Exhibit 99.1
Supplemental Historical Segment Financial Information of Modivcare Inc.
Effective January 1, 2022, the Company completed a segment reorganization that resulted in the establishment of a Corporate and Other segment, which includes the costs associated with our activities related to executive, accounting, finance, internal audit, tax, legal and strategic and corporate development functions for each segment, as well as the results of our equity method investment in Matrix that was previously reported as a separate operating segment. Following the significant changes in our Company’s operations as a result of our recent material acquisitions, our organizational and management realignment activities, and our Matrix investment having a materially lesser impact on our consolidated financial results, our chief operating decision maker now views the business in the following four separate operating segments: NEMT, Personal Care, RPM, and Corporate and Other. With respect to our Corporate and Other segment, it was determined that the Matrix results are reviewed in conjunction with the other corporate results of the business that are not attributable to one of the three other operating segments. Prior to the third quarter of 2021, the Company did not have an RPM segment because it was established in conjunction with the VRI Intermediate Holdings acquisition that was completed in the third quarter of 2021.
The Company’s new operating segments were presented in the Company’s quarterly report on Form 10-Q filed for its first completed fiscal quarter ended March 31, 2022, which was filed with the Securities and Exchange Commission (the “SEC”) on May 5, 2022. In this release, the Company reclassified its costs associated with this reorganization and recast the previously reported amounts for each quarterly period and the full year presented in 2021 to conform to this new presentation for convenience of investor reference. The results of the first quarter of 2022 as filed with the SEC on May 5, 2022 are also included for comparative purposes.
Non-GAAP Financial Measures and Adjustments
In addition to the financial measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), this press release includes EBITDA, Adjusted EBITDA, Adjusted EBITDA margin and Adjusted G&A expense for the Company and its segments, which are performance measures that are not recognized under GAAP. EBITDA is defined as income (loss) from continuing operations, net of taxes, before: (1) interest expense, net, (2) provision (benefit) for income taxes and (3) depreciation and amortization. Adjusted EBITDA is calculated as EBITDA before (as applicable): (1) restructuring and related charges, including severance and office closure and professional services costs, (2) certain transaction and related costs, (3) cash settled equity, (4) stock-based compensation, (5) COVID-19 related costs, net of grant income, and (6) equity in net (income) loss of investee, net of tax. Adjusted EBITDA margin is calculated as Adjusted EBITDA, divided by Service revenue, net. Adjusted G&A expense is calculated as G&A expense before (as applicable): (1) restructuring and related charges, (2) transaction costs, (3) cash settled equity, and (4) stock-based compensation. Our non-GAAP performance measures exclude expenses and amounts that are not driven by our core operating results and may be one time in nature. Excluding these expenses makes comparisons with prior periods as well as to other companies in our industry more meaningful. We believe such measures allow investors to gain a better understanding of the factors and trends affecting the ongoing operations of our business. We consider our core operations to be the ongoing activities to provide services from which we earn revenue, including direct operating costs and indirect costs to support these activities. In addition, our net income or loss in equity investee is excluded from these measures, as we do not have the ability to manage the venture, allocate resources within the venture, or directly control its operations or performance.
Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial measures differently. In addition, there are limitations in using non-GAAP financial measures because they are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies, and exclude expenses that may have a material impact on our reported financial results. The presentation of non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the most directly comparable financial measures prepared in accordance with GAAP. We urge you to review the reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures included below, and not to rely on any single financial measure to evaluate our business.
Forward-Looking Statements
Certain statements contained in this release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are predictive in nature and are frequently identified by the use of terms such as “may,” “will,” “should,” “expect,” “believe,” “estimate,” “intend,” and similar words indicating possible future expectations, events or actions. Such forward-looking statements are based on current expectations, assumptions,
estimates and projections about our business and our industry, and are not guarantees of our future performance. These statements are subject to a number of known and unknown risks, uncertainties and other factors, many of which are beyond our ability to control or predict, which may cause actual events to be materially different from those expressed or implied herein, including but not limited to: government or private insurance program funding reductions or limitations; alternative payment models or the transition of Medicaid and Medicare beneficiaries to Managed Care Organizations, or MCOs; our inability to control reimbursement rates received for our services; cost containment initiatives undertaken by private third-party payors; the effects of a public health emergency; inadequacies in, or security breaches of, our information technology systems, including the systems intended to protect our clients’ privacy and confidential information; any changes in the funding, financial viability or our relationships with our payors; pandemic infectious diseases, including the COVID-19 pandemic; disruptions to our contact center operations caused by health epidemics or pandemics like COVID-19; delays in collection, or non-collection, of our accounts receivable, particularly during any business integration; an impairment of our long-lived assets; any failure to maintain or to develop further reliable, efficient and secure information technology systems; an inability to attract and retain qualified employees; any acquisition or acquisition integration efforts; our contracts not surviving until the end of their stated terms, or not being renewed or extended; our failure to compete effectively in the marketplace; our not being awarded contracts through the government’s requests for proposals process, or our awarded contracts not being profitable; any failure to satisfy our contractual obligations or to maintain existing pledged performance and payment bonds; a failure to estimate accurately the cost of performing our contracts; any misclassification of the drivers we engage as independent contractors rather than as employees; significant interruptions in our communication and data services; not successfully executing on our strategies in the face of our competition; any inability to maintain relationships with existing patient referral sources; any failure to obtain the consent of the New York Department of Health to manage the day to day operations of our licensed in-home personal care services agency business that we acquired with our personal care segment; acquired unknown liabilities in connection with the acquisition of our personal care segment; changes in the case-mix of our personal care patients, or changes in payor mix or payment methodologies; our loss of existing favorable managed care contracts; our experiencing shortages in qualified employees and management; labor disputes or disruptions, in particular in New York; becoming subject to malpractice or other similar claims; and our reliance on others for the financial condition of our equity investment in Matrix.
The Company has provided additional information about the risks facing our business in our annual report on Form 10-K for the year ended December 31, 2021 and subsequent filings most recently filed with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made and are expressly qualified in their entirety by the cautionary statements set forth herein and in our filings with the Securities and Exchange Commission, which you should read in their entirety before making an investment decision with respect to our securities. We undertake no obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise, except as required by applicable law.
--financial tables to follow--
Modivcare Inc.
Page 3
Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended March 31, 2021 |
| NEMT | | Personal Care | | | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 343,416 | | | $ | 110,194 | | | | | $ | — | | | $ | 453,610 | |
| Grant income | — | | | 2,648 | | | | | — | | | 2,648 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 272,416 | | | 87,917 | | | | | — | | | 360,333 | |
| General and administrative expense | 27,987 | | | 15,029 | | | | | 11,909 | | | 54,925 | |
| Depreciation and amortization | 7,312 | | | 4,927 | | | | | — | | | 12,239 | |
| Total operating expenses | 307,715 | | | 107,873 | | | | | 11,909 | | | 427,497 | |
| | | | | | | | | |
| Operating income (loss) | 35,701 | | | 4,969 | | | | | (11,909) | | | 28,761 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | | | 8,423 | | | 8,423 | |
| Income (loss) before income taxes and equity method investment | 35,701 | | | 4,969 | | | | | (20,332) | | | 20,338 | |
| Provision (benefit) for income taxes | 9,404 | | | 1,438 | | | | | (6,103) | | | 4,739 | |
| Equity in net income of investee, net of tax | — | | | — | | | | | (3,241) | | | (3,241) | |
| Net Income (loss) | 26,297 | | | 3,531 | | | | | (10,988) | | | 18,840 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | | | 8,423 | | | 8,423 | |
| Provision (benefit) for income taxes | 9,404 | | | 1,438 | | | | | (6,103) | | | 4,739 | |
| Depreciation and amortization | 7,312 | | | 4,927 | | | | | — | | | 12,239 | |
| EBITDA | 43,013 | | | 9,896 | | | | | (8,668) | | | 44,241 | |
| | | | | | | | | |
Restructuring and related charges(1) | 3,494 | | | — | | | | | 206 | | | 3,700 | |
Transaction costs(2) | (37) | | | 1,045 | | | | | 2,670 | | | 3,678 | |
| Cash settled equity | — | | | — | | | | | 2,093 | | | 2,093 | |
| Stock-based compensation | — | | | — | | | | | 1,149 | | | 1,149 | |
| COVID-19 related costs, net of grant income | 339 | | | (1,852) | | | | | — | | | (1,513) | |
| Equity in net income of investee, net of tax | — | | | — | | | | | (3,241) | | | (3,241) | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 46,809 | | | $ | 9,089 | | | | | $ | (5,791) | | | $ | 50,107 | |
(1) Restructuring and related charges include professional fees for strategic initiatives and severance and office closure costs.
(2) Transaction costs include Circulation management incentive plan ("MIP") costs and acquisition costs related to Simplura Health Group and National MedTrans.
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Modivcare Inc.
Page 4
Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended June 30, 2021 |
| NEMT | | Personal Care | | | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 364,760 | | | $ | 109,688 | | | | | $ | — | | | $ | 474,448 | |
| Grant income | — | | | 852 | | | | | — | | | 852 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 292,656 | | | 86,909 | | | | | — | | | 379,565 | |
| General and administrative expense | 28,099 | | | 14,775 | | | | | 13,591 | | | 56,465 | |
| Depreciation and amortization | 6,936 | | | 4,884 | | | | | — | | | 11,820 | |
| Total operating expenses | 327,691 | | | 106,568 | | | | | 13,591 | | | 447,850 | |
| | | | | | | | | |
| Operating income (loss) | 37,069 | | | 3,972 | | | | | (13,591) | | | 27,450 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | | | 8,287 | | | 8,287 | |
| Income (loss) before income taxes and equity method investment | 37,069 | | | 3,972 | | | | | (21,878) | | | 19,163 | |
| Provision (benefit) for income taxes | 10,019 | | | 918 | | | | | (5,266) | | | 5,671 | |
| Equity in net income of investee, net of tax | — | | | — | | | | | (180) | | | (180) | |
| Net Income (loss) | 27,050 | | | 3,054 | | | | | (16,432) | | | 13,672 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | | | 8,287 | | | 8,287 | |
| Provision (benefit) for income taxes | 10,019 | | | 918 | | | | | (5,266) | | | 5,671 | |
| Depreciation and amortization | 6,936 | | | 4,884 | | | | | — | | | 11,820 | |
| EBITDA | 44,005 | | | 8,856 | | | | | (13,411) | | | 39,450 | |
| | | | | | | | | |
Restructuring and related charges(1) | 4,044 | | | — | | | | | 557 | | | 4,601 | |
Transaction costs(2) | 247 | | | 1,245 | | | | | 1,974 | | | 3,466 | |
| Cash settled equity | — | | | — | | | | | 4,452 | | | 4,452 | |
| Stock-based compensation | — | | | 76 | | | | | 1,340 | | | 1,416 | |
| COVID-19 related costs, net of grant income | 114 | | | (248) | | | | | — | | | (134) | |
| Equity in net income of investee, net of tax | — | | | — | | | | | (180) | | | (180) | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 48,410 | | | $ | 9,929 | | | | | $ | (5,268) | | | $ | 53,071 | |
(1) Restructuring and related charges include professional fees for strategic initiatives and severance and office closure costs.
(2) Transaction costs include Circulation MIP costs and certain transaction-related expenses.
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Modivcare Inc.
Page 5
Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended September 30, 2021 |
| NEMT | | Personal Care | | RPM | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 372,992 | | | $ | 118,503 | | | $ | 1,564 | | | $ | — | | | $ | 493,059 | |
| Grant income | — | | | — | | | — | | | — | | | — | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 304,398 | | | 94,107 | | | 767 | | | — | | | 399,272 | |
| General and administrative expense | 29,875 | | | 15,802 | | | 216 | | | 22,312 | | | 68,205 | |
| Depreciation and amortization | 7,496 | | | 4,912 | | | 200 | | | — | | | 12,608 | |
| Total operating expenses | 341,769 | | | 114,821 | | | 1,183 | | | 22,312 | | | 480,085 | |
| | | | | | | | | |
| Operating income (loss) | 31,223 | | | 3,682 | | | 381 | | | (22,312) | | | 12,974 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 17,702 | | | 17,702 | |
| Income (loss) before income taxes and equity method investment | 31,223 | | | 3,682 | | | 381 | | | (40,014) | | | (4,728) | |
| Provision (benefit) for income taxes | 6,956 | | | 838 | | | 106 | | | (9,901) | | | (2,001) | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 4,845 | | | 4,845 | |
| Net Income (loss) | 24,267 | | | 2,844 | | | 275 | | | (34,958) | | | (7,572) | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 17,702 | | | 17,702 | |
| Provision (benefit) for income taxes | 6,956 | | | 838 | | | 106 | | | (9,901) | | | (2,001) | |
| Depreciation and amortization | 7,496 | | | 4,912 | | | 200 | | | — | | | 12,608 | |
| EBITDA | 38,719 | | | 8,594 | | | 581 | | | (27,157) | | | 20,737 | |
| | | | | | | | | |
Restructuring and related charges(1) | 2,521 | | | — | | | — | | | 717 | | | 3,238 | |
Transaction costs(2) | 376 | | | 1,177 | | | — | | | 9,739 | | | 11,292 | |
| Cash settled equity | — | | | — | | | — | | | 2,600 | | | 2,600 | |
| Stock-based compensation | — | | | — | | | — | | | 1,218 | | | 1,218 | |
| COVID-19 related costs, net of grant income | 165 | | | 229 | | | — | | | — | | | 394 | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 4,845 | | | 4,845 | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 41,781 | | | $ | 10,000 | | | $ | 581 | | | $ | (8,038) | | | $ | 44,324 | |
(1) Restructuring and related charges include professional fees for strategic initiatives and severance and office closure costs.
(2) Transaction costs include Circulation MIP costs and certain transaction-related expenses.
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Modivcare Inc.
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Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended December 31, 2021 |
| NEMT | | Personal Care | | RPM | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 402,528 | | | $ | 157,194 | | | $ | 16,053 | | | $ | — | | | $ | 575,775 | |
| Grant income | — | | | 1,941 | | | — | | | — | | | 1,941 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 316,715 | | | 123,575 | | | 4,838 | | | — | | | 445,128 | |
| General and administrative expense | 46,532 | | | 25,098 | | | 5,575 | | | 14,874 | | | 92,079 | |
| Depreciation and amortization | 7,314 | | | 9,036 | | | 3,981 | | | — | | | 20,331 | |
| Total operating expenses | 370,561 | | | 157,709 | | | 14,394 | | | 14,874 | | | 557,538 | |
| | | | | | | | | |
| Operating income (loss) | 31,967 | | | 1,426 | | | 1,659 | | | (14,874) | | | 20,178 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 14,669 | | | 14,669 | |
| Income (loss) before income taxes and equity method investment | 31,967 | | | 1,426 | | | 1,659 | | | (29,543) | | | 5,509 | |
| Provision (benefit) for income taxes | 3,940 | | | (42) | | | 341 | | | (4,031) | | | 208 | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 36,826 | | | 36,826 | |
| Net Income (loss) | 28,027 | | | 1,468 | | | 1,318 | | | (62,338) | | | (31,525) | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 14,669 | | | 14,669 | |
| Provision (benefit) for income taxes | 3,940 | | | (42) | | | 341 | | | (4,031) | | | 208 | |
| Depreciation and amortization | 7,314 | | | 9,036 | | | 3,981 | | | — | | | 20,331 | |
| EBITDA | 39,281 | | | 10,462 | | | 5,640 | | | (51,700) | | | 3,683 | |
| | | | | | | | | |
Restructuring and related charges(1) | 9,550 | | | 304 | | | — | | | 200 | | | 10,054 | |
Transaction costs(2) | (19) | | | 3,463 | | | 721 | | | 2,987 | | | 7,152 | |
| Cash settled equity | — | | | — | | | — | | | 20 | | | 20 | |
| Stock-based compensation | — | | | (58) | | | — | | | 1,068 | | | 1,010 | |
| COVID-19 related costs, net of grant income | 101 | | | (1,340) | | | — | | | — | | | (1,239) | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 36,826 | | | 36,826 | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 48,913 | | | $ | 12,831 | | | $ | 6,361 | | | $ | (10,599) | | | $ | 57,506 | |
(1) Restructuring and related charges include professional fees for strategic initiatives and severance and office closure costs.
(2) Transaction costs consist of fees incurred in the acquisitions of Care Finders and VRI.
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Modivcare Inc.
Page 7
Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year ended December 31, 2021 |
| NEMT | | Personal Care | | RPM | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 1,483,696 | | | $ | 495,579 | | | $ | 17,617 | | | $ | — | | | $ | 1,996,892 | |
| Grant income | — | | | 5,441 | | | — | | | — | | | 5,441 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 1,186,185 | | | 392,508 | | | 5,605 | | | — | | | 1,584,298 | |
| General and administrative expense | 132,493 | | | 70,704 | | | 5,791 | | | 62,686 | | | 271,674 | |
| Depreciation and amortization | 29,058 | | | 23,759 | | | 4,181 | | | — | | | 56,998 | |
| Total operating expenses | 1,347,736 | | | 486,971 | | | 15,577 | | | 62,686 | | | 1,912,970 | |
| | | | | | | | | |
| Operating income (loss) | 135,960 | | | 14,049 | | | 2,040 | | | (62,686) | | | 89,363 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 49,081 | | | 49,081 | |
| Income (loss) before income taxes and equity method investment | 135,960 | | | 14,049 | | | 2,040 | | | (111,767) | | | 40,282 | |
| Provision (benefit) for income taxes | 30,319 | | | 3,152 | | | 447 | | | (25,301) | | | 8,617 | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 38,250 | | | 38,250 | |
| Net Income (loss) | 105,641 | | | 10,897 | | | 1,593 | | | (124,716) | | | (6,585) | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 49,081 | | | 49,081 | |
| Provision (benefit) for income taxes | 30,319 | | | 3,152 | | | 447 | | | (25,301) | | | 8,617 | |
| Depreciation and amortization | 29,058 | | | 23,759 | | | 4,181 | | | — | | | 56,998 | |
| EBITDA | 165,018 | | | 37,808 | | | 6,221 | | | (100,936) | | | 108,111 | |
| | | | | | | | | |
Restructuring and related charges(1) | 19,609 | | | 304 | | | — | | | 1,680 | | | 21,593 | |
Transaction costs(2) | 567 | | | 6,930 | | | 721 | | | 17,370 | | | 25,588 | |
| Cash settled equity | — | | | — | | | — | | | 9,165 | | | 9,165 | |
| Stock-based compensation | — | | | 18 | | | — | | | 4,775 | | | 4,793 | |
| COVID-19 related costs, net of grant income | 719 | | | (3,211) | | | — | | | — | | | (2,492) | |
| Equity in net loss of investee, net of tax | — | | | — | | | — | | | 38,250 | | | 38,250 | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 185,913 | | | $ | 41,849 | | | $ | 6,942 | | | $ | (29,696) | | | $ | 205,008 | |
(1) Restructuring and related charges include professional fees for strategic initiatives and severance and office closure costs.
(2) Transaction costs consist of fees incurred in the acquisitions of Care Finders and VRI.
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Modivcare Inc.
Page 8
Modivcare Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures
Segment Information and Adjusted EBITDA
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended March 31, 2022 |
| NEMT | | Personal Care | | RPM | | Corporate and Other | | Total |
| | | | | | | | | |
| Service revenue, net | $ | 400,920 | | | $ | 159,698 | | | $ | 13,857 | | | $ | — | | | $ | 574,475 | |
| Grant income | — | | | 468 | | | — | | | — | | | 468 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Service expense | 332,096 | | | 122,232 | | | 4,987 | | | — | | | 459,315 | |
| General and administrative expense | 37,333 | | | 23,133 | | | 4,962 | | | 11,380 | | | 76,808 | |
| Depreciation and amortization | 7,105 | | | 12,505 | | | 4,128 | | | 208 | | | 23,946 | |
| Total operating expenses | 376,534 | | | 157,870 | | | 14,077 | | | 11,588 | | | 560,069 | |
| | | | | | | | | |
| Operating income (loss) | 24,386 | | | 2,296 | | | (220) | | | (11,588) | | | 14,874 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 15,400 | | | 15,400 | |
| Income (loss) before income taxes and equity method investment | 24,386 | | | 2,296 | | | (220) | | | (26,988) | | | (526) | |
| Provision (benefit) for income taxes | 6,575 | | | 640 | | | (58) | | | (7,518) | | | (361) | |
| Equity in net loss (income) of investee, net of tax | 65 | | | — | | | — | | | (548) | | | (483) | |
| Net Income (loss) | 17,746 | | | 1,656 | | | (162) | | | (18,922) | | | 318 | |
| | | | | | | | | |
| Interest expense, net | — | | | — | | | — | | | 15,400 | | | 15,400 | |
| Provision (benefit) for income taxes | 6,575 | | | 640 | | | (58) | | | (7,518) | | | (361) | |
| Depreciation and amortization | 7,105 | | | 12,505 | | | 4,128 | | | 208 | | | 23,946 | |
| EBITDA | 31,426 | | | 14,801 | | | 3,908 | | | (10,832) | | | 39,303 | |
| | | | | | | | | |
Restructuring and related charges(1) | 5,604 | | | 181 | | | 24 | | | 31 | | | 5,840 | |
Transaction costs(2) | — | | | 1,273 | | | 647 | | | 1,791 | | | 3,711 | |
| Cash settled equity | — | | | — | | | — | | | (13) | | | (13) | |
| Stock-based compensation | — | | | 17 | | | 29 | | | 1,420 | | | 1,466 | |
| COVID-19 related costs, net of grant income | 122 | | | 349 | | | — | | | — | | | 471 | |
| Equity in net loss (income) of investee, net of tax | 65 | | | — | | | — | | | (548) | | | (483) | |
| | | | | | | | | |
| Adjusted EBITDA | $ | 37,217 | | | $ | 16,621 | | | $ | 4,608 | | | $ | (8,151) | | | $ | 50,295 | |
(1) Restructuring and related charges include professional services costs and severance and recruiting costs.
(2) Transaction costs include SOX integration efforts at recently acquired subsidiaries and acquisition costs.
--more--
Modivcare Inc.
Page 9
Modivcare Inc.
Unaudited Key Statistical and Financial Data
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended | | Year ended | | Three months ended |
| March 31, 2021 | | June 30, 2021 | | September 30, 2021 | | December 31, 2021 | | December 31, 2021 | | March 31, 2022 |
| | | | | | | | | | | |
| NEMT Segment | | | | | | | | | | | |
| | | | | | | | | | | |
| Service revenue, net | $ | 343,416 | | | $ | 364,760 | | | $ | 372,992 | | | $ | 402,528 | | | $ | 1,483,696 | | | $ | 400,920 | |
| | | | | | | | | | | |
| Purchased services expense | 223,294 | | | 245,015 | | | 256,750 | | | 266,443 | | | 991,502 | | | 277,947 | |
| Payroll and other expense | 49,122 | | | 47,641 | | | 47,648 | | | 50,272 | | | 194,683 | | | 54,149 | |
| Service expense | $ | 272,416 | | | $ | 292,656 | | | $ | 304,398 | | | $ | 316,715 | | | $ | 1,186,185 | | | $ | 332,096 | |
| | | | | | | | | | | |
| Gross profit | $ | 71,000 | | | $ | 72,104 | | | $ | 68,594 | | | $ | 85,813 | | | $ | 297,511 | | | $ | 68,824 | |
| Gross margin | 20.7 | % | | 19.8 | % | | 18.4 | % | | 21.3 | % | | 20.1 | % | | 17.2 | % |
| | | | | | | | | | | |
| G&A expense | $ | 27,987 | | | $ | 28,099 | | | $ | 29,875 | | | $ | 46,532 | | | $ | 132,493 | | | $ | 37,333 | |
| G&A expense adjustments: | | | | | | | | | | | |
| Restructuring and related charges | 3,494 | | | 4,044 | | | 2,521 | | | 9,550 | | | 19,609 | | | 5,604 | |
| Transaction costs | (37) | | | 247 | | | 376 | | | (19) | | | 567 | | | — | |
| Adjusted G&A expense | $ | 24,530 | | | $ | 23,808 | | | $ | 26,978 | | | $ | 37,001 | | | $ | 112,317 | | | $ | 31,729 | |
| Adjusted G&A expense % of revenue | 7.1 | % | | 6.5 | % | | 7.2 | % | | 9.2 | % | | 7.6 | % | | 7.9 | % |
| | | | | | | | | | | |
| Net income | $ | 26,297 | | | $ | 27,050 | | | $ | 24,267 | | | $ | 28,027 | | | $ | 105,641 | | | $ | 17,746 | |
| Net income margin | 7.7 | % | | 7.4 | % | | 6.5 | % | | 7.0 | % | | 7.1 | % | | 4.4 | % |
| | | | | | | | | | | |
| Adjusted EBITDA | $ | 46,809 | | | $ | 48,410 | | | $ | 41,781 | | | $ | 48,913 | | | $ | 185,913 | | | $ | 37,217 | |
| Adjusted EBITDA margin | 13.6 | % | | 13.3 | % | | 11.2 | % | | 12.2 | % | | 12.5 | % | | 9.3 | % |
| | | | | | | | | | | |
| Total paid trips | 6,619 | | | 6,657 | | | 6,928 | | | 7,078 | | | 27,282 | | | 7,111 | |
| Average monthly members | 30,447 | | | 29,756 | | | 29,387 | | | 30,032 | | | 29,906 | | | 32,176 | |
| | | | | | | | | | | |
| Revenue per member per month | $ | 3.76 | | | $ | 4.09 | | | $ | 4.23 | | | $ | 4.47 | | | $ | 4.13 | | | $ | 4.15 | |
| Revenue per trip | $ | 51.88 | | | $ | 54.79 | | | $ | 53.84 | | | $ | 56.87 | | | $ | 54.38 | | | $ | 56.38 | |
| Monthly utilization | 7.2 | % | | 7.5 | % | | 7.9 | % | | 7.9 | % | | 7.6 | % | | 7.4 | % |
| | | | | | | | | | | |
| Purchased services per trip | $ | 33.74 | | | $ | 36.81 | | | $ | 37.06 | | | $ | 37.64 | | | $ | 36.34 | | | $ | 39.09 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
--more--
Modivcare Inc.
Page 10
Modivcare Inc.
Unaudited Key Statistical and Financial Data
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended | | Year ended | | Three months ended |
| March 31, 2021 | | June 30, 2021 | | September 30, 2021 | | December 31, 2021 | | December 31, 2021 | | March 31, 2022 |
| | | | | | | | | | | |
| Personal Care Segment | | | | | | | | | | | |
| | | | | | | | | | | |
| Service revenue, net | $ | 110,194 | | | $ | 109,688 | | | $ | 118,503 | | | $ | 157,194 | | | $ | 495,579 | | | $ | 159,698 | |
| Service expense | 87,917 | | | 86,909 | | | 94,107 | | | 123,575 | | | 392,508 | | | 122,232 | |
| Gross profit | $ | 22,277 | | | $ | 22,779 | | | $ | 24,396 | | | $ | 33,619 | | | $ | 103,071 | | | $ | 37,466 | |
| Gross Margin | 20.2 | % | | 20.8 | % | | 20.6 | % | | 21.4 | % | | 20.8 | % | | 23.5 | % |
| | | | | | | | | | | |
| G&A expense | $ | 15,029 | | | $ | 14,775 | | | $ | 15,802 | | | $ | 25,098 | | | $ | 70,704 | | | $ | 23,133 | |
| G&A expense adjustments: | | | | | | | | | | | |
| Restructuring and related charges | $ | — | | | $ | — | | | $ | — | | | $ | 304 | | | $ | 304 | | | $ | 181 | |
| Transaction costs | 1,045 | | | 1,245 | | | 1,177 | | | 3,463 | | | 6,930 | | | 1,273 | |
| Stock-based compensation | — | | | 76 | | | — | | | (58) | | | 18 | | | 17 | |
| Adjusted G&A expense | $ | 13,984 | | | $ | 13,454 | | | $ | 14,625 | | | $ | 21,389 | | | $ | 63,452 | | | $ | 21,662 | |
| Adjusted G&A expense % of revenue | 12.7 | % | | 12.3 | % | | 12.3 | % | | 13.6 | % | | 12.8 | % | | 13.6 | % |
| | | | | | | | | | | |
| Net income | $ | 3,531 | | | $ | 3,054 | | | $ | 2,844 | | | $ | 1,468 | | | $ | 10,897 | | | $ | 1,656 | |
| Net income margin | 3.2 | % | | 2.8 | % | | 2.4 | % | | 0.9 | % | | 2.2 | % | | 1.0 | % |
| | | | | | | | | | | |
| Adjusted EBITDA | $ | 9,089 | | | $ | 9,929 | | | $ | 10,000 | | | $ | 12,831 | | | $ | 41,849 | | | $ | 16,621 | |
| Adjusted EBITDA margin | 8.2 | % | | 9.1 | % | | 8.4 | % | | 8.2 | % | | 8.4 | % | | 10.4 | % |
| | | | | | | | | | | |
| Total hours | 4,627 | | | 4,629 | | | 5,075 | | | 6,857 | | | 21,188 | | | 6,535 | |
| Revenue per hour | $ | 23.82 | | | $ | 23.70 | | | $ | 23.35 | | | $ | 22.92 | | | $ | 23.39 | | | $ | 24.44 | |
| Service expense per hour | $ | 19.00 | | | $ | 18.77 | | | $ | 18.54 | | | $ | 18.02 | | | $ | 18.53 | | | $ | 18.70 | |
--more--
Modivcare Inc.
Page 11
Modivcare Inc.
Unaudited Key Statistical and Financial Data
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended | | Year ended | | Three months ended |
| March 31, 2021 | | June 30, 2021 | | September 30, 2021 | | December 31, 2021 | | December 31, 2021 | | March 31, 2022 |
| | | | | | | | | | | |
| RPM Segment | | | | | | | | | | | |
| | | | | | | | | | | |
| Service revenue, net | | | | | $ | 1,564 | | | $ | 16,053 | | | $ | 17,617 | | | $ | 13,857 | |
| Service expense | | | | | 767 | | | 4,838 | | | 5,605 | | | 4,987 | |
| Gross profit | | | | | $ | 797 | | | $ | 11,215 | | | $ | 12,012 | | | $ | 8,870 | |
| Gross Margin | | | | | 51.0 | % | | 69.9 | % | | 68.2 | % | | 64.0 | % |
| | | | | | | | | | | |
| G&A expense | | | | | $ | 216 | | | $ | 5,575 | | | $ | 5,791 | | | $ | 4,962 | |
| G&A expense adjustments: | | | | | | | | | | | |
| Restructuring and related charges | | | | | $ | — | | | $ | — | | | $ | — | | | $ | 24 | |
| Transaction costs | | | | | — | | | 721 | | | 721 | | | 647 | |
| Stock-based compensation | | | | | — | | | — | | | — | | | 29 | |
| Adjusted G&A expense | | | | | $ | 216 | | | $ | 4,854 | | | $ | 5,070 | | | $ | 4,262 | |
| Adjusted G&A expense % of revenue | | | | | 13.8 | % | | 30.2 | % | | 28.8 | % | | 30.8 | % |
| | | | | | | | | | | |
| Net income (loss) | | | | | $ | 275 | | | $ | 1,318 | | | $ | 1,593 | | | $ | (162) | |
| Net income (loss) margin | | | | | 17.6 | % | | 8.2 | % | | 9.0 | % | | (1.2) | % |
| | | | | | | | | | | |
| Adjusted EBITDA | | | | | $ | 581 | | | $ | 6,361 | | | $ | 6,942 | | | $ | 4,608 | |
| Adjusted EBITDA margin | | | | | 37.1 | % | | 39.6 | % | | 39.4 | % | | 33.3 | % |
| | | | | | | | | | | |
| Average monthly members | | | | | N/M | | 173 | | | 173 | | | 169 | |
| Revenue per member per month | | | | | N/M | | $ | 30.93 | | | $ | 33.94 | | | $ | 27.33 | |
| | | | | | | | | | | |
N/M - Not Meaningful. The RPM Segment was established with the acquisition of VRI on September 22, 2021 and as such, these figures are not meaningful for comparative purposes.
--more--
Modivcare Inc.
Page 12
Modivcare Inc.
Unaudited Key Statistical and Financial Data
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended | | Year ended | | Three months ended |
| March 31, 2021 | | June 30, 2021 | | September 30, 2021 | | December 31, 2021 | | December 31, 2021 | | March 31, 2022 |
| | | | | | | | | | | |
| Corporate and Other Segment | | | | | | | | | | | |
| | | | | | | | | | | |
| G&A expense | $ | 11,909 | | | $ | 13,591 | | | $ | 22,312 | | | $ | 14,874 | | | $ | 62,686 | | | $ | 11,380 | |
G&A expense adjustments | | | | | | | | | | | |
| Restructuring and related charges | 206 | | | 557 | | | 717 | | | 200 | | | 1,680 | | | 31 | |
| Transaction costs | 2,670 | | | 1,974 | | | 9,739 | | | 2,987 | | | 17,370 | | | 1,791 | |
| Cash settled equity | 2,093 | | | 4,452 | | | 2,600 | | | 20 | | | 9,165 | | | (13) | |
| Stock-based compensation | 1,149 | | | 1,340 | | | 1,218 | | | 1,068 | | | 4,775 | | | 1,420 | |
| Adjusted G&A expense | $ | 5,791 | | | $ | 5,268 | | | $ | 8,038 | | | $ | 10,599 | | | $ | 29,696 | | | $ | 8,151 | |
| Adjusted G&A expense % of consolidated revenue | 1.3 | % | | 1.1 | % | | 1.6 | % | | 1.8 | % | | 1.5 | % | | 1.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended | | Year ended | | Three months ended |
| March 31, 2021 | | June 30, 2021 | | September 30, 2021 | | December 31, 2021 | | December 31, 2021 | | March 31, 2022 |
| | | | | | | | | | | |
| Consolidated ModivCare | | | | | | | | | | | |
| | | | | | | | | | | |
| G&A expense | $ | 54,925 | | | $ | 56,465 | | | $ | 68,205 | | | $ | 92,079 | | | $ | 271,674 | | | $ | 76,808 | |
G&A expense adjustments | | | | | | | | | | | |
| Restructuring and related charges | 3,700 | | | 4,601 | | | 3,238 | | | 10,054 | | | 21,593 | | | 5,840 | |
| Transaction costs | 3,678 | | | 3,466 | | | 11,292 | | | 7,152 | | | 25,588 | | | 3,711 | |
| Cash settled equity | 2,093 | | | 4,452 | | | 2,600 | | | 20 | | | 9,165 | | | (13) | |
| Stock-based compensation | 1,149 | | | 1,416 | | | 1,218 | | | 1,010 | | | 4,793 | | | 1,466 | |
| Adjusted G&A expense | $ | 44,305 | | | $ | 42,530 | | | $ | 49,857 | | | $ | 73,843 | | | $ | 210,535 | | | $ | 65,804 | |
| Adjusted G&A expense % of revenue | 9.8 | % | | 9.0 | % | | 10.1 | % | | 12.8 | % | | 10.5 | % | | 11.5 | % |
--end--
