Modivcare Inc., (the “Company” or “Modivcare”) (Nasdaq: MODV), a
technology-enabled healthcare services company that provides a
platform of integrated supportive care solutions focused on
improving patient outcomes, today reported financial results for
the three months ended March 31, 2022.
First Quarter 2022
Highlights:
- Revenue of $574.5 million, a 26.6% increase as compared to
$453.6 million in Q1 2021
- Net income of $0.3 million or $0.02 per diluted common
share
- Adjusted EBITDA of $50.3 million, Adjusted Net Income of $22.2
million and Adjusted EPS of $1.57
- Net cash provided by operating activities during the quarter of
$69.1 million
- Cash and cash equivalents of $194.1 million as of March 31,
2022, with $1,000.0 million principal amount of debt outstanding
related to the Senior Unsecured Notes due 2025 and 2029
- Undrawn $325.0 million revolving credit facility as of March
31, 2022
“This quarter, we advanced our strategy to improve outcomes and
better serve the health needs of patients through our supportive
care platform,” said Daniel E. Greenleaf, Modivcare’s President and
Chief Executive Officer. “I am very pleased with the recent
management appointments at Modivcare which will help us execute on
key operational and growth objectives. With disciplined execution
from our team and increased momentum from this quarter’s
performance, Modivcare is committed to addressing the social
determinants of health and removing barriers to accessing care for
the 32 million members we serve. I am extremely proud of the
incredible work and dedication of our entire organization to
accelerate our vision of empowering patients to access care through
our integrated platform more easily, efficiently, and
effectively.”
First Quarter 2022 Results
For the first quarter of 2022, the Company reported revenue of
$574.5 million, an increase of 26.6% from $453.6 million in the
first quarter of 2021.
Operating income was $14.9 million, or 2.6% of revenue, in the
first quarter of 2022, compared to operating income of $28.8
million, or 6.3% of revenue, in the first quarter of 2021. Net
income in the first quarter of 2022 was $0.3 million, or $0.02 per
diluted common share, compared to net income of $18.8 million, or
$1.31 per diluted common share, in the first quarter of 2021.
Adjusted EBITDA was $50.3 million, or 8.8% of revenue, in the
first quarter of 2022, compared to $50.0 million, or 11.0% of
revenue, in the first quarter of 2021.
Adjusted Net Income in the first quarter of 2022 was $22.2
million, or $1.57 per diluted common share, compared to $29.6
million, or $2.06 per diluted common share, in the first quarter of
2021.
Comparable adjusted EBITDA and Adjusted Net Income for Q1 2021
was recast to show the impact of cash settled equity, which the
Company is now excluding for the purpose of these calculations.
The year-over-year increase in revenue was primarily due to
incremental revenue of $44.4 million and $13.9 million associated
with the acquisitions of Care Finders and VRI, respectively. NEMT
revenue also increased year-over-year due to higher trip volume
which drove higher revenue per member in Q1 2022.
Adjusted EBITDA increased in the first quarter of 2022 due to
incremental contribution from Care Finders and VRI. This was
partially offset by higher corporate general and administrative
cost as the Company continued to make investments in its employees
and technology.
Modivcare recorded income, net of tax, of $0.5 million related
to its Matrix equity investment in Q1 2022 compared to $3.2 million
for the first quarter of 2021.
Organizational Consolidation and Change in Segments
Effective January 1, 2022, the Company completed its segment
reorganization which resulted in the addition of a Corporate
segment that includes the costs associated with the Company's
corporate operations. The operating results of our Corporate
segment include our activities related to executive, accounting,
finance, internal audit, tax, legal and certain strategic and
corporate development functions for each segment, as well as the
Company's captive insurance program and the results of our Matrix
investment. The Company reclassified certain costs associated with
this reorganization for the three months ended March 31, 2021 to
conform to this presentation.
Investor Presentation and Conference Call
Modivcare will hold a conference call to discuss its financial
results on Thursday, May 5, 2022 at 8:00 a.m. ET. To access the
call, please dial:
US toll-free: 1 (877) 423 9820 International: 1
(201) 493 6749
You may also access the conference call via webcast at
investors.modivcare.com, where the call also will be archived.
About Modivcare
Modivcare Inc. (“Modivcare”) (Nasdaq: MODV) is a
technology-enabled healthcare services company that provides a
platform of integrated supportive care solutions for public and
private payors and their patients. Our value-based solutions
address the social determinants of health (SDoH), enable greater
access to care, reduce costs, and improve outcomes. We are a
leading provider of non-emergency medical transportation (NEMT),
personal care and remote patient monitoring. To learn more about
Modivcare, please visit www.modivcare.com.
Non-GAAP Financial Measures and Adjustments
In addition to the financial measures prepared in accordance
with generally accepted accounting principles in the United States
("GAAP"), this press release includes EBITDA, Adjusted EBITDA and
Adjusted EBITDA margin for the Company and its segments, Adjusted
Net Income and Adjusted EPS for the Company, and Adjusted G&A
expense for the Company’s segments, which are performance measures
that are not recognized under GAAP. EBITDA is defined as income
(loss) from continuing operations, net of taxes, before: (1)
interest expense, net, (2) provision (benefit) for income taxes and
(3) depreciation and amortization. Adjusted EBITDA is calculated as
EBITDA before (as applicable): (1) restructuring and related
charges, including severance and office closure and professional
services costs, (2) certain transaction and related costs, (3) cash
settled equity, (4) stock-based compensation, (5) COVID-19 related
costs, net of grant income, and (6) equity in net (income) loss of
investee. Adjusted EBITDA margin is calculated as Adjusted EBITDA,
divided by Service revenue, net. Adjusted Net Income is calculated
as income from continuing operations, net of taxes, before: (1)
restructuring and related charges including severance and office
closure and professional services costs, (2) certain transaction
and related costs, (3) cash settled equity, (4) stock-based
compensation, (5) equity in net (income) loss of investee, (6)
intangible amortization expense, (7) COVID-19 related costs, net of
grant income, (8) tax impacts from the Coronavirus Aid, Relief, and
Economic Security Act (the "CARES Act"), and (9) the income tax
impact of such adjustments. Adjusted EPS is calculated as Adjusted
Net Income less (as applicable): the sum of (1) dividends on
convertible preferred stock plus (2) income allocated to
participating securities, divided by the diluted weighted-average
number of common shares outstanding as calculated for Adjusted Net
Income. Adjusted G&A expense is calculated as G&A expense
before (as applicable): (1) restructuring and related charges, (2)
transaction costs, (3) cash settled equity, and (4) stock-based
compensation. Our non-GAAP performance measures exclude expenses
and amounts that are not driven by our core operating results and
may be one time in nature. Excluding these expenses makes
comparisons with prior periods as well as to other companies in our
industry more meaningful. We believe such measures allow investors
to gain a better understanding of the factors and trends affecting
the ongoing operations of our business. We consider our core
operations to be the ongoing activities to provide services from
which we earn revenue, including direct operating costs and
indirect costs to support these activities. In addition, our net
income or loss in equity investee is excluded from these measures,
as we do not have the ability to manage the venture, allocate
resources within the venture, or directly control its operations or
performance.
Our non-GAAP financial measures may not provide information that
is directly comparable to that provided by other companies in our
industry, as other companies in our industry may calculate non-GAAP
financial measures differently. In addition, there are limitations
in using non-GAAP financial measures because they are not prepared
in accordance with GAAP, may be different from non-GAAP financial
measures used by other companies, and exclude expenses that may
have a material impact on our reported financial results. The
presentation of non-GAAP financial measures is not intended to be
considered in isolation from or as a substitute for the most
directly comparable financial measures prepared in accordance with
GAAP. We urge you to review the reconciliations of our non-GAAP
financial measures to the most directly comparable GAAP financial
measures included below, and not to rely on any single financial
measure to evaluate our business.
Forward-Looking Statements
Certain statements contained in this press release constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are
predictive in nature and are frequently identified by the use of
terms such as “may,” “will,” “should,” “expect,” “believe,”
“estimate,” “intend,” and similar words indicating possible future
expectations, events or actions. Such forward-looking statements
are based on current expectations, assumptions, estimates and
projections about our business and our industry, and are not
guarantees of our future performance. These statements are subject
to a number of known and unknown risks, uncertainties and other
factors, many of which are beyond our ability to control or
predict, which may cause actual events to be materially different
from those expressed or implied herein, including but not limited
to: government or private insurance program funding reductions or
limitations; alternative payment models or the transition of
Medicaid and Medicare beneficiaries to Managed Care Organizations,
or MCOs; our inability to control reimbursement rates received for
our services; cost containment initiatives undertaken by private
third-party payors; the effects of a public health emergency;
inadequacies in, or security breaches of, our information
technology systems, including the systems intended to protect our
clients’ privacy and confidential information; any changes in the
funding, financial viability or our relationships with our payors;
pandemic infectious diseases, including the COVID-19 pandemic;
disruptions to our contact center operations caused by health
epidemics or pandemics like COVID-19; delays in collection, or
non-collection, of our accounts receivable, particularly during any
business integration; an impairment of our long-lived assets; any
failure to maintain or to develop further reliable, efficient and
secure information technology systems; an inability to attract and
retain qualified employees; any acquisition or acquisition
integration efforts; our contracts not surviving until the end of
their stated terms, or not being renewed or extended; our failure
to compete effectively in the marketplace; our not being awarded
contracts through the government’s requests for proposals process,
or our awarded contracts not being profitable; any failure to
satisfy our contractual obligations or to maintain existing pledged
performance and payment bonds; a failure to estimate accurately the
cost of performing our contracts; any misclassification of the
drivers we engage as independent contractors rather than as
employees; significant interruptions in our communication and data
services; not successfully executing on our strategies in the face
of our competition; any inability to maintain relationships with
existing patient referral sources; any failure to obtain the
consent of the New York Department of Health to manage the day to
day operations of our licensed in-home personal care services
agency business that we acquired with our personal care segment;
acquired unknown liabilities in connection with the acquisition of
our personal care segment; changes in the case-mix of our personal
care patients, or changes in payor mix or payment methodologies;
our loss of existing favorable managed care contracts; our
experiencing shortages in qualified employees and management; labor
disputes or disruptions, in particular in New York; becoming
subject to malpractice or other similar claims; and our reliance on
others for the financial condition of our equity investment in
Matrix.
The Company has provided additional information about the risks
facing our business in our annual report on Form 10-K and
subsequent filings most recently filed with the Securities and
Exchange Commission. You are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the
date the statement was made and are expressly qualified in their
entirety by the cautionary statements set forth herein and in our
filings with the Securities and Exchange Commission, which you
should read in their entirety before making an investment decision
with respect to our securities. We undertake no obligation to
update or revise any forward-looking statements contained in this
release, whether as a result of new information, future events or
otherwise, except as required by applicable law.
--financial tables to follow--
Modivcare Inc.
Unaudited Condensed
Consolidated Statements of Operations
(in thousands, except share and
per share data)
Three months ended March
31,
2022
2021
Service revenue, net
$
574,475
$
453,610
Grant income
468
2,648
Operating expenses:
Service expense
459,315
360,333
General and administrative expense
76,808
54,925
Depreciation and amortization
23,946
12,239
Total operating expenses
560,069
427,497
Operating income
14,874
28,761
Other expenses:
Interest expense, net
15,400
8,423
Income (loss) before income taxes and
equity method investment
(526
)
20,338
Provision (benefit) for income taxes
(361
)
4,739
Equity in net income of investee, net of
tax
(483
)
(3,241
)
Net income
$
318
$
18,840
Earnings per common share:
Basic
$
0.02
$
1.33
Diluted
$
0.02
$
1.31
Weighted-average number of common shares
outstanding:
Basic
14,023,585
14,158,666
Diluted
14,143,548
14,362,226
Modivcare Inc.
Unaudited Condensed
Consolidated Balance Sheets
(in thousands)
March 31, 2022
December 31, 2021
Assets
Current assets:
Cash and cash equivalents
$
194,063
$
133,139
Accounts receivable, net
262,589
233,121
Other current assets (1)
52,405
43,574
Total current assets
509,057
409,834
Property and equipment, net
57,676
53,549
Goodwill and intangible assets, net
1,395,511
1,415,000
Equity investment
83,333
83,069
Operating lease right-of-use assets
42,181
43,750
Other long-term assets
25,226
22,223
Total assets
$
2,112,984
$
2,027,425
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable
$
38,050
$
8,690
Accrued contract payables
314,126
281,586
Accrued expenses and other current
liabilities
138,071
119,563
Accrued transportation costs
107,190
103,294
Current portion of operating lease
liabilities
9,858
9,873
Deferred revenue
5,648
4,228
Total current liabilities
612,943
527,234
Long-term debt, net of deferred financing
costs
976,233
975,225
Operating lease liabilities, less current
portion
34,092
34,524
Long-term contracts payables
1,893
—
Other long-term liabilities (2)
111,623
117,175
Total liabilities
1,736,784
1,654,158
Stockholders' equity
Stockholders' equity
376,200
373,267
Total liabilities and stockholders'
equity
$
2,112,984
$
2,027,425
(1)
Includes other receivables, prepaid
expenses and other current assets and short-term restricted
cash.
(2)
Includes other long-term liabilities and
deferred tax liabilities.
Modivcare Inc.
Unaudited Condensed
Consolidated Statements of Cash Flows
(in thousands)
Three months ended March
31,
2022
2021
Operating activities
Net income
$
318
$
18,840
Depreciation and amortization
23,946
12,239
Stock-based compensation
2,049
1,187
Equity in net income of investee
(483
)
(4,503
)
Deferred income taxes
(6,587
)
(616
)
Reduction of right-of-use asset
2,884
2,745
Other non-cash items (1)
(777
)
608
Changes in working capital (2)
47,720
104,064
Net cash provided by operating
activities
69,070
134,564
Investing activities
Purchase of property and equipment
(8,584
)
(5,388
)
Net cash used in investing activities
(8,584
)
(5,388
)
Financing activities
Repurchase of common stock, for
treasury
—
(14,450
)
Proceeds from common stock issued pursuant
to stock option exercise
1,138
2,286
Restricted stock surrendered for employee
tax payment
(572
)
(721
)
Other financing activities
—
(40
)
Net cash provided by (used in) financing
activities
566
(12,925
)
Net change in cash, cash equivalents and
restricted cash
61,052
116,251
Cash, cash equivalents and restricted cash
at beginning of period
133,422
183,356
Cash, cash equivalents and restricted cash
at end of period
$
194,474
$
299,607
(1)
Includes provision for doubtful accounts
and amortization of deferred financing costs and debt discount.
(2)
Includes accounts receivable and other
receivables, prepaid expenses and other current assets, self-funded
insurance programs, accrued contract payables, accounts payable and
accrued expenses, accrued transportation costs, deferred revenue
and other long-term liabilities.
Modivcare Inc. Unaudited
Reconciliation of Non-GAAP Financial Measures Segment Information
and Adjusted EBITDA (in thousands)
Three months ended March 31,
2022
NEMT
Personal Care
RPM
Corporate (3)
Total
Service revenue, net
$
400,920
$
159,698
$
13,857
$
—
$
574,475
Grant income
—
468
—
—
468
Operating expenses:
Service expense
332,096
122,232
4,987
—
459,315
General and administrative expense
37,333
23,133
4,962
11,380
76,808
Depreciation and amortization
7,105
12,505
4,128
208
23,946
Total operating expenses
376,534
157,870
14,077
11,588
560,069
Operating income (loss)
24,386
2,296
(220
)
(11,588
)
14,874
Interest expense, net
—
—
—
15,400
15,400
Income (loss) before income taxes and
equity method investment
24,386
2,296
(220
)
(26,988
)
(526
)
Provision (benefit) for income taxes
6,575
640
(58
)
(7,518
)
(361
)
Equity in net loss (income) of investee,
net of tax
65
—
—
(548
)
(483
)
Net Income (loss)
17,746
1,656
(162
)
(18,922
)
318
Interest expense, net
—
—
—
15,400
15,400
Provision (benefit) for income taxes
6,575
640
(58
)
(7,518
)
(361
)
Depreciation and amortization
7,105
12,505
4,128
208
23,946
EBITDA
31,426
14,801
3,908
(10,832
)
39,303
Restructuring and related charges (1)
5,604
181
24
31
5,840
Transaction costs (2)
—
1,273
647
1,791
3,711
Cash settled equity
—
—
—
(13
)
(13
)
Stock-based compensation
—
17
29
1,420
1,466
COVID-19 related costs, net of grant
income
122
349
—
—
471
Equity in net loss (income) of investee,
net of tax
65
—
—
(548
)
(483
)
Adjusted EBITDA
$
37,217
$
16,621
$
4,608
$
(8,151
)
$
50,295
(1)
Restructuring and related charges include
professional services costs and severance and recruiting costs.
(2)
Transaction costs include SOX integration
efforts at recently acquired subsidiaries and acquisition
costs.
(3)
Effective January 1, 2022, the Company
completed its segment reorganization which resulted in the addition
of a Corporate segment that includes the costs associated with the
Company's corporate operations. Through this reorganization, it was
also determined that the Matrix Investment is no longer a
reportable segment, and is now reported within the Corporate
segment. Prior period segment amounts have been reclassified to
conform to the current presentation.
Modivcare Inc. Unaudited
Reconciliation of Non-GAAP Financial Measures Segment Information
and Adjusted EBITDA (in thousands)
Three months ended March 31,
2021
NEMT
Personal Care
Corporate (4)
Total
Service revenue, net
$
343,416
$
110,194
$
—
$
453,610
Grant income
—
2,648
—
2,648
Operating expenses:
Service expense
272,416
87,917
—
360,333
General and administrative expense
27,987
15,029
11,909
54,925
Depreciation and amortization
7,312
4,927
—
12,239
Total operating expenses
307,715
107,873
11,909
427,497
Operating income (loss)
35,701
4,969
(11,909
)
28,761
Interest expense, net
—
—
8,423
8,423
Income (loss) before income taxes and
equity method investment
35,701
4,969
(20,332
)
20,338
Provision (benefit) for income taxes
9,404
1,438
(6,103
)
4,739
Equity in net income of investee, net of
tax
—
—
(3,241
)
(3,241
)
Net Income (loss)
26,297
3,531
(10,988
)
18,840
Interest expense, net
—
—
8,423
8,423
Provision (benefit) for income taxes
9,404
1,438
(6,103
)
4,739
Depreciation and amortization
7,312
4,927
—
12,239
EBITDA
43,013
9,896
(8,668
)
44,241
Restructuring and related charges (1)
3,494
—
151
3,645
Transaction costs (2)
(37
)
1,045
2,670
3,678
Cash settled equity (3)
—
—
2,093
2,093
Stock-based compensation
—
—
1,131
1,131
COVID-19 related costs, net of grant
income
339
(1,852
)
—
(1,513
)
Equity in net income of investee, net of
tax
—
—
(3,241
)
(3,241
)
Adjusted EBITDA
$
46,809
$
9,089
$
(5,864
)
$
50,034
(1)
Restructuring and related charges include
professional services costs of $3.2 million and severance and
office closure costs of $0.4 million.
(2)
Transaction costs include Circulation
management incentive plan costs and acquisition costs related to
Simplura Health Group and National MedTrans.
(3)
Adjusted EBITDA for Q1 2021 was recast to
show the impact of cash settled equity, which the Company is now
including for the purpose of this calculation.
(4)
Effective January 1, 2022, the Company
completed its segment reorganization which resulted in the addition
of a Corporate segment that includes the costs associated with the
Company's corporate operations. Through this reorganization, it was
also determined that the Matrix Investment is no longer a
reportable segment, and is now reported within the Corporate
segment. Prior period segment amounts have been reclassified to
conform to the current presentation, with the exception of the RPM
segment, which is not included in Q1 of 2021 as it was purchased in
Q3 of 2021.
Modivcare Inc. Unaudited
Reconciliation of Non-GAAP Financial Measures Adjusted Net Income
and Adjusted Net Income per Common Share: (in thousands, except
share and per share data)
Three months ended March
31,
2022
2021
Net income
$
318
$
18,840
Restructuring and related charges(1)
5,840
3,645
Transaction costs(2)
3,711
3,678
Cash settled equity(3)
(13
)
2,093
Stock-based compensation
1,466
1,131
Equity in net income of investee, net of
tax
(483
)
(3,241
)
Intangible amortization expense
19,490
9,502
COVID-19 related costs, net of grant
income
471
(1,513
)
Tax effected impact of adjustments
(8,629
)
(4,536
)
Adjusted Net Income
$
22,171
$
29,599
Adjusted EPS
$
1.57
$
2.06
Diluted weighted-average number of common
shares outstanding
14,143,548
14,362,226
(1)
Restructuring and related charges include
severance, organizational consolidation costs and professional
fees.
(2)
Transaction costs include certain
transaction-related expenses and SOX integration efforts.
(3)
Adjusted net income for Q1 2021 was recast
to show the impact of cash-settled equity, which the Company is now
including for the purpose of this calculation.
Modivcare Inc. Unaudited Key
Statistical and Financial Data (in thousands)
Three months ended
March 31, 2022
March 31, 2021
% Change
NEMT Segment
Service revenue, net
$
400,920
$
343,416
16.7
%
Service expense; purchased services
277,947
223,294
24.5
%
Service expense; payroll, and other
54,149
49,122
10.2
%
Gross profit
$
68,824
$
71,000
(3.1
) %
Gross margin
17.2
%
20.7
%
G&A expense
$
37,333
$
27,987
33.4
%
G&A expense adjustments
Restructuring and related charges
5,604
3,494
60.4
%
Transaction costs
—
(37
)
(100.0
) %
Adjusted G&A expense
$
31,729
$
24,530
29.3
%
Adjusted G&A expense % of revenue
7.9
%
7.1
%
Net income
$
17,746
$
26,297
(32.5
) %
Net income margin
4.4
%
7.7
%
Adjusted EBITDA
$
37,217
$
46,809
(20.5
) %
Adjusted EBITDA margin
9.3
%
13.6
%
Modivcare Inc. Unaudited Key
Statistical and Financial Data (in thousands)
Three months ended
March 31, 2022
March 31, 2021
% Change
Personal Care Segment
Service revenue, net
$
159,698
$
110,194
44.9
%
Service expense
122,232
87,917
39.0
%
Gross profit
$
37,466
$
22,277
68.2
%
Gross Margin
23.5
%
20.2
%
G&A expense
$
23,133
$
15,029
53.9
%
G&A expense adjustments
Restructuring and related charges
181
—
NA
Transaction costs
1,273
1,045
21.8
%
Stock-based compensation
17
—
NA
Adjusted G&A expense
$
21,662
$
13,984
54.9
%
Adjusted G&A expense % of revenue
13.6
%
12.7
%
Net income
$
1,656
$
3,531
(53.1
) %
Net income margin
1.0
%
3.2
%
Adjusted EBITDA
$
16,621
$
9,089
82.9
%
Adjusted EBITDA margin
10.4
%
8.2
%
RPM Segment
Service revenue, net
$
13,857
Service expense
4,987
Gross profit
$
8,870
Gross Margin
64.0
%
G&A expense
$
4,962
G&A expense adjustments
Restructuring and related charges
24
Transaction costs
647
Stock-based compensation
29
Adjusted G&A expense
$
4,262
Adjusted G&A expense % of revenue
30.8
%
Net loss
$
(162
)
Net loss margin
(1.2
) %
Adjusted EBITDA
$
4,608
Adjusted EBITDA margin
33.3
%
Modivcare Inc. Unaudited Key
Statistical and Financial Data (in thousands)
Three months ended
March 31, 2022
March 31, 2021
% Change
Corporate Segment
G&A expense
$
11,380
$
11,909
(4.4
) %
G&A expense adjustments
Restructuring and related charges
31
151
(79.5
) %
Transaction costs
1,791
2,670
(32.9
) %
Cash settled equity
(13
)
2,093
(100.6
) %
Stock-based compensation
1,420
1,131
25.6
%
Adjusted G&A expense
$
8,151
$
5,864
39.0
%
Adjusted G&A expense % of consolidated
revenue
1.4
%
1.3
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220505005303/en/
Investor Relations Kevin Ellich, Head of Investor
Relations (303) 728-7012 Kevin.ellich@modivcare.com
ModivCare (NASDAQ:MODV)
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부터 6월(6) 2024 으로 7월(7) 2024
ModivCare (NASDAQ:MODV)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024