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Acadia Healthcare Reports Second Quarter 2022 Results and Raises 2022 Guidance

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FRANKLIN, Tenn., July 27, 2022--(BUSINESS WIRE)--Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced financial results for the second quarter ended June 30, 2022.

Second Quarter Highlights

  • Revenue totaled $651.7 million, an increase of 11.9% over the second quarter of 2021

  • Same facility revenue increased 8.5% compared to the second quarter of 2021, including an increase in revenue per patient day of 7.8% and an increase in patient days of 0.7%

  • Net income attributable to Acadia totaled $80.1 million, or $0.88 per diluted share, and adjusted income from continuing operations attributable to Acadia stockholders totaled $82.8 million, or $0.91 per diluted share, which included $0.07 of income from the Provider Relief Fund ("PRF") established under the Coronavirus Aid, Relief, and Economic Security ("CARES") Act

  • Adjusted EBITDA totaled $165.9 million, which included $8.6 million of income from PRF established under the CARES Act

  • Cash flows from operating activities totaled $149.2 million

Second Quarter Results

The Company reported revenue of $651.7 million for the second quarter of 2022, compared with $582.2 million for the second quarter of 2021. Adjusted EBITDA was $165.9 million for the second quarter of 2022, compared with $141.3 million for the same period last year. Excluding the income from PRF, Adjusted EBITDA was $157.3 million for the second quarter of 2022.

As of December 31, 2021, the Company had $8.6 million of PRF that had been received but not recognized in income, pending the Company’s ongoing review of the criteria and evaluation of pandemic related costs incurred. During the second quarter of 2022, the Company received an additional $7.7 million of funds from PRF and $14.2 million of funds from the American Rescue Plan ("ARP") Rural Payments for hospitals. The Company recorded income of $8.6 million in the second quarter of 2022. The Company will continue to review the remaining $21.9 million of PRF and ARP funds held on our balance sheet as of June 30, 2022, for the potential recognition of additional income. Financial guidance for 2022 does not include the recognition of additional income in the second half of 2022.

Net income attributable to Acadia stockholders for the second quarter of 2022 was $80.1 million, or $0.88 per diluted share. Adjusted income from continuing operations attributable to Acadia stockholders was $0.91 per diluted share for the second quarter of 2022. Excluding income from PRF, adjusted income from continuing operations was $0.84 for the second quarter of 2022. Adjustments to income include transaction-related expenses and the income tax effect of adjustments to income. A reconciliation of all non-GAAP financial results in this press release begins on page 10.

For the second quarter of 2022, Acadia’s same facility revenue increased 8.5% compared with the second quarter of 2021, including an increase in revenue per patient day of 7.8% and an increase in patient days of 0.7%. During the quarter, the Company received one-time payments of $5.4 million from one of our states.

Chris Hunter, the Company's Chief Executive Officer, remarked, "Acadia delivered strong financial and operating results for the second quarter of 2022 despite ongoing COVID-19 and labor challenges. We saw increased COVID-19 cases in certain markets, which had a temporary impact on the Company’s patient admissions and staffing. Our team continues to work through these surges with robust policies and procedures to ensure the safety of our patients and staff. We also continue to manage through a tight labor market with our proactive approach to staffing, centralized recruitment efforts and ability to maintain a diversified clinical staff. We are truly grateful for our dedicated employees and clinicians across our facilities who have continued to work tirelessly to meet the needs of our patients in a safe and effective manner.

"We continue to see strong underlying demand for behavioral healthcare services. Acadia is uniquely positioned to meet this critical societal need with our proven operating model and diversified service lines across the continuum of care, each of which offers high-quality patient care. We are mindful of the important role we play as an industry leader, and we are committed to extending our market reach to more patients and communities that need our critical care.

Strategic Investments for Long-Term Growth

"We are pleased with the progress we have made in 2022 with respect to our four strategic growth pathways. In line with our first growth pathway, we added 78 beds to our existing facilities during the first half of the year. We are on target to meet our goal of adding approximately 300 beds in 2022, with a significant portion of 2022’s new beds expected to open in the third quarter. Facility expansions provide an efficient opportunity to expand services in our current markets, as we can leverage the existing operations and experienced staff.

"The second important pathway is to identify underserved markets where we can develop wholly owned de novo facilities that meet the critical demand for behavioral healthcare services. We believe there are significant opportunities in communities across the country to address this unmet need at the local level. As part of our Montrose Behavioral Health Hospital operations in Chicago, we opened a 60-bed children’s hospital in early July. Renovation work continues for the 101-bed adult hospital and the outpatient facility, which are expected to begin operations in 2023. In addition to the new Chicago facilities, we expect to open our de novo facility, Coachella Valley Behavioral Health, in Indio, California, early next year.

"The increase in opioid use disorder has led to a national epidemic of opioid overdose deaths with more than 107,000 estimated drug overdose deaths in 2021. We continue to identify opportunities to expand our network of 142 comprehensive treatment centers (CTCs) as these facilities play a critical role by providing medication-assisted treatment for patients dealing with the opioid use disorder. We opened one new CTC in Virginia during the second quarter, and we are on track to open at least six CTCs in 2022 to support the high demand for effective addiction treatment.

"For our third growth pathway, we are proud to partner with leading health systems across the country to expand behavioral healthcare treatment options in their communities, and we believe joint venture partnerships represent an attractive growth pathway for Acadia. As we enter new markets, we can leverage the established presence and reputation of the local provider and bring our expertise in behavioral healthcare services to develop mutually beneficial partnerships.

"We recently announced new joint ventures with Tufts Medicine, one of New England’s elite health systems to build a new 144-bed behavioral health hospital in Malden, Massachusetts, and ECU Health, one of eastern North Carolina’s premier health systems to build a 144-bed behavioral health hospital in Greenville, North Carolina. The partnership with ECU will expand our acute service line into the North Carolina market. With these newly announced joint ventures, Acadia now has 18 such partnerships. We also expect to open new facilities with our previously announced partnerships with Covenant Health in Knoxville, Tennessee, during the third quarter of 2022, and with Lutheran Health Network in Ft. Wayne, Indiana, later in 2022. These joint ventures advance our strategy to bring together the best practices of Acadia and our partners to expand access to quality behavioral healthcare services in their respective communities.

"For our fourth pathway, we believe there are attractive opportunities for Acadia to acquire existing facilities and implement our operating model and make the necessary investments in both the infrastructure and service offerings to enhance the level of care. We are fortunate to have the financial strength and a disciplined capital allocation strategy to continue to pursue strategic acquisitions as another important growth pathway for Acadia," added Hunter.

Cash and Liquidity

Acadia has continued to maintain a strong financial position in 2022, providing the flexibility to pursue its growth initiatives and make strategic investments in its business. As of June 30, 2022, the Company had $128 million in cash and cash equivalents. During the second quarter, the Company repaid $75 million on its senior secured revolving credit facility, reducing the outstanding balance to $85 million as of June 30, 2022. The Company had $515 million available under its $600 million revolving credit facility and its net leverage ratio was approximately 2.1x as of June 30, 2022.

During the second quarter, the Company continued its repayment of amounts received pursuant to the Medicare Accelerated and Advanced Payment Program under the CARES Act. Of the $45 million of advanced payments received in 2020, the Company repaid a total of $25 million in 2021 and made additional payments of $15 million through the first half of 2022. The Company will continue to repay the remaining balance throughout the rest of 2022. The Company will also repay the remaining $20 million of the approximately $39 million of 2020 payroll tax deferrals in the second half of 2022.

Financial Guidance

Acadia today raised its previously announced financial guidance for 2022, as follows:

2022 Guidance Range

Revenue

$2.56 to $2.60 billion

Adjusted EBITDA, including income from PRF

$591.5 to $621.5 million

Adjusted EBITDA, excluding income from PRF

$583 to $613 million

Adjusted earnings per diluted share, including

income from PRF

$3.00 to $3.25

Adjusted earnings per diluted share, excluding

income from PRF

$2.93 to $3.18

Interest Expense

$67 to $70 million

Tax rate

25% to 26%

Depreciation and amortization expense

$120 to $125 million

Stock compensation expense

Approximately $30 million

Operating cash flows

$380 to $430 million

Expansion capital expenditures

$240 to $280 million

Maintenance capital expenditures

Approximately $50 million

The Company’s guidance does not include the impact of any future acquisitions, divestitures or transaction-related expenses.

Looking Ahead

Hunter added, "Acadia has demonstrated solid execution with favorable results through the first half of 2022, and we believe the strong demand trends across our service lines will support continued growth. As issues surrounding mental health and escalating substance abuse have taken center stage in our public discourse, the stigma associated with treatment has lessened, resulting in more people seeking the care they need. As such, we see many opportunities to extend our role as a leading provider of behavioral healthcare services. Without question, the challenges of the past two years related to the pandemic have highlighted the critical need for our services. We are uniquely positioned to meet this demand with a well-defined growth strategy and enterprise capabilities that extend across 239 facilities offering diversified service lines and patient-centered care. As we look ahead, we will continue to leverage our scale and expertise to have a positive impact on the patients and communities we serve and create value for our stockholders."

Conference Call

Acadia will hold a conference call to discuss its second quarter financial results at 9:00 a.m. Eastern Time on Thursday, July 28, 2022. 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 June 30, 2022, Acadia operated a network of 239 behavioral healthcare facilities with approximately 10,600 beds in 39 states and Puerto Rico. With more than 22,500 employees serving approximately 70,000 patients daily, Acadia is the largest stand-alone behavioral health 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) the impact of the COVID-19 pandemic, including, without limitation, disruption to the U.S. economy and financial markets; reduced admissions and patient volumes; and increased costs relating to labor, supply chain and other expenditures; (ii) the impact of vaccine and other pandemic-related mandates imposed by local, state and federal authorities; (iii) potential difficulties in successfully integrating the operations of acquired facilities or realizing the expected benefits and synergies of our acquisitions, joint ventures and de novo transactions; (iv) Acadia’s ability to add beds, expand services, enhance marketing programs and improve efficiencies at its facilities; (v) potential reductions in payments received by Acadia from government and third-party payors; (vi) 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; (vii) the risk that Acadia may not generate sufficient cash from operations to service its debt and meet its working capital and capital expenditure requirements; (viii) potential disruptions to our information technology systems or a cybersecurity incident; and (ix) potential operating difficulties, labor costs, client preferences, changes in competition 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 June 30,

Six Months Ended June 30,

2022

2021

2022

2021

(In thousands, except per share amounts)

Revenue

$

651,719

$

582,156

$

1,268,372

$

1,133,355

Salaries, wages and benefits (including equity-based compensation expense of
$6,580, $9,031, $14,505 and $16,065, respectively)

339,388

309,233

675,150

613,566

Professional fees

40,440

34,696

77,351

66,313

Supplies

25,022

22,633

48,721

43,955

Rents and leases

11,192

9,620

22,441

19,032

Other operating expenses

84,937

73,751

166,362

145,761

Income from provider relief fund

(8,550

)

(8,550

)

Depreciation and amortization

29,128

25,650

58,054

50,544

Interest expense, net

16,565

16,687

32,352

45,714

Debt extinguishment costs

24,650

Loss on impairment

23,214

23,214

Transaction-related expenses

3,940

1,675

7,522

6,285

Total expenses

542,062

517,159

1,079,403

1,039,034

Income from continuing operations before income taxes

109,657

64,997

188,969

94,321

Provision for income taxes

27,725

19,333

45,127

25,537

Income from continuing operations

81,932

45,664

143,842

68,784

Loss from discontinued operations, net of taxes

(12,641

)

Net income

81,932

45,664

143,842

56,143

Net income attributable to noncontrolling interests

(1,853

)

(1,150

)

(2,926

)

(1,912

)

Net income attributable to Acadia Healthcare Company, Inc.

$

80,079

$

44,514

$

140,916

$

54,231

Basic earnings per share attributable to Acadia Healthcare Company, Inc.
stockholders:

Income from continuing operations attributable to Acadia Healthcare
Company, Inc.

$

0.89

$

0.50

$

1.57

$

0.76

Loss from discontinued operations

$

(0.15

)

Net income attributable to Acadia Healthcare Company, Inc.

$

0.89

$

0.50

$

1.57

$

0.61

Diluted earnings per share attributable to Acadia Healthcare Company, Inc.
stockholders:

Income from continuing operations attributable to Acadia Healthcare
Company, Inc.

$

0.88

$

0.49

$

1.54

$

0.74

Loss from discontinued operations

$

(0.14

)

Net income attributable to Acadia Healthcare Company, Inc.

$

0.88

$

0.49

$

1.54

$

0.60

Weighted-average shares outstanding:

Basic

89,724

88,842

89,492

88,543

Diluted

91,473

90,590

91,504

90,381

Acadia Healthcare Company, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

June 30,

December 31,

2022

2021

(In thousands)

ASSETS

Current assets:

Cash and cash equivalents

$

128,368

$

133,813

Accounts receivable, net

300,313

281,332

Other current assets

89,351

79,886

Total current assets

518,032

495,031

Property and equipment, net

1,857,295

1,771,159

Goodwill

2,205,307

2,199,937

Intangible assets, net

70,214

70,145

Deferred tax assets

3,015

3,080

Operating lease right-of-use assets

137,495

133,761

Other assets

91,281

94,965

Total assets

$

4,882,639

$

4,768,078

LIABILITIES AND EQUITY

Current liabilities:

Current portion of long-term debt

$

21,250

$

18,594

Accounts payable

111,479

98,575

Accrued salaries and benefits

140,528

137,845

Current portion of operating lease liabilities

25,178

23,348

Other accrued liabilities

143,218

126,499

Total current liabilities

441,653

404,861

Long-term debt

1,384,073

1,478,626

Deferred tax liabilities

82,278

74,368

Operating lease liabilities

119,183

116,841

Other liabilities

116,935

110,505

Total liabilities

2,144,122

2,185,201

Redeemable noncontrolling interests

75,475

65,388

Equity:

Common stock

898

890

Additional paid-in capital

2,640,979

2,636,350

Retained earnings (accumulated deficit)

21,165

(119,751

)

Total equity

2,663,042

2,517,489

Total liabilities and equity

$

4,882,639

$

4,768,078

Acadia Healthcare Company, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Six Months Ended June 30,

2022

2021

(In thousands)

Operating activities:

Net income

$

143,842

$

56,143

Adjustments to reconcile net income to net cash provided by continuing operating activities:

Depreciation and amortization

58,054

50,544

Amortization of debt issuance costs

1,620

2,463

Equity-based compensation expense

14,505

16,065

Deferred income taxes

7,975

8,457

Loss from discontinued operations, net of taxes

12,641

Debt extinguishment costs

24,650

Loss on impairment

23,214

Other

396

828

Change in operating assets and liabilities, net of effect of acquisitions:

Accounts receivable, net

(19,763

)

(12,972

)

Other current assets

(18,106

)

(32,056

)

Other assets

2,550

7,276

Accounts payable and other accrued liabilities

25,518

(5,549

)

Accrued salaries and benefits

2,682

8,823

Other liabilities

7,928

(11,121

)

Government relief funds

(1,212

)

16,855

Net cash provided by continuing operating activities

225,989

166,261

Net cash provided by discontinued operating activities

253

Net cash provided by operating activities

225,989

166,514

Investing activities:

Cash paid for capital expenditures

(132,444

)

(112,953

)

Proceeds from U.K. Sale

1,511,020

Settlement of foreign currency derivatives

(84,795

)

Proceeds from sale of property and equipment

1,674

899

Other

(5,016

)

3,153

Net cash (used in) provided by investing activities

(135,786

)

1,317,324

Financing activities:

Borrowings on long-term debt

425,000

Borrowings on revolving credit facility

430,000

Principal payments on revolving credit facility

(85,000

)

(305,000

)

Principal payments on long-term debt

(7,969

)

(2,656

)

Repayment of long-term debt

(2,227,935

)

Payment of debt issuance costs

(7,964

)

Repurchase of shares for payroll tax withholding, net of proceeds from stock option exercises

(9,868

)

13,261

Contributions from noncontrolling partners in joint ventures

8,008

1,800

Distributions to noncontrolling partners in joint ventures

(847

)

(633

)

Other

28

(6,929

)

Net cash used in financing activities

(95,648

)

(1,681,056

)

Effect of exchange rate changes on cash

4,067

Net decrease in cash and cash equivalents

(5,445

)

(193,151

)

Cash and cash equivalents at beginning of the period

133,813

378,697

Cash and cash equivalents at end of the period

$

128,368

$

185,546

Acadia Healthcare Company, Inc.

Operating Statistics

(Unaudited, Revenue in thousands)

Three Months Ended June 30,

Six Months Ended June 30,

2022

2021

% Change

2022

2021

% Change

U.S. Same Facility Results (1)

Revenue

$

626,579

$

577,498

8.5

%

$

1,218,857

$

1,122,976

8.5

%

Patient Days

712,169

707,348

0.7

%

1,396,598

1,376,886

1.4

%

Admissions

44,791

46,895

-4.5

%

87,759

90,991

-3.6

%

Average Length of Stay (2)

15.9

15.1

5.4

%

15.9

15.1

5.2

%

Revenue per Patient Day

$

880

$

816

7.8

%

$

873

$

816

7.0

%

Adjusted EBITDA margin (3)

31.3

%

28.6

%

270 bps

29.6

%

27.5

%

210 bps

Adjusted EBITDA margin excluding income from provider relief fund

29.9

%

28.6

%

130 bps

28.9

%

27.5

%

140 bps

U.S. Facility Results

Revenue

$

651,719

$

582,156

11.9

%

$

1,268,372

$

1,133,355

11.9

%

Patient Days

734,777

712,634

3.1

%

1,441,103

1,387,125

3.9

%

Admissions

47,042

46,974

0.1

%

92,238

91,138

1.2

%

Average Length of Stay (2)

15.6

15.2

3.0

%

15.6

15.2

2.7

%

Revenue per Patient Day

$

887

$

817

8.6

%

$

880

$

817

7.7

%

Adjusted EBITDA margin (3)

29.7

%

28.5

%

120 bps

28.1

%

27.3

%

80 bps

Adjusted EBITDA margin excluding income from provider relief fund

28.4

%

28.5

%

-10 bps

27.4

%

27.3

%

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 the three and six months ended June 30, 2022, includes income from provider relief fund of $8.6 million.

Acadia Healthcare Company, Inc.

Reconciliation of Net Income Attributable to Acadia Healthcare Company, Inc. to Adjusted EBITDA

(Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2022

2021

2022

2021

(in thousands)

Net income attributable to Acadia Healthcare Company, Inc.

$

80,079

$

44,514

$

140,916

$

54,231

Net income attributable to noncontrolling interests

1,853

1,150

2,926

1,912

Loss from discontinued operations, net of taxes

12,641

Provision for income taxes

27,725

19,333

45,127

25,537

Interest expense, net

16,565

16,687

32,352

45,714

Depreciation and amortization

29,128

25,650

58,054

50,544

EBITDA

155,350

107,334

279,375

190,579

Adjustments:

Equity-based compensation expense (a)

6,580

9,031

14,505

16,065

Transaction-related expenses (b)

3,940

1,675

7,522

6,285

Debt extinguishment costs (c)

24,650

Loss on impairment (d)

23,214

23,214

Adjusted EBITDA

$

165,870

$

141,254

$

301,402

$

260,793

Adjusted EBITDA margin

25.5

%

24.3

%

23.8

%

23.0

%

Adjusted EBITDA excluding income from provider relief fund

$

157,320

$

141,254

$

292,852

$

260,793

Adjusted EBITDA margin excluding income from provider relief fund

24.1

%

24.3

%

23.1

%

23.0

%

Se footnotes on page 12.

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 June 30,

Six Months Ended June 30,

2022

2021

2022

2021

(in thousands, except per share amounts)

(in thousands, except per share amounts)

Net income attributable to Acadia Healthcare Company, Inc.

$

80,079

$

44,514

$

140,916

$

54,231

Loss from discontinued operations, net of taxes

12,641

Adjustments to income:

Transaction-related expenses (b)

3,940

1,675

7,522

6,285

Debt extinguishment costs (c)

24,650

Loss on impairment (d)

23,214

23,214

Provision for income taxes

27,725

19,333

45,127

25,537

Adjusted income from continuing operations before income taxes
attributable to Acadia Healthcare Company, Inc.

111,744

88,736

193,565

146,558

Income tax effect of adjustments to income (e)

28,895

24,583

49,514

40,201

Adjusted income from continuing operations attributable to
Acadia Healthcare Company, Inc.

82,849

64,153

144,051

106,357

Income from provider relief fund, net of taxes

(6,230

)

(6,230

)

Adjusted income from continuing operations attributable to
Acadia Healthcare Company, Inc. excluding income
from provider relief fund

$

76,619

$

64,153

$

137,821

$

106,357

Weighted-average shares outstanding - diluted

91,473

90,590

91,504

90,381

Adjusted income from continuing operations attributable to
Acadia Healthcare Company, Inc. per diluted share

$

0.91

$

0.71

$

1.57

$

1.18

Income from provider relief fund, net of taxes, per diluted share

(0.07

)

(0.07

)

Adjusted income from continuing operations attributable to
Acadia Healthcare Company, Inc., excluding income
from provider relief fund, per diluted share

$

0.84

$

0.71

$

1.50

$

1.18

See footnotes on page 12.

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 attributable to Acadia Healthcare Company, Inc. adjusted for net income attributable to noncontrolling interests, loss from discontinued operations, net of taxes, provision for income taxes, net interest expense and depreciation and amortization.

Adjusted EBITDA: EBITDA adjusted for equity-based compensation expense, transaction-related expenses, debt extinguishment costs 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 from continuing operations before income taxes attributable to Acadia Healthcare Company, Inc.: net income attributable to Acadia Healthcare Company, Inc. adjusted for loss from discontinued operations, net of taxes, transaction-related expenses, debt extinguishment costs, loss on impairment and provision for income taxes.

Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc.: Adjusted income from continuing operations before income taxes attributable to Acadia Healthcare Company, Inc. adjusted for the income tax effect of adjustments to income.

Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. excluding income from provider relief fund: Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. adjusted for income from provider relief fund.

Adjusted income attributable to Acadia Healthcare Company, Inc.: the sum of Adjusted income from continuing operations before income taxes attributable to Acadia Healthcare Company, Inc. and income tax effect of adjustments to income.

Adjusted income attributable to Acadia Healthcare Company, Inc. excluding income from provider relief fund: Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. adjusted for income from provider relief fund.

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 and whether including or excluding income from provider relief fund, 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-related expenses incurred by Acadia primarily related to termination, restructuring, management transition, acquisition and other similar costs.

(c) Represents debt extinguishment costs recorded during the first quarter of 2021 in connection with the redemption of the 5.625% senior notes and 6.500% senior notes and the termination of the prior credit facility.

(d) The Company opened a 260-bed replacement hospital in Pennsylvania and recorded a non-cash property impairment charge of $23.2 million for the existing facility during the second quarter of 2021.

(e) Represents the income tax effect of adjustments to income based on tax rates of 25.9% and 27.7% for the three months ended June 30, 2022 and 2021, respectively, and 25.6% and 27.4% for the six months ended June 30, 2022 and 2021, respectively.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220727005947/en/

Contacts

Gretchen Hommrich
Vice President, Investor Relations
(615) 861-6000