Financial Information for the Company and Its Subsidiaries | 20 . Financial Information for the Company and Its Subsidiaries The Company conducts substantially all of its business through its subsidiaries. The 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior Notes and 6.500% Senior Notes are jointly and severally guaranteed on an unsecured senior basis by all of the Companyās subsidiaries that guarantee the Companyās obligations under the Amended and Restated Senior Credit Facility. Presented below is condensed consolidating financial information for the Company and its subsidiaries at June 30, 2019 and December 31, 2018, and for the three and six months ended June 30, 2019 and 2018. The information segregates the parent company (Acadia Healthcare Company, Inc.), the combined wholly-owned subsidiary guarantors, the combined non-guarantor subsidiaries and eliminations. Acadia Healthcare Company, Inc. Condensed Consolidating Balance Sheets June 30, 2019 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Current assets: Cash and cash equivalents $ ā $ 30,264 $ 13,277 $ ā $ 43,541 Accounts receivable, net ā 278,255 68,234 ā 346,489 Other current assets ā 67,790 13,674 ā 81,464 Total current assets ā 376,309 95,185 ā 471,494 Property and equipment, net ā 1,296,263 1,867,813 ā 3,164,076 Goodwill ā 1,991,905 443,120 ā 2,435,025 Intangible assets, net ā 58,355 31,258 ā 89,613 Deferred tax assets 2,038 ā 3,404 (2,038 ) 3,404 Derivative instrument assets 72,965 ā ā ā 72,965 Investment in subsidiaries 5,374,016 ā ā (5,374,016 ) ā Operating lease right-of-use assets ā 95,880 395,671 ā 491,551 Other assets 252,507 53,419 5,502 (249,138 ) 62,290 Total assets $ 5,701,526 $ 3,872,131 $ 2,841,953 $ (5,625,192 ) $ 6,790,418 Current liabilities: Current portion of long-term debt $ 38,895 $ ā $ ā $ ā $ 38,895 Accounts payable ā 81,388 34,263 ā 115,651 Accrued salaries and benefits ā 80,563 29,882 ā 110,445 Current portion of operating lease liabilities ā 16,862 10,716 ā 27,578 Other accrued liabilities 33,417 21,875 82,827 ā 138,119 Total current liabilities 72,312 200,688 157,688 ā 430,688 Long-term debt 3,206,868 ā 249,138 (249,138 ) 3,206,868 Deferred tax liabilities ā 36,334 48,800 (2,038 ) 83,096 Operating lease liabilities ā 84,286 406,617 ā 490,903 Other liabilities ā 106,832 17,478 ā 124,310 Total liabilities 3,279,180 428,140 879,721 (251,176 ) 4,335,865 Redeemable noncontrolling interests ā ā 32,207 ā 32,207 Total equity 2,422,346 3,443,991 1,930,025 (5,374,016 ) 2,422,346 Total liabilities and equity $ 5,701,526 $ 3,872,131 $ 2,841,953 $ (5,625,192 ) $ 6,790,418 Acadia Healthcare Company, Inc. Condensed Consolidating Balance Sheets December 31, 2018 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Current assets: Cash and cash equivalents $ ā $ 32,471 $ 18,039 $ ā $ 50,510 Accounts receivable, net ā 248,218 69,869 ā 318,087 Other current assets ā 60,160 21,660 ā 81,820 Total current assets ā 340,849 109,568 ā 450,417 Property and equipment, net ā 1,219,803 1,887,963 ā 3,107,766 Goodwill ā 1,936,057 460,355 ā 2,396,412 Intangible assets, net ā 56,611 32,379 ā 88,990 Deferred tax assets ā noncurrent 1,841 ā 3,468 (1,841 ) 3,468 Derivative instruments 60,524 ā ā ā 60,524 Investment in subsidiaries 5,190,771 ā ā (5,190,771 ) ā Other assets 306,495 52,824 9,548 (303,940 ) 64,927 Total assets $ 5,559,631 $ 3,606,144 $ 2,503,281 $ (5,496,552 ) $ 6,172,504 Current liabilities: Current portion of long-term debt $ 34,112 $ ā $ ā $ ā $ 34,112 Accounts payable ā 79,463 38,277 ā 117,740 Accrued salaries and benefits ā 84,150 29,149 ā 113,299 Other accrued liabilities 32,837 42,062 76,327 ā 151,226 Total current liabilities 66,949 205,675 143,753 ā 416,377 Long-term debt 3,159,375 ā 303,940 (303,940 ) 3,159,375 Deferred tax liabilities ā noncurrent ā 31,874 50,339 (1,841 ) 80,372 Other liabilities ā 107,866 46,401 ā 154,267 Total liabilities 3,226,324 345,415 544,433 (305,781 ) 3,810,391 Redeemable noncontrolling interests ā ā 28,806 ā 28,806 Total equity 2,333,307 3,260,729 1,930,042 (5,190,771 ) 2,333,307 Total liabilities and equity $ 5,559,631 $ 3,606,144 $ 2,503,281 $ (5,496,552 ) $ 6,172,504 Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Comprehensive Income (Loss) Three Months Ended June 30, 2019 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Revenue $ ā $ 480,250 $ 309,112 $ ā $ 789,362 Salaries, wages and benefits 4,182 254,656 171,381 ā 430,219 Professional fees ā 26,340 32,089 ā 58,429 Supplies ā 20,078 10,836 ā 30,914 Rents and leases ā 8,716 11,703 ā 20,419 Other operating expenses ā 61,519 33,158 ā 94,677 Depreciation and amortization ā 20,017 21,060 ā 41,077 Interest expense, net 20,138 23,486 4,986 ā 48,610 Transaction-related expenses ā 4,578 634 ā 5,212 Total expenses 24,320 419,390 285,847 ā 729,557 (Loss) income before income taxes (24,320 ) 60,860 23,265 ā 59,805 Equity in earnings of subsidiaries 65,884 ā ā (65,884 ) ā (Benefit from) provision for income taxes (6,637 ) 25,298 (7,057 ) ā 11,604 Net income (loss) 48,201 35,562 30,322 (65,884 ) 48,201 Net income attributable to noncontrolling interests ā ā (61 ) ā (61 ) Net income (loss) attributable to Acadia Healthcare Company, Inc. $ 48,201 $ 35,562 $ 30,261 $ (65,884 ) $ 48,140 Other comprehensive income: Foreign currency translation loss ā ā (50,618 ) ā (50,618 ) Gain on derivative instruments 17,587 ā ā ā 17,587 Other comprehensive income (loss) 17,587 ā (50,618 ) ā (33,031 ) Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc. $ 65,788 $ 35,562 $ (20,357 ) $ (65,884 ) $ 15,109 Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Comprehensive Income (Loss) Three Months Ended June 30, 2018 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Revenue $ ā $ 453,782 $ 311,956 $ ā $ 765,738 Salaries, wages and benefits 7,129 239,999 169,613 ā 416,741 Professional fees ā 24,677 28,784 ā 53,461 Supplies ā 19,292 10,841 ā 30,133 Rents and leases ā 8,311 11,925 ā 20,236 Other operating expenses ā 55,258 32,024 ā 87,282 Depreciation and amortization ā 18,611 21,317 ā 39,928 Interest expense, net 15,465 23,602 6,745 ā 45,812 Transaction-related expenses ā 2,671 216 ā 2,887 Total expenses 22,594 392,421 281,465 ā 696,480 (Loss) income before income taxes (22,594 ) 61,361 30,491 ā 69,258 Equity in earnings of subsidiaries 75,752 ā ā (75,752 ) ā (Benefit from) provision for income taxes (5,732 ) 11,442 4,658 ā 10,368 Net income (loss) 58,890 49,919 25,833 (75,752 ) 58,890 Net loss attributable to noncontrolling interests ā ā (54 ) ā (54 ) Net income (loss) attributable to Acadia Healthcare Company, Inc. $ 58,890 $ 49,919 $ 25,779 $ (75,752 ) $ 58,836 Other comprehensive (loss) income: Foreign currency translation loss ā ā (143,599 ) ā (143,599 ) Gain on derivative instruments 29,107 ā ā ā 29,107 Other comprehensive income (loss) 29,107 ā (143,599 ) ā (114,492 ) Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc. $ 87,997 $ 49,919 $ (117,820 ) $ (75,752 ) $ (55,656 ) Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Comprehensive Income (Loss) Six Months Ended June 30, 2019 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Revenue $ ā $ 940,068 $ 609,911 $ ā $ 1,549,979 Salaries, wages and benefits 10,283 509,598 339,917 ā 859,798 Professional fees ā 51,708 63,728 ā 115,436 Supplies ā 39,462 21,409 ā 60,871 Rents and leases ā 17,119 23,607 ā 40,726 Other operating expenses ā 120,909 67,633 ā 188,542 Depreciation and amortization ā 39,622 42,035 ā 81,657 Interest expense, net 39,716 46,504 10,520 ā 96,740 Transaction-related expenses ā 7,796 1,737 ā 9,533 Total expenses 49,999 832,718 570,586 ā 1,453,303 (Loss) income before income taxes (49,999 ) 107,350 39,325 ā 96,676 Equity in earnings of subsidiaries 114,041 ā ā (114,041 ) ā (Benefit from) provision for income taxes (13,670 ) 42,363 (9,729 ) ā 18,964 Net income (loss) 77,712 64,987 49,054 (114,041 ) 77,712 Net gain attributable to noncontrolling interests ā ā (101 ) ā (101 ) Net income (loss) attributable to Acadia Healthcare Company, Inc. $ 77,712 $ 64,987 $ 48,953 $ (114,041 ) $ 77,611 Other comprehensive (loss) income: Foreign currency translation loss ā ā (6,137 ) ā (6,137 ) Gain on derivative instruments 8,897 ā ā ā 8,897 Other comprehensive income (loss) 8,897 ā (6,137 ) ā 2,760 Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc. $ 86,609 $ 64,987 $ 42,816 $ (114,041 ) $ 80,371 Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Comprehensive Income (Loss) Six Months Ended June 30, 2018 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Revenue $ ā $ 889,407 $ 618,572 $ ā 1,507,979 Salaries, wages and benefits 14,048 479,051 335,170 ā 828,269 Professional fees ā 48,948 58,531 ā 107,479 Supplies ā 38,004 21,493 ā 59,497 Rents and leases ā 16,550 23,974 ā 40,524 Other operating expenses ā 111,428 64,085 ā 175,513 Depreciation and amortization ā 36,783 42,918 ā 79,701 Interest expense, net 30,082 47,186 13,787 ā 91,055 Debt extinguishment costs 940 ā ā ā 940 Transaction-related expenses ā 6,680 975 ā 7,655 Total expenses 45,070 784,630 560,933 ā 1,390,633 (Loss) income before income taxes (45,070 ) 104,777 57,639 ā 117,346 Equity in earnings of subsidiaries 143,350 ā ā (143,350 ) ā (Benefit from) provision for income taxes (11,484 ) 11,319 7,747 ā 7,582 Net income (loss) 109,764 93,458 49,892 (143,350 ) 109,764 Net income attributable to noncontrolling interests ā ā (109 ) ā (109 ) Net income (loss) attributable to Acadia Healthcare Company, Inc. $ 109,764 $ 93,458 $ 49,783 $ (143,350 ) $ 109,655 Other comprehensive (loss) income: Foreign currency translation loss ā ā (50,819 ) ā (50,819 ) Gain on derivative instruments 9,054 ā ā ā 9,054 Other comprehensive income (loss) 9,054 ā (50,819 ) ā (41,765 ) Comprehensive income (loss) attributable to Acadia Healthcare Company, Inc. $ 118,818 $ 93,458 $ (1,036 ) $ (143,350 ) $ 67,890 Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Cash Flows Six Months Ended June 30, 2019 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Operating activities: Net income (loss) $ 77,712 $ 64,987 $ 49,054 $ (114,041 ) $ 77,712 Adjustments to reconcile net income (loss) to net cash (used in) provided by continuing operating activities: Equity in earnings of subsidiaries (114,041 ) ā ā 114,041 ā Depreciation and amortization ā 39,622 42,035 ā 81,657 Amortization of debt issuance costs 5,887 ā ā ā 5,887 Equity-based compensation expense 10,283 ā ā ā 10,283 Deferred income taxes (198 ) (73 ) 66 ā (205 ) Other 2,126 321 (52 ) ā 2,395 Change in operating assets and liabilities: Accounts receivable, net ā (24,767 ) (2,902 ) ā (27,669 ) Other current assets ā (11,029 ) 438 ā (10,591 ) Other assets 3,097 (714 ) 1,375 (3,097 ) 661 Accounts payable and other accrued liabilities ā 942 (12,002 ) ā (11,060 ) Accrued salaries and benefits ā (4,628 ) 1,396 ā (3,232 ) Other liabilities ā 5,558 (2,710 ) ā 2,848 Net cash (used in) provided by operating activities (15,134 ) 70,219 76,698 (3,097 ) 128,686 Investing activities: Cash paid for acquisitions, net of cash acquired ā (44,900 ) ā ā (44,900 ) Cash paid for capital expenditures ā (93,952 ) (45,176 ) ā (139,128 ) Cash paid for real estate acquisitions ā (4,448 ) ā ā (4,448 ) Other ā 6,402 4,092 ā 10,494 Net cash used in investing activities ā (136,898 ) (41,084 ) ā (177,982 ) Financing activities: Borrowings on revolving credit facility 76,573 ā ā ā 76,573 Principal payments on revolving credit facility (11,573 ) ā ā ā (11,573 ) Principal payments on long-term debt (16,492 ) ā (3,097 ) 3,097 (16,492 ) Common stock withheld for minimum statutory taxes, net (1,615 ) ā ā ā (1,615 ) Other (2,375 ) (889 ) (1,081 ) ā (4,345 ) Cash (used in) provided by intercompany activity (29,384 ) 65,361 (35,977 ) ā ā Net provided by (used in) in financing activities 15,134 64,472 (40,155 ) 3,097 42,548 Effect of exchange rate changes on cash ā ā (221 ) ā (221 ) Net decrease in cash and cash equivalents ā (2,207 ) (4,762 ) ā (6,969 ) Cash and cash equivalents at beginning of the period ā 32,471 18,039 ā 50,510 Cash and cash equivalents at end of the period $ ā $ 30,264 $ 13,277 $ ā $ 43,541 Acadia Healthcare Company, Inc. Condensed Consolidating Statement of Cash Flows Six Months Ended June 30, 2018 (In thousands) Parent Combined Subsidiary Guarantors Combined Non- Guarantors Consolidating Adjustments Total Consolidated Amounts Operating activities: Net income (loss) $ 109,764 $ 93,458 $ 49,892 $ (143,350 ) $ 109,764 Adjustments to reconcile net income (loss) to net cash provided by (used in) continuing operating activities: Equity in earnings of subsidiaries (143,350 ) ā ā 143,350 ā Depreciation and amortization ā 36,783 42,918 ā 79,701 Amortization of debt issuance costs 5,326 ā (202 ) ā 5,124 Equity-based compensation expense 14,048 ā ā ā 14,048 Deferred income taxes 1,438 (5,843 ) 427 ā (3,978 ) Debt extinguishment costs 940 ā ā ā 940 Other 240 1,149 (349 ) ā 1,040 Change in operating assets and liabilities: Accounts receivable, net ā (23,064 ) (3,040 ) ā (26,104 ) Other current assets ā 12,197 (2,244 ) ā 9,953 Other assets 4,514 2,689 72 (4,514 ) 2,761 Accounts payable and other accrued liabilities ā 27,859 (6,793 ) ā 21,066 Accrued salaries and benefits ā 4,487 (123 ) ā 4,364 Other liabilities ā 3,002 (3,795 ) ā (793 ) Net cash provided by (used in) continuing operating activities (7,080 ) 152,717 76,763 (4,514 ) 217,886 Net cash used in discontinued operating activities ā (572 ) ā ā (572 ) Net cash provided by (used in) operating activities (7,080 ) 152,145 76,763 (4,514 ) 217,314 Investing activities: Cash paid for capital expenditures ā (97,186 ) (64,369 ) ā (161,555 ) Cash paid for real estate acquisitions ā (8,857 ) ā ā (8,857 ) Other ā (5,759 ) 2,422 ā (3,337 ) Net cash used in investing activities ā (111,802 ) (61,947 ) ā (173,749 ) Financing activities: Principal payments on long-term debt (23,246 ) (169 ) (4,345 ) 4,514 (23,246 ) Common stock withheld for minimum statutory taxes, net (2,134 ) ā ā ā (2,134 ) Other (1,742 ) (1,924 ) (1,506 ) ā (5,172 ) Cash provided by (used in) intercompany activity 34,202 (25,131 ) (9,071 ) ā ā Net (used in) provided by in financing activities 7,080 (27,224 ) (14,922 ) 4,514 (30,552 ) Effect of exchange rate changes on cash ā ā (840 ) ā (840 ) Net increase (decrease) in cash and cash equivalents ā 13,119 (946 ) ā 12,173 Cash and cash equivalents at beginning of the period ā 46,860 20,430 ā 67,290 Cash and cash equivalents at end of the period $ ā $ 59,979 $ 19,484 $ ā $ 79,463 |