TUCSON, Ariz., Aug. 6, 2015 /PRNewswire/ -- The Providence
Service Corporation (Nasdaq: PRSC) today announced its financial
results for the second quarter and six months ended June 30, 2015. Included in the results are
results of the operations of Ingeus and Matrix Medical Network
acquired on May 31, 2014 and
October 24, 2014,
respectively.
Second Quarter 2015 Results
For the second quarter of 2015, the Company reported
consolidated revenue of $508.3
million, an increase of 47.8% from $344.0 million in the comparable period of
2014. The 2015 results included $140.7
million of revenue contributed by Ingeus and Matrix in the
second quarter of 2015. The second quarter of 2014 included
$28.8 million in revenue from
Ingeus. Excluding revenue attributable to these acquired
businesses, consolidated revenue was $367.6
million in the second quarter of 2015, an increase of 16.6%
from the comparable period of 2014.
Service expense as a percentage of revenue was 88.6% in the
second quarter of 2015 compared to 89.9% in the second quarter of
2014. Second quarter 2015 and 2014 service expense included a
$1.5 million and $0.5 million charge, respectively, related to the
amortization of the fair value of restricted stock awards issued in
connection with the acquisition of Ingeus. General and
administrative (G&A) expense as a percentage of revenue was
4.6% in the second quarter of 2015 compared to 4.7% in the second
quarter of 2014. Second quarter 2015 G&A expense included
a $0.7 million charge related to
stock award modifications related to a separation agreement with
our former chief executive officer. The Company also reported
a loss on equity investment of $1.1
million in the quarter related to the Company's investment
in Mission Providence, a joint venture in Australia, which continued to incur start-up
costs during the second quarter of 2015.
The Company reported net income available to common shareholders
of $4.2 million, or $0.26 per diluted common share, in the second
quarter of 2015 compared to net income available to common
shareholders of $6.7 million, or
$0.46 per diluted common share, in
the prior year period. Adjusted net income available to
common shareholders (non-GAAP) in the second quarter of 2015 was
$10.8 million, or $0.67 per diluted common share, versus second
quarter 2014 adjusted net income available to common shareholders
(non-GAAP) of $10.7 million, or
$0.74 per diluted common share.
A reconciliation of net income to adjusted net income available to
common shareholders (non-GAAP) and the calculation of adjusted
diluted earnings per common share is presented below.
Adjusted EBITDA (non-GAAP) for the second quarter of 2015 was
$36.0 million compared to
$22.5 million in the same period last
year. Adjusted EBITDA for the second quarter of 2015 includes
the loss on equity investment of $1.1
million related to Mission Providence. A
reconciliation of net income to EBITDA and Adjusted EBITDA is
presented below.
James Lindstrom, Chief Executive
Officer, stated, "Our financial results in the second quarter
benefited from strong volumes in HA Services, execution on
operational improvement and organic growth initiatives in Human
Services, and increased membership and new contracts in NET
Services. In our WD Services segment, management remained focused
on launching large, recently won contracts. Partially due to
delayed start-up expenses and additional complementary revenue
sources associated with these new contracts, the financial
performance of WD Services exceeded our internal expectations for
the second quarter. While we are pleased with our strong
second quarter and first half performance, quarterly volatility
exists across our segments due to a variety of factors including,
but not limited to, seasonality and the timing of contract start-up
expenses. Thus, we remain focused on our annual performance
as previously communicated as well as delivering unique, value-add
solutions for our clients and generating long term intrinsic value
per share."
Year to Date 2015 Results
For the first six months of 2015, the Company reported
consolidated revenue of $1.0 billion,
an increase of 60.1% from $633.4
million in the comparable period of 2014. The 2015
results included $299.1 million of
revenue contributed by Ingeus and Matrix during the first half of
2015. The first half of 2014 included $28.8 million in revenue from Ingeus.
Excluding revenue attributable to these acquired businesses,
consolidated revenue was $715.0
million, an increase of 18.3% from the comparable period of
2014.
Service expense as a percentage of revenue was 88.2% in the
first half of 2015 compared to 89.8% in the first half of
2014. First half 2015 and 2014 service expense included a
$3.1 million and $0.5 million charge, respectively, related to the
amortization of the fair value of restricted stock awards issued in
connection with the acquisition of Ingeus. G&A expense as
a percentage of revenue was 4.7% in the first half of 2015 and
2014. First half 2015 and 2014 G&A expense included a
$0.7 million and $0.5 million charge, respectively, related to
separation arrangements with certain former executive officers. The
Company also reported a loss on equity investment of $3.5 million in the first half of 2015 related to
the Company's investment in Mission Providence, which incurred
start-up costs during the first half of 2015 related to successful
bidding activity.
The Company reported net income available to common shareholders
of $9.2 million, or $0.57 per diluted common share, in the first half
of 2015 compared to net income available to common shareholders of
$13.0 million, or $0.91 per diluted common share, in the prior year
period. Adjusted net income available to common shareholders
(non-GAAP) in the first half of 2015 was $23.2 million, or $1.44 per diluted common share, versus first half
2014 adjusted net income available to common shareholders
(non-GAAP) of $19.4 million, or
$1.36 per diluted common share.
A reconciliation of net income to adjusted net income available to
common shareholders (non-GAAP) and the calculation of adjusted
earnings per diluted common share is presented below.
Adjusted EBITDA (non-GAAP) for the first half of 2015 was
$72.3 million compared to
$40.7 million in the same period last
year. Adjusted EBITDA for the first half of 2015 includes the
loss on equity investment of $3.5
million related to Mission Providence. A
reconciliation of net income to EBITDA and Adjusted EBITDA is
presented below.
Segment Results
For analysis purposes, revenue, expenses, operating income, net
income, EBITDA (non-GAAP), and Adjusted EBITDA (non-GAAP) on a
comparable basis are provided for Providence's four segments for the three and
six month periods ended June 30, 2015
and 2014. As previously disclosed, beginning in 2015, the
Company began analyzing the results of the segments without the
historical allocation of indirect corporate costs. Only
corporate costs that represent expenses directly attributable to
specific segments are allocated to the respective segment.
Additionally, in 2015, the Company's legacy workforce development
businesses were transferred to the management team of the WD
Services segment. As such, the operating segment results for
2014 have been recast.
Non-emergency Transportation (NET) Services
Revenue from the NET Services segment increased 25.1% to
$270.7 million in the second quarter
of 2015 from $216.3 million in the
prior year period. Service expense for the segment increased
to $246.9 million, or 91.2% of NET
Services revenue, in the second quarter of 2015 compared to
$196.5 million or 90.8% of NET
Services revenue in the second quarter of 2014. NET Services
operating income increased 18.5% to $18.9
million in the second quarter from $15.9 million in the prior year period. NET
Services Adjusted EBITDA (non-GAAP) increased $3.4 million, or 19.2%, to $21.2 million in the second quarter from
$17.8 million in the prior year
period.
In the first half of 2015, revenue from the NET Services segment
increased 26.8% to $525.5 million
from $414.4 million in the prior year
period. Service expense for the segment increased to
$476.2 million, or 90.6% of NET
Services revenue, in the first half of 2015 compared to
$371.7 million or 89.7% of NET
Services revenue in the first half of 2014. NET Services
operating income increased 13.0% to $39.6
million in the first half of 2015 from $35.1 million in the prior year period. NET
Services Adjusted EBITDA (non-GAAP) increased $5.5 million, or 14.3%, to $44.2 million in the first half of 2015 from
$38.7 million in the prior year
period.
Revenue for the NET Services segment was favorably impacted by
new contracts in Rhode Island,
Maine, and Texas and increased membership in certain
states, partially offset by the elimination of contracts in
Mississippi and Connecticut.
As anticipated, service costs as a percentage of revenue continued
to increase due to higher utilization related to increased usage by
expansion and woodwork populations in addition to covered members
becoming more aware of their NET benefits.
Human Services
Revenue from the Human Services segment decreased 1.2% to
$90.2 million in the second quarter
of 2015, compared to $91.3 million in
the second quarter of 2014. Both periods exclude revenue
related to the legacy workforce development services business that
was transitioned to the WD Services segment at the beginning of
2015. Service expense for the segment was $78.7 million, or 87.2% of Human Services
revenue, in the second quarter of 2015 compared to $82.6 million, or 90.4% of Human Services revenue
in 2014. Human Services operating income was $4.8 million in the second quarter compared to
$2.0 million in the prior year
period. Human Services Adjusted EBITDA (non-GAAP) increased
$2.7 million to $6.6 million in the second quarter of 2015 from
$3.8 million in the prior year
period.
In the first half of 2015, revenue from the Human Services
segment increased 0.6% to $176.4
million, compared to $175.4
million in the first half of 2014. Both periods
exclude revenue related to the legacy workforce development
services business that was transitioned to the WD Services segment
at the beginning of 2015. Service expense for the segment was
$156.3 million, or 88.6% of Human
Services revenue, in the first half of 2015 compared to
$161.5 million, or 92.1% of Human
Services revenue in 2014. Human Services operating income was
$6.6 million in the first half of the
year compared to $0.7 million in the
prior year period. Human Services Adjusted EBITDA (non-GAAP)
increased $5.6 million to
$10.2 million in the first half of
2015 from $4.6 million in the prior
year period.
Revenue in the Human Services segment was positively impacted by
two acquisitions that occurred in 2014 and organic expansion in
certain markets, and negatively impacted by the termination of the
Texas foster care contract and the
exiting of certain underperforming services and offices.
Service costs as a percentage of revenue benefited from the
termination of the Texas foster
care contract and several business improvement and streamlining
initiatives executed throughout the organization.
Workforce Development (WD) Services
WD Services revenue was $92.2
million in the second quarter of 2015 and relates primarily
to the Ingeus business that was acquired on May 30, 2014. In the second quarter of
2014, WD Services revenue was $36.6
million and represents the legacy workforce development
services business that had historically been part of Human Services
as well as one month of operations of Ingeus. Service expense
for the segment was $83.2 million, or
90.3% of WD revenue, in the second quarter of 2015. WD
Services operating loss was $2.4
million in the second quarter of 2015 and included a
$1.5 million expense related to the
amortization of the fair value of restricted stock awards issued in
connection with the acquisition of Ingeus. WD Services
Adjusted EBITDA (non-GAAP) was $1.4
million in the second quarter of 2015 and included a loss on
equity investment of $1.1 million
related to Mission Providence. In the second quarter of 2014,
service expense was $30.5 million, or
83.2% of WD revenue, operating income was $2.6 million, and Adjusted EBITDA (non-GAAP) was
$5.1 million.
In the first half of 2015, WD Services revenue, related
primarily to the acquired Ingeus operations, was $199.8 million. In the first half of 2014,
WD Services revenue was $44.1 million
and represents the legacy workforce development services business
that had historically been part of Human Services as well as one
month of operations of Ingeus. Service expense for the
segment was $177.5 million, or 88.8%
of WD revenue, in the first half of 2015. WD Services
operating income was $0.4 million in
the first half of 2015 and included a $3.1
million expense related to the amortization of the fair
value of restricted stock awards issued in connection with the
acquisition of Ingeus. WD Services Adjusted EBITDA (non-GAAP)
was $6.6 million in the first half of
2015 and included a loss on equity investment of $3.5 million related to Mission Providence.
In the first half of 2014, service expense was $36.9 million, or 83.7% of WD revenue, operating
income was $3.0 million, and Adjusted
EBITDA (non-GAAP) was $5.7
million.
Health Assessment (HA) Services
HA Services revenue, primarily derived from providing
comprehensive health assessments, was $55.4
million in the second quarter of 2015 and is comprised of
revenue from Matrix, acquired on October 23,
2014. Service expense for the segment was $41.2 million, or 74.4% of HA Services
revenue. HA Services operating income was $6.3 million in the second quarter of 2015, and
HA Services Adjusted EBITDA (non-GAAP) was $13.5 million for the same period.
In the first half of 2015, HA Services revenue was $112.8 million. Service expense for the
segment was $84.4 million, or 74.8%
of HA Services revenue. HA Services operating income was
$12.8 million in the first half of
2015, and HA Services Adjusted EBITDA (non-GAAP) was $27.1 million for the same
period.
Conference Call
Providence will hold a
conference call at 11:00 a.m. EDT
(8:00 a.m. PDT/MST) Friday, August 7, 2015 to discuss its financial
results and corporate developments. Interested parties are invited
to listen to the call live over the Internet at
http://investor.provcorp.com. The call is also available by
dialing (866) 515-2912, or for international callers (617)
399-5126, and by using the passcode 83463896. A replay of the
teleconference will be available on
http://investor.provcorp.com. A replay will also be available
until August 14, 2015 by dialing
(888) 286-8010 or (617) 801-6888 and using passcode 80558015.
About Providence
Providence is a Tucson, Arizona-based company that provides
and manages government sponsored human services, innovative global
employment services, comprehensive health assessment and care
management services, and non-emergency transportation
services. It offers: (1) non-emergency transportation
management services to state Medicaid programs, local government
agencies, hospital systems, health maintenance organizations,
private managed care organizations and commercial insurers, as well
as to individuals with limited mobility, people with limited means
of transportation, people with disabilities and Medicaid members;
(2) home- and community-based counseling services, which include
home-based and intensive home-based counseling, workforce
development, substance abuse treatment services, school support
services and correctional services; (3) foster care and therapeutic
foster care services; (4) case management, referral and monitoring
services; (5) social improvement, employment and welfare services
to various international government bodies and corporations; and
(6) in-home comprehensive health assessment and care management
services primarily to Medicare Advantage programs.
Providence is unique in that it
provides and manages its human services primarily in the client's
own home or in community based settings, rather than in hospitals
or treatment facilities and provides its non-emergency
transportation services clients through local transportation
providers rather than an owned fleet of vehicles.
Non-GAAP Presentation
In addition to the financial results prepared in accordance with
US generally accepted accounting principles (GAAP) provided
throughout this press release, the Company has provided EBITDA,
Adjusted EBITDA, Adjusted net income, and Adjusted diluted EPS,
non-GAAP measurements. Providence's management utilizes these
non-GAAP measurements as a means to measure overall operating
performance and to better compare current operating results with
other companies within its industry. Details of the excluded
items and a reconciliation of the non-GAAP financial measures to
the most comparable GAAP financial measure are presented in the
table below. The non-GAAP measures do not replace the presentation
of our GAAP financial results. The Company has provided this
supplemental non-GAAP information because the Company believes it
provides meaningful comparisons of the results of Providence's operations for the periods
presented in this press release. The non-GAAP measures are not in
accordance with, or an alternative for, GAAP and may be different
from non-GAAP measures used by some other companies.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as "believe," "demonstrate," "expect," "estimate,"
"forecast," "anticipate," "should" and "likely" and similar
expressions identify forward-looking statements. In addition,
statements that are not historical should also be considered
forward-looking statements. Readers are cautioned not to place
undue reliance on those forward-looking statements, which speak
only as of the date the statement was made. Such forward-looking
statements are based on current expectations that involve a number
of known and unknown risks, uncertainties and other factors which
may cause actual events to be materially different from those
expressed or implied by such forward-looking statements. These
factors include, but are not limited to, our continuing
relationship with government entities and our ability to procure
business from them, our ability to manage growing and changing
operations, the implementation of the healthcare reform law, state
budget changes and legislation and other risks detailed in
Providence's filings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K for the fiscal year ended December
31, 2014 and subsequent filings. Providence is under
no obligation to (and expressly disclaims any such obligation to)
update any of the information in this press release if any
forward-looking statement later turns out to be inaccurate whether
as a result of new information, future events or otherwise.
--financial tables to follow--
|
The Providence
Service Corporation
|
|
Unaudited
Condensed Consolidated Statements of Income
|
|
(in thousands except
share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Service
revenue
|
|
$ 508,251
|
|
$ 343,953
|
|
$ 1,014,046
|
|
$ 633,356
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Service expense
|
|
450,058
|
|
309,130
|
|
893,926
|
|
569,066
|
|
General and administrative expense
|
|
23,316
|
|
16,156
|
|
48,000
|
|
29,775
|
|
Depreciation and amortization
|
|
14,957
|
|
5,143
|
|
29,857
|
|
8,871
|
|
Total operating
expenses
|
|
488,331
|
|
330,429
|
|
971,783
|
|
607,712
|
|
Operating
income
|
|
19,920
|
|
13,524
|
|
42,263
|
|
25,644
|
|
|
|
|
|
|
|
|
|
|
Other
expenses:
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
4,545
|
|
1,261
|
|
10,552
|
|
2,846
|
|
Loss on equity investment
|
|
1,059
|
|
-
|
|
3,542
|
|
-
|
|
(Gain) Loss on foreign currency translation
|
|
(714)
|
|
61
|
|
(395)
|
|
101
|
|
Income before income
taxes
|
|
15,030
|
|
12,202
|
|
28,564
|
|
22,697
|
|
Provision for income
taxes
|
|
8,396
|
|
5,530
|
|
15,693
|
|
9,738
|
|
Net
income
|
|
$ 6,634
|
|
$ 6,672
|
|
$ 12,871
|
|
$ 12,959
|
|
|
|
|
|
|
|
|
|
|
Net income available
to common stockholders
|
|
$ 4,181
|
|
$ 6,672
|
|
$ 9,243
|
|
$ 12,959
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.26
|
|
$
0.47
|
|
$
0.58
|
|
$
0.93
|
|
Diluted
|
|
$
0.26
|
|
$
0.46
|
|
$
0.57
|
|
$
0.91
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
number of common
|
|
|
|
|
|
|
|
|
|
shares
outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
16,097,198
|
|
14,171,013
|
|
16,036,959
|
|
14,006,944
|
|
Diluted
|
|
16,240,898
|
|
14,453,964
|
|
16,193,372
|
|
14,306,898
|
|
The Providence
Service Corporation
|
|
Condensed
Consolidated Balance Sheets
|
|
(in thousands except
share and per share data)
|
|
|
June
30,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
Assets
|
|
(Unaudited)
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$ 145,161
|
|
$ 160,406
|
|
Accounts receivable, net of allowance of
|
|
|
|
|
|
$6,893 in 2015 and
$6,034 in 2014
|
|
211,741
|
|
151,344
|
|
Other receivables
|
|
15,131
|
|
6,866
|
|
Prepaid expenses and other
|
|
42,149
|
|
46,157
|
|
Restricted cash
|
|
3,641
|
|
3,807
|
|
Deferred tax assets
|
|
998
|
|
6,066
|
|
Total current
assets
|
|
418,821
|
|
374,646
|
|
Property and
equipment, net
|
|
62,127
|
|
57,148
|
|
Goodwill
|
|
358,483
|
|
355,641
|
|
Intangible assets,
net
|
|
321,535
|
|
340,673
|
|
Other
assets
|
|
40,803
|
|
22,373
|
|
Restricted cash, less
current portion
|
|
15,275
|
|
14,764
|
|
Total
assets
|
|
$ 1,217,044
|
|
$ 1,165,245
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Current portion of long-term obligations
|
|
$ 29,663
|
|
$
25,188
|
|
Note payable to related party
|
|
-
|
|
65,500
|
|
Accounts payable
|
|
56,441
|
|
48,061
|
|
Accrued expenses
|
|
127,722
|
|
121,857
|
|
Accrued transportation costs
|
|
61,514
|
|
55,492
|
|
Deferred revenue
|
|
27,733
|
|
12,245
|
|
Reinsurance liability reserve
|
|
17,861
|
|
11,115
|
|
Total current
liabilities
|
|
320,934
|
|
339,458
|
|
Long-term
obligations, less current portion
|
|
458,667
|
|
484,525
|
|
Other long-term
liabilities
|
|
30,204
|
|
26,609
|
|
Deferred tax
liabilities
|
|
86,432
|
|
93,239
|
|
Total
liabilities
|
|
896,237
|
|
943,831
|
|
Commitments and
contingencies
|
|
|
|
|
|
Mezzanine
equity
|
|
|
|
|
|
Preferred stock: Authorized 10,000,000 shares; $0.001 par
value;
|
|
|
|
|
|
805,000 and 0
issued and outstanding; 5.5%/8.5% dividend rate
|
|
77,719
|
|
-
|
|
Stockholders'
equity
|
|
|
|
|
|
Common stock: Authorized 40,000,000 shares; $0.001
par
|
|
|
|
|
|
value;
17,081,535 and 16,870,285 issued and outstanding
|
|
|
|
|
|
(including
treasury shares)
|
|
17
|
|
17
|
|
Additional paid-in capital
|
|
270,027
|
|
261,155
|
|
Accumulated deficit
|
|
(495)
|
|
(13,366)
|
|
Accumulated other comprehensive loss, net of tax
|
|
(8,045)
|
|
(8,756)
|
|
Treasury shares, at cost, 1,029,557 and 1,014,108 shares
|
|
(18,420)
|
|
(17,686)
|
|
Total
Providence stockholders' equity
|
|
243,084
|
|
221,364
|
|
Non-controlling interest
|
|
4
|
|
50
|
|
Total stockholders'
equity
|
|
243,088
|
|
221,414
|
|
Total liabilities and
stockholders' equity
|
|
$ 1,217,044
|
|
$ 1,165,245
|
|
The Providence
Service Corporation
|
|
Unaudited
Condensed Consolidated Statements of Cash Flows
|
|
(in
thousands)
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
2015
|
|
2014
|
|
Operating
activities
|
|
|
|
|
|
Net
income
|
|
$ 12,871
|
|
$ 12,959
|
|
Adjustments to
reconcile net income to net cash
|
|
|
|
|
|
provided by
operating activities:
|
|
|
|
|
|
Depreciation
|
|
10,165
|
|
4,908
|
|
Amortization
|
|
19,692
|
|
3,963
|
|
Provision for
doubtful accounts
|
|
1,369
|
|
1,089
|
|
Stock based
compensation
|
|
6,058
|
|
1,400
|
|
Deferred
income taxes
|
|
(4,815)
|
|
207
|
|
Amortization
of deferred financing costs
|
|
1,071
|
|
410
|
|
Excess tax
benefit upon exercise of stock options
|
|
(2,239)
|
|
(2,346)
|
|
Loss on equity
investments
|
|
3,542
|
|
-
|
|
Other non-cash
charges
|
|
(225)
|
|
(40)
|
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
Accounts receivable
|
|
(60,908)
|
|
(21,736)
|
|
Other receivables
|
|
(2,617)
|
|
487
|
|
Restricted cash
|
|
69
|
|
205
|
|
Prepaid expenses and other
|
|
(12,234)
|
|
(4,544)
|
|
Reinsurance liability reserve
|
|
9,691
|
|
4,648
|
|
Accounts payable and accrued expenses
|
|
17,755
|
|
7,172
|
|
Accrued transportation costs
|
|
6,022
|
|
13,554
|
|
Deferred revenue
|
|
14,555
|
|
(52)
|
|
Other long-term liabilities
|
|
281
|
|
(4,009)
|
|
Net cash provided by
operating activities
|
|
20,103
|
|
18,275
|
|
Investing
activities
|
|
|
|
|
|
Purchase of property
and equipment
|
|
(13,122)
|
|
(8,267)
|
|
Acquisitions, net of
cash acquired
|
|
(1,665)
|
|
(59,666)
|
|
Equity
investments
|
|
(10,284)
|
|
-
|
|
Net decrease in
short-term investments
|
|
(9)
|
|
(9)
|
|
Restricted cash for
reinsured claims losses
|
|
(413)
|
|
(4,744)
|
|
Net cash used in
investing activities
|
|
(25,493)
|
|
(72,686)
|
|
Financing
activities
|
|
|
|
|
|
Proceeds from
issuance of preferred stock, net of issuance costs
|
|
80,667
|
|
-
|
|
Preferred stock
dividends
|
|
(1,698)
|
|
-
|
|
Repurchase of common
stock, for treasury
|
|
(734)
|
|
(501)
|
|
Proceeds from common
stock issued pursuant to stock
|
|
|
|
|
|
option
exercise
|
|
2,377
|
|
9,150
|
|
Excess tax benefit
upon exercise of stock options
|
|
2,239
|
|
2,346
|
|
Proceeds from
long-term debt
|
|
-
|
|
115,000
|
|
Repayment of
long-term debt
|
|
(87,125)
|
|
(47,500)
|
|
Payment of contingent
consideration
|
|
(7,496)
|
|
-
|
|
Debt financing
costs
|
|
(30)
|
|
(700)
|
|
Other
|
|
(46)
|
|
(8)
|
|
Net cash (used in)
provided by financing activities
|
|
(11,846)
|
|
77,787
|
|
Effect of exchange
rate changes on cash
|
|
1,991
|
|
629
|
|
Net change in
cash
|
|
(15,245)
|
|
24,005
|
|
Cash at beginning of
period
|
|
160,406
|
|
98,995
|
|
Cash at end of
period
|
|
$ 145,161
|
|
$ 123,000
|
|
The Providence
Service Corporation
|
|
Reconciliation of
Non-GAAP Financial Measures
|
|
Adjusted
EBITDA
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
|
Three Months Ended
June 30, 2015
|
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$ 11,693
|
|
$ 2,804
|
|
$ (1,905)
|
|
$ 3,749
|
|
$ (9,707)
|
|
$ 6,634
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
-
|
|
(9)
|
|
(43)
|
|
(5)
|
|
4,602
|
|
4,545
|
|
Provision for income
taxes
|
7,183
|
|
1,992
|
|
(786)
|
|
2,522
|
|
(2,515)
|
|
8,396
|
|
Depreciation and
amortization
|
2,329
|
|
1,767
|
|
3,332
|
|
7,185
|
|
344
|
|
14,957
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
21,205
|
|
6,554
|
|
598
|
|
13,451
|
|
(7,276)
|
|
34,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ingeus acquisition
related equity compensation
|
-
|
|
-
|
|
1,524
|
|
-
|
|
-
|
|
1,524
|
|
Gain on foreign
currency translation
|
-
|
|
-
|
|
(714)
|
|
-
|
|
-
|
|
(714)
|
|
Charges related to
the separation of an executive officer, net
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
695
|
|
695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 21,205
|
|
$ 6,554
|
|
$ 1,408
|
|
$ 13,451
|
|
$ (6,581)
|
|
$ 36,037
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, 2014
|
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$ 9,545
|
|
$ 1,182
|
|
$ 2,321
|
|
$
-
|
|
$ (6,376)
|
|
$ 6,672
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(2)
|
|
(8)
|
|
(228)
|
|
-
|
|
1,499
|
|
1,261
|
|
Provision for income
taxes
|
6,381
|
|
876
|
|
503
|
|
-
|
|
(2,230)
|
|
5,530
|
|
Depreciation and
amortization
|
1,865
|
|
1,745
|
|
1,261
|
|
-
|
|
272
|
|
5,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
17,789
|
|
3,795
|
|
3,857
|
|
-
|
|
(6,835)
|
|
18,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
costs
|
-
|
|
-
|
|
-
|
|
-
|
|
2,496
|
|
2,496
|
|
Integration and
restructuring charges
|
-
|
|
15
|
|
732
|
|
-
|
|
97
|
|
844
|
|
Ingeus acquisition
related equity compensation
|
-
|
|
-
|
|
486
|
|
-
|
|
-
|
|
486
|
|
Loss on foreign
currency translation
|
-
|
|
-
|
|
54
|
|
-
|
|
7
|
|
61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 17,789
|
|
$ 3,810
|
|
$ 5,129
|
|
$
-
|
|
$ (4,235)
|
|
$ 22,493
|
|
The Providence
Service Corporation
|
|
Reconciliation of
Non-GAAP Financial Measures
|
|
Adjusted
EBITDA
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
|
Six Months Ended
June 30, 2015
|
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$ 24,305
|
|
$ 3,840
|
|
$ (4,286)
|
|
$ 7,595
|
|
$ (18,583)
|
|
$ 12,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(1)
|
|
(29)
|
|
(58)
|
|
(9)
|
|
10,649
|
|
10,552
|
|
Provision for income
taxes
|
15,312
|
|
2,798
|
|
1,640
|
|
5,193
|
|
(9,250)
|
|
15,693
|
|
Depreciation and
amortization
|
4,606
|
|
3,614
|
|
6,648
|
|
14,367
|
|
622
|
|
29,857
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
44,222
|
|
10,223
|
|
3,944
|
|
27,146
|
|
(16,562)
|
|
68,973
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ingeus acquisition
related equity compensation
|
-
|
|
-
|
|
3,057
|
|
-
|
|
-
|
|
3,057
|
|
Gain on foreign
currency translation
|
-
|
|
-
|
|
(395)
|
|
-
|
|
-
|
|
(395)
|
|
Charges related to
the separation of an executive officer, net
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
695
|
|
695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 44,222
|
|
$ 10,223
|
|
$ 6,606
|
|
$ 27,146
|
|
$ (15,867)
|
|
$ 72,330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2014
|
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$ 20,954
|
|
$ 380
|
|
$ 2,530
|
|
$
-
|
|
$ (10,905)
|
|
$ 12,959
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(6)
|
|
(20)
|
|
(243)
|
|
-
|
|
3,115
|
|
2,846
|
|
Provision for income
taxes
|
14,114
|
|
369
|
|
660
|
|
-
|
|
(5,405)
|
|
9,738
|
|
Depreciation and
amortization
|
3,626
|
|
3,324
|
|
1,392
|
|
-
|
|
529
|
|
8,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
38,688
|
|
4,053
|
|
4,339
|
|
-
|
|
(12,666)
|
|
34,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
costs
|
-
|
|
-
|
|
-
|
|
-
|
|
4,325
|
|
4,325
|
|
Integration and
restructuring costs
|
-
|
|
29
|
|
732
|
|
-
|
|
97
|
|
858
|
|
Ingeus acquisition
related equity compensation
|
-
|
|
-
|
|
486
|
|
-
|
|
-
|
|
486
|
|
Loss on foreign
currency translation
|
-
|
|
-
|
|
95
|
|
-
|
|
6
|
|
101
|
|
Charges related to
the separation of an executive officer, net
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
511
|
|
-
|
|
-
|
|
-
|
|
511
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 38,688
|
|
$ 4,593
|
|
$ 5,652
|
|
$
-
|
|
$ (8,238)
|
|
$ 40,695
|
|
The Providence
Service Corporation
|
|
Adjusted Earnings
Per Share
|
|
(in thousands, except
share and per share data)
|
|
(Unaudited)
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$ 6,634
|
|
$ 6,672
|
|
$ 12,871
|
|
$ 12,959
|
|
|
|
|
|
|
|
|
|
|
Acquisition
costs
|
-
|
|
2,496
|
|
-
|
|
4,325
|
|
Integration and
restructuring costs
|
-
|
|
844
|
|
-
|
|
858
|
|
Ingeus acquisition
related equity compensation
|
1,524
|
|
486
|
|
3,057
|
|
486
|
|
(Gain) Loss on
foreign currency translation
|
(714)
|
|
61
|
|
(395)
|
|
101
|
|
Payments related to
separation arrangements with certain former executive
officers, net
|
695
|
|
-
|
|
695
|
|
511
|
|
Intangible
amortization expense
|
9,881
|
|
2,338
|
|
19,692
|
|
3,963
|
|
Tax effected impact
of adjustments
|
(3,927)
|
|
(2,157)
|
|
(7,754)
|
|
(3,759)
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
14,093
|
|
10,740
|
|
28,166
|
|
19,444
|
|
|
|
|
|
|
|
|
|
|
Dividends on
preferred stock
|
(1,104)
|
|
-
|
|
(1,698)
|
|
-
|
|
Amortization of
preferred stock discount
|
(825)
|
|
-
|
|
(1,071)
|
|
-
|
|
Income allocated to
participating securities
|
(1,355)
|
|
-
|
|
(2,159)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
available to common stockholders, diluted
|
10,809
|
|
10,740
|
|
23,238
|
|
19,444
|
|
|
|
|
|
|
|
|
|
|
Adjusted diluted
earnings per common share
|
$
0.67
|
|
$
0.74
|
|
$
1.44
|
|
$
1.36
|
|
|
|
|
|
|
|
|
|
|
Diluted
weighted-average number of common shares outstanding
|
16,240,898
|
|
14,453,964
|
|
16,193,372
|
|
14,306,898
|
|
The Providence
Service Corporation
|
|
Segment
Information
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
Three Months Ended
June 30, 2015
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
Revenues
|
$ 270,690
|
|
$ 90,222
|
|
$ 92,175
|
|
$ 55,404
|
|
$ (240)
|
|
$ 508,251
|
|
Operating income
(loss)
|
18,876
|
|
4,787
|
|
(2,389)
|
|
6,266
|
|
(7,620)
|
|
19,920
|
|
Depreciation and
amortization
|
2,329
|
|
1,767
|
|
3,332
|
|
7,185
|
|
344
|
|
14,957
|
|
Net Income
|
11,693
|
|
2,804
|
|
(1,905)
|
|
3,749
|
|
(9,707)
|
|
6,634
|
|
Adjusted EBITDA
(Non-GAAP)
|
21,205
|
|
6,554
|
|
1,408
|
|
13,451
|
|
(6,581)
|
|
36,037
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, 2014
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
Revenues
|
$ 216,296
|
|
$ 91,333
|
|
$ 36,617
|
|
$
-
|
|
$ (293)
|
|
$ 343,953
|
|
Operating income
(loss)
|
15,925
|
|
2,049
|
|
2,649
|
|
-
|
|
(7,099)
|
|
13,524
|
|
Depreciation and
amortization
|
1,865
|
|
1,745
|
|
1,261
|
|
-
|
|
272
|
|
5,143
|
|
Net Income
|
9,545
|
|
1,182
|
|
2,321
|
|
-
|
|
(6,376)
|
|
6,672
|
|
Adjusted EBITDA
(Non-GAAP)
|
17,789
|
|
3,810
|
|
5,129
|
|
-
|
|
(4,235)
|
|
22,493
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2015
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
Revenues
|
$ 525,450
|
|
$ 176,409
|
|
$ 199,793
|
|
$ 112,836
|
|
$ (442)
|
|
$ 1,014,046
|
|
Operating income
(loss)
|
39,615
|
|
6,607
|
|
444
|
|
12,781
|
|
(17,184)
|
|
42,263
|
|
Depreciation and
amortization
|
4,606
|
|
3,614
|
|
6,648
|
|
14,367
|
|
622
|
|
29,857
|
|
Net Income
|
24,305
|
|
3,840
|
|
(4,286)
|
|
7,595
|
|
(18,583)
|
|
12,871
|
|
Adjusted EBITDA
(Non-GAAP)
|
44,222
|
|
10,223
|
|
6,606
|
|
27,146
|
|
(15,867)
|
|
72,330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2014
|
|
NET
Services
|
|
Human
Services
|
|
WD
Services
|
|
HA
Services
|
|
Corporate and
Other
|
|
Total
|
|
Revenues
|
$ 414,373
|
|
$ 175,435
|
|
$ 44,065
|
|
$
-
|
|
$ (517)
|
|
$ 633,356
|
|
Operating income
(loss)
|
35,061
|
|
729
|
|
3,043
|
|
-
|
|
(13,189)
|
|
25,644
|
|
Depreciation and
amortization
|
3,626
|
|
3,324
|
|
1,392
|
|
-
|
|
529
|
|
8,871
|
|
Net Income
|
20,954
|
|
380
|
|
2,530
|
|
-
|
|
(10,905)
|
|
12,959
|
|
Adjusted EBITDA
(Non-GAAP)
|
38,688
|
|
4,593
|
|
5,652
|
|
-
|
|
(8,238)
|
|
40,695
|
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SOURCE Providence Service Corporation