Exhibit 99.1
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following tables set forth the unaudited pro forma condensed combined financial data for Acadia Healthcare Company, Inc. (“Acadia”), Youth and Family Centered Services, Inc. (“YFCS”), PHC, Inc. (“PHC”), HHC Delaware, Inc. (“HHC Delaware”), three inpatient behavioral health facilities from Haven Behavioral Healthcare Holdings, LLC (“the Haven Facilities”), AmiCare Behavioral Centers, LLC (“AmiCare”) and Behavioral Centers of America, LLC (“BCA”) as a combined company, giving effect to:
• | Acadia’s acquisition of YFCS and the related debt and equity financing transactions on April 1, 2011; |
• | PHC’s acquisition of MeadowWood on July 1, 2011; |
• | Acadia’s acquisition of PHC and related debt and equity transactions on November 1, 2011; |
• | Acadia’s acquisition of the Haven Facilities and the related debt financing on March 1, 2012; and |
• | Acadia’s planned acquisitions of BCA and AmiCare and the related debt financing and equity issuance. |
The unaudited pro forma condensed combined statements of operations give effect to each transaction as if it occurred on January 1, 2011. Acadia’s condensed consolidated statement of operations for the year ended December 31, 2011 reflects the results of operations for YFCS for the period from April 1, 2011 to December 31, 2011 and PHC for the period from November 1, 2011 to December 31, 2011. Acadia’s condensed consolidated statement of operations for the nine months ended September 30, 2012 reflects the results of operations for the Haven Facilities for the period from March 1, 2012 to September 30, 2012.
Acadia’s condensed consolidated balance sheet as of September 30, 2012 reflects the effect of the acquisitions of YFCS, PHC, HHC Delaware and the Haven Facilities. The unaudited pro forma condensed combined balance sheet at September 30, 2012 combines the condensed consolidated balance sheet of Acadia at September 30, 2012 with (a) the unaudited consolidated balance sheet of BCA at September 30, 2012 and (b) the unaudited consolidated balance sheet of AmiCare at September 30, 2012.
The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2011 combines the audited consolidated statement of operations of Acadia for that period with:
• | the unaudited condensed consolidated statement of operations of YFCS for the three months ended March 31, 2011; |
• | the unaudited condensed consolidated statement of operations of HHC Delaware for the six months ended June 30, 2011; |
• | the unaudited condensed consolidated statement of operations of PHC for the ten months ended October 31, 2011 (which was derived from the audited consolidated statement of operations of PHC for the fiscal year ended June 30, 2011 less the unaudited condensed consolidated statement of operations of PHC for the six months ended December 31, 2010 plus the unaudited condensed consolidated statement of operations of PHC for the three months ended September 30, 2011 plus the unaudited condensed consolidated statement of operations of PHC for the month ended October 31, 2011); |
• | the audited consolidated statement of operations of the Haven Facilities for the year ended December 31, 2011; |
• | the audited consolidated statement of operations of BCA for the year ended December 31, 2011; and |
• | the audited consolidated statement of operations of AmiCare for the year ended December 31, 2011. |
The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2012 combines the unaudited consolidated statement of operations of Acadia for that period with:
• | the unaudited condensed consolidated statement of operations of the Haven Facilities for the period from January 1, 2012 to February 29, 2012; |
• | the unaudited condensed consolidated statement of operations of BCA for the nine months ended September 30, 2012; and |
• | the unaudited condensed consolidated statement of operations of AmiCare for the nine months ended September 30, 2012. |
1
The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2011 combines the unaudited consolidated statement of operations of Acadia for that period with:
• | the unaudited condensed consolidated statement of operations of YFCS for the three months ended March 31, 2011; |
• | the unaudited condensed consolidated statement of operations of HHC Delaware for the six months ended June 30, 2011; |
• | the unaudited condensed consolidated statement of operations of PHC for the nine months ended September 30, 2011 (which was derived from the audited consolidated statement of operations of PHC for the fiscal year ended June 30, 2011 less the unaudited condensed consolidated statement of operations of PHC for the six months ended December 31, 2010 plus the unaudited condensed consolidated statement of operations of PHC for the three months ended September 30, 2011); |
• | the unaudited consolidated statement of operations of the Haven Facilities for the nine months ended September 30, 2011; |
• | the unaudited condensed consolidated statement of operations of BCA for the nine months ended September 30, 2011; and |
• | the unaudited condensed consolidated statement of operations of AmiCare for the nine months ended September 30, 2011. |
The unaudited pro forma condensed combined financial data has been prepared using the acquisition method of accounting for business combinations under Generally Accepted Accounting Principles (“GAAP”). The adjustments necessary to fairly present the unaudited pro forma condensed combined financial data have been made based on available information and in the opinion of management are reasonable. Assumptions underlying the pro forma adjustments are described in the accompanying notes, which should be read in conjunction with this unaudited pro forma condensed combined financial data. The pro forma adjustments relating to the planned acquisitions of BCA and AmiCare are preliminary and revisions to the fair value of assets acquired and liabilities assumed may have a significant impact on the pro forma adjustments. A final valuation of assets acquired and liabilities assumed has not been completed and the completion of fair value determinations may result in changes in the values assigned to property and equipment and other assets (including intangibles) acquired and liabilities assumed.
The unaudited pro forma condensed combined financial data is for illustrative purposes only and does not purport to represent what our financial position or results of operations actually would have been had the events noted above in fact occurred on the assumed dates or to project our financial position or results of operations for any future date or future period.
The unaudited pro forma condensed combined financial data should be read in conjunction with the consolidated financial statements and notes thereto of Acadia, YFCS, PHC, HHC Delaware, the Haven Facilities, BCA and AmiCare.
2
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
As of September 30, 2012
(In thousands)
ACADIA (1) | AMICARE (2) | BCA(3) | PRO FORMA ADJUSTMENTS | NOTES | PRO FORMA COMBINED | |||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 11,719 | $ | 804 | $ | 44 | $ | (848 | ) | (4 | ) | $ | 45,499 | |||||||||||
33,780 | (8 | ) | ||||||||||||||||||||||
Accounts receivable, net | 54,777 | 4,405 | 8,177 | (1,082 | ) | (10 | ) | 66,277 | ||||||||||||||||
Deferred tax assets | 5,230 | — | — | — | 5,230 | |||||||||||||||||||
Other current assets | 15,305 | 885 | 2,469 | (521 | ) | (10 | ) | 18,138 | ||||||||||||||||
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Total current assets | 87,031 | 6,094 | 10,690 | 31,329 | 135,144 | |||||||||||||||||||
Property and equipment, net | 155,188 | 20,694 | 23,334 | 229 | (7a | ) | 200,058 | |||||||||||||||||
613 | (7b | ) | ||||||||||||||||||||||
Property and equipment held for sale | — | — | 330 | (330 | ) | (10 | ) | — | ||||||||||||||||
Goodwill | 334,622 | 14,175 | 16,550 | 74,812 | (7a | ) | 539,644 | |||||||||||||||||
99,485 | (7b | ) | ||||||||||||||||||||||
Intangible assets, net | 12,534 | — | — | 1,790 | (7a | ) | 16,249 | |||||||||||||||||
1,925 | (7b | ) | ||||||||||||||||||||||
Other assets | 14,383 | 71 | 646 | 3,000 | (8 | ) | 17,642 | |||||||||||||||||
(71 | ) | (6 | ) | |||||||||||||||||||||
(387 | ) | (10 | ) | |||||||||||||||||||||
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Total assets | $ | 603,758 | $ | 41,034 | $ | 51,550 | $ | 212,395 | $ | 908,737 | ||||||||||||||
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LIABILITIES AND EQUITY | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Current portion of long-term debt | $ | 12,000 | $ | 4,283 | $ | 2,613 | $ | (11,046 | ) | (9 | ) | $ | 7,850 | |||||||||||
Accounts payable | 13,323 | 504 | 3,078 | (235 | ) | (10 | ) | 16,670 | ||||||||||||||||
Accrued salaries and benefits | 19,125 | 2,373 | 2,677 | (141 | ) | (10 | ) | 24,034 | ||||||||||||||||
Other accrued liabilities | 13,374 | 940 | 317 | (14 | ) | (10 | ) | 14,617 | ||||||||||||||||
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Total current liabilities | 57,822 | 8,100 | 8,685 | (11,436 | ) | 63,171 | ||||||||||||||||||
Long-term debt | 284,632 | 18,637 | 2,316 | 148,197 | (9 | ) | 453,782 | |||||||||||||||||
Deferred tax liabilities – noncurrent | 1,167 | — | — | — | 1,167 | |||||||||||||||||||
Other liabilities | 6,574 | 173 | 958 | (431 | ) | (10 | ) | 7,274 | ||||||||||||||||
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Total liabilities | 350,195 | 26,910 | 11,959 | 136,330 | 525,394 | |||||||||||||||||||
Equity: | ||||||||||||||||||||||||
Common stock | 418 | — | — | 60 | (8 | ) | 478 | |||||||||||||||||
Additional paid-in capital | 281,687 | — | — | 131,220 | (8 | ) | 412,907 | |||||||||||||||||
Accumulated deficit | (28,542 | ) | — | — | (1,500 | ) | (8 | ) | (30,042 | ) | ||||||||||||||
Members’ equity | — | 14,124 | 39,591 | (53,715 | ) | (5 | ) | — | ||||||||||||||||
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Total equity | 253,563 | 14,124 | 39,591 | 76,065 | 383,343 | |||||||||||||||||||
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Total liabilities and equity | $ | 603,758 | $ | 41,034 | $ | 51,550 | $ | 212,395 | $ | 908,737 | ||||||||||||||
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See accompanying notes to unaudited pro forma financial information.
3
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Year Ended December 31, 2011
(In thousands, except per share amounts)
ACADIA (1) | COMPLETED ACQUISITIONS (16) | AMICARE (2) | BCA(3) | PRO FORMA ADJUSTMENTS | NOTES | PRO FORMA COMBINED | ||||||||||||||||||||||
Revenue before provision for doubtful accounts | $ | 219,704 | $ | 186,977 | $ | 59,842 | $ | 54,507 | $ | 521,030 | ||||||||||||||||||
Provision for doubtful accounts | (3,206 | ) | (6,207 | ) | (1,381 | ) | (1,443 | ) | (12,237 | ) | ||||||||||||||||||
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Revenue | 216,498 | 180,770 | 58,461 | 53,064 | 508,793 | |||||||||||||||||||||||
Salaries, wages and benefits | 152,609 | 102,044 | 37,969 | 28,920 | 321,542 | |||||||||||||||||||||||
Professional fees | 8,896 | 12,043 | 1,948 | 3,199 | 26,086 | |||||||||||||||||||||||
Supplies | 11,349 | 9,060 | 1,157 | 2,886 | 24,452 | |||||||||||||||||||||||
Rents and leases | 5,576 | 4,558 | 2,041 | 1,152 | 13,327 | |||||||||||||||||||||||
Other operating expenses | 20,171 | 20,395 | 8,543 | 9,769 | 58,878 | |||||||||||||||||||||||
Depreciation and amortization | 4,278 | 3,655 | 925 | 955 | 147 | (20e | ) | 10,694 | ||||||||||||||||||||
734 | (20f | ) | ||||||||||||||||||||||||||
Interest expense, net | 9,191 | 21,114 | 1,794 | 135 | 2,300 | (21b | ) | 34,534 | ||||||||||||||||||||
Sponsor management fees | 1,347 | — | — | 924 | (2,271 | ) | (22 | ) | — | |||||||||||||||||||
Transaction-related expenses | 41,547 | — | — | — | (41,547 | ) | (23 | ) | — | |||||||||||||||||||
Legal settlement | — | 446 | — | — | 446 | |||||||||||||||||||||||
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Total expenses | 254,964 | 173,315 | 54,377 | 47,940 | (40,637 | ) | 489,959 | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes | (38,466 | ) | 7,455 | 4,084 | 5,124 | 40,637 | 18,834 | |||||||||||||||||||||
Provision (benefit) for income taxes | (5,272 | ) | 3,349 | — | 219 | (133 | ) | (25 | ) | 14,011 | ||||||||||||||||||
15,848 | (26 | ) | ||||||||||||||||||||||||||
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Income (loss) from continuing operations | $ | (33,194 | ) | $ | 4,106 | $ | 4,084 | $ | 4,905 | $ | 24,922 | $ | 4,823 | |||||||||||||||
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Earnings per share — income (loss) from continuing operations: | ||||||||||||||||||||||||||||
Basic | $ | (1.77 | ) | $ | 0.10 | |||||||||||||||||||||||
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Diluted | $ | (1.77 | ) | $ | 0.10 | |||||||||||||||||||||||
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Weighted average shares: | ||||||||||||||||||||||||||||
Basic | 18,757 | 13,342 | 9,488 | (27c | ) | 47,587 | ||||||||||||||||||||||
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6,000 | (27d | ) | ||||||||||||||||||||||||||
Diluted | 18,757 | 13,342 | 9,488 | (27c | ) | 47,587 | ||||||||||||||||||||||
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6,000 | (27d | ) |
See accompanying notes to unaudited pro forma financial information.
4
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Nine Months Ended September 30, 2012
(In thousands, except per share amounts)
ACADIA (1) | COMPLETED ACQUISITIONS (17) | AMICARE (2) | BCA (3) | PRO FORMA ADJUSTMENTS | NOTES | PRO FORMA COMBINED | ||||||||||||||||||||||
Revenue before provision for doubtful accounts | $ | 298,638 | $ | 30,079 | $ | 47,220 | $ | 48,427 | $ | 424,364 | ||||||||||||||||||
Provision for doubtful accounts | (5,429 | ) | (689 | ) | (1,340 | ) | (1,157 | ) | (8,615 | ) | ||||||||||||||||||
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Revenue | 293,209 | 29,390 | 45,880 | 47,270 | 415,749 | |||||||||||||||||||||||
Salaries, wages and benefits | 173,590 | 15,391 | 29,877 | 24,650 | 243,508 | |||||||||||||||||||||||
Professional fees | 13,521 | 1,060 | 1,249 | 1,666 | 17,496 | |||||||||||||||||||||||
Supplies | 14,148 | 1,328 | 813 | 2,223 | 18,512 | |||||||||||||||||||||||
Rents and leases | 6,244 | 25 | 1,773 | 471 | 8,513 | |||||||||||||||||||||||
Other operating expenses | 30,768 | 3,358 | 6,044 | 8,727 | 48,897 | |||||||||||||||||||||||
Depreciation and amortization | 5,332 | 584 | 703 | 951 | 100 | (20e | ) | 7,930 | ||||||||||||||||||||
260 | (20f | ) | ||||||||||||||||||||||||||
Interest expense, net | 22,186 | 313 | 1,015 | 242 | 2,006 | (21b | ) | 25,762 | ||||||||||||||||||||
Sponsor management fees | — | — | — | 524 | (524 | ) | (22 | ) | — | |||||||||||||||||||
Transaction-related expenses | 2,097 | — | — | — | (2,097 | ) | (23 | ) | — | |||||||||||||||||||
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Total expenses | 267,886 | 22,059 | 41,474 | 39,454 | (255 | ) | 370,618 | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes | 25,323 | 7,331 | 4,406 | 7,816 | 255 | 45,131 | ||||||||||||||||||||||
Provision (benefit) for income taxes | 9,307 | 2,827 | — | (5 | ) | 99 | (26 | ) | 12,228 | |||||||||||||||||||
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Income (loss) from continuing operations | $ | 16,016 | $ | 4,504 | $ | 4,406 | $ | 7,821 | $ | 156 | $ | 32,903 | ||||||||||||||||
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Earnings per share — income (loss) from continuing operations: | ||||||||||||||||||||||||||||
Basic | $ | 0.44 | $ | 0.69 | ||||||||||||||||||||||||
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Diluted | $ | 0.43 | $ | 0.69 | ||||||||||||||||||||||||
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Weighted average shares: | ||||||||||||||||||||||||||||
Basic | 36,795 | 4,900 | (27c | ) | 47,695 | |||||||||||||||||||||||
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6,000 | (27d | ) | ||||||||||||||||||||||||||
Diluted | 37,006 | 4,900 | (27c | ) | 47,906 | |||||||||||||||||||||||
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6,000 | (27d | ) |
See accompanying notes to unaudited pro forma financial information.
5
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Nine Months Ended September 30, 2011
(In thousands, except per share amounts)
ACADIA (1) | COMPLETED ACQUISITIONS (18) | AMICARE (2) | BCA (3) | PRO FORMA ADJUSTMENTS | NOTES | PRO FORMA COMBINED | ||||||||||||||||||||||
Revenue before provision for doubtful accounts | $ | 142,797 | $ | 161,249 | $ | 43,539 | $ | 40,915 | $ | 388,500 | ||||||||||||||||||
Provision for doubtful accounts | (1,654 | ) | (5,220 | ) | (951 | ) | (1,351 | ) | (9,176 | ) | ||||||||||||||||||
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Revenue | 141,143 | 156,029 | 42,588 | 39,564 | 379,324 | |||||||||||||||||||||||
Salaries, wages and benefits | 108,158 | 88,869 | 27,858 | 22,189 | 247,074 | |||||||||||||||||||||||
Professional fees | 5,018 | 10,478 | 1,457 | 1,735 | 18,688 | |||||||||||||||||||||||
Supplies | 7,645 | 7,792 | 865 | 2,117 | 18,419 | |||||||||||||||||||||||
Rents and leases | 3,576 | 4,205 | 1,494 | 1,334 | 10,609 | |||||||||||||||||||||||
Other operating expenses | 12,760 | 17,895 | 6,438 | 7,224 | 44,317 | |||||||||||||||||||||||
Depreciation and amortization | 3,108 | 3,124 | 691 | 674 | 112 | (20e | ) | 8,302 | ||||||||||||||||||||
593 | (20f | ) | ||||||||||||||||||||||||||
Interest expense, net | 4,143 | 18,667 | 1,318 | 105 | 1,910 | (21b | ) | 26,143 | ||||||||||||||||||||
Sponsor management fees | 1,135 | — | — | 813 | (1,948 | ) | (22 | ) | — | |||||||||||||||||||
Transaction-related expenses | 10,595 | — | — | — | (10,595 | ) | (23 | ) | — | |||||||||||||||||||
Legal settlement | — | 446 | — | — | 446 | |||||||||||||||||||||||
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Total expenses | 156,138 | 151,476 | 40,121 | 36,191 | (9,928 | ) | 373,998 | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes | (14,995 | ) | 4,553 | 2,467 | 3,373 | 9,928 | 5,326 | |||||||||||||||||||||
Provision (benefit) for income taxes | 3,426 | 2,272 | — | 160 | (133 | ) | (25 | ) | 9,597 | |||||||||||||||||||
3,872 | (26 | ) | ||||||||||||||||||||||||||
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Income (loss) from continuing operations | $ | (18,421 | ) | $ | 2,281 | $ | 2,467 | $ | 3,213 | $ | 6,189 | $ | (4,271 | ) | ||||||||||||||
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Earnings per share — income (loss) from continuing operations: | ||||||||||||||||||||||||||||
Basic | $ | (1.05 | ) | $ | (0.09 | ) | ||||||||||||||||||||||
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Diluted | $ | (1.05 | ) | $ | (0.09 | ) | ||||||||||||||||||||||
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Weighted average shares: | ||||||||||||||||||||||||||||
Basic | 17,633 | 14,475 | 9,488 | (27c | ) | 47,596 | ||||||||||||||||||||||
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6,000 | (27d | ) | ||||||||||||||||||||||||||
Diluted | 17,633 | 14,475 | 9,488 | (27c | ) | 47,596 | ||||||||||||||||||||||
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6,000 | (27d | ) |
See accompanying notes to unaudited pro forma financial information.
6
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
(Dollars in thousands, except per share amounts)
(1) | The amounts in this column represent, for Acadia, actual results for the periods presented. |
(2) | The amounts in this column represent, for AmiCare, actual results for the periods presented. |
(3) | The amounts in this column represent, for BCA, actual results for the periods presented. |
(4) | Represents cash not acquired as part of the acquisitions. |
(5) | Reflects the elimination of equity accounts of BCA and AmiCare. |
(6) | Reflects the elimination of deferred financing costs in connection with the repayment of debt. |
(7) | Represents adjustments based on preliminary estimates of fair value and the adjustment to goodwill derived from the difference in the estimated total consideration to be transferred by Acadia and the estimated fair value of assets acquired and liabilities assumed by Acadia, calculated as follows: |
(a) | AmiCare: |
Estimated cash consideration | $ | 113,000 | ||
Cash and cash equivalents | — | |||
Accounts receivable | 4,405 | |||
Other current assets | 885 | |||
Property and equipment | 20,923 | |||
Intangible assets | 1,790 | |||
Other long-term assets | — | |||
Accounts payable | (504 | ) | ||
Accrued salaries and benefits | (2,373 | ) | ||
Other accrued liabilities | (940 | ) | ||
Other long-term liabilities | (173 | ) | ||
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Fair value of assets acquired less liabilities assumed | $ | 24,013 | ||
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Estimated goodwill | $ | 88,987 | ||
Less: historical goodwill | (14,175 | ) | ||
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Goodwill adjustment | $ | 74,812 | ||
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(b) | BCA: |
Estimated cash consideration | $ | 145,000 | ||
Cash and cash equivalents | — | |||
Accounts receivable | 7,095 | |||
Other current assets | 1,948 | |||
Property and equipment | 23,947 | |||
Intangible assets | 1,925 | |||
Other long-term assets | 259 | |||
Accounts payable | (2,843 | ) | ||
Accrued salaries and benefits | (2,536 | ) | ||
Other accrued liabilities | (303 | ) | ||
Other long-term liabilities | (527 | ) | ||
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Fair value of assets acquired less liabilities assumed | $ | 28,965 | ||
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Estimated goodwill | $ | 116,035 | ||
Less: historical goodwill | (16,550 | ) | ||
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Goodwill adjustment | $ | 99,485 | ||
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The acquired assets and liabilities assumed will be recorded at their relative fair values as of the closing date of the acquisitions. Estimated goodwill is based upon a determination of the fair value of assets acquired and liabilities assumed that is preliminary and subject to revision as the value of total consideration is finalized and additional information related to the fair value of property and equipment and other assets (including intangible assets) acquired and liabilities assumed becomes available. The actual determination of the fair value of assets acquired and liabilities assumed will differ from that assumed in these unaudited pro forma condensed combined financial statements and such differences may be material. Qualitative factors comprising goodwill include efficiencies derived through synergies expected by the elimination of certain redundant corporate functions and expenses, the ability to leverage call center referrals to a broader provider base, coordination of services provided across the combined network of facilities, achievement of operating efficiencies by benchmarking performance and applying best practices throughout the combined company.
7
(8) | Represents a $33,780 increase in cash as a result of the planned acquisitions of BCA and AmiCare and relating financing transactions. Acadia expects to issue $165,000 of incremental term loans through an amendment to its existing senior credit facility (“Incremental Term Loans”) and to issue additional common shares for estimated net proceeds of $131,280. Based on the assumed public offering price of $22.95, which was the closing price of our common stock on November 30, 2012, as reported on The NASDAQ Global Market, the number of shares to be issued is 6,000,000 with a par value of $0.01, which results in additional common stock of $60 and additional paid-in capital of $131,220 and includes estimated underwriting discounts and other offering expenses of $6,420. The sources and uses of cash in connection with the acquisitions are expected to be as follows: |
Sources: | ||||
Incremental Term Loans | $ | 165,000 | ||
Equity issuance | 131,280 | |||
Uses: | ||||
AmiCare cash consideration | (113,000 | ) | ||
BCA cash consideration | (145,000 | ) | ||
Transaction-related expenses(a) | (4,500 | ) | ||
|
| |||
Cash adjustment | $ | 33,780 | ||
|
|
(a) | Estimated costs to be incurred in connection with the BCA and AmiCare transactions include $3,000 of debt financing costs associated with the Incremental Term Loans and $1,500 of acquisition costs. |
(9) | Represents the issuance of Incremental Term Loans, the elimination of debt not assumed in the BCA and AmiCare acquisitions and the amendment to the credit agreement to adjust the payment schedule for existing loans, as follows: |
CURRENT PORTION | LONG-TERM PORTION | TOTAL DEBT | ||||||||||
Elimination of AmiCare debt not assumed | $ | (4,283 | ) | $ | (18,637 | ) | $ | (22,920 | ) | |||
Elimination of BCA debt not assumed | (2,613 | ) | (2,316 | ) | (4,929 | ) | ||||||
Incremental Term Loan | 4,125 | 160,875 | 165,000 | |||||||||
Amendment to credit agreement | (8,275 | ) | 8,275 | — | ||||||||
|
|
|
|
|
| |||||||
Adjustments | $ | (11,046 | ) | $ | 148,197 | $ | 137,151 | |||||
|
|
|
|
|
|
(10) | Represents the following adjustments to eliminate the assets and liabilities of BCA’s Permian Basin facility, which will be divested prior to the acquisition: |
Accounts receivable, net | $ | 1,082 | ||
Other current assets | 521 | |||
Property and equipment held for sale | 330 | |||
Other assets | 387 | |||
|
| |||
$ | 2,320 | |||
|
| |||
Accounts payable | $ | 235 | ||
Accrued salaries and benefits | 141 | |||
Other accrued liabilities | 14 | |||
Other liabilities | 431 | |||
|
| |||
$ | 821 | |||
|
|
(11) | The amounts in this column represent, for YFCS, actual results for the periods presented, up to the April 1, 2011 acquisition date. The condensed consolidated statements of operations of YFCS have been reclassified to present the provision for doubtful accounts as a deduction from revenue in accordance with Accounting Standards Update (“ASU”) No. 2011-07,“Health Care Entities (Topic 954):Presentation and Disclosure of Patient Service Revenue, Provision for Bad Debts, and the Allowance for Doubtful Accounts for Certain Health Care Entities” (“ASU 2011-07”). |
(12) | The amounts in this column represent, for PHC, actual results for the periods presented, up to the November 1, 2011 acquisition date. The condensed consolidated statements of operations of PHC have been reclassified to conform to Acadia’s expense classification policies, including the reclassification of the provision for doubtful accounts from operating expenses to a deduction from revenue. |
(13) | The amounts in this column represent, for HHC Delaware, actual results for the periods presented, up to July 1, 2011, the date of PHC’s acquisition of HHC Delaware. The condensed consolidated statements of operations of HHC Delaware have been reclassified to present the provision for doubtful accounts as a deduction from revenue in accordance with ASU 2011-07. |
(14) | The amounts in this column represent, for the Haven Facilities, actual results for the periods presented, up to the March 1, 2012 acquisition date. |
(15) | The amounts in this column represent, for other acquisitions, actual results for the periods presented, up to the acquisition dates. |
8
(16) | The amounts in this column represent pro forma combined results of operations for acquisitions completed as of September 30, 2012 for the year ended December 31, 2011 as detailed below. |
YFCS (11) | PHC (12) | HHC DELAWARE (13) | HAVEN FACILITIES (14) | OTHER ACQUISITIONS (15) | PRO FORMA ADJUSTMENTS | NOTES | COMPLETED ACQUISITIONS | |||||||||||||||||||||||||
Revenue before provision for doubtful accounts | $ | 45,686 | $ | 59,786 | $ | 7,541 | $ | 43,448 | $ | 30,516 | $ | 186,977 | ||||||||||||||||||||
Provision for doubtful accounts | (208 | ) | (3,466 | ) | (339 | ) | (1,458 | ) | (736 | ) | (6,207 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Revenue | 45,478 | 56,320 | 7,202 | 41,990 | 29,780 | 180,770 | ||||||||||||||||||||||||||
Salaries, wages and benefits | 29,502 | 31,569 | 4,747 | 21,391 | 14,835 | 102,044 | ||||||||||||||||||||||||||
Professional fees | — | 6,365 | 454 | 1,374 | 1,949 | 1,901 | (19 | ) | 12,043 | |||||||||||||||||||||||
Supplies | — | 2,299 | 469 | 2,819 | 1,269 | 2,204 | (19 | ) | 9,060 | |||||||||||||||||||||||
Rents and leases | — | 3,048 | 19 | 171 | — | 1,320 | (19 | ) | 4,558 | |||||||||||||||||||||||
Other operating expenses | 9,907 | 7,576 | 410 | 4,119 | 3,808 | (5,425 | ) | (19 | ) | 20,395 | ||||||||||||||||||||||
Depreciation and amortization | 819 | 1,051 | 179 | 1,046 | 475 | (294 | ) | (20a | ) | 3,655 | ||||||||||||||||||||||
430 | (20b | ) | ||||||||||||||||||||||||||||||
(470 | ) | (20c | ) | |||||||||||||||||||||||||||||
419 | (20d | ) | ||||||||||||||||||||||||||||||
Interest expense, net | 1,726 | 1,160 | 224 | 343 | — | 17,661 | (21a | ) | 21,114 | |||||||||||||||||||||||
Sponsor management fees | — | — | 226 | — | — | (226 | ) | (22 | ) | — | ||||||||||||||||||||||
Transaction-related expenses | — | 3,374 | — | — | — | (3,374 | ) | (23 | ) | — | ||||||||||||||||||||||
Change in fair value of derivatives | — | — | — | (276 | ) | — | 276 | (24 | ) | — | ||||||||||||||||||||||
Legal settlement | — | 446 | — | — | — | 446 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Total expenses | 41,954 | 56,888 | 6,728 | 30,987 | 22,336 | 14,422 | 173,315 | |||||||||||||||||||||||||
Income (loss) from continuing operations before income taxes | 3,524 | (568 | ) | 474 | 11,003 | 7,444 | (14,422 | ) | 7,455 | |||||||||||||||||||||||
Provision (benefit) for income taxes | 1,404 | 403 | 193 | 4,071 | 2,903 | (5,625 | ) | (26 | ) | 3,349 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Income (loss) from continuing operations | $ | 2,120 | $ | (971 | ) | $ | 281 | $ | 6,932 | $ | 4,541 | $ | (8,797 | ) | $ | 4,106 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Weighted average shares: | ||||||||||||||||||||||||||||||||
Basic | 4,074 | (27a | ) | 13,342 | ||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||
9,268 | (27b | ) | ||||||||||||||||||||||||||||||
Diluted | 4,074 | (27a | ) | 13,342 | ||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||
9,268 | (27b | ) |
9
(17) | The amounts in this column represent pro forma information for acquisitions completed as of September 30, 2012 for the nine months ended September 30, 2012. |
HAVEN FACILITIES (14) | OTHER ACQUISITIONS (15) | PRO FORMA ADJUSTMENTS | NOTES | COMPLETED ACQUISITIONS | ||||||||||||||||
Revenue before provision for doubtful accounts | $ | 7,158 | $ | 22,921 | $ | 30,079 | ||||||||||||||
Provision for doubtful accounts | (233 | ) | (456 | ) | (689 | ) | ||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||
Revenue | 6,925 | 22,465 | 29,390 | |||||||||||||||||
Salaries, wages and benefits | 3,694 | 11,697 | 15,391 | |||||||||||||||||
Professional fees | 222 | 838 | 1,060 | |||||||||||||||||
Supplies | 461 | 867 | 1,328 | |||||||||||||||||
Rents and leases | 25 | — | 25 | |||||||||||||||||
Other operating expenses | 687 | 2,671 | 3,358 | |||||||||||||||||
Depreciation and amortization | 172 | 341 | (76 | ) | (20c | ) | 584 | |||||||||||||
147 | (20d | ) | ||||||||||||||||||
Interest expense, net | 56 | — | 257 | (21a | ) | 313 | ||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||
Total expenses | 5,317 | 16,414 | 328 | 22,059 | ||||||||||||||||
Income (loss) from continuing operations before income taxes | 1,608 | 6,051 | (328 | ) | 7,331 | |||||||||||||||
Provision (benefit) for income taxes | 595 | 2,360 | (128 | ) | (26 | ) | 2,827 | |||||||||||||
|
|
|
|
|
|
|
| |||||||||||||
Income (loss) from continuing operations | $ | 1,013 | $ | 3,691 | $ | (200 | ) | $ | 4,504 | |||||||||||
|
|
|
|
|
|
|
|
10
(18) | The amounts in this column represent pro forma information for acquisitions completed as of September 30, 2012 for the nine months ended September 30, 2011. |
YFCS (11) | PHC(12) | HHC DELAWARE (13) | HAVEN FACILITIES (14) | OTHER ACQUISITIONS (15) | PRO FORMA ADJUSTMENTS | NOTES | COMPLETED ACQUISITIONS | |||||||||||||||||||||||||
Revenue before provision for doubtful accounts | $ | 45,686 | $ | 52,989 | $ | 7,541 | $ | 32,872 | $ | 22,161 | $ | 161,249 | ||||||||||||||||||||
Provision for doubtful accounts | (208 | ) | (3,006 | ) | (339 | ) | (1,225 | ) | (442 | ) | (5,220 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Revenue | 45,478 | 49,983 | 7,202 | 31,647 | 21,719 | 156,029 | ||||||||||||||||||||||||||
Salaries, wages and benefits | 29,502 | 27,840 | 4,747 | 16,097 | 10,683 | 88,869 | ||||||||||||||||||||||||||
Professional fees | — | 5,630 | 454 | 1,024 | 1,469 | 1,901 | (19 | ) | 10,478 | |||||||||||||||||||||||
Supplies | — | 2,062 | 469 | 2,128 | 929 | 2,204 | (19 | ) | 7,792 | |||||||||||||||||||||||
Rents and leases | — | 2,736 | 19 | 130 | — | 1,320 | (19 | ) | 4,205 | |||||||||||||||||||||||
Other operating expenses | 9,907 | 6,914 | 410 | 3,015 | 3,074 | (5,425 | ) | (19 | ) | 17,895 | ||||||||||||||||||||||
Depreciation and amortization | 819 | 918 | 179 | 789 | 387 | (294 | ) | (20a | ) | 3,124 | ||||||||||||||||||||||
397 | (20b | ) | ||||||||||||||||||||||||||||||
(357 | ) | (20c | ) | |||||||||||||||||||||||||||||
286 | (20d | ) | ||||||||||||||||||||||||||||||
Interest expense, net | 1,726 | 968 | 224 | 261 | — | 15,488 | (21a | ) | 18,667 | |||||||||||||||||||||||
Sponsor management fees | — | — | 226 | — | — | (226 | ) | (22 | ) | — | ||||||||||||||||||||||
Transaction-related expenses | — | 2,896 | — | — | — | (2,896 | ) | (23 | ) | — | ||||||||||||||||||||||
Change in fair value of derivatives | — | — | — | (221 | ) | — | 221 | (24 | ) | — | ||||||||||||||||||||||
Legal settlement | — | 446 | — | — | — | 446 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Total expenses | 41,954 | 50,410 | 6,728 | 23,223 | 16,542 | 12,619 | 151,476 | |||||||||||||||||||||||||
Income (loss) from continuing operations before income taxes | 3,524 | (427 | ) | 474 | 8,424 | 5,177 | (12,619 | ) | 4,553 | |||||||||||||||||||||||
Provision (benefit) for income taxes | 1,404 | 459 | 193 | 3,118 | 2,019 | (4,921 | ) | (26 | ) | 2,272 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Income (loss) from continuing operations | $ | 2,120 | $ | (886 | ) | $ | 281 | $ | 5,306 | $ | 3,158 | $ | (7,698 | ) | $ | 2,281 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
Weighted average shares: | ||||||||||||||||||||||||||||||||
Basic | 4,892 | (27a | ) | 14,475 | ||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||
9,583 | (27b | ) | ||||||||||||||||||||||||||||||
Diluted | 4,892 | (27a | ) | 14,475 | ||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||
9,583 | (27b | ) |
(19) | Reflects the reclassification from YFCS other operating expenses of: (a) professional fees of $1,901 for the three months ended March 31, 2011, (b) supplies expense of $2,204 for the three months ended March 31, 2011, and (c) rent expense of $1,320 for the three months ended March 31, 2011. |
11
(20) | Represents the adjustments to depreciation and amortization expense as a result of recording the property and equipment and intangible assets at preliminary estimates of fair value as of the respective dates of the acquisitions, as follows: |
(a) | YFCS acquisition: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | ||||||||||||||
Land | $ | 5,122 | N/A | $ | — | $ | — | $ | — | |||||||||
Land improvements | 2,694 | 10 | 22 | 66 | 66 | |||||||||||||
Building and improvements | 21,562 | 25, or lease term | 73 | 219 | 219 | |||||||||||||
Equipment | 2,024 | 3-7 | 53 | 159 | 159 | |||||||||||||
Construction in progress | 239 | N/A | — | — | — | |||||||||||||
|
|
|
|
|
|
|
| |||||||||||
31,641 | 148 | 444 | 444 | |||||||||||||||
Indefinite-lived intangible assets | 3,835 | N/A | — | — | — | |||||||||||||
Non-compete intangible asset | 321 | 1 | 27 | 81 | 81 | |||||||||||||
Patient-related intangible asset | 1,200 | 0.25 | 400 | — | — | |||||||||||||
|
|
|
| |||||||||||||||
Total depreciation and amortization expense | 525 | 525 | ||||||||||||||||
|
|
|
| |||||||||||||||
Less: historical depreciation and amortization expense | (819 | ) | (819 | ) | ||||||||||||||
|
|
|
| |||||||||||||||
Depreciation and amortization expense adjustment | $ | (294 | ) | $ | (294 | ) | ||||||||||||
|
|
|
|
The adjustment to decrease depreciation and amortization expense relates to the excess of the historical amortization of the pre-acquisition intangible assets of YFCS over the amortization expense resulting from the intangible assets identified by Acadia in its acquisition of YFCS.
(b) | PHC acquisition: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | ||||||||||||||
Land | $ | 2,940 | N/A | $ | — | $ | — | $ | — | |||||||||
Building and improvements | 12,194 | 25, or lease term | 102 | 1,020 | 918 | |||||||||||||
Equipment | 1,751 | 3-7 | 29 | 290 | 261 | |||||||||||||
|
|
|
|
|
|
|
| |||||||||||
16,885 | 131 | 1,310 | 1,179 | |||||||||||||||
Indefinite-lived intangible assets | 1,425 | N/A | — | — | — | |||||||||||||
Customer contract intangibles | 2,100 | 5 | 35 | 350 | 315 | |||||||||||||
|
|
|
| |||||||||||||||
Total depreciation and amortization expense | 1,660 | 1,494 | ||||||||||||||||
|
|
|
| |||||||||||||||
Less: PHC and MeadowWood historical depreciation and amortization expense | (1,230 | ) | (1,097 | ) | ||||||||||||||
|
|
|
| |||||||||||||||
Depreciation and amortization expense adjustment | $ | 430 | $ | 397 | ||||||||||||||
|
|
|
|
12
(c) | Haven Facilities acquisition: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | |||||||||||||||||
Land | $ | 2,960 | N/A | $ | — | $ | — | $ | — | $ | — | |||||||||||
Building and improvements | 8,840 | 25, or lease term | 29 | 348 | 58 | 261 | ||||||||||||||||
Equipment | 871 | 3-7 | 15 | 180 | 30 | 135 | ||||||||||||||||
Construction in progress | 52 | N/A | — | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||||
12,723 | 44 | 528 | 88 | 396 | ||||||||||||||||||
Indefinite-lived intangible assets | 1,050 | N/A | — | — | — | — | ||||||||||||||||
Non-compete intangible asset | 150 | 3 | 4 | 48 | 8 | 36 | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total depreciation and amortization expense | 576 | 96 | 432 | |||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Less: historical depreciation and amortization expense | (1,046 | ) | (172 | ) | (789 | ) | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Depreciation and amortization expense adjustment | $ | (470 | ) | $ | (76 | ) | $ | (357 | ) | |||||||||||||
|
|
|
|
|
|
(d) | Other acquisitions: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | |||||||||||||||||
Land | $ | 1,137 | N/A | $ | — | $ | — | $ | — | $ | — | |||||||||||
Land improvements | 2,601 | 10 | 22 | 260 | 176 | 198 | ||||||||||||||||
Building and improvements | 9,296 | 25, or lease term | 31 | 372 | 248 | 279 | ||||||||||||||||
Equipment | 481 | 3-7 | 8 | 96 | 64 | 72 | ||||||||||||||||
Construction in progress | 109 | N/A | — | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||||
13,624 | 61 | 728 | 488 | 549 | ||||||||||||||||||
Indefinite-lived intangible assets | 3,151 | N/A | — | — | — | — | ||||||||||||||||
Non-compete intangible asset | 166 | 1 | 14 | 166 | — | 124 | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total depreciation and amortization expense | 894 | 488 | 673 | |||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Less: historical depreciation and amortization expense | (475 | ) | (341 | ) | (387 | ) | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Depreciation and amortization expense adjustment | $ | 419 | $ | 147 | $ | 286 | ||||||||||||||||
|
|
|
|
|
|
13
(e) | AmiCare acquisition: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | |||||||||||||||||
Land | $ | 1,381 | N/A | $ | — | $ | — | $ | — | $ | — | |||||||||||
Building and improvements | 16,930 | 25, or lease term | 56 | 677 | 508 | 508 | ||||||||||||||||
Equipment | 1,723 | 3-7 | 29 | 345 | 258 | 258 | ||||||||||||||||
Construction in progress | 889 | N/A | — | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||||
20,923 | 85 | 1,022 | 766 | 766 | ||||||||||||||||||
Indefinite-lived intangible assets | 1,640 | N/A | — | — | — | — | ||||||||||||||||
Non-compete intangible asset | 150 | 3 | 4 | 50 | 37 | 37 | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total depreciation and amortization expense | 1,072 | 803 | 803 | |||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Less: historical depreciation and amortization expense | (925 | ) | (703 | ) | (691 | ) | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Depreciation and amortization expense adjustment | $ | 147 | $ | 100 | $ | 112 | ||||||||||||||||
|
|
|
|
|
|
(f) | BCA acquisition: |
AMOUNT | USEFUL LIVES | MONTHLY DEPRECIATION | TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | |||||||||||||||||
Land | $ | 1,301 | N/A | $ | — | $ | — | $ | — | $ | — | |||||||||||
Building and improvements | 15,073 | 25, or lease term | 50 | 603 | 452 | 452 | ||||||||||||||||
Equipment | 5,057 | 3-7 | 84 | 1,011 | 759 | 759 | ||||||||||||||||
Construction in progress | 2,516 | N/A | — | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||||
23,947 | 134 | 1,614 | 1,211 | 1,211 | ||||||||||||||||||
Indefinite-lived intangible assets | 1,850 | N/A | — | — | — | — | ||||||||||||||||
Non-compete intangible asset | 75 | 1 | 75 | — | 56 | |||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total depreciation and amortization expense | 1,689 | 1,211 | 1,267 | |||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Less: historical depreciation and amortization expense | (955 | ) | (951 | ) | (674 | ) | ||||||||||||||||
|
|
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Depreciation and amortization expense adjustment | $ | 734 | $ | 260 | $ | 593 | ||||||||||||||||
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(21) |
(a) | Represents adjustments to interest expense to give effect to the senior secured credit facility entered into by Acadia on April 1, 2011 (the “Senior Secured Credit Facility”), the issuance of $150,000 of 12.875% Senior Notes (“Senior Notes”) on November 1, 2011, the amendment to the interest rate applicable to the Senior Secured Credit Facility on November 1, 2011, and the amendment to the Senior Secured Credit Facility on March 1, 2012 to issue incremental term loans of $25,000 and increase the revolving line of credit from $30,000 to $75,000 and to the borrowing of $7,000 under the revolving line of credit. Interest expense includes related amortization of $1,000 of deferred financing cost and debt discounts for the year ended December 31, 2011 and $900 for the nine months ended September 30, 2011. The interest expense calculation for the amendment to the Senior Secured Credit Facility on March 1, 2012 assumes the 4.5% rate in effect as of such date was in place throughout the period. |
TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | ||||||||||
Interest related to Senior Secured Credit Facility entered into on April 1, 2011 | $ | 1,992 | $ | — | $ | 1,992 | ||||||
Interest related to Senior Notes issued on November 1, 2011 | 17,100 | — | 15,390 | |||||||||
Interest related to amendment to the Senior Secured Credit Facility on November 1, 2011 | 331 | — | 249 | |||||||||
Interest related to amendment to the Senior Secured Credit Facility on March 1, 2012 | 1,914 | 313 | 1,036 | |||||||||
Less: historical interest expense of Acadia (for the period prior to April 1, 2011), YFCS, PHC, MeadowWood, and Haven as to which the related debt has been repaid | (3,676 | ) | (56 | ) | (3,179 | ) | ||||||
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Interest expense adjustment | $ | 17,661 | $ | 257 | $ | 15,488 | ||||||
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(b) | Represents adjustments to interest expense to give effect to the Incremental Term Loans based on an estimated interest rate of 3.25% and to adjust historical interest expense on the Senior Secured Credit facility entered on April 1, 2011 from the interest rate that was in effect for that period to 3.25%. Interest expense includes related amortization of $650 of deferred financing cost and debt discounts for the year ended December 31, 2011 and $450 for the nine months ended September 30, 2011 and 2012. The interest expense calculation for the Senior Secured Credit Facility assumes the 3.25% rate was in place throughout the period. |
TWELVE MONTHS ENDED DECEMBER 31, 2011 | NINE MONTHS ENDED SEPTEMBER 30, 2012 | NINE MONTHS ENDED SEPTEMBER 30, 2011 | ||||||||||
Interest related to Incremental Term Loans | $ | 5,916 | $ | 4,449 | $ | 4,358 | ||||||
Effect of amendment to lower interest rate on Senior Secured Credit Facility | (1,687 | ) | (1,186 | ) | (1,025 | ) | ||||||
Less: historical interest expense of BCA and AmiCare as to which the related debt will not be assumed | (1,929 | ) | (1,257 | ) | (1,423 | ) | ||||||
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Interest expense adjustment | $ | 2,300 | $ | 2,006 | $ | 1,910 | ||||||
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An increase or decrease of 0.125% in the assumed interest rate would result in a change in interest expense of $395 for the year ended December 31, 2011 and $269 and $304 for the nine month periods ended September 30, 2012 and 2011.
(22) | For Acadia, represents the elimination of advisory fees paid to Waud Capital Partners pursuant to Acadia’s professional services agreement, which was terminated on November 1, 2011 in connection with the PHC acquisition. For BCA, represents management fees paid to its equity sponsor and parent company. For HHC Delaware, represents management fees paid to its parent company. |
(23) | Reflects the removal of acquisition-related expenses included in the historical statements of operations relating to Acadia’s acquisition of YFCS, PHC, the Haven Facilities and other acquisitions and PHC’s acquisition of HHC Delaware and sale to Acadia. |
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(24) | Reflects the elimination of the change in fair value associated with interest rate swap agreements, which were not assumed by Acadia in the acquisition of the Haven Facilities. |
(25) | Reflects a decrease in income taxes of $133 for the three months ended March 31, 2011 to give effect to the election by Acadia Healthcare Company, LLC to be treated as a taxable corporation effective April 1, 2011. |
(26) | Reflects adjustments to income taxes to reflect the impact of the above pro forma adjustments applying combined federal and state statutory tax rates for the respective periods. |
(27) | Represents adjustments to weighted average shares used to compute basic and diluted earnings (loss) per share to reflect the following: |
(a) | The effect of the 4,892,000 shares of common stock of Acadia issued to PHC stockholders on November 1, 2011, which resulted in an increase in weighted average shares outstanding of 4,074,000 shares for the year ended December 31, 2011 and 4,892,000 shares for the nine months ended September 30, 2011. |
(b) | The effect of the 9,583,000 shares of common stock issued by Acadia on December 20, 2011, which resulted in an increase in weighted average shares outstanding of 9,268,000 shares for the year ended December 31, 2011and 9,583,000 shares for the nine months ended September 30, 2011. The proceeds from such offering of common stock were used to partially fund Acadia’s acquisition of the Haven Facilities. |
(c) | The effect of the 9,488,000 shares of common stock issued by Acadia on May 9, 2012, which resulted in an increase in weighted average shares outstanding of 9,488,000 shares for the year ended December 31, 2011, 4,900,000 shares for the nine months ended September 30, 2012 and 9,488,000 shares for the nine months ended September 30, 2011. The proceeds from such offering of common stock were used to partially fund Acadia’s acquisition of the Haven Facilities. |
(d) | The effect of an estimated 6,000,000 shares of common stock to be issued by Acadia in the offering, which resulted in an increase in weighted average shares outstanding of 6,000,000 shares for the year ended December 31, 2011, 6,000,000 shares for the nine months ended September 30, 2012 and 6,000,000 shares for the nine months ended September 30, 2011. The proceeds from such offering of common stock are to be used to partially fund Acadia’s planned acquisition of BCA and AmiCare. |
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