AMN Healthcare Announces Full Year and Fourth Quarter 2011 Results
AMN Healthcare Announces Full Year and Fourth Quarter 2011 Results
AMN Healthcare Services, Inc. (NYSE: AHS), the nation's innovator in healthcare workforce solutions, today announced financial results for the full year and fourth quarter 2011. The results were at the upper end of management's expectations, the Company said. Financial highlights are as follows:
(Dollars in millions, except per share amounts. Amounts have been adjusted to reflect the impact of the discontinued operations associated with the disposal of the Home Healthcare Services segment in January 2012.)
Net Income from Continuing Operations
Net Loss per Diluted Share
* See notes (2) and (3) under "Supplemental Financial and Operating Data" for a reconciliation of non-GAAP items.
NM – Not meaningful
Key business highlights for the full year and fourth quarter of 2011 are as follows:
Consolidated pro forma full year revenues grew by 11% and adjusted EBITDA grew by 40%. Pro forma adjusted EBITDA margin for the year was 7.2%, a 150 basis point improvement over the prior year.
The Travel Nurse division experienced pro forma full year revenue growth of 32% and adjusted EBITDA growth of 71%, reflecting the strength of the Company's managed services program (MSP) client relationships, recruitment strategies, and ability to leverage its infrastructure.
Operating leverage was significantly improved by revenue and cost synergies from integrating the Medfinders organization, which was acquired in September 2010.
Revenues for the fourth quarter in Nurse and Allied Healthcare Staffing, AMN's largest segment, were flat sequentially and up 16% year-over-year due primarily to continued growth in travel nurse volume. Segment operating margin of 12.2% was up 190 basis points sequentially and 380 basis points compared with the same quarter last year.
Fourth quarter consolidated gross margin improved 50 basis points sequentially and 80 basis points year-over-year.
The Company completed the sale of its Home Healthcare Services business on January 30, 2012.
"Going into 2012, we are focused on fulfilling our clients' desire for more workforce solutions and innovative service offerings. AMN's leading position and differentiated value proposition in workforce solutions has put us at the forefront of growth and thought leadership in our industry," said Susan R. Salka, President and Chief Executive Officer of AMN Healthcare. "An indicator of the positive client reaction to our differentiated capabilities was the 20 new MSP contracts won during the year with an estimated $80 million in annualized gross spend under management. We expect these growth trends in MSP and other workforce solutions to continue."
Full Year and Fourth Quarter 2011 Results
Full year 2011 consolidated revenue was $887 million, an increase of 32% from prior year. Nurse and Allied Healthcare Staffing segment revenue was $571 million, a year-over-year increase of 54%. Locum Tenens Staffing segment revenue was $278 million, a year-over-year increase of 5%. Physician Permanent Placement Services segment revenue was $39 million, a year-over-year increase of 14%.
For the fourth quarter of 2011, consolidated revenue was $222 million, a decrease of 3% sequentially and an increase of 8% from the same quarter last year. The sequential decline was due to typical seasonality from fewer clinicians on assignment and overall fewer hours worked over the holidays. Fourth quarter revenue for the Nurse and Allied Healthcare Staffing segment was $148 million, flat sequentially and up 16% from the same quarter last year. The Locum Tenens Staffing segment generated revenue in the fourth quarter of $65 million, a decrease of 10% sequentially and 7% from the same quarter last year. Fourth quarter Physician Permanent Placement Services segment revenue was $9 million, an increase of 2% sequentially and flat from the same quarter last year.
Full year gross margin was 28.1% as compared to 27.5% for prior year. The increase in 2011 gross margin was due primarily to favorable workers compensation adjustments and improved performance within the Nurse and Allied Healthcare Staffing segment, the impact from the adoption of a new revenue recognition accounting standard on January 1, 2011 in the Physician Permanent Placement Services segment, as well as the addition of the higher margin Medfinders businesses. Gross margin in the fourth quarter of 2011 was 28.3%, an increase of 50 basis points compared to the previous quarter and an increase of 80 basis points from the same quarter last year.
For the full year, SG&A expenses as a percentage of revenue were 22.0% compared to 24.3% for the prior year, due primarily to improved operating leverage and the cost synergies achieved through the integration of Medfinders. SG&A expenses for the fourth quarter of 2011 were $49.0 million, representing 22.1% as a percent of revenue, compared to 21.6% in the prior quarter and 24.6% in the same quarter last year. The decrease compared to the same quarter last year was due primarily to lower integration-related expenses associated with the Medfinders acquisition and the resulting improved SG&A leverage. Excluding acquisition and integration related costs, SG&A expenses as a percentage of revenues were 21.9% in the fourth quarter of 2011, which was up 40 basis points from the prior quarter and down 170 basis points from the same quarter last year.
Full year and fourth quarter 2011 net loss per diluted common share was ($0.57) and ($0.05), respectively. Full year and fourth quarter 2011 loss per share was impacted by $31.2 million and $7.7 million, respectively, in non-cash goodwill and intangible asset impairment charges. Excluding the discontinued Home Healthcare Services segment and associated non-cash goodwill and intangible asset impairment charges, integration-related costs, and credit agreement amendment fees charged to interest expense, adjusted earnings per share for the full year and fourth quarter 2011 was $0.16 and $0.04, respectively.
As of December 31, 2011, cash and cash equivalents totaled $4 million, compared to $2 million as of December 31, 2010. Total debt outstanding, net of discount, as of December 31, 2011 was $205 million, compared to $215 million as of December 31, 2010. Subsequent to year-end, the Company made a voluntary debt payment of $5 million and paid off its $3 million revolver balance.
Business Trends and Outlook
On a consolidated basis, first quarter revenues are expected to be between $224 million and $228 million, which represents a 1% to 3% sequential increase. This anticipated sequential increase is driven by continued growth in the Nurse and Allied Healthcare Staffing segment, with flat revenues in the Locum Tenens segment. Gross margin is anticipated to be between 27.5% and 28.0%. SG&A expenses are expected to be approximately 22.0% of revenues. Adjusted EBITDA margin is expected to be approximately 6.5%.
While the Company does not intend to provide annual guidance on revenue and EPS, on the earnings call today management will provide full year estimates for depreciation and amortization, interest expense, share count and capital expenditures.