AMN Healthcare Services, Inc. Reports Record Third Quarter Results; Third Quarter Revenue Increases 47%; Earnings Per Share at $0.30.Business Editors and Health/Medical Writers SAN DIEGO--(BUSINESS WIRE)--Oct. 28, 2002 AMN Amn abbr. airman Healthcare Services, Inc. (NYSE NYSE See: New York Stock Exchange :AHS AHS Assistant House Surgeon. ) today reported record revenue and earnings results for the third quarter ended September September: see month. 30, 2002. These results reflect a 47% increase in revenue to $203.4 million for the third quarter of 2002, up from $137.9 million for the same period a year ago. The company reported net income of $14.3 million, or $0.30 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for the third quarter of 2002 compared to net income of $2.7 million, or $0.09 per diluted share, for the prior year third quarter. (See accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. tables.) "Our solid growth continued in the third quarter as a result of strong long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. healthcare fundamentals and our industry leading position in the travel healthcare staffing sector," said Steven Ste´ven n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. C. Francis Francis, French prince, duke of Alençon and Anjou Francis, 1554–84, French prince, duke of Alençon and Anjou; youngest son of King Henry II of France and Catherine de' Medici. , president and chief executive officer. "Organic volume growth for the quarter, resulting in nearly 8,000 travelers on assignment, combined with effective margin and cost management, translated into strong revenue and earnings results. Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become margin exceeded 12% for the third quarter compared to 11.5% for the third quarter of 2001. In addition, the company improved its net cash position by generating over $30 million in free cash flow during the quarter." Increases in revenue were driven by a 28% growth in the average number of travelers on assignment to 7,983 for the third quarter of 2002, as compared to 6,217 for the third quarter of 2001. Also contributing to revenue growth was a 15% increase in the average revenue per traveler Traveler (U.S. English) or Traveller (British English) may refer to:
"The top-line growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. in the latter half of 2002 have been very robust and, as predicted, have moderated from exceptionally high levels in recent quarters. We expect to continue to maintain attractive long-term traveler, revenue and earnings growth rates," Francis said. Adjusted cash earnings in the third quarter of 2002 increased to $14.5 million, or $0.31 per diluted share, from $6.8 million, or $0.22 per diluted share, for the same period a year ago. Adjusted cash earnings, a non-GAAP measure that the company believes provides a meaningful comparison of operating performance between 2002 and 2001, excludes tax-adjusted charges primarily related to the company's November November: see month. 2001 initial public offering, as well as transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). and the amortization of goodwill and other intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. . Earnings before interest, taxes, depreciation, amortization, transaction costs and non-cash stock-based compensation related to the IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. (adjusted EBITDA, a non-GAAP measure) increased 55% to $24.6 million for the third quarter of 2002, up from $15.9 million for the third quarter of 2001. Gross profit increased 44% for the third quarter of 2002 over the comparable period in 2001, driven primarily by growth in the average number of travelers on assignment. The third quarter gross margin of 24.4% was in line with the company's expectations and remained relatively consistent with the gross margin reported in the second quarter of 2002. Selling, general and administrative expenses for the third quarter of 2002 declined to 12.3% of revenue compared to 13.6% of revenue for the third quarter of 2001 and 12.8% in the second quarter of 2002, reflecting continued leveraging of the company's overhead expenses. For the nine months ended September 30, 2002, revenue increased 59% to $568.6 million from $357.1 million a year ago. The company reported year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. net income of $38.0 million, or $0.80 per diluted share, compared with net income of $4.6 million, or $0.15 per diluted share, a year ago. Year-to-date adjusted cash earnings grew to $38.6 million, or $0.82 per diluted share, up from $15.8 million, or $0.50 per diluted share, for the same period last year. AMN Healthcare continues to be debt free with over $70 million of cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments as of September 30, 2002. 2002 and 2003 Revenue and Earnings Guidance For the fourth quarter of 2002, the company expects net income per diluted share to be approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $0.30 to $0.31 per diluted share, on revenue growth ranging from 29% to 31% over the prior year. Adjusted EBITDA is expected to increase 37% to 40% over the same period in 2001. Combined with quarterly results previously reported, the company expects full year 2002 net income per diluted share to increase to approximately $1.10 to $1.11. Total year 2002 revenue is expected to range from $775 to $780 million, an increase of 50% to 51% over 2001. For 2003, the company expects net income per diluted share to range between $1.32 and $1.38 on revenue growth ranging from 19% to 24% as compared to 2002. Adjusted EBITDA for 2003 is expected to increase 20% to 25% over 2002. Company Summary AMN Healthcare Services, Inc. is the largest nationwide provider of travel healthcare staffing services. The company recruits nurses and allied health professionals nationally and internationally and places them on temporary assignments, typically for 13 weeks, at acute-care hospitals and healthcare facilities throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Conference Call on October October: see month. 29, 2002 AMN Healthcare Services, Inc.'s third quarter earnings conference call will be held on October 29, 2002 at 7:00 a.m. PST PST Paroxysmal supraventricular tachycardia, see there (10:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy ). A live webcast of the call can be accessed at www.amnhealthcare.com/investors, with a replay available on the web site until November 11, 2002. A replay of the call will also be available by telephone through November 4, 2002 by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 653830. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The company has tried, whenever possible, to identify these forward-looking statements using words such as "anticipates," "believes," "estimates," "expects," "plans," "intends" and similar expressions. Similarly, statements herein that describe the company's business strategy, outlook, objectives, plans, intentions or goals are also forward-looking statements. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause the company's actual results, performance or achievements to differ materially from those expressed in, or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by, such statements. These risks and uncertainties may include, but are not limited to: the company's ability to continue to recruit RECRUIT. A newly made soldier. and retain qualified temporary healthcare professionals and ability to attract and retain operational personnel; the company's ability to enter into contracts with hospitals and other healthcare facility clients on terms attractive to the company and to secure orders related to those contracts; the attractiveness to hospitals and healthcare facility clients to use our services; the general level of patient occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy at the company's hospital and healthcare facility clients' facilities; the company's ability to successfully implement its acquisition and integration strategies; the effect of existing or future government regulation of the healthcare industry, and the company's ability to comply with these regulations; the impact of medical malpractice Improper, unskilled, or negligent treatment of a patient by a physician, dentist, nurse, pharmacist, or other health care professional. and other claims asserted against the company; and the company's ability to carry out its business strategy, including adapting to an increasingly competitive environment. The results reported in this release are for a partial year and may not be indicative indicative: see mood. of results for future quarters or for the year. These statements reflect the company's current beliefs and are based upon information currently available to it. Be advised that developments subsequent to this release are likely to cause these statements to become outdated out·dat·ed adj. Out-of-date; old-fashioned. outdated Adjective old-fashioned or obsolete Adj. 1. with the passage of time. The company does not intend, however, to update the guidance provided today prior to its next earnings release. Tables Follow:
AMN Healthcare Services, Inc.
Condensed Statements of Operations
(dollars and shares in thousands, except per share and traveler data)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2002 2001 %Chg 2002 2001 %Chg
----------------------------------------------
Revenue $203,445 $137,936 47% $568,636 $357,108 59%
Cost of revenue 153,748 103,310 49% 430,350 267,333 61%
------------------ ------------------
Gross profit 49,697 34,626 44% 138,286 89,775 54%
------------------ ------------------
24.4% 25.1% 24.3% 25.1%
Expenses:
Selling, general and
administrative 25,049 18,714 34% 72,181 49,750 45%
12.3% 13.6% 12.7% 13.9%
Non-cash stock-based
compensation(1) 219 4,366 (95%) 655 13,096 (95%)
Amortization 98 1,432 (93%) 272 4,128 (93%)
Depreciation 837 604 39% 2,265 1,484 53%
Transaction costs(2) 0 0 N/M 139 0 N/M
------------------ ------------------
Total expenses 26,203 25,116 4% 75,512 68,458 10%
------------------ ------------------
Income from operations 23,494 9,510 N/M 62,774 21,317 N/M
Interest (income)
expense, net (66) 3,783 N/M (217) 11,780 N/M
------------------ ------------------
Income before income
taxes 23,560 5,727 N/M 62,991 9,537 N/M
Income tax expense 9,268 2,978 N/M 25,041 4,959 N/M
------------------ ------------------
Net income $14,292 $2,749 N/M $37,950 $4,578 N/M
================== ==================
Basic and diluted net
income per common
share:
Basic net income per
common share $0.33 $0.10 N/M $0.89 $0.16 N/M
================== ==================
Diluted net income per
common share $0.30 $0.09 N/M $0.80 $0.15 N/M
================== ==================
Weighted average common
shares outstanding -
basic 42,989 28,835 49% 42,627 28,835 48%
================== ==================
Weighted average common
shares outstanding -
diluted 47,054 31,431 50% 47,152 31,431 50%
================== ==================
Other Financial and
Operating Data:
Average travelers on
assignment 7,983 6,217 28% 7,654 5,655 35%
================== ==================
Revenue per traveler per
day $277.01 $241.16 15% $272.13 $231.32 18%
================== ==================
Gross profit per
traveler per day $67.67 $60.54 12% $66.18 $58.15 14%
================== ==================
Adjusted EBITDA(3) $24,648 $15,912 55% $66,105 $40,025 65%
================== ==================
12.1% 11.5% 11.6% 11.2%
Adjusted cash
earnings(4) $14,484 $6,800 113% $38,593 $15,789 144%
================== ==================
Adjusted cash earnings
per diluted share $0.31 $0.22 41% $0.82 $0.50 64%
================== ==================
(1) Non-cash stock-based compensation represents compensation expense related to stock option plans to reflect the difference at the completion of the IPO between the fair market value and the exercise price of stock options previously issued to the company's officers. (2) Transaction costs represent costs incurred in connection with the acquisition of Healthcare Resource Management Corporation in 2002. (3) Adjusted EBITDA represents income from operations plus interest, depreciation, amortization, transaction costs and non-cash stock-based compensation expense. Adjusted EBITDA is presented because the company believes that it is a widely accepted financial indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. used by certain investors and securities analysts to analyze an·a·lyze v. 1. To examine methodically by separating into parts and studying their interrelations. 2. To separate a chemical substance into its constituent elements to determine their nature or proportions. 3. and compare companies on the basis of operating performance. Adjusted EBITDA is not intended to represent cash flows for the period, nor has it been presented as an alternative to operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with accounting principles generally accepted in the United States. As defined, adjusted EBITDA is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. (4) Adjusted cash earnings represents net income excluding the tax-effected impact of non-cash stock-based compensation, transaction costs and amortization expense. Adjusted cash earnings is presented because we believe that it provides a meaningful comparison of operating performance. Adjusted cash earnings is not intended to represent net income for the period, nor has it been presented as an alternative to net income as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with accounting principles generally accepted in the United States. As defined, adjusted cash earnings is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation.
AMN Healthcare Services, Inc.
Adjusted Cash Earnings Reconciliation
(dollars and shares in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2002 2001 %Chg 2002 2001 %Chg
---------------------------------------
Net income $14,292 $2,749 $37,950 $4,578
Adjustments, net of tax:
Non-cash stock-based
compensation 133 3,206 395 8,775
Transaction costs 0 0 84 0
Amortization expense 59 845 164 2,436
--------------- ----------------
Adjusted cash earnings(1) $14,484 $6,800 113% $38,593 $15,789 144%
=============== ================
Adjusted cash earnings per
common share:
Basic $0.34 $0.24 42% $0.91 $0.55 65%
=============== ================
Diluted $0.31 $0.22 41% $0.82 $0.50 64%
=============== ================
Weighted average common shares
outstanding:
Basic 42,989 28,835 49% 42,627 28,835 48%
=============== ================
Diluted 47,054 31,431 50% 47,152 31,431 50%
=============== ================
(1) Adjusted cash earnings represents net income excluding the tax-effected impact of non-cash stock-based compensation, transaction costs and amortization expense. Adjusted cash earnings is presented because we believe that it provides a meaningful comparison of operating performance. Adjusted cash earnings is not intended to represent net income for the period, nor has it been presented as an alternative to net income as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with accounting principles generally accepted in the United States. As defined, adjusted cash earnings is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation.
AMN Healthcare Services, Inc.
Condensed Balance Sheet
(in thousands)
(unaudited)
September June December
30, 30, 31,
2002 2002 2001
---------------------------
Assets
Current assets:
Cash, cash equivalents and short-term
investments $70,007 $40,369 $31,968
Accounts receivable, net 129,246 131,403 105,416
Other current assets 13,066 16,116 14,556
---------------------------
Total current assets 212,319 187,888 151,940
Fixed assets, net 10,120 9,749 7,713
Goodwill, net 135,532 135,585 127,752
Deferred income taxes 16,432 16,432 19,406
Intangible and other assets 2,648 2,706 2,118
---------------------------
Total assets $377,051 $352,360 $308,929
===========================
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $13,303 $11,816 $5,625
Accrued compensation and benefits 35,622 31,079 23,965
Other current liabilities 9,690 4,488 5,872
---------------------------
Total current liabilities 58,615 47,383 35,462
Other long-term liabilities 1,771 2,761 1,562
---------------------------
Total liabilities 60,386 50,144 37,024
Stockholders' equity 316,665 302,216 271,905
---------------------------
Total liabilities and stockholders'
equity $377,051 $352,360 $308,929
===========================
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