, and Intermountain
Health in Denver, Colorado, as well as a new de novo facility in
Madison, Wisconsin, which was completed in October. The number of
new beds available to serve patients by the end of the fourth
quarter is subject to the timing of anticipated state-issued
licenses.
Acadia has 21 joint venture partnerships for 22 hospitals, with
11 hospitals already in operation and 11 additional hospitals
expected to open in the coming years.
Cash and Liquidity Maintaining a strong financial
position to support growth investments and disciplined capital
allocation are top priorities for Acadia. As of September 30, 2024,
the Company had $82.1 million in cash and cash equivalents and
$321.5 million available under its $600 million revolving credit
facility with a net leverage ratio of approximately 2.5x.
Net leverage ratio is a non-GAAP financial
measure. A reconciliation of all non-GAAP financial measures in
this press release begins on page 8.
2024 Financial Guidance Acadia today revised its
previously announced financial guidance for 2024. Revised guidance
reflects the closure of two facilities during the third
quarter(2).
2024
Guidance Range
Revenue(1)
$3.150 to $3.165 billion
Adjusted EBITDA(1)
$725 to $735 million
Adjusted earnings per diluted
share(1)
$3.35 to $3.45
Interest expense
$110 to $120 million
Tax rate
24.5% to 25.5%
Depreciation and amortization
expense
$145 to $155 million
Stock compensation expense
$40 to $45 million
Operating cash flows
$525 to $550 million
Expansion capital
expenditures
$550 to $595 million
Maintenance and IT capital
expenditures
$95 to $105 million
Total bed additions, excluding
acquisitions(3)
Approx. 1,200 beds
(1)
Includes one-time state payments of
approximately $10 million (or $0.09 per diluted share) for the
year, of which approximately $7 million was received in the first
quarter of 2024 and the remainder in the third quarter of
2024.
(2)
Prior full-year guidance assumed
approximately $17 million of revenue and approximately $1 million
of EBITDA contribution in the second half of the year from
facilities that were closed during the third quarter.
(3)
Company anticipates completing
construction on approximately 1,200 beds, of which approximately
1,000 are expected to be licensed and available to serve patients
by year end, with the remaining beds expected to receive licensure
in the first quarter. The exact number of beds available to serve
patients at year end will depend on timing of anticipated required
licenses.
The Company’s guidance does not include the impact of any future
acquisitions, divestitures, transaction, legal and other costs or
non-recurring legal settlements expense.
Conference Call Acadia will hold a conference call to
discuss its third quarter financial results at 8:00 a.m. Central
Time/9:00 a.m. Eastern Time on Thursday, October 31, 2024. A live
webcast of the conference call will be available at
www.acadiahealthcare.com in the “Investors” section of the website.
The webcast of the conference call will be available for 30
days.
About Acadia Acadia is a leading provider of behavioral
healthcare services across the United States. As of September 30,
2024, Acadia operated a network of 260 behavioral healthcare
facilities with approximately 11,300 beds in 38 states and Puerto
Rico. With approximately 23,500 employees serving more than 80,000
patients daily, Acadia is the largest stand-alone behavioral
healthcare company in the U.S. Acadia provides behavioral
healthcare services to its patients in a variety of settings,
including inpatient psychiatric hospitals, specialty treatment
facilities, residential treatment centers and outpatient
clinics.
Forward-Looking Information This press release contains
forward-looking statements. Generally, words such as “may,” “will,”
“should,” “could,” “anticipate,” “expect,” “intend,” “estimate,”
“plan,” “continue,” and “believe” or the negative of or other
variation on these and other similar expressions identify
forward-looking statements. These forward-looking statements are
made only as of the date of this press release. We do not undertake
to update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise.
Forward-looking statements are based on current expectations and
involve risks and uncertainties and our future results could differ
significantly from those expressed or implied by our
forward-looking statements. Factors that may cause actual results
to differ materially include, without limitation, (i) potential
difficulties in successfully integrating the operations of acquired
facilities or realizing the expected benefits and synergies of our
facility expansions, acquisitions, joint ventures and de novo
transactions; (ii) Acadia’s ability to add beds, expand services,
enhance marketing programs and improve efficiencies at its
facilities; (iii) potential reductions in payments received by
Acadia from government and commercial payors; (iv) the occurrence
of patient incidents, governmental investigations, litigation and
adverse regulatory actions, which could adversely affect the price
of our common stock and result in substantial payments and
incremental regulatory burdens; (v) the risk that Acadia may not
generate sufficient cash from operations to service its debt and
meet its working capital and capital expenditure requirements; (vi)
potential disruptions to our information technology systems or a
cybersecurity incident; and (vii) potential operating difficulties,
including, without limitation, disruption to the U.S. economy and
financial markets; reduced admissions and patient volumes;
increased costs relating to labor, supply chain and other
expenditures; changes in competition and client preferences; and
general economic or industry conditions that may prevent Acadia
from realizing the expected benefits of its business strategies.
These factors and others are more fully described in Acadia’s
periodic reports and other filings with the SEC.
Acadia Healthcare Company,
Inc.
Condensed Consolidated
Statements of Operations
(Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
(In thousands, except per
share amounts)
Revenue
$
815,634
$
750,334
$
2,379,725
$
2,185,938
Salaries, wages and benefits (including equity-based
compensation expense of $9,467, $8,163, $27,014 and $23,140,
respectively)
428,147
394,150
1,265,427
1,171,960
Professional fees
48,498
45,540
142,236
130,468
Supplies
29,623
27,147
84,153
79,312
Rents and leases
12,389
11,731
36,141
34,880
Other operating expenses
112,137
104,048
322,900
290,798
Income from provider relief fund
—
(4,442
)
—
(4,442
)
Depreciation and amortization
37,641
33,388
110,054
96,969
Interest expense, net
29,924
20,742
86,297
61,651
Legal settlements expense
—
394,181
—
394,181
Loss on impairment
10,459
—
11,459
8,694
Transaction, legal and other costs
8,249
11,247
17,187
26,792
Total expenses
717,067
1,037,732
2,075,854
2,291,263
Income (loss) before income taxes
98,567
(287,398
)
303,871
(105,325
)
Provision for (benefit from) income taxes
27,199
(71,873
)
72,916
(29,907
)
Net income (loss)
71,368
(215,525
)
230,955
(75,418
)
Net income attributable to noncontrolling interests
(3,236
)
(2,185
)
(7,958
)
(3,978
)
Net income (loss) attributable to Acadia Healthcare Company, Inc.
$
68,132
$
(217,710
)
$
222,997
$
(79,396
)
Earnings (loss) per share attributable to Acadia Healthcare
Company, Inc. stockholders: Basic
$
0.74
$
(2.39
)
$
2.44
$
(0.87
)
Diluted
$
0.74
$
(2.39
)
$
2.42
$
(0.87
)
Weighted-average shares outstanding: Basic
91,720
91,168
91,571
90,852
Diluted
92,188
91,168
92,119
90,852
Acadia Healthcare Company,
Inc.
Condensed Consolidated Balance
Sheets
(Unaudited)
September 30,
December 31,
2024
2023
(In thousands)
ASSETS Current assets:
Cash and cash equivalents
$
82,145
$
100,073
Accounts receivable, net
383,945
361,451
Other current assets
185,972
134,476
Total current assets
652,062
596,000
Property and equipment, net
2,679,807
2,266,610
Goodwill
2,264,851
2,225,962
Intangible assets, net
73,139
73,278
Deferred tax assets
2,706
6,658
Operating lease right-of-use assets
122,771
117,780
Other assets
75,121
72,553
Total assets
$
5,870,457
$
5,358,841
LIABILITIES AND
EQUITY Current liabilities:
Current portion of long-term debt
$
71,694
$
29,219
Accounts payable
201,379
156,132
Accrued salaries and benefits
141,470
141,901
Current portion of operating lease liabilities
27,175
26,268
Other accrued liabilities
167,782
532,261
Total current liabilities
609,500
885,781
Long-term debt
1,804,825
1,342,548
Deferred tax liabilities
54,112
1,931
Operating lease liabilities
105,437
100,808
Other liabilities
150,544
140,113
Total liabilities
2,724,418
2,471,181
Redeemable noncontrolling interests
114,521
105,686
Equity: Common stock
918
913
Additional paid-in capital
2,675,882
2,649,340
Retained earnings
354,718
131,721
Total equity
3,031,518
2,781,974
Total liabilities and equity
$
5,870,457
$
5,358,841
Acadia Healthcare Company,
Inc.
Condensed Consolidated
Statements of Cash Flows
(Unaudited)
Nine Months Ended September
30,
2024
2023
(In thousands)
Operating activities: Net income (loss)
$
230,955
$
(75,418
)
Adjustments to reconcile net income (loss) to net cash provided
by operating activities: Depreciation and
amortization
110,054
96,969
Amortization of debt issuance costs
3,061
2,485
Equity-based compensation expense
27,014
23,140
Deferred income taxes
56,133
(21,655
)
Legal settlements expense
—
394,181
Loss on impairment
11,459
8,694
Other
(3,988
)
1,423
Change in operating assets and liabilities, net of effect of
acquisitions: Accounts receivable, net
(20,936
)
(40,227
)
Other current assets
(3,334
)
(77,165
)
Other assets
676
309
Accounts payable and other accrued liabilities
(404,942
)
23,057
Accrued salaries and benefits
(1,841
)
(3,038
)
Other liabilities
8,681
17,723
Government relief funds
—
(4,442
)
Net cash provided by operating activities
12,992
346,036
Investing activities: Cash paid for
acquisitions, net of cash acquired
(53,550
)
(349
)
Cash paid for capital expenditures
(486,891
)
(285,410
)
Proceeds from sale of property and equipment
10,227
633
Other
(2,935
)
(1,925
)
Net cash used in investing activities
(533,149
)
(287,051
)
Financing activities: Borrowings on long-term
debt
350,000
—
Borrowings on revolving credit facility
210,000
40,000
Principal payments on revolving credit facility
(15,000
)
(35,000
)
Principal payments on long-term debt
(40,968
)
(15,938
)
Payment of debt issuance costs
(1,518
)
—
Repurchase of shares for payroll tax withholding, net of proceeds
from stock option exercises
(824
)
(45,193
)
Contributions from noncontrolling partners in joint ventures
3,500
2,538
Distributions to noncontrolling partners in joint ventures
(2,972
)
(3,480
)
Other
11
30
Net cash provided by (used in) financing activities
502,229
(57,043
)
Net (decrease) increase in cash and cash equivalents
(17,928
)
1,942
Cash and cash equivalents at beginning of the period
100,073
97,649
Cash and cash equivalents at end of the period
$
82,145
$
99,591
$
-
$
-
Effect of acquisitions: Assets acquired, excluding
cash
$
59,235
$
6,766
Liabilities assumed
(4,185
)
(128
)
Contingent consideration issued in connection with an acquisition
(1,500
)
—
Redeemable noncontrolling interest resulting from an acquisition
—
(6,289
)
Cash paid for acquisitions, net of cash acquired
$
53,550
$
349
Acadia Healthcare Company,
Inc.
Operating Statistics
(Unaudited, Revenue in
thousands)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
% Change
2024
2023
% Change
Same Facility Results (1) Revenue
$
802,555
$
739,335
8.6
%
$
2,334,956
$
2,148,408
8.7
%
Patient Days
800,880
764,703
4.7
%
2,332,369
2,260,513
3.2
%
Admissions
50,368
49,397
2.0
%
147,617
147,130
0.3
%
Average Length of Stay (2)
15.9
15.5
2.7
%
15.8
15.4
2.8
%
Revenue per Patient Day
$
1,002
$
967
3.6
%
$
1,001
$
950
5.3
%
Adjusted EBITDA margin (3)
29.7
%
29.3
%
40 bps
29.3
%
28.8
%
50 bps Adjusted EBITDA margin excluding income from provider relief
fund
29.7
%
28.7
%
100 bps
29.3
%
28.6
%
70 bps Facility Results Revenue
$
815,634
$
750,334
8.7
%
$
2,379,725
$
2,185,938
8.9
%
Patient Days
815,126
779,296
4.6
%
2,375,477
2,306,109
3.0
%
Admissions
51,513
50,302
2.4
%
151,082
150,237
0.6
%
Average Length of Stay (2)
15.8
15.5
2.1
%
15.7
15.3
2.4
%
Revenue per Patient Day
$
1,001
$
963
3.9
%
$
1,002
$
948
5.7
%
Adjusted EBITDA margin (3)
28.2
%
28.7
%
-50 bps
27.9
%
28.0
%
-10 bps Adjusted EBITDA margin excluding income from provider
relief fund
28.2
%
28.1
%
10 bps
27.9
%
27.8
%
10 bps (1) Same facility results for the periods presented
include facilities we have operated for more than one year and
exclude certain closed services. (2) Average length of stay is
defined as patient days divided by admissions. (3) For each of the
three and nine months ended September 30, 2023, includes income
from provider relief fund of $4.4 million.
Acadia Healthcare Company,
Inc.
Reconciliation of Net Income
Attributable to Acadia Healthcare Company, Inc. to Adjusted
EBITDA
(Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
(in thousands)
Net income (loss) attributable to Acadia Healthcare Company,
Inc.
$
68,132
$
(217,710
)
$
222,997
$
(79,396
)
Net income attributable to noncontrolling interests
3,236
2,185
7,958
3,978
Provision for (benefit from) income taxes
27,199
(71,873
)
72,916
(29,907
)
Interest expense, net
29,924
20,742
86,297
61,651
Depreciation and amortization
37,641
33,388
110,054
96,969
EBITDA
166,132
(233,268
)
500,222
53,295
Adjustments: Equity-based compensation expense (a)
9,467
8,163
27,014
23,140
Transaction, legal and other costs (b)
8,249
11,247
17,187
26,792
Legal settlements expense (c)
—
394,181
—
394,181
Loss on impairment (d)
10,459
—
11,459
8,694
Adjusted EBITDA
$
194,307
$
180,323
$
555,882
$
506,102
Adjusted EBITDA margin
23.8
%
24.0
%
23.4
%
23.2
%
Income from provider relief fund
—
(4,442
)
—
(4,442
)
Adjusted EBITDA excluding income from provider relief fund
$
194,307
$
175,881
$
555,882
$
501,660
Adjusted EBITDA margin excluding income from provider relief
fund
23.8
%
23.4
%
23.4
%
22.9
%
See footnotes on page 10.
Acadia Healthcare Company,
Inc.
Reconciliation of Net Income
Attributable to Acadia Healthcare Company, Inc. to
Adjusted Income Attributable
to Acadia Healthcare Company, Inc.
(Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
(in thousands, except per
share amounts)
Net income (loss) attributable to Acadia Healthcare Company,
Inc.
$
68,132
$
(217,710
)
$
222,997
$
(79,396
)
Adjustments to income: Transaction, legal and other
costs (b)
8,249
11,247
17,187
26,792
Legal settlements expense (c)
—
394,181
—
394,181
Loss on impairment (d)
10,459
—
11,459
8,694
Provision for (benefit from) income taxes
27,199
(71,873
)
72,916
(29,907
)
Adjusted income before income taxes attributable to Acadia
Healthcare Company, Inc.
114,039
115,845
324,559
320,364
Income tax effect of adjustments to income (e)
29,960
28,756
79,614
79,947
Adjusted income attributable to Acadia Healthcare Company, Inc.
84,079
87,089
244,945
240,417
Income from provider relief fund, net of taxes
—
(3,237
)
—
(3,237
)
Adjusted income attributable to Acadia Healthcare Company, Inc.
excluding income from provider relief fund
$
84,079
$
83,852
$
244,945
$
237,180
Weighted-average shares outstanding - diluted (f)
92,188
91,655
92,119
91,684
Adjusted income attributable to Acadia Healthcare Company,
Inc. per diluted share
$
0.91
$
0.95
$
2.66
$
2.62
Income from provider relief fund, net of taxes, per diluted share
—
(0.04
)
—
(0.04
)
Adjusted income attributable to Acadia Healthcare Company, Inc.,
excluding income from provider relief fund, per diluted share
$
0.91
$
0.91
$
2.66
$
2.58
See footnotes on page 10.
Acadia Healthcare Company, Inc. Footnotes We have
included certain financial measures in this press release,
including those listed below, which are “non-GAAP financial
measures” as defined under the rules and regulations promulgated by
the SEC. These non-GAAP financial measures include, and are
defined, as follows: •
EBITDA: net income (loss) attributable to
Acadia Healthcare Company, Inc. adjusted for net income
attributable to noncontrolling interests, provision for (benefit
from) income taxes, net interest expense and depreciation and
amortization. •
Adjusted EBITDA:
EBITDA adjusted for equity-based compensation expense, transaction,
legal and other costs, legal settlements expense and loss on
impairment. •
Adjusted EBITDA excluding
income from provider relief fund: Adjusted EBITDA adjusted
for income from provider relief fund. •
Adjusted EBITDA margin: Adjusted EBITDA divided by
revenue. •
Adjusted EBITDA margin
excluding income from provider relief fund: Adjusted EBITDA
excluding income from provider relief fund divided by revenue.
•
Adjusted income before income taxes
attributable to Acadia Healthcare Company, Inc.: net income
(loss) attributable to Acadia Healthcare Company, Inc. adjusted for
transaction, legal and other costs, legal settlements expense, loss
on impairment and provision for (benefit from) income taxes.
•
Adjusted income attributable to
Acadia Healthcare Company, Inc.: Adjusted income before
income taxes attributable to Acadia Healthcare Company, Inc.
adjusted for the income tax effect of adjustments to income.
•
Adjusted income attributable to
Acadia Healthcare Company, Inc. excluding income from provider
relief fund: Adjusted income attributable to Acadia
Healthcare Company, Inc. adjusted for income from provider relief
fund. •
Net leverage ratio:
Long-term debt (excluding $9.7 million of unamortized debt issuance
costs, discount and premium) less cash and cash equivalents divided
by Adjusted EBITDA for the trailing twelve months. The
non-GAAP financial measures presented herein are supplemental
measures of our performance and are not required by, or presented
in accordance with, generally accepted accounting principles in the
United States (“GAAP”). The non-GAAP financial measures presented
herein are not measures of our financial performance under GAAP and
should not be considered as alternatives to net income or any other
performance measures derived in accordance with GAAP or as an
alternative to cash flow from operating activities as measures of
our liquidity. Our measurements of these non-GAAP financial
measures may not be comparable to similarly titled measures of
other companies. We have included information concerning the
non-GAAP financial measures in this press release because we
believe that such information is used by certain investors as
measures of a company’s historical performance. We believe these
measures are frequently used by securities analysts, investors and
other interested parties in the evaluation of issuers of equity
securities, many of which present similar non-GAAP financial
measures when reporting their results. Because the non-GAAP
financial measures are not measurements determined in accordance
with GAAP and are thus susceptible to varying calculations, the
non-GAAP financial measures, as presented, may not be comparable to
other similarly titled measures of other companies. Our
presentation of these non-GAAP financial measures should not be
construed as an inference that our future results will be
unaffected by unusual or nonrecurring items. The Company is
not able to provide a reconciliation of projected Adjusted EBITDA
and adjusted earnings per diluted share, where provided, to
expected results due to the unknown effect, timing and potential
significance of transaction-related expenses and the tax effect of
such expenses. (a) Represents the equity-based
compensation expense of Acadia. (b) Represents transaction, legal
and other costs incurred by Acadia primarily related to legal,
government investigations, management transition, termination,
restructuring, acquisition and other similar costs. (c) Represents
legal settlements expense related to the Desert Hills litigation.
(d) Represents non-cash impairment charges related to the closure
of certain facilities. (e) Represents the income tax effect of
adjustments to income based on tax rates of 26.3% and 24.8% for the
three months ended September 30, 2024 and 2023, respectively, and
24.5% and 25.0% for the nine months ended September 30, 2024 and
2023, respectively. (f) For the three and nine months ended
September 30, 2023, approximately 0.5 million and 0.8 million
outstanding shares of restricted stock and shares of common stock
issuable upon exercise of outstanding stock option awards,
respectively, have been included in the calculation of
weighted-average shares outstanding-diluted. These shares are
excluded from the calculation of diluted earnings per share in the
condensed consolidated statement of operations because the net loss
for the three and nine months ended September 30, 2023 causes such
securities to be anti-dilutive.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241030593005/en/
Investor Contact: Patrick Feeley Senior Vice President, Investor
Relations (615) 861-6000
Acadia Healthcare (NASDAQ:ACHC)
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