[PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) The unaudited Q1 2021 financial statements reflect significant revenue growth, a shift to net income, asset and liability increases from the Northfield acquisition, and improved operating cash flow [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheets show total assets increased to **$2.20 billion** driven by the Northfield acquisition, with total liabilities rising to **$1.73 billion** due to increased long-term debt Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $13,328 | $206,505 | | Goodwill | $1,122,530 | $817,113 | | Total assets | $2,195,836 | $1,903,356 | | **Liabilities & Equity** | | | | Long-term debt, less current portion | $1,350,035 | $1,145,055 | | Total liabilities | $1,729,783 | $1,461,411 | | Total equity | $466,053 | $441,945 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2021 revenue increased **31.2%** to **$235.2 million**, with gross margin improving to **43.1%** and a shift from net loss to **$9.6 million** net income Q1 2021 vs Q1 2020 Statement of Operations (in thousands, except per share data) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Revenue | $235,245 | $179,240 | | Gross Margin | $101,323 | $57,807 | | Operating Income | $32,099 | $1,241 | | Consolidated Net Income (Loss) | $9,583 | $(12,548) | | Diluted Income (Loss) Per Share | $0.09 | $(0.13) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow more than doubled to **$62.9 million**, while investing activities saw a **$457.5 million** outflow primarily for acquisitions, funded by **$201.4 million** in financing Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $62,909 | $27,679 | | Net cash used in investing activities | $(457,525) | $(101,139) | | Net cash provided by financing activities | $201,439 | $134,483 | | Net change in cash and cash equivalents | $(193,177) | $61,023 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the **$475 million** Northfield Medical acquisition, the post-quarter IPO raising **$397.4 million** for debt repayment, and a significant **20%** revenue contract with HHS - On March 19, 2021, the company acquired Northfield Medical, Inc. for a total consideration of approximately **$475 million**, consisting of **$461.0 million** in cash and **$11.3 million** in common stock, funded by additional borrowings[31](index=31&type=chunk)[32](index=32&type=chunk)[34](index=34&type=chunk) - Subsequent to the quarter end, on April 27, 2021, the company closed its IPO, raising net proceeds of approximately **$397.4 million**, used to repay **$240.0 million** of the Second Lien Term Loan, **$80.0 million** of the First Lien Term Loan, and **$10.0 million** of the Revolving Loan[91](index=91&type=chunk)[93](index=93&type=chunk) - For the three months ended March 31, 2021, approximately **20%** of total revenue was derived from contracts with the U.S. Department of Health and Human Services[88](index=88&type=chunk) - Total long-term debt increased to **$1.37 billion** as of March 31, 2021, from **$1.16 billion** at year-end 2020, primarily to finance the Northfield acquisition[55](index=55&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong Q1 2021 performance to **31.2%** revenue growth across all service lines, gross margin expansion to **43.1%**, and **77.0%** Adjusted EBITDA growth to **$86.2 million** Revenue by Service Solution (in thousands) | Service Solution | Q1 2021 | Q1 2020 | % Change | | :--- | :--- | :--- | :--- | | Equipment Solutions | $82,471 | $68,405 | 20.6% | | Clinical Engineering | $75,106 | $66,014 | 13.8% | | Onsite Managed Services | $77,668 | $44,821 | 73.3% | | **Total Revenue** | **$235,245** | **$179,240** | **31.2%** | - The positive impact from COVID-19 within the Equipment Solutions segment was estimated to be in the **$10 million to $12 million** range for Q1 2021[112](index=112&type=chunk) - Gross margin increased to **43.1%** of revenue in Q1 2021 from **32.3%** in Q1 2020, primarily due to favorable leverage from volume growth, allowing the company to better utilize its fixed cost infrastructure[114](index=114&type=chunk)[115](index=115&type=chunk) Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net income (loss) attributable to Agiliti | $9,553 | $(12,622) | | Interest expense | $18,021 | $17,817 | | Income tax expense (benefit) | $4,495 | $(4,028) | | Depreciation and amortization | $43,563 | $40,166 | | **EBITDA** | **$75,632** | **$41,333** | | Non-cash share-based compensation | $2,412 | $2,383 | | Management and other expenses | $563 | $4,111 | | Transaction costs | $3,451 | $889 | | Tax receivable agreement remeasurement | $4,148 | — | | **Adjusted EBITDA** | **$86,206** | **$48,716** | [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from interest rates, fuel costs, and pension valuation, with a **1.0 percentage point** interest rate change impacting annual expense by **$8.7 million** - The company's primary market risks are related to interest rates, fuel costs, and pension valuation[138](index=138&type=chunk) - As of March 31, 2021, the company had **$869.4 million** in variable rate debt, where a **1.0 percentage point** change in interest rates would result in an annual interest expense fluctuation of approximately **$8.7 million**[139](index=139&type=chunk) - A hypothetical **10%** increase in gasoline prices would increase annual fuel costs by approximately **$0.3 million**, based on Q1 2021 usage levels[140](index=140&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report (March 31, 2021)[143](index=143&type=chunk) - No changes occurred in the company's internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, these controls[145](index=145&type=chunk) [PART II - OTHER INFORMATION](index=29&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company faces ordinary course liability claims, but management believes their resolution will not materially adversely affect financial position or operations - The company is subject to liability claims related to employees and equipment in the ordinary course of business, but management does not expect these to have a material adverse effect[146](index=146&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) Key risks include potential non-renewal of the significant HHS contract, impairment charges for goodwill, and challenges associated with substantial indebtedness - A key risk is the potential non-renewal of a one-year agreement with HHS, which accounted for approximately **20%** of total revenue for the three months ended March 31, 2021, and is set to expire on July 21, 2021[152](index=152&type=chunk)[153](index=153&type=chunk) - The company faces risk of impairment charges for goodwill or other long-lived assets, as testing for impairment requires estimates about future performance that are subject to significant assumptions[154](index=154&type=chunk) - As of March 31, 2021, the company had substantial indebtedness, with approximately **$1.12 billion** under its First Lien Term Loan and **$240.0 million** under its Second Lien Term Loan, which could make it difficult to satisfy debt obligations and limit financial flexibility[156](index=156&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company issued unregistered equity for the Northfield acquisition and RSU settlement, then completed an IPO raising **$397.4 million** primarily for debt repayment - In connection with the Northfield Acquisition on March 19, 2021, the company issued **752,328 shares** of common stock to the Northfield management team[158](index=158&type=chunk) - On April 27, 2021, the company completed its IPO, receiving net proceeds of **$397.4 million** after underwriting discounts and expenses[160](index=160&type=chunk) - Approximately **$330.0 million** of the IPO proceeds were used to repay debt: **$240.0 million** for the Second Lien Term Loan, **$80.0 million** for the First Lien Term Loan, and **$10.0 million** for the Revolving Loan[162](index=162&type=chunk) [Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the quarterly report, including certifications from the Principal Executive Officer and Principal Financial Officer - This section provides a list of all exhibits filed with the quarterly report, including certifications from the Principal Executive Officer and Principal Financial Officer[165](index=165&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-K (Mark One) ☒ Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2018 or ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to . Commission File Number: 132-02824 AGILITI, INC. (Exact name of registrant as specified in its charter) Delaware 82-1608463 (State or other jurisdiction of (I ...