Cross ntry Healthcare(CCRN) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Financial Results Overview Selected Financial Highlights Q2 2025 revenue was $274.1 million, down 19% YoY and 7% QoQ, with a $6.7 million net loss and $7.6 million adjusted EBITDA | Metric | Q2 2025 | Q2 2025 vs Q2 2024 Change | Q2 2025 vs Q1 2025 Change | | :--------------------------------- | :-------- | :------------------------ | :------------------------ | | Revenue | $274,072 | (19) % | (7) % | | Gross profit margin* | 20.4 % | (40) bps | 40 bps | | Net loss attributable to common stockholders | $(6,659) | (59) % | (1,259) % | | Diluted EPS | $(0.20) | $0.27 | $(0.18) | | Adjusted EBITDA* | $7,591 | (46) % | (12) % | | Adjusted EBITDA margin* | 2.8 % | (140) bps | (10) bps | | Adjusted EPS* | $(0.01) | $(0.11) | $(0.07) | | Cash flows provided by operations | $4,217 | (95) % | (26) % | Business Highlights Q2 performance met expectations, driven by growth in home care and physician staffing, alongside effective cost control measures - Q2 performance met expectations, primarily due to growth momentum in home care and physician staffing businesses and continuous cost control[4] - Customer retention remained stable, with significant MSP implementation and expansion plans for H2 2025[5] - Home care staffing business showed strong performance, with revenue growing over 30% year-over-year[5] - Physician staffing revenue increased 3% year-over-year, driven by favorable mix and pricing[5] - Selling, general and administrative expenses (SG&A) decreased 5% sequentially, benefiting from further utilization of the low-cost center of excellence in India[5] Six Months Ended June 30, 2025 Consolidated Results Consolidated revenue for the six months ended June 30, 2025, was $567.5 million, down 21.1% YoY, with a $7.1 million net loss | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------- | :------------------------- | :----------- | | Consolidated revenue | $567.5 million | $718.9 million | (21.1)% | | Consolidated gross profit margin | 20.2% | 20.6% | (40) bps | | Net loss attributable to common stockholders | $7.1 million | $13.4 million | 47% (Improvement) | | Diluted EPS | $(0.22) | $(0.39) | 44% (Improvement) | | Adjusted EBITDA | $16.2 million | $29.5 million | (45)% | | Adjusted EBITDA margin | 2.9% | 4.1% | (120) bps | | Adjusted EPS | $0.05 | $0.29 | (83)% | Business Segment Performance Nurse and Allied Staffing Nurse and Allied Staffing revenue was $224.3 million, down 23% YoY and 7% QoQ, with contribution income of $13.9 million, up 139% YoY | Metric | Q2 2025 | Q2 2024 | Q1 2025 | YoY Change | QoQ Change | | :--------------------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Revenue | $224.3 million | $291.5 million | $242.3 million | (23)% | (7)% | | Contribution income | $13.9 million | $5.8 million | $17.2 million | 139% | (19)% | | Average FTEs | 7,035 | 8,415 | 7,411 | (16.4)% | (5.1)% | | Revenue per FTE per day | $348 | $377 | $360 | (7.7)% | (3.3)% | Physician Staffing Physician Staffing revenue was $49.8 million, up 3% YoY and down 3% QoQ, with contribution income of $4.6 million, up 13% YoY | Metric | Q2 2025 | Q2 2024 | Q1 2025 | YoY Change | QoQ Change | | :--------------------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Revenue | $49.8 million | $48.3 million | $51.1 million | 3% | (3)% | | Contribution income | $4.6 million | $4.0 million | $4.0 million | 13% | 14% | | Total days filled | 22,228 | 24,252 | 22,692 | (8.3)% | (2.0)% | | Revenue per day filled | $2,239 | $1,992 | $2,253 | 12.4% | (0.6)% | Financial Position and Liquidity Cash Flow Highlights Net cash from operating activities in Q2 2025 was $4.2 million, a significant 95% YoY and 26% QoQ decrease | Metric | Q2 2025 | Q2 2024 | Q1 2025 | YoY Change | QoQ Change | | :--------------------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Net cash provided by operating activities | $4,217 | $82,401 | $5,681 | (95)% | (26)% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change | | :--------------------------------- | :----------------------------- | :----------------------------- | :--------- | | Net cash provided by operating activities | $9,898 | $88,412 | (88.8)% | Balance Sheet Highlights As of June 30, 2025, the company held $81.2 million in cash and equivalents with no outstanding debt, reflecting a healthy balance sheet - As of June 30, 2025, the company held $81.2 million in cash and cash equivalents with no outstanding debt[5][12] - As of June 30, 2025, the balance sheet remained healthy, with $553.8 million in total assets and $141.6 million in total liabilities[25] | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $81,193 | $81,633 | | Total assets | $553,818 | $589,251 | | Total liabilities | $141,576 | $170,292 | | Total stockholders' equity | $412,242 | $418,959 | Corporate Updates and Disclosures Pending Merger Transaction A merger agreement with Aya Healthcare, Inc. was signed on December 3, 2024, expected to close in Q4, leading to no Q2 earnings call or forward guidance - The company signed a merger agreement with Aya Healthcare, Inc. on December 3, 2024, with the transaction expected to close in Q4[4][13] - Due to the pending merger transaction, the company will not hold a Q2 earnings conference call or provide forward-looking guidance[13] About Cross Country Healthcare Cross Country Healthcare, Inc. is a market-leading, technology-driven workforce solutions and consulting firm with 39 years of experience - Cross Country Healthcare is a market-leading, technology-driven workforce solutions and consulting company[14] - The company has 39 years of industry experience, helping clients solve complex labor challenges and achieve high-quality outcomes through data-driven insights[14] Non-GAAP Financial Measures Explanation Non-GAAP financial measures are supplementary to GAAP, used by management to assess performance by excluding items not representative of future operating results - Non-GAAP financial measures (e.g., gross margin, adjusted EBITDA, adjusted EBITDA margin, and adjusted EPS) are provided as supplementary information and should not replace or be superior to GAAP measures[16] - Management uses non-GAAP measures for consistency and comparability with prior year results, believing they aid investors in evaluating performance by excluding items not representative of future operating performance[16] Forward-Looking Statements This press release contains forward-looking statements regarding future performance and the Aya merger, subject to inherent risks and uncertainties, with no obligation to update - This press release contains forward-looking statements regarding the company's future performance, the expected timing, completion, and potential benefits of the Aya merger transaction, and other related matters[17] - Forward-looking statements are subject to inherent risks, uncertainties, and changes in circumstances that could cause actual results to differ materially from expectations[18] - The company undertakes no obligation to update or revise any forward-looking statements, and investors should refer to risks and uncertainties identified in the company's SEC filings[18][19] Detailed Financial Statements Consolidated Statements of Operations | | June 30, 2025 | June 30, 2024 | March 31, 2025 | June 30, 2025 (YTD) | June 30, 2024 (YTD) | | :------------------------------------- | :------------ | :------------ | :------------- | :------------------ | :------------------ | | Revenue from services | $274,072 | $339,771 | $293,408 | $567,480 | $718,945 | | Direct operating expenses | 218,068 | 268,966 | 234,750 | 452,818 | 570,843 | | Selling, general and administrative expenses | 50,050 | 60,255 | 52,486 | 102,536 | 123,507 | | Credit loss expense | 30 | 18,858 | 35 | 65 | 20,148 | | Depreciation and amortization | 4,101 | 4,719 | 4,772 | 8,873 | 9,361 | | Acquisition and integration-related costs | 5,995 | 3 | 2,041 | 8,036 | 3 | | Restructuring costs | 588 | 2,116 | 301 | 889 | 3,054 | | Legal and other losses | 1,099 | 3,946 | — | 1,099 | 7,596 | | Impairment charges | — | 114 | — | — | 718 | | Total operating expenses | 279,931 | 358,977 | 294,385 | 574,316 | 735,230 | | Loss from operations | (5,859) | (19,206) | (977) | (6,836) | (16,285) | | Interest expense | 549 | 568 | 543 | 1,092 | 1,030 | | Interest income | (702) | (235) | (681) | (1,383) | (408) | | Other expense (income) , net | 23 | 23 | 60 | 83 | (1,034) | | Loss before income taxes | (5,729) | (19,562) | (899) | (6,628) | (15,873) | | Income tax expense (benefit) | 930 | (3,512) | (409) | 521 | (2,515) | | Net loss attributable to common stockholders | $(6,659) | $(16,050) | $(490) | $(7,149) | $(13,358) | | Net loss per share attributable to common stockholders - Basic | $(0.20) | $(0.47) | $(0.02) | $(0.22) | $(0.39) | | Net loss per share attributable to common stockholders - Diluted | $(0.20) | $(0.47) | $(0.02) | $(0.22) | $(0.39) | | Weighted average common shares outstanding: Basic | 32,492 | 33,960 | 32,282 | 32,388 | 34,088 | | Weighted average common shares outstanding: Diluted | 32,492 | 33,960 | 32,282 | 32,388 | 34,088 | Reconciliation of Non-GAAP Financial Measures | | June 30, 2025 | June 30, 2024 | March 31, 2025 | June 30, 2025 (YTD) | June 30, 2024 (YTD) | | :------------------------------------------------ | :------------ | :------------ | :------------- | :------------------ | :------------------ | | Net loss attributable to common stockholders | $(6,659) | $(16,050) | $(490) | $(7,149) | $(13,358) | | Interest expense | 549 | 568 | 543 | 1,092 | 1,030 | | Income tax expense (benefit) | 930 | (3,512) | (409) | 521 | (2,515) | | Depreciation and amortization | 4,101 | 4,719 | 4,772 | 8,873 | 9,361 | | Acquisition and integration-related costs | 5,995 | — | 2,041 | 8,036 | — | | Restructuring costs | 588 | 2,116 | 301 | 889 | 3,054 | | Legal, bankruptcy, and other losses | 1,099 | 23,319 | — | 1,099 | 26,969 | | Impairment charges | — | 114 | — | — | 718 | | Interest income | (702) | (235) | (681) | (1,383) | (408) | | Other expense (income), net | 23 | 23 | 60 | 83 | (1,034) | | Equity compensation | 870 | 2,259 | 1,318 | 2,188 | 3,457 | | System conversion costs | 797 | 857 | 1,164 | 1,961 | 2,186 | | Adjusted EBITDA | $7,591 | $14,178 | $8,619 | $16,210 | $29,460 | | Adjusted EBITDA margin | 2.8 % | 4.2 % | 2.9 % | 2.9 % | 4.1 % | | Adjusted EPS, non-GAAP | $(0.01) | $0.10 | $0.06 | $0.05 | $0.29 | Consolidated Balance Sheets | | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Assets | | | | Cash and cash equivalents | $81,193 | $81,633 | | Accounts receivable, net | 201,694 | 223,238 | | Total current assets | 309,056 | 335,000 | | Property and equipment, net | 28,221 | 28,850 | | Goodwill | 135,060 | 135,060 | | Other intangible assets, net | 37,744 | 42,186 | | Total assets | $553,818 | $589,251 | | Liabilities and Stockholders' Equity | | | | Accounts payable and accrued expenses | $49,004 | $64,946 | | Accrued compensation and benefits | 45,264 | 47,646 | | Total current liabilities | 96,165 | 120,402 | | Total liabilities | 141,576 | 170,292 | | Total stockholders' equity | 412,242 | 418,959 | | Total liabilities and stockholders' equity | $553,818 | $589,251 | Segment Data | | June 30, 2025 | June 30, 2024 | March 31, 2025 | YoY Change | QoQ Change | | :-------------------------- | :------------ | :------------ | :------------- | :--------- | :--------- | | Revenue from services: | | | | | | | Nurse and Allied Staffing | $224,305 | $291,451 | $242,291 | (23)% | (7)% | | Physician Staffing | 49,767 | 48,320 | 51,117 | 3% | (3)% | | Total Revenue | $274,072 | $339,771 | $293,408 | (19)% | (7)% | | Contribution income: | | | | | | | Nurse and Allied Staffing | $13,887 | $5,820 | $17,244 | 139% | (19)% | | Physician Staffing | 4,577 | 4,033 | 4,029 | 13% | 14% | | Total Contribution Income | $18,464 | $9,853 | $21,273 | 87% | (13)% | | Loss from operations | $(5,859) | $(19,206) | $(977) | 69% | (500)% | | | June 30, 2025 (YTD) | June 30, 2024 (YTD) | YoY Change | | :-------------------------- | :------------------ | :------------------ | :--------- | | Revenue from services: | | | | | Nurse and Allied Staffing | $466,596 | $623,637 | (25)% | | Physician Staffing | 100,884 | 95,308 | 6% | | Total Revenue | $567,480 | $718,945 | (21)% | | Contribution income: | | | | | Nurse and Allied Staffing | $31,131 | $33,003 | (6)% | | Physician Staffing | 8,606 | 7,171 | 20% | | Total Contribution Income | $39,737 | $40,174 | (1)% | | Loss from operations | $(6,836) | $(16,285) | 58% | Summary Condensed Consolidated Statements of Cash Flows | | June 30, 2025 | June 30, 2024 | March 31, 2025 | June 30, 2025 (YTD) | June 30, 2024 (YTD) | | :------------------------------------ | :------------ | :------------ | :------------- | :------------------ | :------------------ | | Net cash provided by operating activities | $4,217 | $82,401 | $5,681 | $9,898 | $88,412 | | Net cash used in investing activities | (1,967) | (2,849) | (1,886) | (3,853) | (5,059) | | Net cash used in financing activities | (1,756) | (15,193) | (4,725) | (6,481) | (30,846) | | Change in cash and cash equivalents | 496 | 64,359 | (936) | (440) | 52,507 | | Cash and cash equivalents at end of period | $81,193 | $69,601 | $80,697 | $81,193 | $69,601 | Other Financial Data | | June 30, 2025 | June 30, 2024 | March 31, 2025 | June 30, 2025 (YTD) | June 30, 2024 (YTD) | | :------------------------------------ | :------------ | :------------ | :------------- | :------------------ | :------------------ | | Revenue from services | $274,072 | $339,771 | $293,408 | $567,480 | $718,945 | | Less: Direct operating expenses | 218,068 | 268,966 | 234,750 | 452,818 | 570,843 | | Gross profit | $56,004 | $70,805 | $58,658 | $114,662 | $148,102 | | Consolidated gross profit margin | 20.4 % | 20.8 % | 20.0 % | 20.2 % | 20.6 % | | Nurse and Allied Staffing statistical data: | | | | | | | FTEs | 7,035 | 8,415 | 7,411 | 7,223 | 8,770 | | Average Nurse and Allied Staffing revenue per FTE per day | $348 | $377 | $360 | $354 | $388 | | Physician Staffing statistical data: | | | | | | | Days filled | 22,228 | 24,252 | 22,692 | 44,920 | 48,037 | | Revenue per day filled | $2,239 | $1,992 | $2,253 | $2,246 | $1,984 |