Cross Country Healthcare Announces Second Quarter 2017 Financial Results
BOCA RATON, Fla., Aug. 2, 2017 /PRNewswire/ -- Cross Country Healthcare, Inc. (the "Company") (Nasdaq: CCRN) today announced financial results for the second quarter ended June 30, 2017. In addition, the Company announced it has renewed and increased the size of its Credit Agreement to $215 million, including a $100 million term loan and a $115 million revolving credit facility.
FINANCIAL HIGHLIGHTS:
Amounts are in thousands, except percent and per share data.
Q2 2017 Variance Variance
Q2 2017 vs. Q2 2017 vs.
Q2 2016 Q1 2017
Revenue $209,313 5% 1%
--------
Gross
profit
margin 27.0% (50) bps 130 bps
Net income
attributable
to common
shareholders $4,850 128% 341%
Diluted EPS $0.13 $0.67 $0.21
Adjusted
EBITDA* $10,880 (2)% 69%
Adjusted
EPS* $0.16 $ - $0.11
-------- ----- --- --- -----
* Refer to tables and discussion of Non-GAAP financial measures below.
"We had a solid second quarter highlighted by year-over-year revenue growth in all three reporting segments. With revenue in line with expectations, I was pleased that we exceeded guidance for Gross Margin, Adjusted EBITDA and Adjusted EPS," said William J. Grubbs, President and Chief Executive Officer. "Our new MSP implementations are progressing and we expect an increase in demand from these programs through the third and fourth quarters. Coupled with the delivery capabilities from the Advantage RN acquisition, we expect to see stronger revenue growth as we enter 2018."
Second quarter consolidated revenue was $209.3 million, an increase of 5% year-over-year and 1% sequentially. Consolidated gross profit margin was 27.0%, down 50 basis points year-over-year and up 130 basis points sequentially. Net income attributable to common shareholders was $4.9 million compared to a net loss of $17.2 million in the prior year, which included a loss on early extinguishment of debt, a loss on derivative liability, and impairment charges, totaling $22.4 million after taxes. Diluted EPS was $0.13 per share compared to a loss of $0.54 per share in the prior year. Adjusted EBITDA was $10.9 million or 5.2% of revenue, as compared with $11.1 million or 5.5% of revenue in the prior year. Adjusted EPS was $0.16 for the second quarter of 2017 and 2016 and $0.05 in the prior quarter.
For the six months ended June 30, 2017, consolidated revenue was $416.9 million, an increase of 5% year-over-year. Consolidated gross profit margin was 26.3%, down 40 basis points year-over-year. Adjusted EBITDA was $17.3 million or 4.2% of revenue, as compared with $19.6 million or 4.9% of revenue in the prior year. Net income attributable to common shareholders was $2.8 million, or $0.05 per diluted share, compared to net income of $1.8 million, or a net loss of $0.26 per diluted share, in the prior year. Adjusted EPS was $0.21 compared to $0.25 in the prior year.
Quarterly Business Segment Highlights
Nurse and Allied Staffing
Revenue from Nurse and Allied Staffing was $180.9 million, an increase of 5% year-over-year and a decrease of 1% sequentially. The year-over-year increase in segment revenue was predominantly due to higher volume. Contribution income in this segment was $18.1 million, up from $17.6 million in the prior year. Average field FTEs increased to 7,155 from 6,884 in the prior year. Revenue per FTE per day was $278 compared to $275 in the prior year, primarily reflecting a change in the mix of business.
Physician Staffing
Revenue from Physician Staffing was $24.7 million, an increase of 3% year-over-year and 15% sequentially. The year-over-year increase was primarily due to an increase in volume. Contribution income was $2.0 million, consistent with the prior year. Compared to the prior year, total days filled increased to 15,220 from 14,480, primarily due to volume growth in advanced practice professionals. Revenue per day filled increased to $1,557 from $1,525 due to improved pricing partly offset by the change in mix of specialties.
Other Human Capital Management Services
Revenue from Other Human Capital Management Services was $3.7 million, an increase of 6% year-over-year and 22% sequentially. Contribution income was $0.2 million, compared to $0.1 million in the prior year.
Cash Flow and Balance Sheet Highlights
Cash flow provided by operating activities for the current quarter was $24.1 million compared to $10.3 million in the same period of the prior year. At June 30, 2017, the Company had $33.9 million in cash and cash equivalents and $37.6 million of total debt. There were no borrowings drawn on its $100.0 million revolving credit facility, and $21.6 million of letters of credit outstanding, leaving $78.4 million available for borrowings under the revolving credit facility.
Renewal of Credit Agreement
As previously announced, the July acquisition of Advantage RN was funded using available cash and borrowings of approximately $67.5 million under the existing credit facility, including a $40 million incremental term loan. Subsequent to the acquisition, on August 1, 2017, the Company entered into an Amendment and Restatement to its Credit Agreement to refinance and increase the current aggregate committed size of the facility to $215 million, including a term loan of $100 million and a $115 million revolving credit facility. The proceeds of $106.5 million from this refinancing included $6.5 million under the new revolving credit facility, and were used to repay borrowings under the Company's previously existing credit facilities, as well as to pay related interest, fees and expenses.
Outlook for Third Quarter 2017
Q3 2017 Range Year-over-Year Sequential
-------------
Change Change
------ ------
Revenue $227 million - $232 million 6% - 8% 8% - 11%
Gross
profit
margin 26.3% - 26.8% (80) - (30) bps (70) - (20) bps
Adjusted
EBITDA $12 million - $13 million (9)% - (1)% 10% - 19%
Adjusted
EPS $0.16 - $0.18 $(0.08) - $(0.06) $0.00 - $0.02
The estimates above are based on current management expectations and, as such, are forward-looking and actual results may differ materially. These ranges include the impact of the Advantage RN acquisition, but do not include the potential impact of any future divestitures, mergers, acquisitions or other business combinations, any impairment charges or valuation allowances, any acquisition-related measurement period adjustments, changes in debt structure, or any material legal or restructuring charges. See accompanying Non-GAAP financial measures and tables below.
INVITATION TO CONFERENCE CALL
The Company will hold its quarterly conference call on Thursday, August 3, 2017, at 9:00 A.M. Eastern Time to discuss its second quarter 2017 financial results. This call will be webcast live and can be accessed at the Company's website at www.crosscountryhealthcare.com or by dialing 800-857-6331 from anywhere in the U.S. or by dialing 517-623-4781 from non-U.S. locations - Passcode: Cross Country. A replay of the webcast will be available from August 3rd through August 17th at the Company's website and a replay of the conference call will be available by telephone by calling 800-510-0118 from anywhere in the U.S. or 203-369-3808 from non-U.S. locations - Passcode: 2017.
ABOUT CROSS COUNTRY HEALTHCARE
Cross Country Healthcare is a national leader in providing innovative healthcare workforce solutions and staffing services. Our solutions leverage our nearly 40 years of expertise and insight to assist clients in solving complex labor-related challenges while maintaining high quality outcomes. We are dedicated to recruiting and placing highly qualified healthcare professionals in virtually every specialty and area of expertise. Our diverse client base includes both clinical and nonclinical settings, servicing acute care hospitals, physician practice groups, outpatient and ambulatory-care centers, nursing facilities, both public schools and charter schools, rehabilitation and sports medicine clinics, government facilities, and homecare. Through our national staffing teams and network of 85 office locations, we are able to place clinicians on travel and per diem assignments, local short-term contracts and permanent positions. We are a market leader in providing flexible workforce management solutions, which include managed service programs (MSP), internal resource pool consulting and development, electronic medical record (EMR) transition staffing, recruitment process outsourcing, predictive modeling and other outsourcing and consultative services. In addition, we provide both retained and contingent placement services for healthcare executives, physicians, and other healthcare professionals.
Copies of this and other news releases as well as additional information about Cross Country Healthcare can be obtained online at www.crosscountryhealthcare.com. Shareholders and prospective investors can also register to automatically receive the Company's press releases, SEC filings and other notices by e-mail.
NON-GAAP FINANCIAL MEASURES
This press release and accompanying financial statement tables reference non-GAAP financial measures. Such non-GAAP financial measures are provided as additional information and should not be considered substitutes for, or superior to, financial measures calculated in accordance with U.S. GAAP. Such non-GAAP financial measures are provided for consistency and comparability to prior year results; furthermore, management believes they are useful to investors when evaluating the Company's performance as they exclude certain items that management believes are not indicative of the Company's operating performance. Pro forma measures, if applicable, are adjusted to include the results of our acquisitions, and exclude the results of divestments, as if the transactions occurred in the beginning of the periods mentioned.]Such non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. The financial statement tables that accompany this press release include a reconciliation of each non-GAAP financial measure to the most directly comparable U.S. GAAP financial measure and a more detailed discussion of each financial measure; as such, the financial statement tables should be read in conjunction with the presentation of these non-GAAP financial measures.
FORWARD LOOKING STATEMENT
In addition to historical information, this press release contains statements relating to our future results (including certain projections and business trends) that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are subject to the "safe harbor" created by those sections. Forward-looking statements consist of statements that are predictive in nature, depend upon or refer to future events. Words such as "expects", "anticipates", "intends", "plans", "believes", "estimates", "suggests", "appears", "seeks", "will", and variations of such words and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. These factors include, but are not limited to, the following: our ability to attract and retain qualified nurses, physicians and other healthcare personnel, costs and availability of short-term housing for our travel healthcare professionals, demand for the healthcare services we provide, both nationally and in the regions in which we operate, the functioning of our information systems, the effect of cyber security risks and cyber incidents on our business, the effect of existing or future government regulation and federal and state legislative and enforcement initiatives on our business, our clients' ability to pay us for our services, our ability to successfully implement our acquisition and development strategies, including our ability to successfully integrate acquired businesses and realize synergies from such acquisitions, the effect of liabilities and other claims asserted against us, the effect of competition in the markets we serve, our ability to successfully defend the Company, its subsidiaries, and its officers and directors on the merits of any lawsuit or determine its potential liability, if any, and other factors set forth in Item 1A. "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2016, and our other Securities and Exchange Commission filings made prior to the date hereof.
Although we believe that these statements are based upon reasonable assumptions, we cannot guarantee future results and readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this press release. There can be no assurance that (i) we have correctly measured or identified all of the factors affecting our business or the extent of these factors' likely impact, (ii) the available information with respect to these factors on which such analysis is based is complete or accurate, (iii) such analysis is correct or (iv) our strategy, which is based in part on this analysis, will be successful. The Company undertakes no obligation to update or revise forward-looking statements. All references to "we", "us", "our", or "Cross Country" in this press release mean Cross Country Healthcare, Inc. and its subsidiaries.
Cross Country Healthcare, Inc.
Consolidated Statements of Operations
(Unaudited, amounts in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, March 31, June 30, June 30,
2017 2016 2017 2017 2016
---- ---- ---- ---- ----
Revenue from services $209,313 $199,443 $207,573 $416,886 $396,026
Cost of services 152,785 144,597 154,298 307,083 290,134
Gross profit 56,528 54,846 53,275 109,803 105,892
------ ------ ------ ------- -------
Operating expenses:
Selling, general and administrative expenses 46,600 44,675 47,236 93,836 87,608
Bad debt expense 326 228 323 649 477
Depreciation and amortization 2,285 2,465 2,191 4,476 4,877
Acquisition-related contingent consideration (a) 281 183 270 551 470
Acquisition and integration costs (b) 587 - - 587 -
Impairment charges (c) - 24,311 - - 24,311
Total operating expenses 50,079 71,862 50,020 100,099 117,743
------ ------ ------ ------- -------
Income (loss) from operations 6,449 (17,016) 3,255 9,704 (11,851)
Other expenses (income):
Interest expense 535 1,608 1,219 1,754 3,243
Loss (gain) on derivative liability (d) - 3,571 (1,581) (1,581) (12,865)
Loss on early extinguishment of debt (e) - 1,568 4,969 4,969 1,568
Other income, net (59) (34) - (59) (51)
---
Income (loss) before income taxes 5,973 (23,729) (1,352) 4,621 (3,746)
Income tax expense (benefit) 753 (6,634) 366 1,119 (5,837)
--- ------ --- ----- ------
Consolidated net income (loss) 5,220 (17,095) (1,718) 3,502 2,091
Less: Net income attributable to noncontrolling interest in subsidiary 370 142 292 662 306
--- --- --- --- ---
Net income (loss) attributable to common shareholders $4,850 $(17,237) $(2,010) $2,840 $1,785
====== ======== ======= ====== ======
Net income (loss) per share attributable to common shareholders - Basic $0.14 $(0.54) $(0.06) $0.08 $0.06
===== ====== ====== ===== =====
Net income (loss) per share attributable to common shareholders - Diluted $0.13 $(0.54) $(0.08) $0.05 $(0.26)
===== ====== ====== ===== ======
Weighted average common shares outstanding:
Basic 35,651 32,085 32,872 34,269 32,021
====== ====== ====== ====== ======
Diluted (f) 36,021 32,085 36,480 36,250 36,194
====== ====== ====== ====== ======
Cross Country Healthcare, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited, amounts in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, March 31, June 30, June 30,
2017 2016 2017 2017 2016
---- ---- ---- ---- ----
Adjusted EBITDA: (g)
Net income (loss) attributable to common shareholders $4,850 $(17,237) $(2,010) $2,840 $1,785
Depreciation and amortization 2,285 2,465 2,191 4,476 4,877
Interest expense 535 1,608 1,219 1,754 3,243
Income tax expense (benefit) 753 (6,634) 366 1,119 (5,837)
Acquisition-related contingent consideration (a) 281 183 270 551 470
Acquisition and integration costs (b) 587 - - 587 -
Impairment charges (c) - 24,311 - - 24,311
Loss (gain) on derivative liability (d) - 3,571 (1,581) (1,581) (12,865)
Loss on early extinguishment of debt (e) - 1,568 4,969 4,969 1,568
Other income, net (59) (34) - (59) (51)
Equity compensation 1,278 1,119 737 2,015 1,767
Net income attributable to noncontrolling interest in subsidiary 370 142 292 662 306
--- --- --- --- ---
Adjusted EBITDA (g) $10,880 $11,062 $6,453 $17,333 $19,574
======= ======= ====== ======= =======
Adjusted EPS: (h)
Numerator:
Net income (loss) attributable to common shareholders $4,850 $(17,237) $(2,010) $2,840 $1,785
Non-GAAP adjustments - pretax:
Acquisition-related contingent consideration (a) 281 183 270 551 470
Acquisition and integration costs (b) 587 - - 587 -
Impairment charges (c) - 24,311 - - 24,311
Loss (gain) on derivative liability (d) - 3,571 (1,581) (1,581) (12,865)
Loss on early extinguishment of debt (e) - 1,568 4,969 4,969 1,568
Tax impact of non-GAAP adjustments (i) - (7,036) - - (7,036)
Adjusted net income attributable to common shareholders - non-GAAP $5,718 $5,360 $1,648 $7,366 $8,233
====== ====== ====== ====== ======
Denominator:
Weighted average common shares - basic, GAAP 35,651 32,085 32,872 34,269 32,021
Dilutive impact of share-based payments 370 601 674 522 652
--- --- ---
Adjusted weighted average common shares - diluted, non-GAAP 36,021 32,686 33,546 34,791 32,673
====== ====== ====== ====== ======
Reconciliation: (h)
Diluted EPS, GAAP $0.13 $(0.54) $(0.08) $0.05 $(0.26)
Non-GAAP adjustments - pretax:
Acquisition-related contingent consideration (a) 0.01 0.01 0.01 0.02 0.01
Acquisition and integration costs (b) 0.02 - - 0.02 -
Impairment charges (c) - 0.74 - - 0.74
Loss (gain) on derivative liability (d) - 0.11 (0.05) (0.05) (0.39)
Loss on early extinguishment of debt (e) - 0.05 0.15 0.15 0.05
Tax impact of non-GAAP adjustments (i) - (0.22) - - (0.22)
Adjustment for change in dilutive shares - 0.01 0.02 0.02 0.32
--- ---- ---- ---- ----
Adjusted EPS, non-GAAP (h) $0.16 $0.16 $0.05 $0.21 $0.25
===== ===== ===== ===== =====
Cross Country Healthcare, Inc.
Consolidated Balance Sheets
(Unaudited, amounts in thousands)
June 30, December 31,
2017 2016
---- ----
Assets
Current assets:
Cash and cash
equivalents $33,936 $20,630
Accounts
receivable,
net 155,903 173,620
Prepaid
expenses 6,230 6,126
Insurance
recovery
receivable 3,197 3,037
Other current
assets 1,249 2,198
----- -----
Total current
assets 200,515 205,611
Property and
equipment,
net 13,862 12,818
Goodwill, net 79,648 79,648
Trade names,
indefinite-
lived 35,402 35,402
Other
intangible
assets, net 34,690 36,835
Other non-
current
assets 18,373 18,064
------ ------
Total assets $382,490 $388,378
======== ========
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts
payable and
accrued
expenses $52,435 $58,837
Accrued
employee
compensation
and benefits 31,073 33,243
Other current
liabilities 6,097 5,012
----- -----
Total current
liabilities 89,605 97,092
Long-term
debt and
capital
lease
obligations 35,344 84,760
Non-current
deferred tax
liabilities 14,353 13,154
Long-term
accrued
claims 29,066 28,870
Contingent
consideration 4,390 5,301
Other long-
term
liabilities 8,084 7,399
----- -----
Total
liabilities 180,842 236,576
Commitments and contingencies
Stockholders' equity:
Common stock 4 3
Additional
paid-in
capital 303,917 256,570
Accumulated
other
comprehensive
loss (1,183) (1,241)
Accumulated
deficit (101,784) (104,089)
-------- --------
Total Cross
Country
Healthcare,
Inc.
stockholders'
equity 200,954 151,243
Noncontrolling
interest 694 559
--- ---
Total
stockholders'
equity 201,648 151,802
Total
liabilities
and
stockholders'
equity $382,490 $388,378
======== ========
Cross Country Healthcare, Inc.
Segment Data (j)
(Unaudited, amounts in thousands)
Three Months Ended % Change Fav/(Unfav)
June 30, % of June 30, % of March 31, % of Year-over-
2017 Total 2016 Total 2017 Total Year Sequential
---- ----- ---- ----- ---- ----- ---- ----------
Revenue from services:
Nurse and Allied Staffing $180,927 86% $172,048 86% $183,108 88% 5% (1)%
Physician Staffing 24,720 12% 23,927 12% 21,464 10% 3% 15%
Other Human Capital Management Services 3,666 2% 3,468 2% 3,001 2% 6% 22%
----- ----- -----
$209,313 100% $199,443 100% $207,573 100% 5% 1%
======== === ======== === ======== ===
Contribution income: (k)
Nurse and Allied Staffing $18,141 $17,615 $15,622 3% 16%
Physician Staffing 2,047 2,050 820 - % 150%
Other Human Capital Management Services 241 69 (440) 249% 155%
--- --- ----
20,429 19,734 16,002 4% 28%
Unallocated corporate overhead (l) 10,827 9,791 10,286 (11)% (5)%
Depreciation and amortization 2,285 2,465 2,191 7% (4)%
Acquisition-related contingent consideration (a) 281 183 270 (54)% (4)%
Acquisition and integration costs (b) 587 - - (100)% (100)%
Impairment charges (c) - 24,311 - 100% - %
Income (loss) from operations $6,449 $(17,016) $3,255 138% 98%
====== ======== ======
Six Months Ended % Change Fav/(Unfav)
June 30, % of June 30, % of Year-over-
2017 Total 2016 Total Year
---- ----- ---- ----- ----
Revenue from services:
Nurse and Allied Staffing $364,035 87% $340,813 86% 7%
Physician Staffing 46,184 11% 48,380 12% (5)%
Other Human Capital Management Services 6,667 2% 6,833 2% (2)%
----- -----
$416,886 100% $396,026 100% 5%
======== === ======== ===
Contribution income: (k)
Nurse and Allied Staffing $33,763 $34,405 (2)%
Physician Staffing 2,867 3,603 (20)%
Other Human Capital Management Services (199) (42) (374)%
---- ---
36,431 37,966 (4)%
Unallocated corporate overhead (l) 21,113 20,159 (5)%
Depreciation and amortization 4,476 4,877 8%
Acquisition-related contingent consideration (a) 551 470 (17)%
Acquisition and integration costs (b) 587 - (100)%
Impairment charges (c) - 24,311 100%
Income (loss) from operations $9,704 $(11,851) 182%
====== ========
Cross Country Healthcare, Inc.
Other Financial Data
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30, March 31, June 30, June 30,
2017 2016 2017 2017 2016
---- ---- ---- ---- ----
Net cash provided by (used in) $24,115 $10,303 $1,410 $25,525 $12,867
operating activities (in thousands)
Consolidated gross profit margin 27.0% 27.5% 25.7% 26.3% 26.7%
Nurse and Allied Staffing statistical data:
-------------------------------------------
FTEs (m) 7,155 6,884 7,204 7,180 6,850
Average Nurse and Allied Staffing revenue per FTE per day (n) $278 $275 $282 $280 $273
Physician Staffing statistical data:
------------------------------------
Days filled (o) 15,220 14,480 15,036 30,256 31,322
Revenue per day filled (p) $1,557 $1,525 $1,592 $1,574 $1,523
(a) Acquisition-related contingent
consideration primarily represents
the fair value and accretion
adjustments to the contingent
consideration liabilities for the
Mediscan acquisition that closed on
October 30, 2015 and the US
Resources Healthcare acquisition
that closed on December 1, 2016.
(b) Acquisition and integration costs
are primarily related to due
diligence for the Advantage RN, LLC
acquisition that closed on July 5,
2017.
(c) The three months and six months
ended June 30, 2016 includes non-
cash impairment charges of $24.3
million ($17.3 million after taxes)
related to the Physician Staffing
reporting unit.
(d) Loss (gain) on derivative liability
represents the change in the fair
value of embedded features of our
Convertible Notes up until their
repayment.
(e) Loss on early extinguishment of debt
for the three months ended March
31, 2017 and six months ended June
30, 2017 is related to the
Company's settlement of its
convertible notes on March 17,
2017. Loss on early extinguishment
of debt for the three months and
six months ended June 30, 2016
relates to the write-off of
unamortized debt discount and
issuance costs as well as
transaction fees and expenses
related to the extinguishment of
the Company's subordinated term
loan.
(f) When applying the if-converted
method to our Convertible Notes,
3,521,126 shares are not included
in diluted weighted average shares
for the three months ended June 30,
2016 because their effect was anti-
dilutive. For the three months
ended March 31, 2017 and the six
months ended June 30, 2017,
2,934,271 shares and 1,459,030
shares, respectively, were included
in diluted weighted average shares.
(g) Adjusted EBITDA, a non-GAAP
(Generally Accepted Accounting
Principles) financial measure, is
defined as net income (loss)
attributable to common shareholders
before depreciation and
amortization, interest expense,
income tax expense (benefit),
acquisition-related contingent
consideration, acquisition and
integration costs, impairment
charges, loss (gain) on derivative
liability, loss on early
extinguishment of debt, other
income, net, equity compensation,
and includes net income
attributable to noncontrolling
interest in subsidiary. Adjusted
EBITDA should not be considered a
measure of financial performance
under GAAP. Management presents
Adjusted EBITDA because it believes
that Adjusted EBITDA is a useful
supplement to net income (loss)
attributable to common shareholders
as an indicator of operating
performance. Management uses
Adjusted EBITDA for planning
purposes and as one performance
measure in its incentive programs
for certain members of its
management team. Adjusted EBITDA,
as defined, closely matches the
operating measure typically used in
the Company's credit facilities in
calculating various ratios.
Adjusted EBITDA Margin is
calculated by dividing Adjusted
EBITDA by the Company's
consolidated revenue.
(h) Adjusted EPS, a non-GAAP financial
measure, is defined as net income
(loss) attributable to common
shareholders per diluted share
before the diluted EPS impact of
acquisition-related contingent
consideration, acquisition and
integration costs, impairment
charges, loss (gain) on derivative
liability, and loss on early
extinguishment of debt. Adjusted
EPS should not be considered a
measure of financial performance
under GAAP. Management presents
Adjusted EPS because it believes
that Adjusted EPS is a useful
supplement to its reported EPS as
an indicator of operating
performance. Management uses
Adjusted EPS as one performance
measure in its annual cash
incentive program for certain
members of its management team.
Management believes it provides a
more useful comparison of the
Company's underlying business
performance from period to period
and is more representative of the
future earnings capacity of the
Company.
(i) Tax impact on the non-GAAP items is
related to the impairment charges
on indefinite-lived intangible
assets of the Physician Staffing
business for the three months and
six months ended June 30, 2016.
There is no tax impact on the other
items due to the Company's full
valuation allowance for all
reported periods.
(j) Segment data provided is in
accordance with the Segment
Reporting Topic of the FASB ASC.
(k) Contribution income is defined as
income or loss from operations
before depreciation and
amortization, loss on sale of
business, acquisition-related
contingent consideration,
acquisition and integration costs,
restructuring costs, impairment
charges, and corporate expenses not
specifically identified to a
reporting segment. Contribution
income is a financial measure used
by management when assessing
segment performance.
(l) Unallocated corporate overhead
includes corporate compensation and
benefits, and general and
administrative expenses including
rent and utilities, computer
supplies and expenses, insurance,
professional expenses, corporate-
wide projects (initiatives), and
public company expense.
(m) FTEs represent the average number of
Nurse and Allied Staffing contract
personnel on a full-time
equivalent basis.
(n) Average revenue per FTE per day is
calculated by dividing the Nurse
and Allied Staffing revenue by the
number of days worked in the
respective periods. Nurse and
Allied Staffing revenue also
includes revenue from the permanent
placement of nurses.
(o) Days filled is calculated by
dividing the total hours invoiced
during the period by 8 hours.
(p) Revenue per day filled is calculated
by dividing revenue invoiced by
days filled for the period
presented.
Cross Country Healthcare, Inc.
William J. Grubbs, 561-237-6202
President & Chief Executive Officer
wgrubbs@crosscountry.com
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SOURCE Cross Country Healthcare, Inc.
