AMN Healthcare Services(US:AMN)2019-05-03 20:51Financial Data and Key Metrics Changes - The company's first quarter consolidated revenue was $532 million, representing a 2% year-over-year growth and $4 million above the high end of guidance [10][21] - Gross margin for the quarter was 33.2%, up 110 basis points from the previous year and 60 basis points better than the prior quarter [21] - Adjusted EBITDA was $66 million, down 1% year-over-year, with an adjusted EBITDA margin of 12.4%, lower by 30 basis points year-over-year [24] Business Line Data and Key Metrics Changes - Nurse and Allied segment revenue was $337 million, flat year-over-year, with a gross margin of 27.9%, down 10 basis points from the prior year [11][22] - Locum Tenens segment revenue was $80 million, down 22% year-over-year, with a gross margin of 27.7%, down 100 basis points from the prior year [13][23] - Other Workforce Solutions segment revenue was $115 million, up 42% year-over-year, primarily due to acquisitions, with a gross margin of 52.6%, lower by 100 basis points year-over-year [15][23] Market Data and Key Metrics Changes - The labor market in healthcare remains tight, with vacancies at all-time highs and turnover in double digits [9] - Orders in staffing businesses have risen, particularly in travel nursing, Allied, and interim leadership, with travel nurse orders currently up more than 25% compared to the prior year [9][11] - The company signed new MSP and expanded existing MSP relationships totaling over $150 million in gross spend under management [9] Company Strategy and Development Direction - The company announced the acquisition of Advanced Medical for $200 million, which is expected to enhance its capabilities in therapy staffing and teletherapy services [7][27] - The company is focused on making investments in technology and digital capabilities to better serve clients and healthcare professionals [18] - The strategic partnerships being built with large healthcare organizations are seen as a positive indicator of the company's positioning in the market [17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand for travel therapy and nursing, indicating that the demand environment is strong and expected to remain so [9][17] - The company anticipates total Nurse and Allied segment revenue to be down 3% to 4% year-over-year in the second quarter, primarily due to a labor disruption event in the prior year [13][28] - Management noted that the current order trends and economic indicators suggest that a slowdown is not likely in the near term [17] Other Important Information - The company repurchased 378,000 shares for $18 million during the quarter and has added $150 million to its share repurchase authorization [26] - Total debt outstanding was $475 million, with a leverage ratio of 1.9x:1 [26] Q&A Session Summary Question: What is driving the strength in Nursing and Allied? - Management indicated that growth is seen across various relationships, with a lift in the marketplace and some share movement due to recent large MSP wins [31] Question: How is the premium rate anniversary impacting results? - Management confirmed that the average bill rate in Nursing was down about 1% in the first quarter, but they expect it to stabilize in the second quarter [34] Question: What is the outlook for the Locum segment? - The Locum segment is expected to grow about 2% sequentially in the second quarter, but still down significantly year-over-year [14] Question: Can you provide insights on the Advanced acquisition? - The acquisition is expected to enhance the company's capabilities in hard-to-fill specialties and provide opportunities for innovation in teletherapy and school staffing [56][62] Question: What is the growth rate of Advanced Medical? - Advanced Medical is expected to see double-digit growth in its Allied business and significant growth in its school staffing segment [62]