Apollo Medical(AMEH) - 2024 Q3 - Quarterly Results

Financial & Operating Highlights Astrana Health reported strong revenue growth for Q3 and YTD 2024, driven by Care Partners, with mixed profitability and a key acquisition Q3 2024 Financial Highlights (vs. Q3 2023) | Metric | Q3 2024 | Change vs. Q3 2023 | | :--- | :--- | :--- | | Total Revenue | $478.7M | ⬆️ 37% | | Care Partners Revenue | $455.8M | ⬆️ 42% | | Net Income (attributable to Astrana) | $16.1M | ⬇️ 27% | | EPS - diluted | $0.33 | ⬇️ 30% | | Adjusted EBITDA | $45.2M | ⬇️ 13% | Nine Months Ended Sep 30, 2024 Financial Highlights (vs. Prior Year) | Metric | Nine Months 2024 | Change vs. 2023 | | :--- | :--- | :--- | | Total Revenue | $1,369.3M | ⬆️ 32% | | Care Partners Revenue | $1,301.4M | ⬆️ 36% | | Net Income (attributable to Astrana) | $50.1M | ⬆️ 4% | | EPS - diluted | $1.04 | ⬆️ 1% | | Adjusted EBITDA | $135.3M | ⬆️ 15% | - On October 4, 2024, the company acquired Collaborative Health Systems (CHS), Golden Triangle Physician Alliance, and Heritage Physician Networks for an aggregate purchase price of $37.5 million, plus potential earnout payments up to $21.5 million[4] Segment Performance In Q3 2024, Care Partners led revenue growth with an operating income decline, while Care Delivery grew revenue but incurred a loss, and Care Enablement showed modest growth Q3 2024 Segment Results (in thousands) | Segment | Total Revenues | % Change vs. Q3 2023 | Income (Loss) from Operations | % Change vs. Q3 2023 | | :--- | :--- | :--- | :--- | :--- | | Care Partners | $455,760 | ⬆️ 42% | $38,786 | ⬇️ 4% | | Care Delivery | $34,728 | ⬆️ 20% | $(1,357) | ⬆️ 31% (less loss) | | Care Enablement | $40,930 | ⬆️ 11% | $6,314 | ⬇️ 2% | Full Year 2024 Guidance Following the CHS acquisition, Astrana raised its full-year 2024 revenue guidance and narrowed ranges for net income, Adjusted EBITDA, and EPS Updated Full Year 2024 Guidance | Metric | Low Range | High Range | | :--- | :--- | :--- | | Total Revenue | $1,950M | $2,030M | | Net Income (attributable to Astrana) | $52M | $58M | | Adjusted EBITDA | $165M | $175M | | EPS – diluted | $1.06 | $1.19 | Financial Statements The financial statements detail significant growth in total assets and liabilities, alongside increased revenue but mixed profitability for Q3 and YTD 2024 Consolidated Balance Sheets As of September 30, 2024, Astrana's total assets and liabilities significantly increased, driven by cash, goodwill, debt, and medical liabilities, with total equity also rising Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2024 (Unaudited) | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $347,994 | $293,807 | | Goodwill | $409,711 | $278,831 | | Total Assets | $1,285,376 | $933,361 | | Medical liabilities | $160,279 | $106,657 | | Long-term debt, net | $423,119 | $258,939 | | Total Liabilities | $778,269 | $522,593 | | Total Equity | $709,619 | $616,651 | Consolidated Statements of Income Q3 2024 revenue grew significantly, but increased costs and interest expense led to a net income decline, while nine-month results showed strong revenue growth and modest net income improvement Consolidated Income Statement Highlights (in thousands, except per share data) | Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $478,710 | $348,173 | $1,369,331 | $1,033,625 | | Capitation, net | $431,401 | $305,678 | $1,239,885 | $906,430 | | Income from operations | $28,425 | $39,083 | $88,630 | $88,483 | | Net Income Attributable to Astrana | $16,094 | $22,059 | $50,100 | $48,361 | | EPS - diluted | $0.33 | $0.47 | $1.04 | $1.03 | Non-GAAP Financial Measures & Reconciliations The company utilizes non-GAAP measures like Adjusted EBITDA for performance evaluation, reporting a Q3 2024 decline but nine-month growth, and providing full-year 2024 guidance reconciliation Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $18,981 | $27,973 | $57,709 | $57,943 | | EBITDA | $39,154 | $42,818 | $116,255 | $102,823 | | Adjusted EBITDA | $45,170 | $51,974 | $135,332 | $117,573 | | Adjusted EBITDA Margin | 9% | 15% | 10% | 11% | 2024 Guidance Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Low Range | High Range | | :--- | :--- | :--- | | Net Income | $59,340 | $66,240 | | EBITDA | $132,250 | $142,250 | | Adjusted EBITDA | $165,000 | $175,000 | - Adjusted EBITDA is a key non-GAAP metric used by management for operational decision-making, calculated by taking earnings before interest, taxes, depreciation, and amortization, and excluding items like income/loss from equity investments, non-recurring transactions, and stock-based compensation[26] Company Overview & Conference Call Astrana Health is a physician-centric, technology-powered healthcare company focused on value-based care, serving a large patient and provider network, and recently held a conference call to discuss Q3 results - Astrana operates a value-based healthcare model aiming to provide high-quality, cost-effective care through its network of providers and affiliated entities[14] - The company serves approximately 1.1 million patients in value-based care arrangements and works with over 12,000 providers[2][15] - A conference call to discuss Q3 2024 results was scheduled for November 7, 2024, with webcast and replay information provided[9][10]