Bright Horizons Family Solutions(US:BFAM)2022-08-04 16:00Revenue and Profitability - For the three months ended June 30, 2022, revenue was $490.3 million, a 11.0% increase from $441.5 million in the same period of 2021[90]. - Gross profit for the three months ended June 30, 2022, was $128.5 million, representing a gross margin of 26.2%, compared to 24.0% in 2021[90]. - For the six months ended June 30, 2022, net income was $44.4 million, up from $25.9 million in the same period of 2021, reflecting a net income margin of 4.7%[92]. - Adjusted EBITDA for the six months ended June 30, 2022, was $145.9 million, representing 15.3% of revenue, compared to 13.7% in 2021[92]. - Total revenue for the three months ended June 30, 2022, was $490.3 million, an increase of $48.9 million or 11.1% compared to $441.5 million in the same period in 2021[96]. - Revenue from full-service center-based child care increased by $36.9 million, or 11%, driven by enrollment increases and the reopening of temporarily closed centers[96]. - Tuition revenue rose by $38.8 million, or 13%, on a 16% increase in enrollment, although occupancy levels remain below pre-COVID-19 levels[96]. - Gross profit increased by $22.5 million, or 21%, to $128.5 million, with a gross profit margin of 26% for the three months ended June 30, 2022[96]. - Income from operations increased by $13.8 million, or 41%, to $47.8 million, with significant contributions from the full-service center-based child care segment[99]. - Adjusted EBITDA increased by $15.1 million, or 22%, primarily due to the increase in gross profit in the full-service center-based child care segment[99]. - Total revenue for the six months ended June 30, 2022, was $950.8 million, an increase of $118.4 million or 14.2% compared to $832.3 million in the same period of 2021[101]. - Revenue from full-service center-based child care increased by $100.5 million, or 16%, driven by enrollment increases and the reopening of temporarily closed centers[101]. - Tuition revenue rose by $108.8 million, or 19.8%, attributed to a 22% increase in enrollment[101]. - Gross profit increased by $51.2 million, or 27%, to $238.6 million, with a gross profit margin of 25%, up approximately 2% from the prior year[102]. - Income from operations increased by $31.3 million, or 66%, to $79.0 million, with significant contributions from the full-service center-based child care segment[104]. - Adjusted EBITDA increased by $31.7 million, or 28%, for the six months ended June 30, 2022, primarily due to increased gross profit[105]. - Adjusted net income rose by $26.1 million, or 60%, compared to the same period in 2021, mainly due to higher income from operations[105]. - Net income for the three months ended June 30, 2022, was $24,945,000, an increase of 32.5% from $18,815,000 in the same period of 2021[108]. - Adjusted EBITDA for the three months ended June 30, 2022, was $83,076,000, up 22.3% from $67,951,000 in the prior year[108]. - Adjusted net income for the six months ended June 30, 2022, was $69,836,000, an increase of 58.5% from $43,696,000 in the same period of 2021[108]. Operational Performance - The company operated 1,014 early education and child care centers as of June 30, 2022, with a capacity to serve approximately 114,000 children[88]. - As of June 30, 2022, 98% of the child care centers were open, indicating a strong recovery from the pandemic[88]. - The company plans to continue investing in employee compensation and benefits to attract and retain talent in a challenging labor market[88]. - The company expects to implement effective pricing strategies to manage rising personnel costs and inflationary pressures[88]. - Cost of services increased by $26.3 million, or 8%, to $361.8 million, with personnel costs representing 70% of the costs for the full-service center-based child care segment[96]. - Cost of services increased by $67.2 million, or 10%, to $712.2 million, with personnel costs rising by 13% due to enrollment growth[102]. Acquisitions and Investments - The acquisition of Only About Children was completed on July 1, 2022, for a total consideration of AUD$450 million (approximately USD$313.5 million)[89]. - The company completed the acquisition of OAC for AUD$450 million, with an initial payment of approximately AUD$300 million (USD$207 million) financed with cash on hand[113]. - The company invested $19.2 million in fixed asset purchases for new child care centers and refurbishments in existing centers during the first half of 2022, compared to $28.5 million in the same period in 2021[116]. - The company used $3.3 million to acquire one center in the first half of 2022, compared to $9.1 million for two centers and a camp in the same period in 2021[116]. Financial Position and Cash Flow - The company had $270.4 million in cash as of June 30, 2022, compared to $261.0 million at December 31, 2021[112]. - Cash provided by operating activities decreased to $125.8 million for the six months ended June 30, 2022, compared to $135.7 million for the same period in 2021[114]. - Net cash provided by operating activities decreased to $125.8 million in 2022 from $135.7 million in 2021, representing a decline of approximately 7.5%[115]. - Cash used in investing activities was $23.1 million for the six months ended June 30, 2022, down from $37.7 million in the same period in 2021, a decrease of about 38.5%[116]. - Cash used in financing activities increased to $89.0 million for the six months ended June 30, 2022, compared to $56.7 million in 2021, an increase of approximately 56.8%[117]. - Total debt as of June 30, 2022, was $984.9 million, slightly down from $992.4 million at the end of 2021[119]. - The weighted average interest rate for term loans was 2.55% for the six months ended June 30, 2022, down from 3.06% in the same period in 2021[121]. - The revolving credit facility has $400 million available for borrowing, with no borrowings outstanding as of June 30, 2022[119]. Foreign Currency and Risk Management - The company reported a loss on foreign currency forward contracts of $5.9 million for the three months ended June 30, 2022[90]. - The company recognized realized and unrealized losses of $5.9 million related to foreign currency forward contracts during the six months ended June 30, 2022[104]. - The company entered into foreign currency forward contracts with a total notional value of approximately AUD$320 million to mitigate foreign currency fluctuations related to an acquisition in Australia[123]. - The company recognized realized and unrealized losses of $5.9 million during the three months ended June 30, 2022, due to fluctuations in the Australian dollar[123]. Shareholder Returns - The company repurchased 0.9 million shares for $84.2 million during the six months ended June 30, 2022, with $296.4 million remaining under the share repurchase program[113]. - The weighted average common shares outstanding—diluted was 59,252,869 for the three months ended June 30, 2022, down from 61,106,792 in the same period of 2021[108].