Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2017 | Nov. 03, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | Premier, Inc. | |
Entity Central Index Key | 1,577,916 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 57,215,258 | |
Class B Common Stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 82,337,595 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2017 | Jun. 30, 2017 |
Assets | ||
Cash and cash equivalents | $ 132,120 | $ 156,735 |
Accounts receivable (net of $2,007 and $1,812 allowance for doubtful accounts, respectively) | 173,869 | 159,745 |
Inventory | 57,604 | 50,426 |
Prepaid expenses and other current assets | 29,787 | 35,164 |
Due from related parties | 487 | 6,742 |
Total current assets | 393,867 | 408,812 |
Property and equipment (net of $252,840 and $236,460 accumulated depreciation, respectively) | 186,179 | 187,365 |
Intangible assets (net of $113,096 and $99,198 accumulated amortization, respectively) | 364,064 | 377,962 |
Goodwill | 906,545 | 906,545 |
Deferred income tax assets | 506,166 | 482,484 |
Deferred compensation plan assets | 40,906 | 41,518 |
Investments in unconsolidated affiliates | 97,131 | 92,879 |
Other assets | 9,484 | 10,271 |
Total assets | 2,504,342 | 2,507,836 |
Liabilities, redeemable limited partners' capital and stockholders' deficit | ||
Accounts payable | 47,449 | 42,815 |
Accrued expenses | 56,891 | 55,857 |
Revenue share obligations | 69,535 | 72,078 |
Limited partners' distribution payable | 20,752 | 24,951 |
Accrued compensation and benefits | 37,259 | 53,506 |
Deferred revenue | 41,102 | 44,443 |
Current portion of tax receivable agreements | 17,925 | 17,925 |
Current portion of long-term debt | 173,023 | 227,993 |
Other liabilities | 26,198 | 32,019 |
Total current liabilities | 490,134 | 571,587 |
Long-term debt, less current portion | 6,275 | 6,279 |
Tax receivable agreements, less current portion | 362,093 | 321,796 |
Deferred compensation plan obligations | 40,906 | 41,518 |
Deferred tax liabilities | 51,363 | 48,227 |
Other liabilities | 42,599 | 42,099 |
Total liabilities | 993,370 | 1,031,506 |
Redeemable limited partners' capital | 2,799,533 | 3,138,583 |
Stockholders' deficit: | ||
Additional paid-in-capital | 0 | 0 |
Accumulated deficit | (1,289,097) | (1,662,772) |
Accumulated other comprehensive loss | 0 | 0 |
Total stockholders' deficit | (1,288,561) | (1,662,253) |
Total liabilities, redeemable limited partners' capital and stockholders' deficit | 2,504,342 | 2,507,836 |
Class A Common Stock | ||
Stockholders' deficit: | ||
Common stock | 536 | 519 |
Class B Common Stock | ||
Stockholders' deficit: | ||
Common stock | $ 0 | $ 0 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2017 | Jun. 30, 2017 |
Allowance for doubtful accounts | $ 2,007 | $ 1,812 |
Accumulated depreciation | 252,840 | 236,460 |
Accumulated amortization | $ 113,096 | $ 99,198 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 53,558,451 | 51,943,281 |
Common stock, shares outstanding | 53,558,451 | 51,943,281 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.000001 | $ 0.000001 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock, shares issued | 86,067,478 | 87,298,888 |
Common stock, shares outstanding | 86,067,478 | 87,298,888 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Net revenue: | ||
Net administrative fees | $ 150,991 | $ 125,976 |
Other services and support | 86,911 | 81,167 |
Services | 237,902 | 207,143 |
Products | 152,662 | 106,129 |
Net revenue | 390,564 | 313,272 |
Cost of revenue: | ||
Services | 46,936 | 42,690 |
Products | 144,440 | 95,813 |
Cost of revenue | 191,376 | 138,503 |
Gross profit | 199,188 | 174,769 |
Operating expenses: | ||
Selling, general and administrative | 114,321 | 92,238 |
Research and development | 489 | 806 |
Amortization of purchased intangible assets | 13,898 | 9,209 |
Operating expenses | 128,708 | 102,253 |
Operating income | 70,480 | 72,516 |
Equity in net income of unconsolidated affiliates | 4,252 | 9,579 |
Interest and investment loss, net | (1,495) | (152) |
Loss on disposal of long-lived assets | (1,320) | (1,518) |
Other income | 1,463 | 1,006 |
Other income, net | 2,900 | 8,915 |
Income before income taxes | 73,380 | 81,431 |
Income tax expense | 12,764 | 23,336 |
Net income | 60,616 | 58,095 |
Net income attributable to non-controlling interest in Premier LP | (44,610) | (49,601) |
Adjustment of redeemable limited partners' capital to redemption amount | 320,424 | 61,808 |
Net income attributable to stockholders | $ 336,430 | $ 70,302 |
Weighted average shares outstanding: | ||
Basic (in shares) | 52,909 | 47,214 |
Diluted (in shares) | 140,046 | 142,962 |
Earnings per share attributable to stockholders: | ||
Basic (in dollars per share) | $ 6.36 | $ 1.49 |
Diluted (in dollars per share) | $ 0.36 | $ 0.26 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 60,616 | $ 58,095 |
Net unrealized gain on marketable securities | 0 | 128 |
Total comprehensive income | 60,616 | 58,223 |
Less: comprehensive income attributable to non-controlling interest | (44,610) | (49,686) |
Comprehensive income attributable to stockholders | $ 16,006 | $ 8,537 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Stockholders' Deficit (Unaudited) - 3 months ended Sep. 30, 2017 - USD ($) $ in Thousands | Total | Class B Common Stock | Common StockClass A Common Stock | Common StockClass B Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Beginning Balance (in shares) at Jun. 30, 2017 | 51,943,000 | 87,299,000 | ||||
Beginning Balance at Jun. 30, 2017 | $ (1,662,253) | $ 519 | $ 0 | $ 0 | $ (1,662,772) | |
Increase (Decrease) in Stockholders' Equity | ||||||
Class B common units and associated Class B common shares exchanged (in shares) | 1,231,410 | 1,232,000 | (1,232,000) | |||
Exchange of Class B units for Class A common stock by member owners | 42,976 | $ 13 | 42,963 | |||
Decrease in additional paid-in capital related to quarterly exchange by member owners, including associated TRA revaluation | (11,452) | (11,452) | ||||
Issuance of Class A common stock under equity incentive plan (in shares) | 383,000 | |||||
Issuance of Class A common stock under equity incentive plan | 2,652 | $ 4 | 2,648 | |||
Stock-based compensation expense | 8,815 | 8,815 | ||||
Repurchase of vested restricted units for employee tax-withholding | (5,729) | (5,729) | ||||
Net income | 60,616 | 60,616 | ||||
Net income attributable to non-controlling interest in Premier LP | (44,610) | (44,610) | ||||
Adjustment of redeemable limited partners' capital to redemption amount | 320,424 | (37,245) | 357,669 | |||
Ending Balance (in shares) at Sep. 30, 2017 | 53,558,000 | 86,067,000 | ||||
Ending Balance at Sep. 30, 2017 | $ (1,288,561) | $ 536 | $ 0 | $ 0 | $ (1,289,097) |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net income | $ 60,616 | $ 58,095 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 30,405 | 23,227 |
Equity in net income of unconsolidated affiliates | (4,252) | (9,579) |
Deferred income taxes | 8,298 | 17,074 |
Stock-based compensation | 8,815 | 5,800 |
Adjustment to tax receivable agreement liability | 0 | (5,722) |
Loss on disposal of long-lived assets | 1,320 | 1,518 |
Changes in operating assets and liabilities: | ||
Accounts receivable, prepaid expenses and other current assets | (8,748) | (8,119) |
Other assets | 1,379 | (1,112) |
Inventories | (7,178) | (827) |
Accounts payable, accrued expenses and other current liabilities | (21,933) | (38,463) |
Long-term liabilities | (111) | 322 |
Other operating activities | 6,422 | (387) |
Net cash provided by operating activities | 75,033 | 41,827 |
Investing activities | ||
Proceeds from sale of marketable securities | 0 | 48,013 |
Acquisition of Acro Pharmaceuticals, net of cash acquired | 0 | (68,745) |
Investments in unconsolidated affiliates | 0 | (65,660) |
Distributions received on equity investments in unconsolidated affiliates | 0 | 6,550 |
Purchases of property and equipment | (16,647) | (16,966) |
Other investing activities | 1 | 5 |
Net cash used in investing activities | (16,646) | (96,803) |
Financing activities | ||
Payments made on notes payable | (4,974) | (218) |
Payments on credit facility | (50,000) | 0 |
Proceeds from exercise of stock options under equity incentive plan | 2,652 | 2,317 |
Repurchase of vested restricted units for employee tax-withholding | (5,729) | (17,435) |
Distributions to limited partners of Premier LP | (24,951) | (22,493) |
Net cash used in financing activities | (83,002) | (37,829) |
Net decrease in cash and cash equivalents | (24,615) | (92,805) |
Cash and cash equivalents at beginning of year | 156,735 | 248,817 |
Cash and cash equivalents at end of period | 132,120 | 156,012 |
Supplemental schedule of non cash investing and financing activities: | ||
Decrease in redeemable limited partners' capital for adjustment to fair value, with offsetting increases in additional paid-in-capital and accumulated deficit | 320,424 | 61,808 |
Reduction in redeemable limited partners' capital, with offsetting increases in common stock and additional paid-in capital related to quarterly exchanges by member owners | 42,976 | 43,072 |
Reduction in redeemable limited partners' capital for limited partners' distribution payable | 20,752 | 22,137 |
Distributions utilized to reduce subscriptions, notes, interest and accounts receivable from member owners | 492 | 558 |
Net increase in deferred tax assets related to quarterly exchanges by member owners and other adjustments | 28,844 | 16,863 |
Net increase in tax receivable agreement liabilities related to quarterly exchanges by member owners and other adjustments | 40,296 | 10,286 |
Net increase (decrease) in additional paid-in capital related to quarterly exchanges by member owners and other adjustments | $ (11,452) | $ 6,577 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | (1) ORGANIZATION AND BASIS OF PRESENTATION Organization Premier, Inc. ("Premier" or the "Company") is a publicly-held, for-profit Delaware corporation owned by hospitals, health systems and other healthcare organizations (such owners of Premier are referred to herein as "member owners") located in the United States and by public stockholders. The Company, together with its subsidiaries and affiliates, is a leading healthcare performance improvement company that unites hospitals, health systems, physicians and other healthcare providers to improve and innovate in the clinical, financial and operational areas of their businesses to meet the demands of a rapidly evolving healthcare industry. The Company's business model and solutions are designed to provide its members access to scale efficiencies, spread the cost of their development, provide actionable intelligence derived from anonymized data in the Company's data warehouse, mitigate the risk of innovation and disseminate best practices that will help the Company's member organizations succeed in their transformation to higher quality and more cost-effective healthcare. The Company, together with its subsidiaries and affiliates, delivers its integrated platform of solutions through two business segments: Supply Chain Services and Performance Services. See Note 16 - Segments for further information related to the Company's reportable business segments. The Supply Chain Services segment includes one of the largest healthcare group purchasing organization ("GPO") programs in the United States, and integrated pharmacy and direct sourcing activities. The Performance Services segment includes one of the largest informatics and advisory services businesses in the United States focused on healthcare providers. The Company's software as a service ("SaaS") informatics products utilize the Company's comprehensive data set to provide actionable intelligence to its members, enabling them to benchmark, analyze and identify areas of improvement across the three main categories of cost management, quality and safety, and population health management. The Performance Services segment also includes the Company's technology-enabled performance improvement collaboratives, advisory services, government services and insurance management services. The Company, through its wholly-owned subsidiary, Premier Services, LLC ("Premier GP"), held an approximate 38% and 37% general partner interest in our main operating company, Premier Healthcare Alliance, L.P. ("Premier LP"), at September 30, 2017 and June 30, 2017 , respectively. In addition to their ownership interest in Premier, our member owners held an approximate 62% and 63% ownership interest in Premier LP at September 30, 2017 and June 30, 2017 , respectively. Basis of Presentation and Consolidation Basis of Presentation The member owners' interest in Premier LP is reflected as redeemable limited partners' capital in the Company's accompanying Condensed Consolidated Balance Sheets, and the limited partners' proportionate share of income in Premier LP is reflected within net income attributable to non-controlling interest in Premier LP in the Company's accompanying Condensed Consolidated Statements of Income and within comprehensive income attributable to non-controlling interest in Premier LP in the Company's accompanying Condensed Consolidated Statements of Comprehensive Income. At September 30, 2017 and June 30, 2017 , the member owners owned approximately 62% and 63% , respectively, of the Company's combined Class A and Class B common stock through their ownership of Class B common stock. During the three months ended September 30, 2017 , the member owners exchanged 1.2 million Class B common units and associated Class B common shares for an equal number of Class A common shares pursuant to an exchange agreement (the "Exchange Agreement") entered into by the member owners in connection with the completion of our initial public offering on October 1, 2013. The Exchange Agreement provides each member owner the cumulative right to exchange up to one-seventh of its initial allocation of Class B common units, as well as any additional Class B common units purchased by such member owner pursuant to certain rights of first refusal, for shares of Class A common stock (on a one-for-one basis subject to customary adjustments for subdivisions or combinations by split, reverse split, distribution, reclassification, recapitalization or otherwise), cash or a combination of both, the form of consideration to be at the discretion of the Company's independent Audit and Compliance Committee of the Board of Directors (the "Audit and Compliance Committee"). In connection with Class B common units exchanged for Class A common shares during the three months ended September 30, 2017 , approximately 1.2 million Class B common units were contributed to Premier LP and converted to Class A common units, which remain outstanding. Refer to the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2017 (the " 2017 Annual Report") filed with the Securities and Exchange Commission ("SEC") on August 23, 2017 for further discussion of the Exchange Agreement. At September 30, 2017 and June 30, 2017 , the public investors, which may include member owners that have received shares of Class A common stock in connection with previous exchanges of their Class B common units and associated Class B common shares for an equal number of Class A common shares, owned approximately 38% and 37% , respectively, of the Company's outstanding common stock through their ownership of Class A common stock. Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and pursuant to the rules and regulations of the SEC. Accordingly, certain information and disclosures normally included in annual financial statements have been condensed or omitted. The accompanying condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary for a fair presentation of results of operations and financial condition for the interim periods shown, including normal recurring adjustments. The Company believes that the disclosures are adequate to make the information presented not misleading and should be read in conjunction with the audited consolidated financial statements and related footnotes contained in the 2017 Annual Report. Variable Interest Entities Premier LP is a variable interest entity ("VIE") as the limited partners do not have the ability to exercise a substantive removal right with respect to the general partner. The Company does not hold a majority interest but, through Premier GP, has the exclusive power and authority to manage the business and affairs of Premier LP, to make all decisions with respect to driving the economic performance of Premier LP, and has both an obligation to absorb losses and a right to receive benefits. As such, the Company is the primary beneficiary of the VIE and consolidates the operations of Premier LP under the Variable Interest Model. The assets and liabilities of Premier LP at September 30, 2017 and June 30, 2017 consisted of the following (in thousands): September 30, 2017 June 30, 2017 Assets Current $ 361,578 $ 385,477 Noncurrent 1,604,275 1,616,539 Total assets of Premier LP $ 1,965,853 $ 2,002,016 Liabilities Current $ 479,916 $ 560,582 Noncurrent 137,119 134,635 Total liabilities of Premier LP $ 617,035 $ 695,217 Net income attributable to Premier LP during the three months ended September 30, 2017 and 2016 was as follows (in thousands): Three Months Ended September 30, 2017 2016 Premier LP net income $ 72,291 $ 73,915 Premier LP's cash flows for the three months ended September 30, 2017 and 2016 consisted of the following (in thousands): Three Months Ended September 30, 2017 2016 Net cash provided by (used in): Operating activities $ 88,407 $ 12,865 Investing activities (16,613 ) (96,805 ) Financing activities (100,476 ) (22,168 ) Net decrease in cash and cash equivalents (28,682 ) (106,108 ) Cash and cash equivalents at beginning of year 133,451 210,048 Cash and cash equivalents at end of period $ 104,769 $ 103,940 Use of Estimates in the Preparation of Financial Statements The preparation of the Company's condensed consolidated financial statements in accordance with GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Significant estimates are evaluated on an ongoing basis, including estimates for allowances for doubtful accounts, useful lives of property and equipment, stock-based compensation, payables under tax receivable agreements ("TRAs"), values of investments not publicly traded, the valuation allowance on deferred tax assets, uncertain income taxes, deferred revenue, future cash flows associated with asset impairments, values of put and call rights, values of earn-out liabilities and the allocation of purchase prices. These estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | (2) SIGNIFICANT ACCOUNTING POLICIES There have been no material changes to the Company's significant accounting policies as described in the 2017 Annual Report. Recently Adopted Accounting Standards In July 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory , which requires entities to measure most inventory "at the lower of cost and net realizable value," thereby simplifying the guidance under which an entity must measure inventory at the lower of cost or market. This guidance does not apply to inventories that are measured by using either the last-in, first-out method or the retail inventory method. The Company adopted this standard effective July 1, 2017 using the prospective approach. The implementation of this ASU did not have a material effect on the Company's condensed consolidated financial statements. Recently Issued Accounting Standards Not Yet Adopted In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The new guidance will reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective prospectively for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which eliminates Step 2 from the goodwill impairment test. The guidance requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. In addition, the guidance eliminates the requirement for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. The standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2020. Early adoption is permitted for interim and annual goodwill impairment tests performed after January 1, 2017. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory , which removes the prohibition in ASC 740 against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. The guidance is intended to reduce the complexity of GAAP and diversity in practice related to the tax consequences of certain types of intra-entity asset transfers, particularly those involving intellectual property. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The ASU amendments add or clarify guidance on eight cash flow issues. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which is intended to increase transparency and comparability among organizations of accounting for leasing arrangements. This guidance establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Entities will be required to recognize and measure leases as of the earliest period presented using a modified retrospective approach. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2019. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which is intended to provide users of financial statements with more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted for certain amendments. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which will supersede nearly all existing revenue recognition guidance. The new standard requires revenue to be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new standard allows for either full retrospective or modified retrospective adoption. The FASB subsequently issued an amendment in ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date , in August 2015 to defer the effective date of the new standard for all entities by one year. The new standard, as amended, will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption as of the original effective date for public entities will be permitted. The FASB issued another amendment in ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations , in March 2016 related to a third party providing goods or services to a customer. When another party is involved in providing goods or services to a customer, an entity is required to determine whether the nature of its promise is to provide the specified good or service itself or to arrange for the good or service to be provided by a third party. If the entity provides the specific good or service itself, the entity acts as a principal. If an entity arranges for the good or service to be provided by a third party, the entity acts as an agent. The standard requires the principal to recognize revenue for the gross amount and the agent to recognize revenue for the amount of any fee or commission for which it expects to be entitled in exchange for arranging for the specified good or service to be provided. The new standard will be effective with ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing , which amends specific aspects of ASU 2014-09, including how to identify performance obligations and guidance related to licensing implementation. This amendment provides guidance on determining whether an entity's promise to grant a license provides a customer with either a right to use the entity's intellectual property or a right to access the entity's intellectual property. The amendment will be effective with ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients , which clarifies specific aspects of ASU 2014-09, clarifying how to identify performance obligations and guidance related to its promise in granting a license of intellectual property. This new standard provides guidance to allow entities to disregard items that are immaterial in the context of the contract, clarify when a promised good or service is separately identifiable and allow an entity to elect to account for the cost of shipping and handling performed after control of a good has been transferred to the customer as a fulfillment cost. The new standard also clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property to help determine whether it recognizes revenue over time or at a point in time and addresses how entities should consider license renewals and restrictions. The new standard will be effective with ASU 2014-09. In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606: Revenue from Contracts with Customers , which clarifies specific aspects of ASU 2014-09, including allowing entities not to make quantitative disclosures about remaining performance obligations in certain cases and requiring entities that use any of the new or previously existing optional exemptions to expand their qualitative disclosures. The new standard also makes twelve other technical corrections and modifications to ASU 2014-09. The new standard will be effective with ASU 2014-09. The new revenue recognition standards related to Topic 606 discussed above, as amended, will be effective for the Company for the fiscal year beginning July 1, 2018, at which time we plan to adopt the standard using the modified retrospective approach. To-date, the Company has identified the following preliminary impacts of adopting the new standards on various revenue streams across its operating segments. Within the Supply Chain Services segment, the Company is continuing to assess the impacts of adopting the new standards on its various revenue streams. Under the new standard, the Company expects to recognize administrative fee revenue upon the occurrence of a sale by suppliers to the Company’s members. This differs from the current treatment in which the Company recognizes revenue in the period that the respective supplier reports member purchasing data, which is usually a month or a quarter in arrears of the actual member purchase activity. This change is expected to result in the Company recognizing revenue sooner in the revenue cycle than under the Company's current revenue recognition policy and the creation of a contract asset associated with this shift in revenue recognition timing. The Company is continuing to assess the impact of these changes on the financial statements and disclosures. Within the Performance Services segment, the Company is continuing to assess the impacts of adopting the new standards on its various revenue streams. Under the new standard, the Company will be required to capitalize the incremental costs of obtaining a contract, which the Company has preliminarily identified as sales commissions and costs associated with implementing our SaaS informatics tools, and to amortize these costs in a manner that reflects the transfer of services to the customer. These costs are expensed as incurred under the Company's current revenue recognition policy. The Company is continuing to assess the impact of these changes on the financial statements and disclosures. Additionally, the Company is evaluating the potential impacts on its business processes, systems and controls necessary to support revenue recognition and disclosure requirements under the new standard. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 3 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | (3) BUSINESS ACQUISITIONS Acquisition of Innovatix and Essensa Innovatix, LLC ("Innovatix") and Essensa Ventures, LLC ("Essensa") are GPOs focused on serving alternate site healthcare providers and other organizations throughout the United States. Prior to December 2, 2016 , the Company, through its consolidated subsidiary, Premier Supply Chain Improvement ("PSCI"), held 50% of the membership interests in Innovatix (see Note 4 - Investments ). On December 2, 2016 , the Company, through PSCI, acquired from GNYHA Holdings, LLC ("GNYHA Holdings") (see Note 14 - Related Party Transactions ) the remaining 50% ownership interest of Innovatix and 100% of the ownership interest in Essensa for $325.0 million , of which $227.5 million in cash was paid at closing and $97.5 million in cash was paid on January 10, 2017 . As a result of certain purchase price adjustments provided for in the purchase agreement, the adjusted purchase price was $336.0 million . In connection with the acquisition, the Company utilized its credit facility dated June 24, 2014, as amended on June 4, 2015 (the "Credit Facility") to fund the $325.0 million purchase price (see Note 8 - Debt), the outstanding portion of which is reflected within current portion of long-term debt in the Condensed Consolidated Balance Sheet at September 30, 2017 . The Company incurred $1.7 million and $0.4 million of transaction costs related to this acquisition during the three months ended September 30, 2017 and 2016 , respectively. These transaction costs were included in selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Income. The Company has accounted for the Innovatix and Essensa acquisition as a business combination whereby the purchase price was allocated to tangible and intangible assets acquired (see Note 6 - Intangible Assets, Net ) and liabilities assumed based on their preliminary fair values. The purchase price allocation for the Innovatix and Essensa acquisition is preliminary and subject to changes in the fair value of working capital and valuation of the assets acquired and the liabilities assumed. The acquisition resulted in the recognition of approximately $334.7 million of goodwill (see Note 7 - Goodwill ) attributable to the anticipated profitability of Innovatix and Essensa. The acquisition was considered an asset acquisition for tax purposes, and accordingly, the Company expects the goodwill to be deductible for tax purposes. The preliminary fair values assigned to the net assets acquired and the liabilities assumed as of the acquisition date were as follows (in thousands): Acquisition Date Fair Value Cash paid at closing $ 227,500 Cash paid on January 10, 2017 97,500 Purchase price 325,000 Additional cash paid at closing 10,984 Adjusted purchase price 335,984 Earn-out liability 16,662 Receivable from GNYHA Holdings, LLC (3,000 ) Total consideration paid 349,646 Cash acquired (16,267 ) Net consideration 333,379 50% ownership interest in Innovatix 218,356 Payable to Innovatix and Essensa (5,765 ) Enterprise value 545,970 Accounts receivable 21,242 Prepaid expenses and other current assets 686 Fixed assets, net 3,476 Intangible assets 241,494 Total assets acquired 266,898 Accrued expenses 5,264 Revenue share obligations 7,011 Other current liabilities 694 Total liabilities assumed 12,969 Deferred tax liability 42,636 Goodwill $ 334,677 The acquisition provides the sellers an earn-out opportunity of up to $43.0 million based on Innovatix's and Essensa's Adjusted EBITDA (as defined in the purchase agreement) for the fiscal year ending June 30, 2017 , which is still in the process of being finalized. As of September 30, 2017 , the fair value of the earn-out liability was $21.1 million (see Note 5 - Fair Value Measurements ). Certain executive officers of Innovatix and Essensa executed employment agreements that became effective upon the closing of the acquisition. The purchase agreement provides that in the event that Innovatix's and Essensa's Adjusted EBITDA exceeds agreed upon amounts, certain of those executive officers are entitled to receive a retention bonus payment of up to $3.0 million in the aggregate, for which the Company will be reimbursed by GNYHA Holdings, LLC. The Company's 50% ownership interest in Innovatix prior to the acquisition was accounted for under the equity method and had a carrying value of $13.3 million (see Note 4 - Investments ). In connection with the acquisition, the Company's investment was remeasured under business combination accounting rules to a fair value of $218.4 million , resulting in a one-time gain of $205.1 million which was recorded as other income as of the transaction closing date. Pro forma results of operations for the acquisition have not been presented because the effects on revenue and net income were not material to our historic consolidated financial statements. The Company reports Innovatix and Essensa as part of its Supply Chain Services segment. Acquisition of Acro Pharmaceuticals Acro Pharmaceutical Services LLC ("Acro") and Community Pharmacy Services, LLC (collectively with Acro, "Acro Pharmaceuticals") are specialty pharmacy businesses that provide customized healthcare management solutions to members. On August 23, 2016, the Company, through its consolidated subsidiary, NS3 Health, LLC, acquired 100% of the membership interests of Acro Pharmaceuticals for $75.0 million in cash. As a result of certain purchase price adjustments provided for in the purchase agreement, the adjusted purchase price was $62.9 million . The acquisition was funded with available cash on hand. The Company has accounted for the Acro Pharmaceuticals acquisition as a business combination whereby the purchase price was allocated to tangible and intangible assets acquired and liabilities assumed based on their fair values. The Acro Pharmaceuticals acquisition resulted in the recognition of approximately $33.9 million of goodwill (see Note 7 - Goodwill ) attributable to the anticipated profitability of Acro Pharmaceuticals. The Acro Pharmaceuticals acquisition was considered an asset acquisition for tax purposes and accordingly, the Company expects the goodwill to be deductible for tax purposes. Pro forma results of operations for the acquisition have not been presented because the effects on revenue and net income were not material to our historic consolidated financial statements. The Company reports Acro Pharmaceuticals as part of its Supply Chain Services segment. |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Sep. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENTS | (4) INVESTMENTS Investments in Unconsolidated Affiliates The Company's investments in unconsolidated affiliates consisted of the following (in thousands): Carrying Value Equity in Net Income (Loss) Three Months Ended September 30, September 30, 2017 June 30, 2017 2017 2016 FFF $ 89,857 $ 85,520 $ 4,337 $ 3,059 Bloodbuy 2,033 2,066 (33 ) (19 ) PharmaPoint 4,180 4,232 (52 ) (77 ) Innovatix — — — 6,616 Other investments 1,061 1,061 — — Total investments $ 97,131 $ 92,879 $ 4,252 $ 9,579 On July 26, 2016, the Company, through its consolidated subsidiary, PSCI, acquired 49% of the issued and outstanding stock of FFF Enterprises, Inc. ("FFF") for $65.7 million in cash plus consideration in the form of the FFF put and call rights. The Company recorded the initial investment in FFF in the accompanying Condensed Consolidated Balance Sheets at $81.1 million , of which $65.7 million was in cash and $15.4 million was consideration in the form of the net fair value of the FFF put and call rights (see Note 5 - Fair Value Measurements for additional information related to the fair values of the FFF put and call rights). The Company accounts for its investment in FFF using the equity method of accounting and includes the investment as part of the Supply Chain Services segment. The Company, through its consolidated subsidiary, PSCI, held a 15% ownership interest in BloodSolutions, LLC ("Bloodbuy") through its 5.3 million units of Class B Membership Interests at September 30, 2017 and June 30, 2017 . The Company accounts for its investment in Bloodbuy using the equity method of accounting as the Company has rights to appoint a Board member, and includes the investment as part of the Supply Chain Services segment. The Company, through its consolidated subsidiary, PSCI, held a 28% ownership interest in PharmaPoint, LLC ("PharmaPoint") through its 5.0 million units of Class B Membership Interests at September 30, 2017 and June 30, 2017 . The Company accounts for its investment in PharmaPoint using the equity method of accounting and includes the investment as part of the Supply Chain Services segment. The Company, through its consolidated subsidiary, PSCI, held 50% of the membership interests in Innovatix until December 2, 2016, at which time it acquired the remaining 50% membership interests (see Note 3 - Business Acquisitions and Note 14 - Related Party Transactions ). Prior to the acquisition, the Company accounted for its investment in Innovatix using the equity method of accounting and included the investment as part of the Supply Chain Services segment. Marketable Securities The Company has historically invested its excess cash in commercial paper, U.S. government debt securities, corporate debt securities and other securities with maturities generally ranging from three months to five years from the date of purchase. The Company uses the specific-identification method to determine the cost of securities sold. At September 30, 2017 and June 30, 2017 , the Company had no marketable securities other than those included in deferred compensation plan assets (see Note 5 - Fair Value Measurements ). |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | (5) FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements The following table provides a summary of the Company's financial assets and liabilities which are measured at fair value on a recurring basis (in thousands): Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) September 30, 2017 Cash equivalents $ 9,322 $ 9,322 $ — $ — FFF call right 4,593 — — 4,593 Deferred compensation plan assets 44,567 44,567 — — Total assets $ 58,482 $ 53,889 $ — $ 4,593 Earn-out liabilities $ 21,675 $ — $ — $ 21,675 FFF put right 24,008 — — 24,008 Total liabilities $ 45,683 $ — $ — $ 45,683 June 30, 2017 Cash equivalents $ 22,218 $ 22,218 $ — $ — FFF call right 4,655 — — 4,655 Deferred compensation plan assets 47,202 47,202 — — Total assets $ 74,075 $ 69,420 $ — $ 4,655 Earn-out liabilities $ 21,310 $ — $ — $ 21,310 FFF put right 24,050 — — 24,050 Total liabilities $ 45,360 $ — $ — $ 45,360 Cash equivalents were included in cash and cash equivalents in the accompanying Condensed Consolidated Balance Sheets (see Note 4 - Investments ). Deferred compensation plan assets consisted of highly liquid mutual fund investments, which were classified as Level 1. The current portion of deferred compensation plan assets was included in prepaid expenses and other current assets ( $3.7 million and $5.7 million at September 30, 2017 and June 30, 2017 , respectively) in the accompanying Condensed Consolidated Balance Sheets. Financial Instruments Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) Earn-out liabilities Earn-out liabilities were incurred in connection with acquisitions of Healthcare Insights, LLC (acquired on July 31, 2015), Inflow Health, LLC (acquired on October 1, 2015) and Innovatix and Essensa (acquired on December 2, 2016) (see Note 3 - Business Acquisitions ). At September 30, 2017 and June 30, 2017 , the earn-out liabilities were classified within Level 3 of the fair value hierarchy. The fair values of the earn-out liabilities were determined based on estimated future earnings and the probability of achieving them. The current portion of the earn-out liabilities was $21.1 million at both September 30, 2017 and June 30, 2017 , and was included in other liabilities, current in the accompanying Condensed Consolidated Balance Sheets. The long-term portion of the earn-out liabilities was $0.6 million and $0.2 million at September 30, 2017 and June 30, 2017 , respectively, and was included in other liabilities, non-current in the accompanying Condensed Consolidated Balance Sheets. Changes in the fair values of the earn-out liabilities were recorded within selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Income. FFF put and call rights Pursuant to a shareholders' agreement entered into in connection with the Company's equity investment in FFF (see Note 4 - Investments ), the majority shareholder of FFF obtained a put right ("FFF put right") that provides such shareholder the right to sell all or any portion of its interest in FFF to the Company, which is exercisable beginning on the fourth anniversary of the investment closing date, July 26, 2020, at a per share price equal to FFF's earnings before interest, taxes, depreciation and amortization ("EBITDA") over the twelve calendar months prior to the purchase date multiplied by a market adjusted multiple, adjusted for any outstanding debt and cash and cash equivalents ("Equity Value per Share"). In addition, the shareholders' agreement provided the Company with a call right ("FFF call right") to purchase the remaining interest in FFF from the majority shareholder, which is exercisable at any time within 180 calendar days after the date of a Key Man Event (generally defined in the shareholders' agreement as the resignation, termination for cause, death or disability of the majority shareholder). In the event that the FFF put or call rights are exercised, the purchase price for the additional interest in FFF will be at a per share price equal to the Equity Value per Share. The fair value of the FFF put and call rights were determined based on the Equity Value per Share calculation using unobservable inputs, which included the estimated FFF put and call rights' expiration dates, the forecast of FFF's EBITDA over the option period, forecasted movements in the overall market and the likelihood of a Key Man Event. Significant changes to the Equity Value per Share resulting from changes in the unobservable inputs could have a significant impact on the fair values of the FFF put and call rights. The Company recorded the FFF put and call rights within long-term other liabilities and long-term other assets, respectively, within the accompanying Condensed Consolidated Balance Sheets. Net changes in the fair value of the FFF put and call rights were recorded within other income in the accompanying Condensed Consolidated Statements of Income. A reconciliation of the Company's earn-out liabilities and FFF put and call rights is as follows (in thousands): Beginning Balance Purchases Gain (Loss) Ending Balance Three Months Ended September 30, 2017 FFF call right $ 4,655 $ — $ (62 ) $ 4,593 Total Level 3 assets $ 4,655 $ — $ (62 ) $ 4,593 Earn-out liabilities $ 21,310 $ — $ (365 ) $ 21,675 FFF put right 24,050 — 42 24,008 Total Level 3 liabilities $ 45,360 $ — $ (323 ) $ 45,683 Three Months Ended September 30, 2016 FFF call right $ — $ 10,361 $ (45 ) $ 10,316 Total Level 3 assets $ — $ 10,361 $ (45 ) $ 10,316 Earn-out liabilities $ 4,128 $ — $ 1,769 $ 2,359 FFF put right — 25,821 10 25,811 Total Level 3 liabilities $ 4,128 $ 25,821 $ 1,779 $ 28,170 Non-Recurring Fair Value Measurements During the three months ended September 30, 2017 , no non-recurring fair value measurements were required related to the measurement of goodwill and intangible assets for impairment. Financial Instruments For Which Fair Value Only is Disclosed The fair values of non-interest bearing notes payable, classified as Level 2, were less than their carrying values by approximately $0.5 million and $0.6 million at September 30, 2017 and June 30, 2017 , respectively, based on assumed market interest rates of 2.6% for both September 30, 2017 and June 30, 2017 . Other Financial Instruments The fair values of cash, accounts receivable, accounts payable, accrued liabilities and the Company's Credit Facility approximated carrying value due to the short-term nature of these financial instruments. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | (6) INTANGIBLE ASSETS, NET Intangible assets, net consisted of the following (in thousands): Useful Life September 30, 2017 June 30, 2017 Member relationships 14.7 years $ 220,100 $ 220,100 Technology 5.0 years 143,727 143,727 Customer relationships 8.3 years 48,120 48,120 Trade names 8.3 years 22,710 22,710 Distribution network 10.0 years 22,400 22,400 Favorable lease commitments 10.1 years 11,393 11,393 Non-compete agreements 5.9 years 8,710 8,710 Total intangible assets 477,160 477,160 Accumulated amortization (113,096 ) (99,198 ) Intangible assets, net $ 364,064 $ 377,962 Intangible asset amortization totaled $13.9 million and $9.2 million for the three months ended September 30, 2017 and 2016 , respectively. |
GOODWILL
GOODWILL | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | (7) GOODWILL Goodwill consisted of the following (in thousands): September 30, 2017 June 30, 2017 Supply Chain Services $ 400,348 $ 400,348 Performance Services 506,197 506,197 Total goodwill $ 906,545 $ 906,545 |
DEBT
DEBT | 3 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | (8) DEBT Long-term debt consisted of the following (in thousands): Commitment Amount Due Date September 30, 2017 June 30, 2017 Credit Facility $ 750,000 June 24, 2019 $ 170,000 $ 220,000 Notes payable — Various 9,298 14,272 Total debt 179,298 234,272 Less: Current portion (173,023 ) (227,993 ) Total long-term debt $ 6,275 $ 6,279 Credit Facility Premier LP, along with its consolidated subsidiaries, PSCI and PHSI, as Co-Borrowers, Premier GP and certain domestic subsidiaries of Premier GP, as guarantors, entered into an unsecured Credit Facility, dated as of June 24, 2014 and amended on June 4, 2015. The Credit Facility has a maturity date of June 24, 2019. The Credit Facility provides for borrowings of up to $750.0 million with (i) a $25.0 million sub-facility for standby letters of credit and (ii) a $75.0 million sub-facility for swingline loans. The Credit Facility may be increased from time to time at the Company's request up to an aggregate additional amount of $250.0 million , subject to lender approval. The Credit Facility includes an unconditional and irrevocable guaranty of all obligations under the Credit Facility by Premier GP, certain domestic subsidiaries of Premier GP and future guarantors, if any. Premier, Inc. is not a guarantor under the Credit Facility. At the Company's option, committed loans may be in the form of eurodollar rate loans ("Eurodollar Loans") or base rate loans ("Base Rate Loans"). Eurodollar Loans bear interest at the eurodollar rate (defined as the London Interbank Offered Rate, or LIBOR, plus the Applicable Rate (defined as a margin based on the Consolidated Total Leverage Ratio (as defined in the Credit Facility))). Base Rate Loans bear interest at the Base Rate (defined as the highest of the prime rate announced by the administrative agent, the federal funds effective rate plus 0.50% or the one-month LIBOR plus 1.0% ) plus the Applicable Rate. The Applicable Rate ranges from 1.125% to 1.750% for Eurodollar Loans and 0.125% to 0.750% for Base Rate Loans. At September 30, 2017 , the interest rate for three-month Eurodollar Loans was 2.459% and the interest rate for Base Rate Loans was 4.375% . The Co-Borrowers are required to pay a commitment fee ranging from 0.125% to 0.250% per annum on the actual daily unused amount of commitments under the Credit Facility. At September 30, 2017 , the commitment fee was 0.125% . The Credit Facility contains customary representations and warranties as well as customary affirmative and negative covenants, including, among others, limitations on liens, indebtedness, fundamental changes, dispositions, restricted payments and investments, of which certain covenant calculations use EBITDA, a Non-GAAP financial measure. Under the terms of the Credit Facility, Premier GP is not permitted to allow its consolidated total leverage ratio (as defined in the Credit Facility) to exceed 3.00 to 1.00 for any period of four consecutive quarters. In addition, Premier GP must maintain a minimum consolidated interest coverage ratio (as defined in the Credit Facility) of 3.00 to 1.00 at the end of every fiscal quarter. Premier GP was in compliance with all such covenants at September 30, 2017 . The Credit Facility also contains customary events of default including, among others, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults of any indebtedness or guarantees in excess of $30.0 million , bankruptcy and other insolvency events, judgment defaults in excess of $30.0 million , and the occurrence of a change of control (as defined in the Credit Facility). If any event of default occurs and is continuing, the administrative agent under the Credit Facility may, with the consent, or shall, at the request of the required lenders, terminate the commitments and declare all of the amounts owed under the Credit Facility to be immediately due and payable. The Company may prepay amounts outstanding under the Credit Facility without premium or penalty provided that Co-Borrowers compensate the lenders for losses and expenses incurred as a result of the prepayment of any Eurodollar Loan, as defined in the Credit Facility. Proceeds from borrowings under the Credit Facility may generally be used to finance ongoing working capital requirements, including permitted acquisitions, discretionary cash settlements of Class B unit exchanges under the Exchange Agreement, repurchases of Class A common stock pursuant to a stock repurchase program, and other general corporate activities. During the three months ended September 30, 2017 , the Company repaid $50.0 million of borrowings under the Credit Facility. The Company had outstanding borrowings under the Credit Facility of $170.0 million at September 30, 2017 . Borrowings due within one year of the balance sheet date are classified as current liabilities in the Condensed Consolidated Balance Sheets. They may be renewed or extended at the option of the Company through the maturity date of the Credit Facility. Notes Payable At September 30, 2017 and June 30, 2017 , the Company had $9.3 million and $14.3 million , respectively, in notes payable consisting primarily of non-interest bearing notes payable outstanding to departed member owners, of which $3.0 million and $8.0 million , respectively, were included in current portion of long-term debt and $6.3 million and $6.3 million , respectively, were included in long-term debt, less current portion, in the accompanying Condensed Consolidated Balance Sheets. Notes payable generally have stated maturities of five years from their date of issuance. |
REDEEMABLE LIMITED PARTNERS' CA
REDEEMABLE LIMITED PARTNERS' CAPITAL | 3 Months Ended |
Sep. 30, 2017 | |
Temporary Equity Disclosure [Abstract] | |
REDEEMABLE LIMITED PARTNERS' CAPITAL | (9) REDEEMABLE LIMITED PARTNERS' CAPITAL Redeemable limited partners' capital represents the member owners' 62% ownership of Premier LP through their ownership of Class B common units at September 30, 2017 . The member owners hold the majority of the votes of the Board of Directors and any redemption or transfer or choice of consideration cannot be assumed to be within the control of the Company. Therefore, redeemable limited partners' capital is recorded at the greater of the book value or redemption amount per the Amended and Restated Limited Partnership Agreement of Premier LP (as amended, the "LP Agreement"), and is calculated as the fair value of all Class B common units as if immediately exchangeable into Class A common shares. For the three months ended September 30, 2017 and 2016 , the Company recorded decreases to fair value for the redemption amount to redeemable limited partners' capital of $320.4 million and $61.8 million , respectively. Redeemable limited partners' capital is classified as temporary equity in the mezzanine section of the accompanying Condensed Consolidated Balance Sheets as, pursuant to the LP Agreement, withdrawal is at the option of each member owner and the conditions of the repurchase are not solely within the Company's control. The table below provides a summary of the changes in the redeemable limited partners' capital from June 30, 2017 to September 30, 2017 (in thousands): Receivables From Limited Partners Redeemable Limited Partners' Capital Total Redeemable Limited Partners' Capital June 30, 2017 $ (4,177 ) $ 3,142,760 $ 3,138,583 Distributions applied to receivables from limited partners 492 — 492 Net income attributable to non-controlling interest in Premier LP — 44,610 44,610 Distributions to limited partners — (20,752 ) (20,752 ) Exchange of Class B common units for Class A common stock by member owners — (42,976 ) (42,976 ) Adjustment to redemption amount — (320,424 ) (320,424 ) September 30, 2017 $ (3,685 ) $ 2,803,218 $ 2,799,533 Receivables from limited partners represent amounts due from limited partners for their required capital in Premier LP. These receivables are either interest bearing notes that were issued to new limited partners or non-interest bearing loans (contribution loans) provided to existing limited partners. These receivables are reflected as a reduction to redeemable limited partners' capital so that amounts due from limited partners for capital are not reflected as redeemable limited partnership capital until paid. No interest bearing notes receivable were executed by limited partners of Premier LP during the three months ended September 30, 2017 . During the three months ended September 30, 2017 , no limited partners withdrew from Premier LP. The limited partnership agreement provides for the redemption of former limited partners' Class B common units that are not eligible for exchange in the form of a five -year, unsecured, non-interest bearing term promissory note, a cash payment equal to the present value of the redemption amount, or other mutually agreed upon terms. Partnership interest obligations to former limited partners are reflected in notes payable in the accompanying Condensed Consolidated Balance Sheets. Under the Exchange Agreement, Class B common units that are eligible for exchange by withdrawing limited partners must be exchanged in the subsequent exchange process. Premier LP's distribution policy requires cash distributions as long as taxable income is generated and cash is available to distribute, on a quarterly basis prior to the 60 th day after the end of each calendar quarter. The Company makes quarterly distributions to its limited partners in the form of a legal partnership income distribution governed by the terms of the LP Agreement. These partner distributions are based on the limited partner's ownership in Premier LP and relative participation across Premier service offerings. While these distributions are based on relative participation across Premier service offerings, they are not based directly on revenue generated from an individual partner's participation as the distributions are based on the net income (loss) of the partnership which encompasses the operating expenses of the partnership as well as participation by non-owner members in Premier's service offerings. To the extent Premier LP incurred a net loss, the limited partners would not receive a quarterly distribution. As provided in the LP Agreement, the amount of actual cash distributed may be reduced by the amount of such distributions used by limited partners to offset contribution loans or other amounts payable to the Company. Quarterly distributions made to limited partners during the current fiscal year are as follows (in thousands): Date Distribution (a) August 24, 2017 $ 24,951 (a) Distributions are equal to Premier LP’s total taxable income from the preceding fiscal quarter-to-date period for each respective distribution date multiplied by the Company's standalone effective combined federal, state and local income tax rate. Premier LP expects to make a $20.8 million quarterly distribution on or before November 22, 2017. The distribution is reflected in limited partners' distribution payable in the accompanying Condensed Consolidated Balance Sheets at September 30, 2017. Pursuant to the Exchange Agreement (see Note 1 - Organization and Basis of Presentation for more information), each limited partner has the cumulative right to exchange up to one-seventh of its initial allocation of Class B common units for shares of Class A common stock, cash or a combination of both, the form of consideration to be at the discretion of the Company's independent Audit and Compliance Committee. During the three months ended September 30, 2017 , the Company recorded total reductions of $43.0 million to redeemable limited partners' capital to reflect the exchange of approximately 1.2 million Class B common units and surrender of associated shares of Class B common stock by member owners for a like number of shares of the Company's Class A common stock (see Note 11 - Earnings Per Share for more information). Quarterly exchanges during the current fiscal year were as follows (in thousands, except Class B common units). Date of Quarterly Exchange Number of Class B Common Units Exchanged Reduction in Redeemable Limited Partners' Capital July 31, 2017 1,231,410 $ 42,976 Total 1,231,410 $ 42,976 |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 3 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
STOCKHOLDERS' DEFICIT | (10) STOCKHOLDERS' DEFICIT As of September 30, 2017 , there were 53,558,451 shares of the Company's Class A common stock, par value $0.01 per share, and 86,067,478 shares of the Company's Class B common stock, par value $0.000001 per share, outstanding. Holders of Class A common stock are entitled to (i) one vote for each share held of record on all matters submitted to a vote of stockholders, (ii) receive dividends, when and if declared by the Board of Directors out of funds legally available, subject to any statutory or contractual restrictions on the payment of dividends and subject to any restrictions on the payment of dividends imposed by the terms of any outstanding preferred stock or any class of series of stock having a preference over or the right to participate with the Class A common stock with respect to the payment of dividends or other distributions and (iii) receive pro rata, based on the number of shares of Class A common stock held, the remaining assets available for distribution upon the dissolution or liquidation of Premier, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any. Holders of Class B common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders, but are not entitled to receive dividends, other than dividends payable in shares of Premier's common stock, or to receive a distribution upon the dissolution or a liquidation of Premier. Pursuant to the Voting Trust Agreement, the trustee will vote all of the Class B common stock as a block in the manner determined by the plurality of the votes received by the trustee from the member owners for the election of directors to serve on the Board of Directors, and by a majority of the votes received by the trustee from the member owners for all other matters. Class B common stock will not be listed on any stock exchange and, except in connection with any permitted sale or transfer of Class B common units, cannot be sold or transferred. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | (11) EARNINGS PER SHARE Basic earnings per share of Premier is computed by dividing net income attributable to stockholders by the weighted average number of shares of common stock outstanding for the period. Net income attributable to stockholders includes the adjustment recorded in the period to reflect redeemable limited partners' capital at the redemption amount, as a result of the exchange benefit obtained by limited partners through the ownership of Class B common units. Except when the effect would be anti-dilutive, the diluted earnings per share calculation, which is calculated using the treasury stock method, includes the impact of shares that could be issued under the outstanding stock options, non-vested restricted stock units and awards, shares of non-vested performance share awards and the effect of the assumed redemption of Class B common units through the issuance of Class A common shares. The following table provides a reconciliation of the numerator and denominator used for basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended September 30, 2017 2016 Numerator for basic earnings per share: Net income attributable to stockholders $ 336,430 $ 70,302 Numerator for diluted earnings per share: Net income attributable to stockholders $ 336,430 $ 70,302 Adjustment of redeemable limited partners' capital to redemption amount (320,424 ) (61,808 ) Net income attributable to non-controlling interest in Premier LP 44,610 49,601 Net income 60,616 58,095 Tax effect on Premier, Inc. net income (a) (10,551 ) (20,951 ) Adjusted net income $ 50,065 $ 37,144 Denominator for basic earnings per share: Weighted average shares (b) 52,909 47,214 Denominator for diluted earnings per share: Weighted average shares (b) 52,909 47,214 Effect of dilutive securities: (c) Stock options 351 302 Restricted stock 304 171 Performance share awards — 466 Class B shares outstanding 86,482 94,809 Weighted average shares and assumed conversions 140,046 142,962 Basic earnings per share $ 6.36 $ 1.49 Diluted earnings per share $ 0.36 $ 0.26 (a) Represents income tax expense related to Premier, Inc. retaining the portion of net income attributable to income from non-controlling interest in Premier, LP for the purpose of diluted earnings per share. (b) Weighted average number of common shares used for basic earnings per share excludes weighted average shares of non-vested stock options, non-vested restricted stock, non-vested performance share awards and Class B shares outstanding for the three months ended September 30, 2017 and 2016 . (c) For the three months ended September 30, 2017 , the effect of 1.4 million stock options was excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect, and the effect of 0.6 million performance share awards was excluded from diluted weighted average shares outstanding as they had not satisfied the applicable performance criteria at the end of the period. For the three months ended September 30, 2016 , the effect of 1.6 million stock options was excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. Pursuant to the terms of the Exchange Agreement, on a quarterly basis, the Company has the option, as determined by the independent Audit and Compliance Committee, to settle the exchange of Class B common units of Premier LP by member owners for cash, an equal number of Class A common shares of Premier, Inc. or a combination of cash and shares of Class A common stock. In connection with the exchange of Class B common units by member owners, regardless of the consideration used to settle the exchange, an equal number of shares of Premier's Class B common stock are surrendered by member owners and retired (see Note 9 - Redeemable Limited Partners' Capital ). The following table presents certain information regarding the exchange of Class B common units and associated Class B common stock for Premier's Class A common stock and/or cash in connection with the quarterly exchanges pursuant to the terms of the Exchange Agreement, including activity related to the Class A and Class B common units and Class A and Class B common stock through the date of the applicable quarterly exchange: Quarterly Exchange by Member Owners Class B Common Shares Retired Upon Exchange (a) Class B Common Shares Outstanding After Exchange (a) Class A Common Shares Outstanding After Exchange Percentage of Combined Voting Power Class B/Class A Common Stock July 31, 2017 1,231,410 86,067,478 53,212,057 62%/38% October 31, 2017 (b) 3,651,294 82,416,184 57,215,143 59%/41% (a) The number of Class B common shares retired or outstanding is equivalent to the number of Class B common units retired upon exchange or outstanding after the exchange, as applicable. (b) As the quarterly exchange occurred on October 31, 2017, the impact of the exchange is not reflected in the condensed consolidated financial statements for the quarter ended September 30, 2017 . |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | (12) STOCK-BASED COMPENSATION Stock-based compensation expense is recognized over the requisite service period, which generally equals the stated vesting period. Pre-tax stock-based compensation expense was $8.8 million and $5.8 million for the three months ended September 30, 2017 and 2016 , respectively, with a resulting deferred tax benefit of $3.3 million and $2.2 million , respectively. The deferred tax benefit was calculated at a rate of 38% , which represents the expected effective income tax rate at the time of the compensation expense deduction primarily at PHSI, and differs from the Company's current effective income tax rate which includes the impact of partnership income not subject to federal and state income taxes. Premier 2013 Equity Incentive Plan The Premier 2013 Equity Incentive Plan, as amended and restated (and including any further amendments thereto, the "2013 Equity Incentive Plan") provides for grants of up to 11.3 million shares of Class A common stock, all of which are eligible to be issued as non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units or performance share awards. As of September 30, 2017 , there were 3.5 million shares available for grant under the 2013 Equity Incentive Plan. The following table includes information related to restricted stock, performance share awards and stock options for the three months ended September 30, 2017 : Restricted Stock Performance Share Awards Stock Options Number of Awards Weighted Average Fair Value at Grant Date Number of Awards Weighted Average Fair Value at Grant Date Number of Options Weighted Average Exercise Price Outstanding at June 30, 2017 576,988 $ 32.92 1,085,872 $ 32.79 3,372,499 $ 30.31 Granted 202,532 $ 32.90 678,340 $ 32.70 538,413 $ 32.90 Vested/exercised (107,764 ) $ 31.64 (352,867 ) $ 31.73 (96,137 ) $ 28.12 Forfeited (15,930 ) $ 32.37 (37,131 ) $ 32.35 (71,191 ) $ 34.24 Outstanding at September 30, 2017 655,826 $ 33.14 1,374,214 $ 33.02 3,743,584 $ 30.66 Stock options outstanding and exercisable at September 30, 2017 2,628,081 $ 29.66 Restricted stock units and restricted stock awards issued and outstanding generally vest over a three -year period for employees and a one -year period for directors. Performance share awards issued and outstanding generally vest over three years if performance targets are met. Stock options have a term of ten years from the date of grant. Vested stock options will expire either after twelve months of an employee's termination with Premier or immediately upon an employee's termination with Premier, depending on the termination circumstances. Stock options generally vest in equal annual installments over three years. Unrecognized stock-based compensation expense at September 30, 2017 was as follows (in thousands): Unrecognized Stock-Based Compensation Expense Weighted Average Amortization Period Restricted stock $ 13,180 2.19 years Performance share awards 31,492 2.20 years Stock options 11,920 2.21 years Total unrecognized stock-based compensation expense $ 56,592 2.20 years The aggregate intrinsic value of stock options at September 30, 2017 was as follows (in thousands): Intrinsic Value of Stock Options Outstanding and exercisable $ 9,107 Expected to vest 349 Total outstanding $ 9,456 Exercised during the three months ended September 30, 2017 $ 566 The Company estimated the fair value of each stock option on the date of grant using a Black-Scholes option-pricing model, applying the following assumptions, and amortized expense over each option's vesting period using the straight-line attribution approach: Three Months Ended September 30, 2017 2016 Expected life (a) 6 years 6 years Expected dividend (b) — — Expected volatility (c) 32.26% 33.00% Risk-free interest rate (d) 1.89% 1.31% Weighted average option grant date fair value $ 11.42 $ 10.80 (a) The six -year expected life (estimated period of time outstanding) of stock options granted was estimated using the "Simplified Method" which utilizes the midpoint between the vesting date and the end of the contractual term. This method was utilized for the stock options due to the lack of historical exercise behavior of Premier's employees. (b) No dividends are expected to be paid over the contractual term of the stock options granted, resulting in the use of a zero expected dividend rate. (c) The expected volatility rate is based on the observed historical volatilities of comparable companies. (d) The risk-free interest rate was interpolated from the five -year and seven -year Constant Maturity Treasury rate published by the United States Treasury as of the date of the grant. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | (13) INCOME TAXES The Company's income tax expense is attributable to the activities of the Company, PHSI and PSCI, all of which are subchapter C corporations. Under the provision of federal and state laws, Premier LP is not subject to federal and state income taxes. For federal and state income tax purposes, income realized by Premier LP is taxable to its partners. The Company, PHSI and PSCI are subject to U.S. federal and state income taxes. Income tax expense decreased $10.5 million , or 45% , to $12.8 million for the three months ended September 30, 2017 from $23.3 million for the three months ended September 30, 2016 , while our effective tax rate decreased to 17% for the three months ended September 30, 2017 from 29% for the three months ended September 30, 2016 . The decrease is primarily attributable to higher income tax expense in the prior year as a result of an increase in deferred tax expense for the three months ended September 30, 2016 attributed to the revaluation of deferred tax assets related to a 1% reduction in the North Carolina state tax rate. The Company's effective tax rate differs from income taxes recorded at the statutory rate primarily due to partnership income not subject to federal, state and local income taxes and valuation allowances against deferred tax assets at PHSI. The Company had net deferred tax assets of $454.8 million and $434.3 million as of September 30, 2017 and June 30, 2017 , respectively. The current period balance was comprised of $506.2 million in deferred tax assets at Premier, Inc. offset by $51.4 million in deferred tax liabilities at PHSI and PSCI. The increase of $20.5 million was primarily attributable to $17.7 million of deferred tax assets recorded in connection with the quarterly member owner exchanges that occurred during the three months ended September 30, 2017 , and $7.5 million associated with the revaluation of the TRA liabilities due to the change in the allocation and realization of future contingent payments. The increase is partially offset by $5.3 million in allowance recorded against deferred tax assets at PHSI. The Company had TRA liabilities of $380.0 million and $339.7 million at September 30, 2017 and June 30, 2017 , respectively, representing 85% of the tax savings payable to limited partners that the Company expects to receive in connection with the Section 754 election. The election results in adjustments to the tax bases of the assets of Premier LP upon member owner exchanges of Class B common units of Premier LP for Class A common stock of Premier, Inc. or cash. The $40.3 million increase was primarily attributable to $20.9 million associated with the revaluation of the TRA liabilities due to a change in the allocation and realization of future contingent payments and a $16.8 million increase in connection with the quarterly member owner exchanges that occurred during the three months ended September 30, 2017 . |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | (14) RELATED PARTY TRANSACTIONS GNYHA GNYHA Purchasing Alliance, LLC and its member organizations ("GNYHA PA") owned approximately 9.5% of the outstanding partnership interests in Premier LP as of September 30, 2017 . Although we no longer consider GNYHA PA a related party under U.S. GAAP, prior period information is included below. Net administrative fees revenue based on purchases by GNYHA Services, Inc. ("GNYHA") (an affiliate of GNYHA PA) and its member organizations was $17.7 million for the three months ended September 30, 2016 . The Company has a contractual requirement under the GPO participation agreement to pay each member owner revenue share from Premier LP equal to 30% of all gross administrative fees collected by Premier LP based upon purchasing by such member owner's facilities through Premier LP's GPO supplier contracts. As GNYHA also remits to Premier LP all gross administrative fees collected by GNYHA based on purchases by its member organizations through GNYHA's own GPO supplier contracts, it also receives revenue share from Premier LP equal to 30% of such gross administrative fees remitted to the Company. Approximately $7.8 million of revenue share obligations in the accompanying Condensed Consolidated Balance Sheets related to revenue share obligations to GNYHA and its member organizations at June 30, 2017 . In addition, of the $25.0 million limited partners' distribution payable in the accompanying Condensed Consolidated Balance Sheets at June 30, 2017 , $2.7 million were payable to GNYHA and its member organizations. Services and support revenue earned from GNYHA and its member organizations was $3.6 million during the three months ended September 30, 2016 . Product revenue earned from, or attributable to services provided to, GNYHA and its member organizations was $3.8 million during the three months ended September 30, 2016 . Receivables from GNYHA and its member organizations, included in due from related parties in the accompanying Condensed Consolidated Balance sheets, were $5.4 million at June 30, 2017 . Innovatix and Essensa The Company held 50% of the membership interests in Innovatix until December 2, 2016, at which time it acquired the remaining 50% of the membership interests from GNYHA Holdings (see Note 3 - Business Acquisitions ). The Company's share of Innovatix's net income included in equity in net income of unconsolidated affiliates in the accompanying Condensed Consolidated Statements of Income prior to the acquisition was $6.5 million during the three months ended September 30, 2016 . The Company maintained a group purchasing agreement with Innovatix under which Innovatix members were permitted to utilize Premier LP's GPO supplier contracts. Gross administrative fees revenue and a corresponding revenue share recorded under the arrangement prior to the acquisition were $11.4 million for the three months ended September 30, 2016 . The Company historically maintained a group purchasing agreement with Essensa, under which Essensa utilized the Company's GPO supplier contracts. On December 2, 2016, the Company acquired 100% of the membership interests in Essensa from GNYHA Holdings (see Note 3 - Business Acquisitions ). Net administrative fees revenue recorded from Essensa prior to the acquisition was $0.7 million for the three months ended September 30, 2016 . FFF The Company's 49% ownership share of net income of FFF, which was acquired on July 26, 2016, included in equity in net income of unconsolidated affiliates in the accompanying Condensed Consolidated Statements of Income was $4.3 million and $3.0 million for the three months ended September 30, 2017 and 2016 , respectively. The Company maintains group purchasing agreements with FFF and receives administrative fees for purchases made by the Company's members pursuant to those agreements. Net administrative fees revenue recorded from purchases under those agreements was $1.7 million and $1.5 million (of which $0.1 million was recorded after July 26, 2016) during the three months ended September 30, 2017 and 2016 , respectively. AEIX The Company conducts all operational activities for American Excess Insurance Exchange Risk Retention Group ("AEIX"), a reciprocal risk retention group that provides excess and umbrella healthcare professional and general liability insurance to certain hospital and healthcare system members. The Company is reimbursed by AEIX for actual costs, plus an annual incentive management fee not to exceed $0.5 million per calendar year. The Company received cost reimbursement of $1.5 million and $1.1 million during the three months ended September 30, 2017 and 2016 , respectively. As of September 30, 2017 and June 30, 2017 , $0.5 million and $0.6 million , respectively, in amounts receivable from AEIX are included in due from related parties in the accompanying Condensed Consolidated Balance Sheets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | (15) COMMITMENTS AND CONTINGENCIES The Company is not currently involved in any litigation it believes to be significant. The Company is periodically involved in litigation, arising in the ordinary course of business or otherwise, which from time to time may include claims relating to commercial, product liability, tort and personal injury, employment, antitrust, intellectual property, or other regulatory matters. If current or future government regulations, specifically, those with respect to antitrust or healthcare laws, are interpreted or enforced in a manner adverse to the Company or its business, the Company may be subject to enforcement actions, penalties and other material limitations which could have a material adverse effect on the Company's business, financial condition and results of operations. |
SEGMENTS
SEGMENTS | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENTS | (16) SEGMENTS The Company delivers its solutions and manages its business through two reportable business segments, the Supply Chain Services segment and the Performance Services segment. The Supply Chain Services segment includes the Company's GPO, integrated pharmacy offerings and direct sourcing activities. The Performance Services segment includes the Company's informatics, collaborative, advisory services, government services and insurance services businesses. Segment information was as follows (in thousands): Three Months Ended September 30, 2017 2016 Net revenue: Supply Chain Services Net administrative fees $ 150,991 $ 125,976 Other services and support 2,149 1,645 Services 153,140 127,621 Products 152,662 106,129 Total Supply Chain Services 305,802 233,750 Performance Services 84,762 79,522 Net revenue $ 390,564 $ 313,272 Depreciation and amortization expense (a) : Supply Chain Services $ 5,495 $ 466 Performance Services 22,918 20,875 Corporate 1,992 1,886 Total depreciation and amortization expense $ 30,405 $ 23,227 Capital expenditures: Supply Chain Services $ 307 $ — Performance Services 13,549 16,851 Corporate 2,791 115 Total capital expenditures $ 16,647 $ 16,966 Total assets: September 30, 2017 June 30, 2017 Supply Chain Services $ 991,569 $ 1,017,023 Performance Services 879,564 888,862 Corporate 633,209 601,951 Total assets $ 2,504,342 $ 2,507,836 (a) Includes amortization of purchased intangible assets. The Company uses Segment Adjusted EBITDA (a financial measure not determined in accordance with generally accepted accounting principles ("Non-GAAP")) as its primary measure of profit or loss to assess segment performance and to determine the allocation of resources. The Company also uses Segment Adjusted EBITDA to facilitate the comparison of the segment operating performance on a consistent basis from period to period. The Company defines Segment Adjusted EBITDA as the segment's net revenue and equity in net income of unconsolidated affiliates less operating expenses directly attributable to the segment excluding depreciation and amortization, amortization of purchased intangible assets, merger and acquisition related expenses and non-recurring or non-cash items. Operating expenses directly attributable to the segment include expenses associated with sales and marketing, general and administrative and product development activities specific to the operation of each segment. Non-recurring items are income or expenses and other items that have not been earned or incurred within the prior two years and are not expected to recur within the next two years. General and administrative corporate expenses that are not specific to a particular segment are not included in the calculation of Segment Adjusted EBITDA. For more information on Segment Adjusted EBITDA and the use of Non-GAAP financial measures, see "Our Use of Non-GAAP Financial Measures" within Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations. A reconciliation of income before income taxes to Segment Adjusted EBITDA is as follows (in thousands): Three Months Ended September 30, 2017 2016 Income before income taxes $ 73,380 $ 81,431 Equity in net income of unconsolidated affiliates (a) (4,252 ) (9,579 ) Interest and investment loss, net (b) 1,495 152 Loss on disposal of long-lived assets 1,320 1,518 Other income (1,463 ) (1,006 ) Operating income 70,480 72,516 Depreciation and amortization 16,507 14,018 Amortization of purchased intangible assets 13,898 9,209 Stock-based compensation (c) 8,957 5,896 Acquisition related expenses 3,099 2,937 Adjustment to tax receivable agreement liabilities (d) — (5,722 ) ERP implementation expenses (e) 335 1,094 Acquisition related adjustment - revenue 105 151 Equity in net income of unconsolidated affiliates (a) 4,252 9,579 Deferred compensation plan income (f) 1,539 1,095 Other expense (1 ) — Adjusted EBITDA $ 119,171 $ 110,773 Segment Adjusted EBITDA: Supply Chain Services $ 125,620 $ 117,304 Performance Services 21,221 22,311 Corporate (27,670 ) (28,842 ) Adjusted EBITDA $ 119,171 $ 110,773 (a) Refer to Note 4 - Investments for further information regarding equity in net income of unconsolidated affiliates. (b) Represents interest expense, net and realized gains and losses on our marketable securities. (c) Represents non-cash employee stock-based compensation expense and $0.1 million of stock purchase plan expense during both of the three months ended September 30, 2017 and 2016 . (d) Represents adjustment to TRA liabilities for a 1% decrease in the North Carolina state income tax rate during the three months ended September 30, 2016 . (e) Represents implementation and other costs associated with the implementation of our enterprise resource planning ("ERP") system. (f) Represents realized and unrealized gains and losses and dividend income on deferred compensation plan assets. |
SIGNIFICANT ACCOUNTING POLICI24
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The member owners' interest in Premier LP is reflected as redeemable limited partners' capital in the Company's accompanying Condensed Consolidated Balance Sheets, and the limited partners' proportionate share of income in Premier LP is reflected within net income attributable to non-controlling interest in Premier LP in the Company's accompanying Condensed Consolidated Statements of Income and within comprehensive income attributable to non-controlling interest in Premier LP in the Company's accompanying Condensed Consolidated Statements of Comprehensive Income. At September 30, 2017 and June 30, 2017 , the member owners owned approximately 62% and 63% , respectively, of the Company's combined Class A and Class B common stock through their ownership of Class B common stock. During the three months ended September 30, 2017 , the member owners exchanged 1.2 million Class B common units and associated Class B common shares for an equal number of Class A common shares pursuant to an exchange agreement (the "Exchange Agreement") entered into by the member owners in connection with the completion of our initial public offering on October 1, 2013. The Exchange Agreement provides each member owner the cumulative right to exchange up to one-seventh of its initial allocation of Class B common units, as well as any additional Class B common units purchased by such member owner pursuant to certain rights of first refusal, for shares of Class A common stock (on a one-for-one basis subject to customary adjustments for subdivisions or combinations by split, reverse split, distribution, reclassification, recapitalization or otherwise), cash or a combination of both, the form of consideration to be at the discretion of the Company's independent Audit and Compliance Committee of the Board of Directors (the "Audit and Compliance Committee"). In connection with Class B common units exchanged for Class A common shares during the three months ended September 30, 2017 , approximately 1.2 million Class B common units were contributed to Premier LP and converted to Class A common units, which remain outstanding. Refer to the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2017 (the " 2017 Annual Report") filed with the Securities and Exchange Commission ("SEC") on August 23, 2017 for further discussion of the Exchange Agreement. At September 30, 2017 and June 30, 2017 , the public investors, which may include member owners that have received shares of Class A common stock in connection with previous exchanges of their Class B common units and associated Class B common shares for an equal number of Class A common shares, owned approximately 38% and 37% , respectively, of the Company's outstanding common stock through their ownership of Class A common stock. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and pursuant to the rules and regulations of the SEC. Accordingly, certain information and disclosures normally included in annual financial statements have been condensed or omitted. The accompanying condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary for a fair presentation of results of operations and financial condition for the interim periods shown, including normal recurring adjustments. The Company believes that the disclosures are adequate to make the information presented not misleading and should be read in conjunction with the audited consolidated financial statements and related footnotes contained in the 2017 Annual Report. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of the Company's condensed consolidated financial statements in accordance with GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Significant estimates are evaluated on an ongoing basis, including estimates for allowances for doubtful accounts, useful lives of property and equipment, stock-based compensation, payables under tax receivable agreements ("TRAs"), values of investments not publicly traded, the valuation allowance on deferred tax assets, uncertain income taxes, deferred revenue, future cash flows associated with asset impairments, values of put and call rights, values of earn-out liabilities and the allocation of purchase prices. These estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. |
Recently Adopted Accounting Standards and Recently Issued Accounting Standards Not Yet Adopted | Recently Adopted Accounting Standards In July 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory , which requires entities to measure most inventory "at the lower of cost and net realizable value," thereby simplifying the guidance under which an entity must measure inventory at the lower of cost or market. This guidance does not apply to inventories that are measured by using either the last-in, first-out method or the retail inventory method. The Company adopted this standard effective July 1, 2017 using the prospective approach. The implementation of this ASU did not have a material effect on the Company's condensed consolidated financial statements. Recently Issued Accounting Standards Not Yet Adopted In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The new guidance will reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective prospectively for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which eliminates Step 2 from the goodwill impairment test. The guidance requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. In addition, the guidance eliminates the requirement for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. The standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2020. Early adoption is permitted for interim and annual goodwill impairment tests performed after January 1, 2017. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory , which removes the prohibition in ASC 740 against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. The guidance is intended to reduce the complexity of GAAP and diversity in practice related to the tax consequences of certain types of intra-entity asset transfers, particularly those involving intellectual property. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The ASU amendments add or clarify guidance on eight cash flow issues. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which is intended to increase transparency and comparability among organizations of accounting for leasing arrangements. This guidance establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Entities will be required to recognize and measure leases as of the earliest period presented using a modified retrospective approach. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2019. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which is intended to provide users of financial statements with more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard will be effective for the Company for the fiscal year beginning July 1, 2018. Early adoption is permitted for certain amendments. The Company is currently evaluating the impact of the adoption of the new standard on its consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which will supersede nearly all existing revenue recognition guidance. The new standard requires revenue to be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new standard allows for either full retrospective or modified retrospective adoption. The FASB subsequently issued an amendment in ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date , in August 2015 to defer the effective date of the new standard for all entities by one year. The new standard, as amended, will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption as of the original effective date for public entities will be permitted. The FASB issued another amendment in ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations , in March 2016 related to a third party providing goods or services to a customer. When another party is involved in providing goods or services to a customer, an entity is required to determine whether the nature of its promise is to provide the specified good or service itself or to arrange for the good or service to be provided by a third party. If the entity provides the specific good or service itself, the entity acts as a principal. If an entity arranges for the good or service to be provided by a third party, the entity acts as an agent. The standard requires the principal to recognize revenue for the gross amount and the agent to recognize revenue for the amount of any fee or commission for which it expects to be entitled in exchange for arranging for the specified good or service to be provided. The new standard will be effective with ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing , which amends specific aspects of ASU 2014-09, including how to identify performance obligations and guidance related to licensing implementation. This amendment provides guidance on determining whether an entity's promise to grant a license provides a customer with either a right to use the entity's intellectual property or a right to access the entity's intellectual property. The amendment will be effective with ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients , which clarifies specific aspects of ASU 2014-09, clarifying how to identify performance obligations and guidance related to its promise in granting a license of intellectual property. This new standard provides guidance to allow entities to disregard items that are immaterial in the context of the contract, clarify when a promised good or service is separately identifiable and allow an entity to elect to account for the cost of shipping and handling performed after control of a good has been transferred to the customer as a fulfillment cost. The new standard also clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property to help determine whether it recognizes revenue over time or at a point in time and addresses how entities should consider license renewals and restrictions. The new standard will be effective with ASU 2014-09. In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606: Revenue from Contracts with Customers , which clarifies specific aspects of ASU 2014-09, including allowing entities not to make quantitative disclosures about remaining performance obligations in certain cases and requiring entities that use any of the new or previously existing optional exemptions to expand their qualitative disclosures. The new standard also makes twelve other technical corrections and modifications to ASU 2014-09. The new standard will be effective with ASU 2014-09. The new revenue recognition standards related to Topic 606 discussed above, as amended, will be effective for the Company for the fiscal year beginning July 1, 2018, at which time we plan to adopt the standard using the modified retrospective approach. To-date, the Company has identified the following preliminary impacts of adopting the new standards on various revenue streams across its operating segments. Within the Supply Chain Services segment, the Company is continuing to assess the impacts of adopting the new standards on its various revenue streams. Under the new standard, the Company expects to recognize administrative fee revenue upon the occurrence of a sale by suppliers to the Company’s members. This differs from the current treatment in which the Company recognizes revenue in the period that the respective supplier reports member purchasing data, which is usually a month or a quarter in arrears of the actual member purchase activity. This change is expected to result in the Company recognizing revenue sooner in the revenue cycle than under the Company's current revenue recognition policy and the creation of a contract asset associated with this shift in revenue recognition timing. The Company is continuing to assess the impact of these changes on the financial statements and disclosures. Within the Performance Services segment, the Company is continuing to assess the impacts of adopting the new standards on its various revenue streams. Under the new standard, the Company will be required to capitalize the incremental costs of obtaining a contract, which the Company has preliminarily identified as sales commissions and costs associated with implementing our SaaS informatics tools, and to amortize these costs in a manner that reflects the transfer of services to the customer. These costs are expensed as incurred under the Company's current revenue recognition policy. The Company is continuing to assess the impact of these changes on the financial statements and disclosures. Additionally, the Company is evaluating the potential impacts on its business processes, systems and controls necessary to support revenue recognition and disclosure requirements under the new standard. |
ORGANIZATION AND BASIS OF PRE25
ORGANIZATION AND BASIS OF PRESENTATION (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Financial Information of Premier LP | The assets and liabilities of Premier LP at September 30, 2017 and June 30, 2017 consisted of the following (in thousands): September 30, 2017 June 30, 2017 Assets Current $ 361,578 $ 385,477 Noncurrent 1,604,275 1,616,539 Total assets of Premier LP $ 1,965,853 $ 2,002,016 Liabilities Current $ 479,916 $ 560,582 Noncurrent 137,119 134,635 Total liabilities of Premier LP $ 617,035 $ 695,217 Net income attributable to Premier LP during the three months ended September 30, 2017 and 2016 was as follows (in thousands): Three Months Ended September 30, 2017 2016 Premier LP net income $ 72,291 $ 73,915 Premier LP's cash flows for the three months ended September 30, 2017 and 2016 consisted of the following (in thousands): Three Months Ended September 30, 2017 2016 Net cash provided by (used in): Operating activities $ 88,407 $ 12,865 Investing activities (16,613 ) (96,805 ) Financing activities (100,476 ) (22,168 ) Net decrease in cash and cash equivalents (28,682 ) (106,108 ) Cash and cash equivalents at beginning of year 133,451 210,048 Cash and cash equivalents at end of period $ 104,769 $ 103,940 |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Fair Values Assigned to Net Assets Acquired and Liabilities Assumed | The preliminary fair values assigned to the net assets acquired and the liabilities assumed as of the acquisition date were as follows (in thousands): Acquisition Date Fair Value Cash paid at closing $ 227,500 Cash paid on January 10, 2017 97,500 Purchase price 325,000 Additional cash paid at closing 10,984 Adjusted purchase price 335,984 Earn-out liability 16,662 Receivable from GNYHA Holdings, LLC (3,000 ) Total consideration paid 349,646 Cash acquired (16,267 ) Net consideration 333,379 50% ownership interest in Innovatix 218,356 Payable to Innovatix and Essensa (5,765 ) Enterprise value 545,970 Accounts receivable 21,242 Prepaid expenses and other current assets 686 Fixed assets, net 3,476 Intangible assets 241,494 Total assets acquired 266,898 Accrued expenses 5,264 Revenue share obligations 7,011 Other current liabilities 694 Total liabilities assumed 12,969 Deferred tax liability 42,636 Goodwill $ 334,677 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Investments in Unconsolidated Affiliates | The Company's investments in unconsolidated affiliates consisted of the following (in thousands): Carrying Value Equity in Net Income (Loss) Three Months Ended September 30, September 30, 2017 June 30, 2017 2017 2016 FFF $ 89,857 $ 85,520 $ 4,337 $ 3,059 Bloodbuy 2,033 2,066 (33 ) (19 ) PharmaPoint 4,180 4,232 (52 ) (77 ) Innovatix — — — 6,616 Other investments 1,061 1,061 — — Total investments $ 97,131 $ 92,879 $ 4,252 $ 9,579 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities | The following table provides a summary of the Company's financial assets and liabilities which are measured at fair value on a recurring basis (in thousands): Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) September 30, 2017 Cash equivalents $ 9,322 $ 9,322 $ — $ — FFF call right 4,593 — — 4,593 Deferred compensation plan assets 44,567 44,567 — — Total assets $ 58,482 $ 53,889 $ — $ 4,593 Earn-out liabilities $ 21,675 $ — $ — $ 21,675 FFF put right 24,008 — — 24,008 Total liabilities $ 45,683 $ — $ — $ 45,683 June 30, 2017 Cash equivalents $ 22,218 $ 22,218 $ — $ — FFF call right 4,655 — — 4,655 Deferred compensation plan assets 47,202 47,202 — — Total assets $ 74,075 $ 69,420 $ — $ 4,655 Earn-out liabilities $ 21,310 $ — $ — $ 21,310 FFF put right 24,050 — — 24,050 Total liabilities $ 45,360 $ — $ — $ 45,360 |
Reconciliation of Earn-Out Liabilities and FFF Put Rights | A reconciliation of the Company's earn-out liabilities and FFF put and call rights is as follows (in thousands): Beginning Balance Purchases Gain (Loss) Ending Balance Three Months Ended September 30, 2017 FFF call right $ 4,655 $ — $ (62 ) $ 4,593 Total Level 3 assets $ 4,655 $ — $ (62 ) $ 4,593 Earn-out liabilities $ 21,310 $ — $ (365 ) $ 21,675 FFF put right 24,050 — 42 24,008 Total Level 3 liabilities $ 45,360 $ — $ (323 ) $ 45,683 Three Months Ended September 30, 2016 FFF call right $ — $ 10,361 $ (45 ) $ 10,316 Total Level 3 assets $ — $ 10,361 $ (45 ) $ 10,316 Earn-out liabilities $ 4,128 $ — $ 1,769 $ 2,359 FFF put right — 25,821 10 25,811 Total Level 3 liabilities $ 4,128 $ 25,821 $ 1,779 $ 28,170 |
Reconciliation of FFF Call Rights | A reconciliation of the Company's earn-out liabilities and FFF put and call rights is as follows (in thousands): Beginning Balance Purchases Gain (Loss) Ending Balance Three Months Ended September 30, 2017 FFF call right $ 4,655 $ — $ (62 ) $ 4,593 Total Level 3 assets $ 4,655 $ — $ (62 ) $ 4,593 Earn-out liabilities $ 21,310 $ — $ (365 ) $ 21,675 FFF put right 24,050 — 42 24,008 Total Level 3 liabilities $ 45,360 $ — $ (323 ) $ 45,683 Three Months Ended September 30, 2016 FFF call right $ — $ 10,361 $ (45 ) $ 10,316 Total Level 3 assets $ — $ 10,361 $ (45 ) $ 10,316 Earn-out liabilities $ 4,128 $ — $ 1,769 $ 2,359 FFF put right — 25,821 10 25,811 Total Level 3 liabilities $ 4,128 $ 25,821 $ 1,779 $ 28,170 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets, Net | Intangible assets, net consisted of the following (in thousands): Useful Life September 30, 2017 June 30, 2017 Member relationships 14.7 years $ 220,100 $ 220,100 Technology 5.0 years 143,727 143,727 Customer relationships 8.3 years 48,120 48,120 Trade names 8.3 years 22,710 22,710 Distribution network 10.0 years 22,400 22,400 Favorable lease commitments 10.1 years 11,393 11,393 Non-compete agreements 5.9 years 8,710 8,710 Total intangible assets 477,160 477,160 Accumulated amortization (113,096 ) (99,198 ) Intangible assets, net $ 364,064 $ 377,962 |
GOODWILL (Tables)
GOODWILL (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill consisted of the following (in thousands): September 30, 2017 June 30, 2017 Supply Chain Services $ 400,348 $ 400,348 Performance Services 506,197 506,197 Total goodwill $ 906,545 $ 906,545 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consisted of the following (in thousands): Commitment Amount Due Date September 30, 2017 June 30, 2017 Credit Facility $ 750,000 June 24, 2019 $ 170,000 $ 220,000 Notes payable — Various 9,298 14,272 Total debt 179,298 234,272 Less: Current portion (173,023 ) (227,993 ) Total long-term debt $ 6,275 $ 6,279 |
REDEEMABLE LIMITED PARTNERS' 32
REDEEMABLE LIMITED PARTNERS' CAPITAL (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Temporary Equity Disclosure [Abstract] | |
Changes in Redeemable Limited Partners' Capital | The table below provides a summary of the changes in the redeemable limited partners' capital from June 30, 2017 to September 30, 2017 (in thousands): Receivables From Limited Partners Redeemable Limited Partners' Capital Total Redeemable Limited Partners' Capital June 30, 2017 $ (4,177 ) $ 3,142,760 $ 3,138,583 Distributions applied to receivables from limited partners 492 — 492 Net income attributable to non-controlling interest in Premier LP — 44,610 44,610 Distributions to limited partners — (20,752 ) (20,752 ) Exchange of Class B common units for Class A common stock by member owners — (42,976 ) (42,976 ) Adjustment to redemption amount — (320,424 ) (320,424 ) September 30, 2017 $ (3,685 ) $ 2,803,218 $ 2,799,533 |
Schedule of Quarterly Distributions and Quarterly Exchanges | Quarterly exchanges during the current fiscal year were as follows (in thousands, except Class B common units). Date of Quarterly Exchange Number of Class B Common Units Exchanged Reduction in Redeemable Limited Partners' Capital July 31, 2017 1,231,410 $ 42,976 Total 1,231,410 $ 42,976 Quarterly distributions made to limited partners during the current fiscal year are as follows (in thousands): Date Distribution (a) August 24, 2017 $ 24,951 (a) Distributions are equal to Premier LP’s total taxable income from the preceding fiscal quarter-to-date period for each respective distribution date multiplied by the Company's standalone effective combined federal, state and local income tax rate. Premier LP expects to make a $20.8 million quarterly distribution on or before November 22, 2017. The distribution is reflected in limited partners' distribution payable in the accompanying Condensed Consolidated Balance Sheets at September 30, 2017. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Numerator and Denominator Used for Basic and Diluted Earnings (Loss) Per Share | The following table provides a reconciliation of the numerator and denominator used for basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended September 30, 2017 2016 Numerator for basic earnings per share: Net income attributable to stockholders $ 336,430 $ 70,302 Numerator for diluted earnings per share: Net income attributable to stockholders $ 336,430 $ 70,302 Adjustment of redeemable limited partners' capital to redemption amount (320,424 ) (61,808 ) Net income attributable to non-controlling interest in Premier LP 44,610 49,601 Net income 60,616 58,095 Tax effect on Premier, Inc. net income (a) (10,551 ) (20,951 ) Adjusted net income $ 50,065 $ 37,144 Denominator for basic earnings per share: Weighted average shares (b) 52,909 47,214 Denominator for diluted earnings per share: Weighted average shares (b) 52,909 47,214 Effect of dilutive securities: (c) Stock options 351 302 Restricted stock 304 171 Performance share awards — 466 Class B shares outstanding 86,482 94,809 Weighted average shares and assumed conversions 140,046 142,962 Basic earnings per share $ 6.36 $ 1.49 Diluted earnings per share $ 0.36 $ 0.26 (a) Represents income tax expense related to Premier, Inc. retaining the portion of net income attributable to income from non-controlling interest in Premier, LP for the purpose of diluted earnings per share. (b) Weighted average number of common shares used for basic earnings per share excludes weighted average shares of non-vested stock options, non-vested restricted stock, non-vested performance share awards and Class B shares outstanding for the three months ended September 30, 2017 and 2016 . (c) For the three months ended September 30, 2017 , the effect of 1.4 million stock options was excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect, and the effect of 0.6 million performance share awards was excluded from diluted weighted average shares outstanding as they had not satisfied the applicable performance criteria at the end of the period. For the three months ended September 30, 2016 , the effect of 1.6 million stock options was excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. |
Schedule of Exchange Agreement | The following table presents certain information regarding the exchange of Class B common units and associated Class B common stock for Premier's Class A common stock and/or cash in connection with the quarterly exchanges pursuant to the terms of the Exchange Agreement, including activity related to the Class A and Class B common units and Class A and Class B common stock through the date of the applicable quarterly exchange: Quarterly Exchange by Member Owners Class B Common Shares Retired Upon Exchange (a) Class B Common Shares Outstanding After Exchange (a) Class A Common Shares Outstanding After Exchange Percentage of Combined Voting Power Class B/Class A Common Stock July 31, 2017 1,231,410 86,067,478 53,212,057 62%/38% October 31, 2017 (b) 3,651,294 82,416,184 57,215,143 59%/41% (a) The number of Class B common shares retired or outstanding is equivalent to the number of Class B common units retired upon exchange or outstanding after the exchange, as applicable. (b) As the quarterly exchange occurred on October 31, 2017, the impact of the exchange is not reflected in the condensed consolidated financial statements for the quarter ended September 30, 2017 . |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Information Related to Restricted Stock | The following table includes information related to restricted stock, performance share awards and stock options for the three months ended September 30, 2017 : Restricted Stock Performance Share Awards Stock Options Number of Awards Weighted Average Fair Value at Grant Date Number of Awards Weighted Average Fair Value at Grant Date Number of Options Weighted Average Exercise Price Outstanding at June 30, 2017 576,988 $ 32.92 1,085,872 $ 32.79 3,372,499 $ 30.31 Granted 202,532 $ 32.90 678,340 $ 32.70 538,413 $ 32.90 Vested/exercised (107,764 ) $ 31.64 (352,867 ) $ 31.73 (96,137 ) $ 28.12 Forfeited (15,930 ) $ 32.37 (37,131 ) $ 32.35 (71,191 ) $ 34.24 Outstanding at September 30, 2017 655,826 $ 33.14 1,374,214 $ 33.02 3,743,584 $ 30.66 Stock options outstanding and exercisable at September 30, 2017 2,628,081 $ 29.66 |
Schedule of Information Related to Performance Share Awards | The following table includes information related to restricted stock, performance share awards and stock options for the three months ended September 30, 2017 : Restricted Stock Performance Share Awards Stock Options Number of Awards Weighted Average Fair Value at Grant Date Number of Awards Weighted Average Fair Value at Grant Date Number of Options Weighted Average Exercise Price Outstanding at June 30, 2017 576,988 $ 32.92 1,085,872 $ 32.79 3,372,499 $ 30.31 Granted 202,532 $ 32.90 678,340 $ 32.70 538,413 $ 32.90 Vested/exercised (107,764 ) $ 31.64 (352,867 ) $ 31.73 (96,137 ) $ 28.12 Forfeited (15,930 ) $ 32.37 (37,131 ) $ 32.35 (71,191 ) $ 34.24 Outstanding at September 30, 2017 655,826 $ 33.14 1,374,214 $ 33.02 3,743,584 $ 30.66 Stock options outstanding and exercisable at September 30, 2017 2,628,081 $ 29.66 |
Schedule of Information Related to Stock Options | The following table includes information related to restricted stock, performance share awards and stock options for the three months ended September 30, 2017 : Restricted Stock Performance Share Awards Stock Options Number of Awards Weighted Average Fair Value at Grant Date Number of Awards Weighted Average Fair Value at Grant Date Number of Options Weighted Average Exercise Price Outstanding at June 30, 2017 576,988 $ 32.92 1,085,872 $ 32.79 3,372,499 $ 30.31 Granted 202,532 $ 32.90 678,340 $ 32.70 538,413 $ 32.90 Vested/exercised (107,764 ) $ 31.64 (352,867 ) $ 31.73 (96,137 ) $ 28.12 Forfeited (15,930 ) $ 32.37 (37,131 ) $ 32.35 (71,191 ) $ 34.24 Outstanding at September 30, 2017 655,826 $ 33.14 1,374,214 $ 33.02 3,743,584 $ 30.66 Stock options outstanding and exercisable at September 30, 2017 2,628,081 $ 29.66 |
Schedule of Unrecognized Stock-Based Compensation Expense | Unrecognized stock-based compensation expense at September 30, 2017 was as follows (in thousands): Unrecognized Stock-Based Compensation Expense Weighted Average Amortization Period Restricted stock $ 13,180 2.19 years Performance share awards 31,492 2.20 years Stock options 11,920 2.21 years Total unrecognized stock-based compensation expense $ 56,592 2.20 years |
Schedule of Aggregate Intrinsic Value of Stock Options | The aggregate intrinsic value of stock options at September 30, 2017 was as follows (in thousands): Intrinsic Value of Stock Options Outstanding and exercisable $ 9,107 Expected to vest 349 Total outstanding $ 9,456 Exercised during the three months ended September 30, 2017 $ 566 |
Assumptions Used for Determining the Fair Value of Stock Options Granted | The Company estimated the fair value of each stock option on the date of grant using a Black-Scholes option-pricing model, applying the following assumptions, and amortized expense over each option's vesting period using the straight-line attribution approach: Three Months Ended September 30, 2017 2016 Expected life (a) 6 years 6 years Expected dividend (b) — — Expected volatility (c) 32.26% 33.00% Risk-free interest rate (d) 1.89% 1.31% Weighted average option grant date fair value $ 11.42 $ 10.80 (a) The six -year expected life (estimated period of time outstanding) of stock options granted was estimated using the "Simplified Method" which utilizes the midpoint between the vesting date and the end of the contractual term. This method was utilized for the stock options due to the lack of historical exercise behavior of Premier's employees. (b) No dividends are expected to be paid over the contractual term of the stock options granted, resulting in the use of a zero expected dividend rate. (c) The expected volatility rate is based on the observed historical volatilities of comparable companies. (d) The risk-free interest rate was interpolated from the five -year and seven -year Constant Maturity Treasury rate published by the United States Treasury as of the date of the grant. |
SEGMENTS (Tables)
SEGMENTS (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Segment information was as follows (in thousands): Three Months Ended September 30, 2017 2016 Net revenue: Supply Chain Services Net administrative fees $ 150,991 $ 125,976 Other services and support 2,149 1,645 Services 153,140 127,621 Products 152,662 106,129 Total Supply Chain Services 305,802 233,750 Performance Services 84,762 79,522 Net revenue $ 390,564 $ 313,272 Depreciation and amortization expense (a) : Supply Chain Services $ 5,495 $ 466 Performance Services 22,918 20,875 Corporate 1,992 1,886 Total depreciation and amortization expense $ 30,405 $ 23,227 Capital expenditures: Supply Chain Services $ 307 $ — Performance Services 13,549 16,851 Corporate 2,791 115 Total capital expenditures $ 16,647 $ 16,966 Total assets: September 30, 2017 June 30, 2017 Supply Chain Services $ 991,569 $ 1,017,023 Performance Services 879,564 888,862 Corporate 633,209 601,951 Total assets $ 2,504,342 $ 2,507,836 (a) Includes amortization of purchased intangible assets. |
Reconciliation of Income Before Income Taxes to Segment Adjusted EBITDA | A reconciliation of income before income taxes to Segment Adjusted EBITDA is as follows (in thousands): Three Months Ended September 30, 2017 2016 Income before income taxes $ 73,380 $ 81,431 Equity in net income of unconsolidated affiliates (a) (4,252 ) (9,579 ) Interest and investment loss, net (b) 1,495 152 Loss on disposal of long-lived assets 1,320 1,518 Other income (1,463 ) (1,006 ) Operating income 70,480 72,516 Depreciation and amortization 16,507 14,018 Amortization of purchased intangible assets 13,898 9,209 Stock-based compensation (c) 8,957 5,896 Acquisition related expenses 3,099 2,937 Adjustment to tax receivable agreement liabilities (d) — (5,722 ) ERP implementation expenses (e) 335 1,094 Acquisition related adjustment - revenue 105 151 Equity in net income of unconsolidated affiliates (a) 4,252 9,579 Deferred compensation plan income (f) 1,539 1,095 Other expense (1 ) — Adjusted EBITDA $ 119,171 $ 110,773 Segment Adjusted EBITDA: Supply Chain Services $ 125,620 $ 117,304 Performance Services 21,221 22,311 Corporate (27,670 ) (28,842 ) Adjusted EBITDA $ 119,171 $ 110,773 (a) Refer to Note 4 - Investments for further information regarding equity in net income of unconsolidated affiliates. (b) Represents interest expense, net and realized gains and losses on our marketable securities. (c) Represents non-cash employee stock-based compensation expense and $0.1 million of stock purchase plan expense during both of the three months ended September 30, 2017 and 2016 . (d) Represents adjustment to TRA liabilities for a 1% decrease in the North Carolina state income tax rate during the three months ended September 30, 2016 . (e) Represents implementation and other costs associated with the implementation of our enterprise resource planning ("ERP") system. (f) Represents realized and unrealized gains and losses and dividend income on deferred compensation plan assets. |
ORGANIZATION AND BASIS OF PRE36
ORGANIZATION AND BASIS OF PRESENTATION - Organization (Narrative) (Details) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2017categorysegment | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||
Number of business segments | segment | 2 | |
General partner interest (as a percent) | 38.00% | 37.00% |
Limited partners ownership interest (as a percent) | 62.00% | 63.00% |
Performance services segment | ||
Segment Reporting Information [Line Items] | ||
Number of main categories | category | 3 |
ORGANIZATION AND BASIS OF PRE37
ORGANIZATION AND BASIS OF PRESENTATION - Basis of Presentation (Narrative) (Details) - shares shares in Millions | 3 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Jun. 30, 2017 | |
Noncontrolling Interest [Line Items] | ||
Limited partners ownership interest (as a percent) | 62.00% | 63.00% |
General partner interest (as a percent) | 38.00% | 37.00% |
Exchanged for cash | Class B common units | ||
Noncontrolling Interest [Line Items] | ||
Class B common units and associated Class B common shares exchanged (in shares) | 1.2 | |
Exchanged for Class A common stock | Class B common units | ||
Noncontrolling Interest [Line Items] | ||
Class B common units and associated Class B common shares exchanged (in shares) | 1.2 | |
Shares retired (in shares) | 1.2 |
ORGANIZATION AND BASIS OF PRE38
ORGANIZATION AND BASIS OF PRESENTATION - Schedule of Assets and Liabilities of Premier LP (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Jun. 30, 2017 |
Assets | ||
Current | $ 393,867 | $ 408,812 |
Liabilities | ||
Current | 490,134 | 571,587 |
Premier LP | ||
Assets | ||
Current | 361,578 | 385,477 |
Noncurrent | 1,604,275 | 1,616,539 |
Total assets of Premier LP | 1,965,853 | 2,002,016 |
Liabilities | ||
Current | 479,916 | 560,582 |
Noncurrent | 137,119 | 134,635 |
Total liabilities of Premier LP | $ 617,035 | $ 695,217 |
ORGANIZATION AND BASIS OF PRE39
ORGANIZATION AND BASIS OF PRESENTATION - Schedule of Net Income Attributable to Premier LP (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Variable Interest Entity [Line Items] | ||
Premier LP net income | $ 60,616 | $ 58,095 |
Premier LP | ||
Variable Interest Entity [Line Items] | ||
Premier LP net income | $ 72,291 | $ 73,915 |
ORGANIZATION AND BASIS OF PRE40
ORGANIZATION AND BASIS OF PRESENTATION - Schedule of Premier LP's Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Net cash provided by (used in): | ||
Operating activities | $ 75,033 | $ 41,827 |
Investing activities | (16,646) | (96,803) |
Financing activities | (83,002) | (37,829) |
Net decrease in cash and cash equivalents | (24,615) | (92,805) |
Cash and cash equivalents at beginning of year | 156,735 | 248,817 |
Cash and cash equivalents at end of period | 132,120 | 156,012 |
Premier LP | ||
Net cash provided by (used in): | ||
Operating activities | 88,407 | 12,865 |
Investing activities | (16,613) | (96,805) |
Financing activities | (100,476) | (22,168) |
Net decrease in cash and cash equivalents | (28,682) | (106,108) |
Cash and cash equivalents at beginning of year | 133,451 | 210,048 |
Cash and cash equivalents at end of period | $ 104,769 | $ 103,940 |
BUSINESS ACQUISITIONS - Acquisi
BUSINESS ACQUISITIONS - Acquisition of Innovatix and Essensa (Narrative) (Details) - USD ($) | Jan. 10, 2017 | Dec. 02, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | Dec. 01, 2016 |
Business Acquisition [Line Items] | ||||||
Transaction costs | $ 3,099,000 | $ 2,937,000 | ||||
Goodwill recognized | 906,545,000 | $ 906,545,000 | ||||
Retention bonus payment (up to) | $ 3,000,000 | |||||
Carrying value of ownership interest in Innovatix prior to acquisition | 97,131,000 | $ 92,879,000 | ||||
Innovatix | ||||||
Business Acquisition [Line Items] | ||||||
Carrying value of ownership interest in Innovatix prior to acquisition | $ 13,300,000 | |||||
Innovatix | ||||||
Business Acquisition [Line Items] | ||||||
Ownership interest prior to acquisition (as a percent) | 50.00% | |||||
Ownership interest acquired (as a percent) | 50.00% | |||||
Payments to acquire businesses, adjusted purchase price | $ 336,000,000 | |||||
Remeasured fair value under business combination accounting rules | 218,400,000 | |||||
One-time gain related to remeasurement | $ 205,100,000 | |||||
Essensa | ||||||
Business Acquisition [Line Items] | ||||||
Ownership interest acquired (as a percent) | 100.00% | |||||
Innovatix and Essensa | ||||||
Business Acquisition [Line Items] | ||||||
Total purchase price | $ 325,000,000 | |||||
Cash paid at closing | 227,500,000 | |||||
Cash payment included in deferred purchase price | $ 97,500,000 | 97,500,000 | ||||
Payments to acquire businesses, adjusted purchase price | 335,984,000 | |||||
Transaction costs | 1,700,000 | $ 400,000 | ||||
Goodwill recognized | 334,677,000 | |||||
Selling members earn-out opportunity (up to) | 43,000,000 | |||||
Fair value of earn-out liability | 16,662,000 | $ 21,100,000 | ||||
Retention bonus payment (up to) | 3,000,000 | |||||
Remeasured fair value under business combination accounting rules | $ 218,356,000 |
BUSINESS ACQUISITIONS - Schedul
BUSINESS ACQUISITIONS - Schedule of Preliminary Fair Values Assigned to Net Assets Acquired and Liabilities Assumed (Details) - USD ($) | Jan. 10, 2017 | Dec. 02, 2016 | Sep. 30, 2017 | Jun. 30, 2017 |
Business Acquisition [Line Items] | ||||
Receivable from GNYHA Holdings, LLC | $ (3,000,000) | |||
Revenue share obligations | $ 69,535,000 | $ 72,078,000 | ||
Goodwill | 906,545,000 | $ 906,545,000 | ||
Innovatix and Essensa | ||||
Business Acquisition [Line Items] | ||||
Cash paid at closing | 227,500,000 | |||
Cash paid on January 10, 2017 | $ 97,500,000 | 97,500,000 | ||
Purchase price | 325,000,000 | |||
Additional cash paid at closing | 10,984,000 | |||
Adjusted purchase price | 335,984,000 | |||
Earn-out liability | 16,662,000 | $ 21,100,000 | ||
Receivable from GNYHA Holdings, LLC | (3,000,000) | |||
Total consideration paid | 349,646,000 | |||
Cash acquired | (16,267,000) | |||
Net consideration | 333,379,000 | |||
50% ownership interest in Innovatix | 218,356,000 | |||
Payable to Innovatix and Essensa | (5,765,000) | |||
Enterprise value | 545,970,000 | |||
Accounts receivable | 21,242,000 | |||
Prepaid expenses and other current assets | 686,000 | |||
Fixed assets, net | 3,476,000 | |||
Intangible assets | 241,494,000 | |||
Total assets acquired | 266,898,000 | |||
Accrued expenses | 5,264,000 | |||
Revenue share obligations | 7,011,000 | |||
Other current liabilities | 694,000 | |||
Total liabilities assumed | 12,969,000 | |||
Deferred tax liability | 42,636,000 | |||
Goodwill | $ 334,677,000 |
BUSINESS ACQUISITIONS - Acqui43
BUSINESS ACQUISITIONS - Acquisition of Acro Pharmaceutical (Narrative) (Details) - USD ($) $ in Thousands | Aug. 23, 2016 | Sep. 30, 2017 | Jun. 30, 2017 |
Business Acquisition [Line Items] | |||
Goodwill recognized | $ 906,545 | $ 906,545 | |
Acro Pharmaceuticals | |||
Business Acquisition [Line Items] | |||
Membership interest acquired (as a percent) | 100.00% | ||
Cash purchase price | $ 75,000 | ||
Payments to acquire businesses, adjusted purchase price | 62,900 | ||
Goodwill recognized | $ 33,900 |
INVESTMENTS - Schedule of Inves
INVESTMENTS - Schedule of Investments in Unconsolidated Affiliates (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | $ 97,131 | $ 92,879 | |
Equity in Net Income (Loss) | 4,252 | $ 9,579 | |
FFF | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 89,857 | 85,520 | |
Equity in Net Income (Loss) | 4,337 | 3,059 | |
Bloodbuy | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 2,033 | 2,066 | |
Equity in Net Income (Loss) | (33) | (19) | |
PharmaPoint | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 4,180 | 4,232 | |
Equity in Net Income (Loss) | (52) | (77) | |
Innovatix | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 0 | 0 | |
Equity in Net Income (Loss) | 0 | 6,616 | |
Other investments | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 1,061 | $ 1,061 | |
Equity in Net Income (Loss) | $ 0 | $ 0 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) - USD ($) shares in Millions | Jul. 26, 2016 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 02, 2016 | Dec. 01, 2016 |
Schedule of Equity Method Investments [Line Items] | |||||
Marketable securities | $ 0 | ||||
Innovatix | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity method investment (as a percent) | 50.00% | ||||
Ownership interest acquired (as a percent) | 50.00% | ||||
PSCI | FFF | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership interest through subsidiary (as a percent) | 49.00% | ||||
Cash portion of acquisition price | $ 65,700,000 | ||||
Initial investment | 81,100,000 | ||||
Consideration in the form of net fair value of put and call rights | $ 15,400,000 | ||||
PSCI | Class B Membership Interests | Bloodbuy | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Membership units (in shares) | 5.3 | 5.3 | |||
PSCI | Class B Membership Interests | PharmaPoint | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership interest through subsidiary (as a percent) | 28.00% | ||||
Membership units (in shares) | 5 | 5 | |||
Minimum | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Notes payable, stated maturity period | 3 months | ||||
Maximum | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Notes payable, stated maturity period | 5 years | ||||
Innovatix | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity method investment (as a percent) | 50.00% | ||||
Ownership interest acquired (as a percent) | 50.00% | ||||
PharmaPoint | PSCI | Class B Membership Interests | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership interest through subsidiary (as a percent) | 28.00% | ||||
Bloodbuy | PSCI | Class B Membership Interests | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership interest through subsidiary (as a percent) | 15.00% | 15.00% |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Financial Assets and Liabilities (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2017 | Jun. 30, 2017 |
Assets | ||
Cash equivalents | $ 9,322 | $ 22,218 |
Deferred compensation plan assets | 44,567 | 47,202 |
Total assets | 58,482 | 74,075 |
Liabilities | ||
Total liabilities | 45,683 | 45,360 |
Earn-out liabilities | ||
Liabilities | ||
Earn-out liabilities | 21,675 | 21,310 |
FFF call right | ||
Assets | ||
Securities | 4,655 | |
FFF | ||
Assets | ||
FFF call right | 4,593 | |
Liabilities | ||
FFF put right | 24,008 | 24,050 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets | ||
Cash equivalents | 9,322 | 22,218 |
Deferred compensation plan assets | 44,567 | 47,202 |
Total assets | 53,889 | 69,420 |
Liabilities | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Earn-out liabilities | ||
Liabilities | ||
Earn-out liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | FFF call right | ||
Assets | ||
Securities | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | FFF | ||
Assets | ||
FFF call right | 0 | |
Liabilities | ||
FFF put right | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Deferred compensation plan assets | 0 | 0 |
Total assets | 0 | 0 |
Liabilities | ||
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Earn-out liabilities | ||
Liabilities | ||
Earn-out liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | FFF call right | ||
Assets | ||
Securities | 0 | |
Significant Other Observable Inputs (Level 2) | FFF | ||
Assets | ||
FFF call right | 0 | |
Liabilities | ||
FFF put right | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Deferred compensation plan assets | 0 | 0 |
Total assets | 4,593 | 4,655 |
Liabilities | ||
Total liabilities | 45,683 | 45,360 |
Significant Unobservable Inputs (Level 3) | Earn-out liabilities | ||
Liabilities | ||
Earn-out liabilities | 21,675 | 21,310 |
Significant Unobservable Inputs (Level 3) | FFF call right | ||
Assets | ||
Securities | 4,655 | |
Significant Unobservable Inputs (Level 3) | FFF | ||
Assets | ||
FFF call right | 4,593 | |
Liabilities | ||
FFF put right | $ 24,008 | $ 24,050 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Jun. 30, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of deferred compensation plan assets | $ 40,906 | $ 41,518 |
FFF call right | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Call right, exercisable term | 180 days | |
Level 1 | Prepaid expenses and other current assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of deferred compensation plan assets | $ 3,700 | 5,700 |
Level 2 | Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes payable, difference between fair value and carrying value | $ 500 | 600 |
Level 2 | Nonrecurring | Notes payable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assumed market interest rate | 2.60% | |
Level 3 | Current portion of earn-out liabilities | Earn-out liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair values of earn-out liabilities | $ 21,100 | 21,100 |
Level 3 | Long-term portion of earn-out liabilities | Earn-out liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair values of earn-out liabilities | $ 600 | $ 200 |
FAIR VALUE MEASUREMENTS - Recon
FAIR VALUE MEASUREMENTS - Reconciliation of Earn-Out Liabilities and FFF Put and Call Rights (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | $ 4,655 | $ 0 |
Purchases | 0 | 10,361 |
Gain (Loss) | (62) | (45) |
Ending Balance | 4,593 | 10,316 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 45,360 | 4,128 |
Purchases | 0 | 25,821 |
Gain (Loss) | (323) | 1,779 |
Ending Balance | 45,683 | 28,170 |
Earn-out liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 21,310 | 4,128 |
Purchases | 0 | 0 |
Gain (Loss) | (365) | 1,769 |
Ending Balance | 21,675 | 2,359 |
FFF put right | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 24,050 | 0 |
Purchases | 0 | 25,821 |
Gain (Loss) | 42 | 10 |
Ending Balance | 24,008 | 25,811 |
FFF call right | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 4,655 | 0 |
Purchases | 0 | 10,361 |
Gain (Loss) | (62) | (45) |
Ending Balance | $ 4,593 | $ 10,316 |
INTANGIBLE ASSETS, NET - Schedu
INTANGIBLE ASSETS, NET - Schedule of Intangible Assets, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Jun. 30, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 477,160 | $ 477,160 |
Accumulated amortization | (113,096) | (99,198) |
Intangible assets, net | $ 364,064 | 377,962 |
Member relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 14 years 8 months | |
Total intangible assets | $ 220,100 | 220,100 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 5 years | |
Total intangible assets | $ 143,727 | 143,727 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 8 years 4 months | |
Total intangible assets | $ 48,120 | 48,120 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 8 years 4 months | |
Total intangible assets | $ 22,710 | 22,710 |
Distribution network | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 10 years | |
Total intangible assets | $ 22,400 | 22,400 |
Favorable lease commitments | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 10 years 1 month | |
Total intangible assets | $ 11,393 | 11,393 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 5 years 11 months | |
Total intangible assets | $ 8,710 | $ 8,710 |
INTANGIBLE ASSETS, NET - Narrat
INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Intangible asset amortization | $ 13,898 | $ 9,209 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Jun. 30, 2017 |
Goodwill [Line Items] | ||
Goodwill | $ 906,545 | $ 906,545 |
Supply Chain Services | ||
Goodwill [Line Items] | ||
Goodwill | 400,348 | |
Performance Services | ||
Goodwill [Line Items] | ||
Goodwill | $ 506,197 | $ 506,197 |
DEBT - Schedule of Long-Term De
DEBT - Schedule of Long-Term Debt (Details) - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
Debt Instrument [Line Items] | ||
Total debt | $ 179,298,000 | $ 234,272,000 |
Less: Current portion | (173,023,000) | (227,993,000) |
Total long-term debt | 6,275,000 | 6,279,000 |
Credit Facility | ||
Debt Instrument [Line Items] | ||
Commitment Amount | 750,000,000 | |
Total debt | 170,000,000 | 220,000,000 |
Notes payable | ||
Debt Instrument [Line Items] | ||
Total debt | $ 9,298,000 | $ 14,272,000 |
DEBT - Credit Facility (Narrati
DEBT - Credit Facility (Narrative) (Details) | Jun. 04, 2015USD ($)quarter | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2017USD ($) |
Line of Credit Facility [Line Items] | ||||
Repaid borrowings under the Credit Facility | $ 50,000,000 | $ 0 | ||
Outstanding borrowings | $ 179,298,000 | $ 234,272,000 | ||
Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 750,000,000 | |||
Additional borrowing capacity | $ 250,000,000 | |||
Commitment fee (as a percent) | 0.125% | |||
Maximum total leverage ratio | 3 | |||
Maximum consecutive period for total leverage ratio to exceed limit | quarter | 4 | |||
Minimum consolidated interest coverage ratio | 3 | |||
Indebtedness or guarantee threshold | $ 30,000,000 | |||
Judgment default threshold | $ 30,000,000 | |||
Repaid borrowings under the Credit Facility | $ 50,000,000 | |||
Credit Facility | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Contractual commitment fee on daily unused amount (as a percent) | 0.125% | |||
Credit Facility | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Contractual commitment fee on daily unused amount (as a percent) | 0.25% | |||
Credit Facility | Base Rate Loans | Federal funds effective rate | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.50% | |||
Credit Facility | Base Rate Loans | LIBOR | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.00% | |||
Credit Facility | Base Rate Loans | Applicable Rate | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.125% | |||
Credit Facility | Base Rate Loans | Applicable Rate | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.75% | |||
Credit Facility | Base Rate Loans | Three-month Eurodollar | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 4.375% | |||
Credit Facility | Eurodollar Loans | Applicable Rate | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.125% | |||
Credit Facility | Eurodollar Loans | Applicable Rate | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.75% | |||
Credit Facility | Eurodollar Loans | Three-month Eurodollar | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.459% | |||
Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 750,000,000 | |||
Outstanding borrowings | $ 170,000,000 | $ 220,000,000 |
DEBT - Notes Payable (Narrative
DEBT - Notes Payable (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Jun. 30, 2017 | |
Debt Instrument [Line Items] | ||
Notes payable | $ 9,300 | $ 14,300 |
Notes payable included in current portion of long-term debt | 3,000 | 8,000 |
Notes payable included in long-term debt, less current portion | $ 6,275 | $ 6,279 |
Notes payable | ||
Debt Instrument [Line Items] | ||
Notes payable, stated maturity period | 5 years |
REDEEMABLE LIMITED PARTNERS' 55
REDEEMABLE LIMITED PARTNERS' CAPITAL - Narrative (Details) $ in Thousands, shares in Millions | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2017USD ($)notes_receivablelimited_partnershares | Sep. 30, 2016USD ($) | Jun. 30, 2017 | |
Temporary Equity [Line Items] | |||
Limited partners ownership (as a percent) | 62.00% | 63.00% | |
Exchanged for cash | Class B common units | |||
Temporary Equity [Line Items] | |||
Class B common units and associated Class B common shares exchanged (in shares) | shares | 1.2 | ||
Exchanged for Class A common stock | Class B common units | |||
Temporary Equity [Line Items] | |||
Class B common units and associated Class B common shares exchanged (in shares) | shares | 1.2 | ||
Limited partner | |||
Temporary Equity [Line Items] | |||
Decrease to fair value for the redemption amount | $ | $ 320,424 | ||
Number of interest bearing notes receivable executed | notes_receivable | 0 | ||
Number of limited partners withdrawing from partnership | limited_partner | 0 | ||
Redeemable limited partners' capital | Limited partner | |||
Temporary Equity [Line Items] | |||
Decrease to fair value for the redemption amount | $ | $ 320,424 | $ 61,800 | |
Promissory note | |||
Temporary Equity [Line Items] | |||
Promissory note for which common units are not eligible for exchange, term | 5 years | ||
Five-year, unsecured, non-interest bearing term promissory note | Promissory note | |||
Temporary Equity [Line Items] | |||
Promissory note for which common units are not eligible for exchange, term | 5 years |
REDEEMABLE LIMITED PARTNERS' 56
REDEEMABLE LIMITED PARTNERS' CAPITAL - Changes in Redeemable Limited Partners' Capital (Details) - USD ($) $ in Thousands | Aug. 24, 2017 | Sep. 30, 2017 | Sep. 30, 2016 |
Increase (Decrease) in Temporary Equity | |||
June 30, 2017 | $ 3,138,583 | ||
Exchange of Class B common units for Class A common stock by member owners | (42,976) | ||
September 30, 2017 | 2,799,533 | ||
Limited Partner | |||
Increase (Decrease) in Temporary Equity | |||
June 30, 2017 | 3,138,583 | ||
Distributions applied to receivables from limited partners | 492 | ||
Net income attributable to non-controlling interest in Premier LP | 44,610 | ||
Distributions to limited partners | $ (24,951) | (20,752) | |
Exchange of Class B common units for Class A common stock by member owners | (42,976) | ||
Adjustment to redemption amount | (320,424) | ||
September 30, 2017 | 2,799,533 | ||
Limited Partner | Receivables From Limited Partners | |||
Increase (Decrease) in Temporary Equity | |||
June 30, 2017 | (4,177) | ||
Distributions applied to receivables from limited partners | 492 | ||
September 30, 2017 | (3,685) | ||
Limited Partner | Redeemable Limited Partners' Capital | |||
Increase (Decrease) in Temporary Equity | |||
June 30, 2017 | 3,142,760 | ||
Net income attributable to non-controlling interest in Premier LP | 44,610 | ||
Distributions to limited partners | (20,752) | ||
Exchange of Class B common units for Class A common stock by member owners | (42,976) | ||
Adjustment to redemption amount | (320,424) | $ (61,800) | |
September 30, 2017 | $ 2,803,218 |
REDEEMABLE LIMITED PARTNERS' 57
REDEEMABLE LIMITED PARTNERS' CAPITAL - Schedule of Quarterly Distributions to Limited Partners (Details) - Limited Partner - USD ($) $ in Thousands | Nov. 22, 2017 | Aug. 24, 2017 | Sep. 30, 2017 |
Limited Partners' Capital Account [Line Items] | |||
Distribution | $ 24,951 | $ 20,752 | |
Scenario, Forecast | |||
Limited Partners' Capital Account [Line Items] | |||
Distributions paid | $ 20,800 |
REDEEMABLE LIMITED PARTNERS' 58
REDEEMABLE LIMITED PARTNERS' CAPITAL - Schedule Of Common Stock Units Quarterly Exchanges (Details) - Class B Common Stock - USD ($) $ in Thousands | Jul. 31, 2017 | Sep. 30, 2017 |
Limited Partners' Capital Account [Line Items] | ||
Class B common units and associated Class B common shares exchanged (in shares) | 1,231,410 | 1,231,410 |
Reduction in Redeemable Limited Partnership Account | $ 42,976 | $ 42,976 |
STOCKHOLDERS' DEFICIT (Details)
STOCKHOLDERS' DEFICIT (Details) | 3 Months Ended | |
Sep. 30, 2017$ / sharesshares | Jun. 30, 2017$ / sharesshares | |
Class A Common Stock | ||
Class of Stock [Line Items] | ||
Common stock, shares outstanding | shares | 53,558,451 | 51,943,281 |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 |
Voting rights, ratio of votes to shares held | 1 | |
Class B Common Stock | ||
Class of Stock [Line Items] | ||
Common stock, shares outstanding | shares | 86,067,478 | 87,298,888 |
Common stock, par value (in dollars per share) | $ / shares | $ 0.000001 | $ 0.000001 |
Voting rights, ratio of votes to shares held | 1 |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of the Numerator and Denominator Used for Basic and Diluted Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Numerator for basic earnings per share: | ||
Net income attributable to stockholders | $ 336,430 | $ 70,302 |
Numerator for diluted earnings per share: | ||
Adjustment of redeemable limited partners' capital to redemption amount | (320,424) | (61,808) |
Net income attributable to non-controlling interest in Premier LP | 44,610 | 49,601 |
Net income | 60,616 | 58,095 |
Tax effect on Premier, Inc. net income | (10,551) | (20,951) |
Adjusted net income | $ 50,065 | $ 37,144 |
Denominator for basic earnings per share: | ||
Weighted average shares (in shares) | 52,909 | 47,214 |
Denominator for diluted earnings per share: | ||
Weighted average shares (in shares) | 52,909 | 47,214 |
Effect of dilutive securities: | ||
Weighted average shares and assumed conversions (in shares) | 140,046 | 142,962 |
Basic earnings per share (in dollars per share) | $ 6.36 | $ 1.49 |
Diluted earnings per share (in dollars per share) | $ 0.36 | $ 0.26 |
Class B Common Stock | ||
Effect of dilutive securities: | ||
Effect of dilutive securities (in shares) | 86,482 | 94,809 |
Stock options | ||
Effect of dilutive securities: | ||
Effect of dilutive securities (in shares) | 351 | 302 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,400 | 1,600 |
Restricted stock | ||
Effect of dilutive securities: | ||
Effect of dilutive securities (in shares) | 304 | 171 |
Performance share awards | ||
Effect of dilutive securities: | ||
Effect of dilutive securities (in shares) | 0 | 466 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 600 |
EARNINGS PER SHARE - Schedule o
EARNINGS PER SHARE - Schedule of Exchange Agreement (Details) - shares | Oct. 31, 2017 | Jul. 31, 2017 | Sep. 30, 2017 |
Class B Common Shares | |||
Conversion of Stock [Line Items] | |||
Class B Common Shares Retired Upon Exchange (in shares) | 1,231,410 | 1,231,410 | |
Shares Outstanding After Exchange (in shares) | 86,067,478 | ||
Percentage of Combined Voting Power Class B/Class A Common Stock | 62.00% | ||
Class A Common Shares | |||
Conversion of Stock [Line Items] | |||
Shares Outstanding After Exchange (in shares) | 53,212,057 | ||
Percentage of Combined Voting Power Class B/Class A Common Stock | 38.00% | ||
Subsequent Event | Class B Common Shares | |||
Conversion of Stock [Line Items] | |||
Class B Common Shares Retired Upon Exchange (in shares) | 3,651,294 | ||
Shares Outstanding After Exchange (in shares) | 82,416,184 | ||
Percentage of Combined Voting Power Class B/Class A Common Stock | 59.00% | ||
Subsequent Event | Class A Common Shares | |||
Conversion of Stock [Line Items] | |||
Shares Outstanding After Exchange (in shares) | 57,215,143 | ||
Percentage of Combined Voting Power Class B/Class A Common Stock | 41.00% |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Pre-tax stock-based compensation expense | $ 8.8 | $ 5.8 |
Deferred tax benefit | $ 3.3 | $ 2.2 |
Expected effective income tax rate | 38.00% | |
2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of awards authorized for grant (up to) (in shares) | 11.3 | |
Number of shares available for grant | 3.5 | |
Restricted stock | Employee | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 3 years | |
Restricted stock | Director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 1 year | |
Performance share awards | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 3 years | |
Stock options | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 3 years | |
Award term | 10 years | |
Options, expiration period | 12 months | |
Year One | Stock options | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting rights (as a percent) | 33.33% | |
Year Two | Stock options | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting rights (as a percent) | 33.33% | |
Year Three | Stock options | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting rights (as a percent) | 33.33% |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of Information Related to Restricted Stock, Performance Share Awards and Stock Options (Details) - 2013 Equity Incentive Plan | 3 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Restricted Stock | |
Number of Awards | |
Outstanding, beginning balance (in shares) | shares | 576,988 |
Granted (in shares) | shares | 202,532 |
Vested/exercised (in shares) | shares | (107,764) |
Forfeited (in shares) | shares | (15,930) |
Outstanding, ending balance (in shares) | shares | 655,826 |
Weighted Average Fair Value at Grant Date | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 32.92 |
Granted (in dollars per share) | $ / shares | 32.90 |
Vested/exercised (in dollars per share) | $ / shares | 31.64 |
Forfeited (in dollars per share) | $ / shares | 32.37 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 33.14 |
Performance Share Awards | |
Number of Awards | |
Outstanding, beginning balance (in shares) | shares | 1,085,872 |
Granted (in shares) | shares | 678,340 |
Vested/exercised (in shares) | shares | (352,867) |
Forfeited (in shares) | shares | (37,131) |
Outstanding, ending balance (in shares) | shares | 1,374,214 |
Weighted Average Fair Value at Grant Date | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 32.79 |
Granted (in dollars per share) | $ / shares | 32.70 |
Vested/exercised (in dollars per share) | $ / shares | 31.73 |
Forfeited (in dollars per share) | $ / shares | 32.35 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 33.02 |
Stock options | |
Number of Options | |
Outstanding, beginning balance (in shares) | shares | 3,372,499 |
Granted (in shares) | shares | 538,413 |
Vested/exercised (in shares) | shares | (96,137) |
Forfeited (in shares) | shares | (71,191) |
Outstanding, ending balance (in shares) | shares | 3,743,584 |
Stock options outstanding and exercisable (in shares) | shares | 2,628,081 |
Weighted Average Exercise Price | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 30.31 |
Granted (in dollars per share) | $ / shares | 32.90 |
Vested/exercised (in dollars per share) | $ / shares | 28.12 |
Forfeited (in dollars per share) | $ / shares | 34.24 |
Outstanding, ending balance (in dollars per share) | $ / shares | 30.66 |
Stock options outstanding and exercisable (in dollars per share) | $ / shares | $ 29.66 |
STOCK-BASED COMPENSATION - Sc64
STOCK-BASED COMPENSATION - Schedule of Unrecognized Stock-Based Compensation Expense (Details) $ in Thousands | 3 Months Ended |
Sep. 30, 2017USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 56,592 |
Weighted Average Amortization Period | 2 years 2 months 12 days |
2013 Equity Incentive Plan | Restricted stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 13,180 |
Weighted Average Amortization Period | 2 years 2 months 8 days |
2013 Equity Incentive Plan | Performance share awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 31,492 |
Weighted Average Amortization Period | 2 years 2 months 12 days |
2013 Equity Incentive Plan | Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 11,920 |
Weighted Average Amortization Period | 2 years 2 months 15 days |
STOCK-BASED COMPENSATION - Sc65
STOCK-BASED COMPENSATION - Schedule of Aggregate Intrinsic Value of Stock Options (Details) - 2013 Equity Incentive Plan $ in Thousands | Sep. 30, 2017USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding and exercisable | $ 9,107 |
Expected to vest | 349 |
Total outstanding | 9,456 |
Exercised during the three months ended September 30, 2017 | $ 566 |
STOCK-BASED COMPENSATION - Assu
STOCK-BASED COMPENSATION - Assumptions Used for Determining the Fair Value of Stock Options Granted (Details) - 2013 Equity Incentive Plan - Stock options - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 6 years | 6 years |
Expected dividend (in dollars per share) | $ 0 | $ 0 |
Expected volatility (as a percent) | 32.36% | 33.00% |
Risk-free interest rate (as a percent) | 0.00% | 1.31% |
Weighted average option grant date fair value (in dollars per share) | $ 0 | $ 10.80 |
Expected dividend rate | 0.00% | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Constant maturity treasury rate (term) | 5 years | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Constant maturity treasury rate (term) | 7 years |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Income Tax Contingency [Line Items] | |||
Increase (decrease) in income taxes | $ 10,500 | ||
Increase (decrease) income taxes, percent | 45.00% | ||
Tax expense | $ 12,764 | $ 23,336 | |
Effective tax rate | 17.00% | 29.00% | |
Net deferred tax assets | $ 454,800 | $ 434,300 | |
Current deferred tax assets at Premier, Inc. | 506,166 | 482,484 | |
Current deferred tax liabilities | 51,363 | 48,227 | |
Decrease in deferred tax assets | 20,500 | ||
Deferred tax assets, other | 17,700 | ||
Increase (decrease) in tax receivable agreement liability, revaluation of future contingent payments | 7,500 | $ 20,900 | |
TRA liabilities | 380,000 | $ 339,700 | |
Increase in TRA liabilities | $ 40,300 | ||
Tax savings payable to limited partners (as a percent) | 85.00% | 85.00% | |
Liabilities incurred in connection with quarterly member owner exchanges | $ 16,800 | ||
Premier Healthcare Solutions, Inc. | |||
Income Tax Contingency [Line Items] | |||
Valuation allowance recorded against deferred tax assets | $ 5,300 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Jul. 26, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | Dec. 02, 2016 | Dec. 01, 2016 |
Related Party Transaction [Line Items] | |||||||
Revenue share obligations | $ 69,535,000 | $ 72,078,000 | |||||
Limited partners' distribution payable | 20,752,000 | 24,951,000 | |||||
Due from related parties | 487,000 | 6,742,000 | |||||
Share of Innovatix's net income | 4,252,000 | $ 9,579,000 | |||||
Net administrative fees revenue recorded from purchases under agreements | 150,991,000 | 125,976,000 | |||||
Innovatix | |||||||
Related Party Transaction [Line Items] | |||||||
Share of Innovatix's net income | 0 | 6,616,000 | |||||
FFF | |||||||
Related Party Transaction [Line Items] | |||||||
Share of Innovatix's net income | 4,337,000 | 3,059,000 | |||||
GYNHA | |||||||
Related Party Transaction [Line Items] | |||||||
Revenue share obligations | 7,800,000 | ||||||
Limited partners' distribution payable | 2,700,000 | ||||||
Essensa | Administrative Fee Revenue | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | 700,000 | ||||||
AEIX | |||||||
Related Party Transaction [Line Items] | |||||||
Maximum annual incentive management fee | 500,000 | ||||||
AEIX | Administrative Fee Revenue | |||||||
Related Party Transaction [Line Items] | |||||||
Due from related parties | 500,000 | 600,000 | |||||
AEIX | Cost Reimbursement | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | $ 1,500,000 | 1,100,000 | |||||
Premier LP | GYNHA | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership of outstanding partnership interests (as a percent) | 9.50% | ||||||
Premier LP | GYNHA | Administrative Fee Revenue | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | 17,700,000 | ||||||
Due from related parties | $ 5,400,000 | ||||||
Premier LP | GYNHA | Services and Support Revenue | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | 3,600,000 | ||||||
Premier LP | GYNHA | Product Revenue | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | 3,800,000 | ||||||
Premier LP | Member Owners | |||||||
Related Party Transaction [Line Items] | |||||||
Revenue share of gross administrative fees (as a percent) | 30.00% | ||||||
Premier Supply Chain Improvement, Inc | Innovatix | |||||||
Related Party Transaction [Line Items] | |||||||
Share of Innovatix's net income | 6,500,000 | ||||||
Premier Supply Chain Improvement, Inc | FFF | |||||||
Related Party Transaction [Line Items] | |||||||
Share of Innovatix's net income | $ 4,300,000 | 3,000,000 | |||||
Ownership share of net income of FFF (as a percent) | 49.00% | ||||||
Net administrative fees revenue recorded from purchases under agreements | $ 100,000 | $ 1,700,000 | 1,500,000 | ||||
Premier Healthcare Solutions, Inc. | Innovatix | |||||||
Related Party Transaction [Line Items] | |||||||
Net administrative fees revenue | $ 11,400,000 | ||||||
Innovatix | |||||||
Related Party Transaction [Line Items] | |||||||
Membership interest prior to acquisition (as a percent) | 50.00% | ||||||
Remaining membership interest acquired (as a percent) | 50.00% | ||||||
Essensa | |||||||
Related Party Transaction [Line Items] | |||||||
Remaining membership interest acquired (as a percent) | 100.00% | ||||||
Innovatix | |||||||
Related Party Transaction [Line Items] | |||||||
Membership interest prior to acquisition (as a percent) | 50.00% | ||||||
Remaining membership interest acquired (as a percent) | 50.00% |
SEGMENTS - Narrative (Details)
SEGMENTS - Narrative (Details) | 3 Months Ended |
Sep. 30, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable business segments | 2 |
Threshold to classify expenses as non-recurring (period) | 2 years |
Threshold to classify expenses as non-recurring, not expected to occur within (period) | 2 years |
SEGMENTS - Schedule of Segment
SEGMENTS - Schedule of Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | |||
Net administrative fees | $ 150,991 | $ 125,976 | |
Other services and support | 86,911 | 81,167 | |
Services | 237,902 | 207,143 | |
Products | 152,662 | 106,129 | |
Net revenue | 390,564 | 313,272 | |
Depreciation and amortization expense | 30,405 | 23,227 | |
Capital expenditures | 16,647 | 16,966 | |
Total assets | 2,504,342 | $ 2,507,836 | |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization expense | 1,992 | 1,886 | |
Capital expenditures | 2,791 | 115 | |
Total assets | 633,209 | 601,951 | |
Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net administrative fees | 150,991 | 125,976 | |
Other services and support | 2,149 | 1,645 | |
Services | 153,140 | 127,621 | |
Products | 152,662 | 106,129 | |
Net revenue | 305,802 | 233,750 | |
Supply Chain Services | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization expense | 5,495 | 466 | |
Capital expenditures | 307 | 0 | |
Total assets | 991,569 | 1,017,023 | |
Performance Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 84,762 | 79,522 | |
Performance Services | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization expense | 22,918 | 20,875 | |
Capital expenditures | 13,549 | $ 16,851 | |
Total assets | $ 879,564 | $ 888,862 |
SEGMENTS - Reconciliation of In
SEGMENTS - Reconciliation of Income Before Income Taxes to Segment Adjusted EBITDA (Details) - USD ($) $ in Thousands | Dec. 02, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 01, 2016 |
Segment Reporting Information [Line Items] | ||||
Income before income taxes | $ 73,380 | $ 81,431 | ||
Equity in net income of unconsolidated affiliates | (4,252) | (9,579) | ||
Interest and investment loss, net | 1,495 | 152 | ||
Loss on disposal of long-lived assets | 1,320 | 1,518 | ||
Other income | (1,463) | (1,006) | ||
Operating income | 70,480 | 72,516 | ||
Depreciation and amortization | 16,507 | 14,018 | ||
Amortization of purchased intangible assets | 13,898 | 9,209 | ||
Stock-based compensation | 8,957 | 5,896 | ||
Acquisition related expenses | 3,099 | 2,937 | ||
Adjustment to tax receivable agreement liability | 0 | (5,722) | ||
ERP implementation expenses | 335 | 1,094 | ||
Acquisition related adjustment - revenue | 105 | 151 | ||
Equity in net income of unconsolidated affiliates | 4,252 | 9,579 | ||
Deferred compensation plan income (expense) | 1,539 | 1,095 | ||
Other expense | (1) | 0 | ||
Adjusted EBITDA | 119,171 | 110,773 | ||
Business Acquisition [Line Items] | ||||
Stock purchase plan expense | $ 100 | |||
Income taxes, reduction in rate, percent | 1.00% | |||
Purchase accounting adjustments to Adjusted EBITDA | 105 | $ 151 | ||
Innovatix | ||||
Segment Reporting Information [Line Items] | ||||
Remeasurement gain attributable to acquisition of Innovatix, LLC | $ (205,100) | |||
Business Acquisition [Line Items] | ||||
Ownership interest prior to acquisition (as a percent) | 50.00% | |||
Ownership interest acquired (as a percent) | 50.00% | |||
Innovatix and Essensa | ||||
Segment Reporting Information [Line Items] | ||||
Acquisition related expenses | 1,700 | 400 | ||
FFF | ||||
Segment Reporting Information [Line Items] | ||||
Equity in net income of unconsolidated affiliates | (4,337) | (3,059) | ||
Operating Segments | Supply Chain Services | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 125,620 | 117,304 | ||
Operating Segments | Performance Services | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 21,221 | 22,311 | ||
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | $ (27,670) | $ (28,842) |
Uncategorized Items - pinc-2017
Label | Element | Value |
Letter of Credit [Member] | ||
Line of Credit Facility, Maximum Borrowing Capacity | us-gaap_LineOfCreditFacilityMaximumBorrowingCapacity | $ 25,000,000 |
Revolving Credit Facility, Swing Line Loan [Member] | ||
Line of Credit Facility, Maximum Borrowing Capacity | us-gaap_LineOfCreditFacilityMaximumBorrowingCapacity | $ 75,000,000 |