Cover
Cover - shares | 3 Months Ended | |
Sep. 30, 2021 | Oct. 28, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36092 | |
Entity Registrant Name | Premier, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 35-2477140 | |
Entity Address, Address Line One | 13034 Ballantyne Corporate Place | |
Entity Address, City or Town | Charlotte, | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28277 | |
City Area Code | 704 | |
Local Phone Number | 357-0022 | |
Title of 12(b) Security | Class A Common Stock, $0.01 Par Value | |
Trading Symbol | PINC | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 121,860,329 | |
Entity Central Index Key | 0001577916 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 |
Assets | ||
Cash and cash equivalents | $ 184,421 | $ 129,141 |
Accounts receivable (net of $1,283 and $1,174 allowance for credit losses, respectively) | 139,111 | 142,557 |
Contract assets (net of $1,014 and $1,110 allowance for credit losses, respectively) | 272,049 | 266,173 |
Inventory | 169,019 | 176,376 |
Prepaid expenses and other current assets | 68,125 | 68,049 |
Total current assets | 832,725 | 782,296 |
Property and equipment (net of $538,399 and $518,332 accumulated depreciation, respectively) | 226,349 | 224,271 |
Intangible assets (net of $300,801 and $289,912 accumulated amortization, respectively) | 385,753 | 396,642 |
Goodwill | 999,913 | 999,913 |
Deferred income tax assets | 763,125 | 781,824 |
Deferred compensation plan assets | 54,572 | 59,581 |
Investments in unconsolidated affiliates | 186,282 | 153,224 |
Operating lease right-of-use assets | 46,432 | 48,199 |
Other assets | 71,769 | 76,948 |
Total assets | 3,566,920 | 3,522,898 |
Liabilities and stockholders' equity | ||
Accounts payable | 89,533 | 85,413 |
Accrued expenses | 42,540 | 48,144 |
Revenue share obligations | 223,748 | 226,883 |
Accrued compensation and benefits | 47,957 | 100,713 |
Deferred revenue | 33,211 | 34,058 |
Current portion of notes payable to members | 96,412 | 95,948 |
Line of credit and current portion of long-term debt | 175,416 | 78,295 |
Other current liabilities | 48,224 | 47,330 |
Total current liabilities | 757,041 | 716,784 |
Long-term debt, less current portion | 5,333 | 5,333 |
Notes payable to members, less current portion | 274,717 | 298,995 |
Deferred compensation plan obligations | 54,572 | 59,581 |
Deferred consideration, less current portion | 57,126 | 56,809 |
Operating lease liabilities, less current portion | 40,979 | 43,102 |
Other liabilities | 49,066 | 112,401 |
Total liabilities | 1,238,834 | 1,293,005 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Treasury stock, at cost; 1,091,362 and 0 shares at September 30, 2021 and June 30, 2021, respectively | (42,628) | 0 |
Additional paid-in capital | 2,102,875 | 2,059,194 |
Retained earnings | 266,601 | 169,474 |
Total stockholders' equity | 2,328,086 | 2,229,893 |
Total liabilities and stockholders' equity | 3,566,920 | 3,522,898 |
Common Class A | ||
Stockholders' equity: | ||
Class A common stock, $0.01 par value, 500,000,000 shares authorized; 123,772,055 shares issued and 122,680,693 shares outstanding at September 30, 2021 and 122,533,051 shares issued and outstanding at June 30, 2021 | $ 1,238 | $ 1,225 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 |
Allowance for doubtful accounts | $ 1,283 | $ 1,174 |
Allowance for credit losses | 1,014 | 1,110 |
Accumulated depreciation | 538,399 | 518,332 |
Accumulated amortization | $ 300,801 | $ 289,912 |
Treasury stock, shares (in shares) | 1,091,362 | 0 |
Common Class A | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 123,772,055 | 122,533,051 |
Common stock, shares outstanding (in shares) | 122,680,693 | 122,533,051 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Net revenue: | ||
Net revenue | $ 365,147 | $ 346,887 |
Cost of revenue: | ||
Cost of revenue | 153,171 | 152,178 |
Gross profit | 211,976 | 194,709 |
Operating expenses: | ||
Selling, general and administrative | 127,814 | 123,954 |
Research and development | 994 | 576 |
Amortization of purchased intangible assets | 10,889 | 13,204 |
Operating expenses | 139,697 | 137,734 |
Operating income | 72,279 | 56,975 |
Equity in net income of unconsolidated affiliates | 7,058 | 5,927 |
Interest expense, net | (2,788) | (2,119) |
Gain (loss) on FFF put and call rights | 64,110 | (1,919) |
Other (expense) income, net | (320) | 3,683 |
Other income, net | 68,060 | 5,572 |
Income before income taxes | 140,339 | 62,547 |
Income tax expense (benefit) | 19,033 | (94,981) |
Net income | 121,306 | 157,528 |
Net loss (income) attributable to non-controlling interest | 698 | (11,845) |
Adjustment of redeemable limited partners' capital to redemption amount | 0 | (26,685) |
Net income attributable to stockholders | 122,004 | 118,998 |
Comprehensive income: | ||
Net income | 121,306 | 157,528 |
Comprehensive loss (income) attributable to non-controlling interest | 698 | (11,845) |
Comprehensive income attributable to stockholders | $ 122,004 | $ 145,683 |
Weighted average shares outstanding: | ||
Basic (in shares) | 122,945 | 99,575 |
Diluted (in shares) | 124,573 | 100,130 |
Earnings per share attributable to stockholders: | ||
Basic earnings per share attributable to stockholders (in dollars per share) | $ 0.99 | $ 1.20 |
Diluted earnings per share attributable to stockholders (in dollars per share) | $ 0.97 | $ 1.19 |
Services | ||
Net revenue: | ||
Net revenue | $ 246,717 | $ 231,472 |
Cost of revenue: | ||
Cost of revenue | 43,809 | 38,750 |
Net administrative fees | ||
Net revenue: | ||
Net revenue | 149,462 | 132,645 |
Other services and support | ||
Net revenue: | ||
Net revenue | 97,255 | 98,827 |
Products | ||
Net revenue: | ||
Net revenue | 118,430 | 115,415 |
Cost of revenue: | ||
Cost of revenue | $ 109,362 | $ 113,428 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Impact of change in accounting principle | Adjusted balance | Common StockCommon Class A | Common StockCommon Class B | Common StockAdjusted balanceCommon Class A | Common StockAdjusted balanceCommon Class B | Treasury Stock | Treasury StockAdjusted balance | Additional Paid-In Capital | Additional Paid-In CapitalAdjusted balance | Retained Earnings | Retained EarningsImpact of change in accounting principle | Retained EarningsAdjusted balance |
Beginning balance (in shares) at Jun. 30, 2020 | 71,627 | 50,213 | 71,627 | 50,213 | 0 | 0 | ||||||||
Beginning balance at Jun. 30, 2020 | $ 139,263 | $ (1,228) | $ 138,035 | $ 716 | $ 0 | $ 716 | $ 0 | $ 0 | $ 0 | $ 138,547 | $ 138,547 | $ 0 | $ (1,228) | $ (1,228) |
Increase (Decrease) in Stockholders' Equity | ||||||||||||||
Exchange of Class B common units for Class A common stock by member owners (in shares) | 70 | (70) | ||||||||||||
Exchange of Class B common units for Class A common stock by member owners | 2,437 | $ 1 | 2,436 | |||||||||||
Increase in additional paid-in capital related to quarterly exchange by member owners, including associated TRA revaluation | 37,319 | 37,319 | ||||||||||||
Increase in additional paid-in capital related to final exchange by member owners, including TRA termination | 517,526 | 517,526 | ||||||||||||
Issuance of Class A common stock under equity incentive plan (in shares) | 241 | |||||||||||||
Issuance of Class A common stock under equity incentive plan | 644 | $ 2 | 642 | |||||||||||
Stock-based compensation expense | 7,229 | 7,229 | ||||||||||||
Repurchase of vested restricted units for employee tax-withholding | (3,023) | (3,023) | ||||||||||||
Net income | 157,528 | 157,528 | ||||||||||||
Net loss attributable to non-controlling interest | (11,845) | (11,845) | ||||||||||||
Adjustment of redeemable limited partners' capital to redemption amount | (26,685) | (26,685) | ||||||||||||
Reclassification of redeemable limited partners' capital to permanent equity | 1,754,607 | 1,750,840 | 3,767 | |||||||||||
Final exchange of Class B common units for Class A common stock by member owners (in shares) | 50,143 | (50,143) | ||||||||||||
Final exchange of Class B common units for Class A common stock by member owners | 0 | $ 502 | (502) | |||||||||||
Early termination payments to members | (438,967) | (438,967) | ||||||||||||
Dividends | (23,381) | (23,381) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 122,081 | 0 | 0 | |||||||||||
Ending balance at Sep. 30, 2020 | 2,111,424 | $ 1,221 | $ 0 | $ 0 | 2,012,047 | 98,156 | ||||||||
Beginning balance (in shares) at Jun. 30, 2021 | 122,533 | 0 | 0 | |||||||||||
Beginning balance at Jun. 30, 2021 | 2,229,893 | $ 1,225 | $ 0 | $ 0 | 2,059,194 | 169,474 | ||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||
Increase in additional paid-in capital related to final exchange by member owners, including TRA termination | 0 | |||||||||||||
Issuance of Class A common stock under equity incentive plan (in shares) | 1,239 | |||||||||||||
Issuance of Class A common stock under equity incentive plan | 22,864 | $ 13 | 22,851 | |||||||||||
Treasury stock (in shares) | (1,091) | (1,091) | ||||||||||||
Treasury stock | (42,628) | $ (42,628) | ||||||||||||
Stock-based compensation expense | 7,554 | 7,554 | ||||||||||||
Repurchase of vested restricted units for employee tax-withholding | (9,171) | (9,171) | ||||||||||||
Net income | 121,306 | 121,306 | ||||||||||||
Net loss attributable to non-controlling interest | 0 | (698) | 698 | |||||||||||
Reclassification of redeemable limited partners' capital to permanent equity | 0 | |||||||||||||
Early termination payments to members | 0 | |||||||||||||
Dividends | (24,877) | (24,877) | ||||||||||||
Non-controlling interest related to acquisition | 23,145 | 23,145 | ||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 122,681 | 0 | (1,091) | |||||||||||
Ending balance at Sep. 30, 2021 | $ 2,328,086 | $ 1,238 | $ 0 | $ (42,628) | $ 2,102,875 | $ 266,601 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Stockholders' Equity (Parenthetical) - $ / shares shares in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Treasury Stock | ||
Treasury Stock, Shares, Acquired | 1,091 | |
Common Class A | ||
Per share amount of dividends (in dollars per share) | $ 0.20 | $ 0.19 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Operating activities | ||
Net income | $ 121,306 | $ 157,528 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 31,485 | 30,678 |
Equity in net income of unconsolidated affiliates | (7,058) | (5,927) |
Deferred income taxes | 18,700 | (106,386) |
Stock-based compensation | 7,554 | 7,229 |
(Gain) loss on FFF call/put rights | (64,110) | 1,919 |
Other | 518 | 201 |
Changes in operating assets and liabilities, net of the effects of acquisitions: | ||
Accounts receivable, inventories, prepaid expenses and other assets | 22,682 | (45,469) |
Contract assets | (5,876) | (29,568) |
Accounts payable, accrued expenses, deferred revenue, revenue share obligations and other current liabilities | (70,014) | 20,577 |
Net cash provided by operating activities | 55,187 | 30,782 |
Investing activities | ||
Purchases of property and equipment | (21,050) | (24,982) |
Acquisition of businesses and equity method investments, net of cash acquired | (26,000) | 0 |
Other | 0 | 29 |
Net cash used in investing activities | (47,050) | (24,953) |
Financing activities | ||
Payments made on notes payable | (26,692) | (188) |
Proceeds from credit facility | 175,000 | 100,000 |
Payments on credit facility | (75,000) | (25,000) |
Distributions to limited partners of Premier LP | 0 | (9,949) |
Payments to limited partners of Premier LP related to tax receivable agreements | 0 | (24,218) |
Cash dividends paid | (24,852) | (23,195) |
Repurchase of Class A common stock (held as treasury stock) | (38,151) | 0 |
Other | 36,838 | (2,167) |
Net cash provided by financing activities | 47,143 | 15,283 |
Net increase in cash and cash equivalents | 55,280 | 21,112 |
Cash and cash equivalents at beginning of period | 129,141 | 99,304 |
Cash and cash equivalents at end of period | $ 184,421 | $ 120,416 |
ORGANIZATION
ORGANIZATION | 3 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | (1) ORGANIZATION Organization Premier, Inc. (“Premier” or the “Company”) is a publicly held, for-profit Delaware corporation located in the United States. The Company is a holding company with no material business operations of its own. The Company’s primary asset is its equity interest in its wholly owned subsidiary Premier Services, LLC, a Delaware limited liability company (“Premier GP”). Premier GP is the sole general partner of Premier Healthcare Alliance, L.P. (“Premier LP”), a California limited partnership. The Company conducts substantially all of its business operations through Premier LP and its other consolidated subsidiaries. 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 also provides services to other businesses including food service, schools and universities. The Company’s business model and solutions are designed to provide its members and other customers access to scale efficiencies, spread the cost of their development, provide actionable intelligence derived from anonymized data in the Company’s enterprise data warehouse, mitigate the risk of innovation and disseminate best practices to help the Company’s member organizations and other customers 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 15 - 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, supply chain co-management and direct sourcing activities. The Performance Services segment consists of three sub-brands: PINC AI TM , the Company’s technology and services platform with offerings that help optimize performance in three main areas – clinical intelligence, margin improvement and value-based care – using advanced analytics to identify improvement opportunities, consulting services for clinical and operational design, and workflow solutions to hardwire sustainable change, Contigo Health ® , the Company’s direct to employer business and Remitra TM , the Company’s electronic invoicing and payables business. Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC and in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and include the assets, liabilities, revenues and expenses of all majority-owned subsidiaries over which the Company exercised control and when applicable, entities for which the Company had a controlling financial interest or was the primary beneficiary. All intercompany transactions have been eliminated upon consolidation. 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, consisting of normal recurring adjustments unless otherwise disclosed. 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 2021 Annual Report. Prior Periods’ Financial Statement Revision As disclosed in the Company’s 2021 Annual Report, during the fourth quarter of fiscal year 2021, we identified and corrected an error to “Income tax (benefit) expense” resulting in additional income tax expense in the Condensed Consolidated Statements of Income and Comprehensive Income in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020. As a result, the Company has revised the Condensed Consolidated Statements of Stockholders' Equity and the Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2020. Supplementary Cash Flows Information The following table presents supplementary cash flows information for the three months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Supplementary non-cash investing and financing activities: Increase in treasury stock related to a payable as a result of applying trade date accounting when recording the repurchase of Class A common stock $ 4,477 $ — Non-cash additions to property and equipment 1,628 1,083 Accrued dividend equivalents 149 186 Increase in redeemable limited partners' capital for adjustment to fair value, with offsetting decrease in stockholders' equity — 26,685 Decrease in redeemable limited partners' capital, with offsetting increase in stockholders' equity related to quarterly exchanges by member owners — (2,437) Net increase in deferred tax assets related to departures and quarterly exchanges by member owners and other adjustments — 331 Net increase in deferred tax assets related to final exchange by member owners — 284,852 Reclassification of redeemable limited partners' capital to additional paid in capital — 1,754,607 Decrease in additional paid-in capital related to notes payable to members, net of discounts — 438,967 Net increase in additional paid-in capital related to departures and quarterly exchanges by member owners and other adjustments — 37,319 Increase in additional paid-in capital related to final exchange by member owners — 517,526 Use of Estimates in the Preparation of Financial Statements |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2021 | |
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 2021 Annual Report. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 3 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | (3) BUSINESS ACQUISITIONS Acquisition of Invoice Delivery Services, LP Assets On March 1, 2021, the Company, through Premier IDS, LLC (“Premier IDS”), acquired substantially all the assets and assumed certain liabilities of Invoice Delivery Services, LP (“IDS”) for an adjusted purchase price of $80.7 million, subject to certain adjustments, of which $80.0 million was paid at closing with borrowings under the Company’s Credit Facility (as defined in Note 8 - Debt and Notes Payable). The Company has accounted for the IDS 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 total fair value assigned to intangible assets acquired was $22.4 million, consisting primarily of developed technology. The IDS acquisition resulted in the recognition of $57.7 million of goodwill based on the purchase price paid in the acquisition compared to the fair value of the tangible assets acquired. The IDS acquisition was considered an asset acquisition for income tax purposes. Accordingly, the Company expects tax goodwill to be deductible for tax purposes. The initial purchase price allocation for the IDS acquisition is preliminary and subject to changes in the valuation of the assets acquired and liabilities assumed. IDS was integrated within Premier under the brand name Remitra TM and reported as part of the Performance Services segment. Pro forma results of operations for the acquisition have not been presented because the effects on revenue and net income were not material to the Company’s historic consolidated financial statements. |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Sep. 30, 2021 | |
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 Three Months Ended September 30, September 30, 2021 June 30, 2021 2021 2020 FFF $ 126,493 $ 120,548 $ 5,945 $ 4,574 Exela 26,000 — — — Prestige 15,236 14,478 758 1,052 Other investments 18,553 18,198 355 301 Total investments $ 186,282 $ 153,224 $ 7,058 $ 5,927 The Company, through PSCI, held a 49% interest in FFF Enterprises, Inc. (“FFF”) through its ownership of stock of FFF at September 30, 2021 and June 30, 2021. On July 29, 2021, the FFF shareholders’ agreement was amended resulting in the termination of the FFF put right, which had previously provided the majority shareholder of FFF a right to require the Company to purchase such shareholder’s interest in FFF, on an all or nothing basis, on or after April 15, 2023 (“FFF Put Right”). The termination of the FFF Put Right resulted in the derecognition of the FFF Put Right liability and the recognition of a corresponding non-cash gain of $64.1 million in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income (see Note 5 - Fair Value Measurements for additional information). 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, ExPre Holdings, LLC (“ExPre”), held an approximate 6% interest in Exela Holdings, Inc. (“Exela”), through its ownership of Exela Class A common stock at September 30, 2021. The Company owns approximately 15% of the membership interest of ExPre, with the remainder of the membership interests held by 11 member health systems or their affiliates. The Company accounts for its investment in Exela using the equity method of accounting and includes the investment as part of the Supply Chain Services segment. The Company, through its consolidated subsidiary, PRAM Holdings, LLC (“PRAM”), held an approximate 20% interest in Prestige Ameritech Ltd. (“Prestige”) through its ownership of Prestige limited partnership units at September 30, 2021. The Company owns approximately 26% of the membership interest of PRAM, with the remainder of the membership interests held by 16 member health systems or their affiliates. The Company accounts for its investment in Prestige using the equity method of accounting and includes the investment as part of the Supply Chain Services segment. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | (5) FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements The following table represents the Company’s financial assets and liabilities, which are measured at fair value on a recurring basis (in thousands): Fair Value of Financial Assets and Liabilities Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs September 30, 2021 Cash equivalents $ 75 $ 75 $ — $ — Deferred compensation plan assets 60,559 60,559 — — Total assets 60,634 60,634 — — Earn-out liabilities 24,368 — — 24,368 Total liabilities $ 24,368 $ — $ — $ 24,368 June 30, 2021 Cash equivalents $ 75 $ 75 $ — $ — Deferred compensation plan assets 65,051 65,051 — — Total assets 65,126 65,126 — — Earn-out liabilities 24,249 — — 24,249 FFF put right 64,110 — — 64,110 Total liabilities $ 88,359 $ — $ — $ 88,359 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 ($6.0 million and $5.5 million at September 30, 2021 and June 30, 2021, respectively) was included in prepaid expenses and other current assets in the accompanying Condensed Consolidated Balance Sheets. Financial Instruments Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) FFF put and call rights In connection with the Company’s equity investment in FFF, the FFF shareholders’ agreement was amended which resulted in the termination of the FFF Put Right on July 29, 2021. In the event of a Key Man Event (generally defined in the FFF shareholders’ agreement as the resignation, termination for cause, death or disability of the majority shareholder), the Company has a call right that requires the majority shareholder to sell its remaining interest in FFF to the Company, and is exercisable at any time within the later of 180 calendar days after (i) the date of a Key Man Event or (ii) January 30, 2021 (the “Call Right”, together with the FFF Put Right, the “Put and Call Rights”). As of September 30, 2021 and June 30, 2021, the Call Right had zero value. In the event that the Call Right is exercised, the purchase price for the additional interest in FFF will be at a per share price equal to the per share price equal to FFF’s earnings before interest, taxes, depreciation and amortization (“FFF 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”). At September 30, 2021, the fair value of the Call Right was zero. At June 30, 2021, the fair values of the Put and Call Rights were determined using a Monte Carlo simulation in a risk-neutral framework based on the Equity Value per Share calculation using unobservable inputs, which included the estimated Put and Call Rights expiration dates, the forecast of FFF’s EBITDA and enterprise value over the option period, forecasted movements in the overall market and the likelihood of a Key Man Event. FFF’s enterprise value over the option period was valued utilizing expected annual FFF EBITDA and revenue growth rates, among other assumptions. The resulting FFF enterprise value was an assumption utilized in the valuation of the Put and Call Rights. The Company utilized the following assumptions to estimate the fair value of the Put and Call Rights at June 30, 2021: June 30, 2021 Annual FFF EBITDA growth rate 2.5-10.8% Annual revenue growth rate 2.5-6.3% Correlation 80.0 % Weighted average cost of capital 14.0 % Asset volatility 30.0 % Credit spread 0.8 % The significant assumptions using the Monte Carlo simulation approach for valuation of the Put and Call Rights are: (i) Annual EBITDA Growth Rate: The forecasted EBITDA growth range over six years; (ii) Annual Revenue Growth Rate: The forecasted Revenue growth range over six years; (iii) Correlation: The estimated correlation between future Business Enterprise Value and EBITDA of FFF; (iv) Weighted Average Cost of Capital: The expected rate paid to security holders to finance debt and equity; (v) Asset volatility: Based on the asset volatility of guideline public companies in the healthcare industry; and (vi) Credit Spread: Based on term-matched BBB yield curve. At September 30, 2021, the fair value of the Call Right was zero. At June 30, 2021, the Company recorded the 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 values of the Put and Call Rights, including the gain recorded as a result of the termination of the FFF Put Right, were recorded within other (expense) income, net in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income. Earn-out liabilities An earn-out liability was established in connection with the acquisition of substantially all of the assets and certain liabilities of Acurity, Inc. and Nexera, Inc. (the “Acurity and Nexera asset acquisition”) in February 2020. The earn-out liability was classified as Level 3 of the fair value hierarchy. The earn-out liability arising from expected earn-out payments related to the Acurity and Nexera asset acquisition was measured on the acquisition date using a probability-weighted expected payment model and are remeasured periodically due to changes in management’s estimates of the number of transferred member renewals and market conditions. In determining the fair value of the contingent liabilities, management reviews the current results of the acquired business, along with projected results for the remaining earn-out period, to calculate the expected earn-out payment to be made based on the contractual terms set out in the acquisition agreement. The Acurity and Nexera earn-out liability utilized a credit spread of 0.8% and 0.9% at September 30, 2021 and June 30, 2021, respectively. As of September 30, 2021 and June 30, 2021, the undiscounted range of outcomes is between $0 and $30.0 million. A significant decrease in the probability could result in a significant decrease in the value of the earn-out liability. The fair value of the Acurity and Nexera earn-out liability at September 30, 2021 and June 30, 2021 was $24.4 million and $24.2 million, respectively. Acurity and Nexera Earn-out (a) Input assumptions As of September 30, 2021 As of June 30, 2021 Probability of transferred member renewal percentage < 50% 5.0 % 5.0 % Probability of transferred member renewal percentage between 50% and 65% 10.0 % 10.0 % Probability of transferred member renewal percentage between 65% and 80% 25.0 % 25.0 % Probability of transferred member renewal percentage > 80% 60.0 % 60.0 % Credit spread 0.8 % 0.9 % _________________________________ (a) The Acurity and Nexera earn-out liability was initially valued as of February 28, 2020. A reconciliation of the Company’s Put Right and earn-out liabilities is as follows (in thousands): Beginning Balance Purchases (Settlements) (a) (Gain)/Loss (b) Ending Balance Three Months Ended September 30, 2021 Earn-out liabilities $ 24,249 — 119 24,368 FFF put right 64,110 (64,110) — — Total Level 3 liabilities $ 88,359 $ (64,110) $ 119 $ 24,368 Three Months Ended September 30, 2020 Earn-out liabilities $ 33,151 $ (9,073) $ (1,061) $ 23,017 FFF put right 36,758 — 1,919 38,677 Total Level 3 liabilities $ 69,909 $ (9,073) $ 858 $ 61,694 _________________________________ (a) Purchases (Settlements) for the three months ended September 30, 2021 includes non-cash gain recognized as a result the termination of the FFF Put Right and the derecognition of the FFF Put Right liability. Purchases (Settlements) for the three months ended September 30, 2020 includes the full earn-out from the acquisition of Stanson Health, Inc. in November 2018, which had been earned but not yet paid as of September 30, 2020. (b) A gain on level 3 liability balances will decrease the liability ending balance whereas a loss on level 3 liability balance will increase the liability ending balance. Non-Recurring Fair Value Measurements During the three months ended September 30, 2021, the Company recorded notes payable to members as a result of the August 2020 Restructuring. Although these notes are non-interest bearing, they include a Level 2 input associated with the implied interest rate of 1.8% and are calculated as of August 11, 2020. (see Note 8 - Debt and Notes Payable). During the three months ended September 30, 2021, no non-recurring fair value measurements were required relating 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 value by $0.1 million at both September 30, 2021 and June 30, 2021 based on assumed market interest rates of 1.6% for both periods. Other Financial Instruments |
CONTRACT BALANCES
CONTRACT BALANCES | 3 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
CONTRACT BALANCES | (6) CONTRACT BALANCES Deferred Revenue Revenue recognized during the three months ended September 30, 2021 that was included in the opening balance of deferred revenue at June 30, 2021 was $7.3 million, which is a result of satisfying performance obligations. Performance Obligations A performance obligation is a promise to transfer a distinct good or service to a customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Contracts may have a single performance obligation as the promise to transfer individual goods or services is not separately identifiable from other promises and, therefore, not distinct, while other contracts may have multiple performance obligations, most commonly due to the contract covering multiple phases or deliverable arrangements (licensing fees, implementation fees, maintenance and support fees, professional fees for consulting services), including certain performance guarantees. Net revenue of $1.4 million was recognized during the three months ended September 30, 2021 from performance obligations that were satisfied or partially satisfied in prior periods. The net revenue recognized was driven by a $1.8 million increase in net administrative fees revenue related to under-forecasted cash receipts received in the current period partially offset by a reduction of $0.4 million associated with revised forecasts from underlying contracts that include variable consideration components as well as additional fluctuations due to input method contracts which occur in the normal course of business. A decrease to net revenue of $2.5 million was recognized during the three months ended September 30, 2020 from performance obligations that were satisfied or partially satisfied in prior periods. The decrease in net revenue recognized was driven by a $2.7 million decrease in net administrative fees revenue related to over-forecasted cash receipts received in the current period partially offset by $0.2 million associated with revised forecasts from underlying contracts that include variable consideration components as well as additional fluctuations due to input method contracts which occur in the normal course of business Remaining performance obligations represent the portion of the transaction price that has not yet been satisfied or achieved. As of September 30, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations was $588.8 million. The Company expects to recognize approximately 47% of the remaining performance obligations over the next 12 months and an additional 27% over the following 12 months, with the remainder recognized thereafter. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | (7) GOODWILL AND INTANGIBLE ASSETS Goodwill At September 30, 2021 and June 30, 2021, we had goodwill balances recorded at Supply Chain Services and Performance Services of $388.5 million and $611.4 million, respectively. Intangible Assets, Net Intangible assets, net consisted of the following (in thousands): Useful Life September 30, 2021 June 30, 2021 Member relationships 14.7 years $ 386,100 $ 386,100 Technology 6.1 years 186,017 186,017 Customer relationships 9.6 years 70,830 70,830 Trade names 7.4 years 24,610 24,610 Non-compete agreements 5.3 years 11,315 11,315 Other (a) 10.2 years 7,682 7,682 Total intangible assets 686,554 686,554 Accumulated amortization (300,801) (289,912) Total intangible assets, net $ 385,753 $ 396,642 _________________________________ (a) Includes a $1.0 million indefinite-lived asset that was acquired through the HDP acquisition. Intangible asset amortization was $10.9 million and $13.2 million for the three months ended September 30, 2021 and 2020, respectively. |
DEBT AND NOTES PAYABLE
DEBT AND NOTES PAYABLE | 3 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
DEBT AND NOTES PAYABLE | (8) DEBT AND NOTES PAYABLE Long-term debt and notes payable consisted of the following (in thousands): September 30, 2021 June 30, 2021 Credit Facility $ 175,000 $ 75,000 Notes payable to members 371,129 394,943 Other notes payable 5,749 8,628 Total debt and notes payable 551,878 478,571 Less: current portion (271,828) (174,243) Total long-term debt and notes payable $ 280,050 $ 304,328 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 November 9, 2018 (the “Credit Facility”). Premier, Inc. is not a guarantor under the Credit Facility. Outstanding borrowings under the Credit Facility bear interest on a variable rate structure with borrowings bearing interest at either London Interbank Offered Rate (“LIBOR”) plus an applicable margin rangin g from 1.000% to 1.500% or the prime lending rate plus an applicable margin ranging from 0.000% to 0.500%. At September 30, 2021, the weighted average interest rate on outstanding borrowings under the Credit Facility was 1.090%. At September 30, 2021 , the annual commitment fee, which the Co-Borrowers are required to pay on the actual daily unused amount of commitments under the Credit Facility, was 0.100%. 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. Premier GP was in compliance with all such covenants at September 30, 2021. The Credit Facility also contains customary events of default, including a cross-default of any indebtedness or guarantees in excess of $75.0 million. 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 a majority of the lenders under the Credit Facility, terminate the commitments and declare all of the amounts owed under the Credit Facility to be immediately due and payable. The Company had $175.0 million in outstanding borrowings under the Credit Facility at September 30, 2021 with $824.9 million of available borrowing capacity after reductions for outstanding borrowings and outstanding letters of credit. For the three months ended September 30, 2021, the Company borrowed $175.0 million and repaid $75.0 million of outstanding borrowings under the Credit Facility. In October 2021, the Company repaid $50.0 million of outstanding borrowings under the Credit Facility. Notes Payable Notes Payable to Members At September 30, 2021, the Company had $371.1 million of notes payable to members, net of discounts on notes payable of $13.9 million, of which $96.4 million was recorded to current portion of notes payable to members in the accompanying Condensed Consolidated Balance Sheets. At June 30, 2021, the Company had $394.9 million of notes payable to members, net of discounts on notes payable of $15.8 million, of which $95.9 million was recorded to current portion of notes payable to members in the accompanying Condensed Consolidated Balance Sheets. The notes payable to members were issued in connection with the early termination of the TRA as part of the August 2020 Restructuring. Although the notes payable to members are non-interest bearing, pursuant to GAAP requirements, they were recorded net of imputed interest at a fixed annual rate of 1.8%. Other At September 30, 2021 and June 30, 2021, the Company had $5.7 million and $8.6 million in other notes payable, respectively, of which $0.4 million and $3.3 million, respectively, were included in current portion of long-term debt in the accompanying Condensed Consolidated Balance Sheets. Other notes payable do not bear interest and generally have stated maturities of three |
REDEEMABLE LIMITED PARTNERS' CA
REDEEMABLE LIMITED PARTNERS' CAPITAL | 3 Months Ended |
Sep. 30, 2021 | |
Temporary Equity Disclosure [Abstract] | |
REDEEMABLE LIMITED PARTNERS' CAPITAL | (9) REDEEMABLE LIMITED PARTNERS' CAPITAL The fair value of redeemable limited partners’ capital was reclassified from temporary equity in the mezzanine section of the Condensed Consolidated Balance Sheets to additional paid in capital as a component of permanent equity at July 31, 2020. As a result, there were no adjustments to the fair value of redeemable limited partners’ capital for the three months ended September 30, 2021. For the three months ended September 30, 2020, the Company recorded an adjustment of $(26.7) million to the fair value of redeemable limited partners’ capital as an adjustment of redeemable limited partners’ capital to redemption amount in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income. Subsequent to July 31, 2020, there were no adjustments to the fair value of redeemable limited partners’ capital as an adjustment of redeemable limited partners’ capital to redemption amount were recorded in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income. The tables below provide a summary of the changes in redeemable limited partners’ capital from June 30, 2020 to September 30, 2020 (in thousands). There were no changes in redeemable limited partner’s capital subsequent to July 31, 2020. Receivables From Limited Partners Redeemable Limited Partners' Capital Total Redeemable Limited Partners' Capital June 30, 2020 $ (995) $ 1,721,304 $ 1,720,309 Distributions applied to receivables from limited partners 141 — 141 Net income attributable to non-controlling interest in Premier LP — 11,845 11,845 Distributions to limited partners — (1,936) (1,936) Exchange of Class B common units for Class A common stock by member owners — (2,437) (2,437) Adjustment of redeemable limited partners' capital to redemption amount — 26,685 26,685 Reclassification to permanent equity 854 (1,755,461) (1,754,607) September 30, 2020 $ — $ — $ — |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | (10) STOCKHOLDERS' EQUITY As of September 30, 2021, there were 122,680,693 shares of the Company's Class A common stock, par value $0.01 per share, outstanding. On August 5, 2021, the Company’s Board of Directors authorized the repurchase of up to $250.0 million of our outstanding Class A common stock during fiscal year 2022 through open market purchases or privately negotiated transactions. As of September 30, 2021, the Company had purchased approximately 1.1 million shares of Class A common stock at an average price of $39.04 per share for a total purchase price of $42.6 million. There can be no assurances regarding the timing or number of shares of Class A common stock purchased under this authorization. The repurchase authorization may be suspended, delayed or discontinued at any time at the discretion of the Company’s Board of Directors. During the three months ended September 30, 2021, the Company paid a cash dividend of $0.20 per share on outstanding shares of Class A common stock to stockholders of record on September 1, 2021. On October 21, 2021, the Board of Directors declared a cash dividend of $0.20 per share, payable on December 15, 2021 to stockholders of record on December 1, 2021. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | (11) EARNINGS PER SHARE Basic earnings per share 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, which was due to the exchange benefit obtained by limited partners through the ownership of Class B common units, which were canceled in August 2020. 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 all potentially issuable dilutive shares of Class A common stock. 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, 2021 2020 Numerator for basic earnings per share: Net income attributable to stockholders (a) $ 122,004 $ 118,998 Numerator for diluted earnings per share: Net income attributable to stockholders (a) $ 122,004 $ 118,998 Net loss attributable to non-controlling interest (698) — Net income (b) 121,306 118,998 Denominator for earnings per share: Basic weighted average shares outstanding (c) 122,945 99,575 Effect of dilutive securities: (d) Stock options 310 253 Restricted stock 492 302 Performance share awards 826 — Diluted weighted average shares and assumed conversions 124,573 100,130 Earnings per share attributable to stockholders: Basic earnings per share attributable to stockholders $ 0.99 $ 1.20 Diluted earnings per share attributable to stockholders $ 0.97 $ 1.19 _________________________________ (a) Net income attributable to stockholders was calculated as follows (in thousands): Three Months Ended September 30, 2021 2020 Net income $ 121,306 $ 157,528 Net loss (income) attributable to non-controlling interest 698 (11,845) Adjustment of redeemable limited partners’ capital to redemption amount — (26,685) Net income attributable to stockholders $ 122,004 $ 118,998 (b) For the three months ended September 30, 2021 and 2020, the tax expense related to the Company retaining the portion of net loss (income) attributable to income from non-controlling interest was calculated as a component of the income tax provision for the three months ended September 30, 2021 and 2020. (c) Weighted average number of common shares used for basic earnings per share excludes the impact of all potentially issuable dilutive shares of Class A common stock for the three months ended September 30, 2021 and 2020. (d) For the three months ended September 30, 2021, the effect of 0.3 million stock options and restricted stock units were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. Additionally, the effect of 0.2 million performance share awards was excluded from diluted weighted average shares outstanding as the awards had not satisfied the applicable performance criteria at the end of the period. For the three months ended September 30, 2020, the effect of 0.7 million stock options and restricted stock units and 22.4 million Class B common units were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. Additionally, the effect of 0.6 million performance share awards was excluded from diluted weighted average shares outstanding as the awards had not satisfied the applicable performance criteria at the end of the period. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [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. The associated deferred tax benefit was calculated at a rate of 26% for the three months ended September 30, 2021 and 2020, which represents the expected effective income tax rate at the time of the compensation expense deduction and differs from the Company’s current effective income tax rate. See Note 13 - Income Taxes for further information. Stock-based compensation expense and the resulting deferred tax benefits were as follows (in thousands): Three Months Ended September 30, 2021 2020 Pre-tax stock-based compensation expense $ 7,554 $ 7,229 Deferred tax benefit (a) 1,281 1,110 Total stock-based compensation expense, net of tax $ 6,273 $ 6,119 _________________________________ (a) For the three months ended September 30, 2021 and 2020, the deferred tax benefit was reduced by $0.7 million and $0.8 million, respectively, attributable to stock-based compensation expense that is nondeductible for tax purposes pursuant to Section 162(m) as amended by the Tax Cuts and Jobs Act of 2017. 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 14.8 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, 2021, there were 4.6 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, 2021: 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, 2021 990,301 $ 35.27 1,731,002 $ 35.56 2,163,006 $ 30.32 Granted 576,575 $ 37.76 651,392 $ 37.18 — $ — Vested/exercised (156,158) $ 42.73 (588,142) $ 43.74 (745,407) $ 30.71 Forfeited (103,034) $ 33.41 (147,825) $ 31.75 (12,025) $ 36.54 Outstanding at September 30, 2021 1,307,684 $ 35.63 1,646,427 $ 33.62 1,405,574 $ 30.07 Stock options outstanding and exercisable at September 30, 2021 1,405,574 $ 30.07 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 a three-year period if performance targets are met. Stock options have a term of ten years from the date of grant. Vested stock options will expire either twelve months after 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, 2021 was as follows (in thousands). At September 30, 2021, there was no unrecognized stock-based compensation expense for outstanding stock options. Unrecognized Stock-Based Compensation Expense Weighted Average Amortization Period Restricted stock $ 31,788 2.5 years Performance share awards 33,266 2.1 years Total unrecognized stock-based compensation expense $ 65,054 2.3 years The aggregate intrinsic value of stock options at September 30, 2021 was as follows (in thousands): Intrinsic Value of Stock Options Outstanding and exercisable $ 12,218 Exercised during the year ended September 30, 2021 $ 4,748 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | (13) INCOME TAXES Income tax expense for the three months ended September 30, 2021 was $19.0 million, which reflects an effective tax rate of 14% compared to an income tax benefit of $95.0 million for the three months ended September 30, 2020 which reflects an effective tax rate of (152)%. The change in the effective tax rate for the three months ended September 30, 2021 is primarily driven by the prior year deferred tax remeasurement due to the change in the state statutory rate and valuation allowance release resulting from the Company and its subsidiaries forming one consolidated filing group for tax purposes at the consummation of the August 2020 Restructuring. Excluding the one-time deferred tax benefit, the effective tax rate would have been 24% for the three months ended September 30, 2020. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | (14) COMMITMENTS AND CONTINGENCIES Operating Leases Operating lease expense for the three months ended September 30, 2021 and 2020 was $2.6 million and $3.4 million, respectively. As of September 30, 2021, the weighted average remaining lease term was 4.6 years and the weighted average discount rate was 4%. Future minimum lease payments under noncancelable operating leases with initial lease terms in excess of one year were as follows (in thousands): September 30, 2021 June 30, 2021 2022 (a) $ 8,910 $ 11,738 2023 12,131 12,012 2024 12,267 12,145 2025 12,301 12,177 2026 9,005 8,878 Thereafter 1,324 1,293 Total future minimum lease payments 55,938 58,243 Less: imputed interest 4,840 5,289 Total operating lease liabilities (b) $ 51,098 $ 52,954 _________________________________ (a) As of September 30, 2021, future minimum lease payments are for the period from October 1, 2021 to June 30, 2022. (b) As of September 30, 2021, total operating lease liabilities included $10.1 million within other current liabilities in the Condensed Consolidated Balance Sheets. Other Matters The Company is not currently involved in any litigation it believes to be material. 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. |
SEGMENTS
SEGMENTS | 3 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
SEGMENTS | (15) 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, supply chain co-management and direct sourcing activities. The Performance Services segment consists of three sub-brands: PINC AI TM , the Company’s technology and services platform, Contigo Health ® , the Company’s direct to employer business and Remitra TM , the Company’s electronic invoicing and payables business. The following table presents disaggregated revenue by business segment and underlying source (in thousands): Three Months Ended September 30, 2021 2020 Net revenue: Supply Chain Services Net administrative fees $ 149,462 $ 132,645 Other services and support 8,924 5,592 Services 158,386 138,237 Products 118,430 115,415 Total Supply Chain Services (a) 276,816 253,652 Performance Services (a) 88,331 93,235 Net revenue $ 365,147 $ 346,887 _________________________________ (a) Includes intersegment revenue that is eliminated in consolidation. Intersegment revenue is not separately identified in Segments as the amounts are not material. Additional segment information related to depreciation and amortization expense, capital expenditures and total assets was as follows (in thousands): Three Months Ended September 30, 2021 2020 Depreciation and amortization expense (a) : Supply Chain Services $ 13,144 $ 8,802 Performance Services 16,109 19,757 Corporate 2,232 2,119 Total depreciation and amortization expense $ 31,485 $ 30,678 Capital expenditures: Supply Chain Services $ 8,157 $ 2,876 Performance Services 11,023 18,371 Corporate 1,870 3,735 Total capital expenditures $ 21,050 $ 24,982 September 30, 2021 June 30, 2021 Total assets: Supply Chain Services $ 1,593,084 $ 1,550,300 Performance Services 1,014,850 1,043,608 Corporate 958,990 928,939 Total assets 3,566,924 3,522,847 Eliminations (b) (4) 51 Total assets, net $ 3,566,920 $ 3,522,898 _________________________________ (a) Includes amortization of purchased intangible assets. (b) Includes eliminations of intersegment transactions which occur during the ordinary course of business. 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 less cost of revenue and 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, and including equity in net income of unconsolidated affiliates. 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. Segment Adjusted EBITDA also excludes any income and expense that has been classified as discontinued operations. 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 unaudited Segment Adjusted EBITDA, a Non-GAAP financial measure, is as follows (in thousands): Three Months Ended September 30, 2021 2020 Income before income taxes $ 140,339 $ 62,547 Equity in net income of unconsolidated affiliates (a) (7,058) (5,927) Interest and investment loss, net 2,788 2,119 (Gain) loss on FFF put and call rights (b) (64,110) 1,919 Other (income) expense 320 (3,683) Operating income 72,279 56,975 Depreciation and amortization 20,596 17,474 Amortization of purchased intangible assets 10,889 13,204 Stock-based compensation (c) 7,751 7,375 Acquisition and disposition related expenses 3,421 2,845 Equity in net income of unconsolidated affiliates (a) 7,058 5,927 Deferred compensation plan income (expense) (d) (318) 2,907 Other expense, net 27 4,036 Non-GAAP Adjusted EBITDA $ 121,703 $ 110,743 Segment Non-GAAP Adjusted EBITDA: Supply Chain Services (e) $ 129,269 $ 102,649 Performance Services (e) 23,715 37,116 Corporate (31,281) (29,022) Non-GAAP Adjusted EBITDA $ 121,703 $ 110,743 _________________________________ (a) Refer to Note 4 - Investments for more information. (b) Refer to Note 5 - Fair Value Measurements for more information. (c) Includes non-cash employee stock-based compensation expense and stock purchase plan expense of $0.2 million and $0.1 million for the three months ended September 30, 2021 and 2020, respectively. (d) Represents realized and unrealized gains and losses and dividend income on deferred compensation plan assets. (e) Includes intersegment revenue which is eliminated in consolidation. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC and in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and include the assets, liabilities, revenues and expenses of all majority-owned subsidiaries over which the Company exercised control and when applicable, entities for which the Company had a controlling financial interest or was the primary beneficiary. All intercompany transactions have been eliminated upon consolidation. 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, consisting of normal recurring adjustments unless otherwise disclosed. 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 2021 Annual Report. Prior Periods’ Financial Statement Revision |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial StatementsThe 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 net administrative fees revenue, other services and support revenue, contract assets, deferred revenue, contract costs, allowances for credit losses, useful lives of property and equipment, stock-based compensation, deferred tax balances including valuation allowances on deferred tax assets, uncertain tax positions, values of investments not publicly traded, projected future cash flows used in the evaluation of 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. |
ORGANIZATION (Tables)
ORGANIZATION (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Cash Flow Information | The following table presents supplementary cash flows information for the three months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Supplementary non-cash investing and financing activities: Increase in treasury stock related to a payable as a result of applying trade date accounting when recording the repurchase of Class A common stock $ 4,477 $ — Non-cash additions to property and equipment 1,628 1,083 Accrued dividend equivalents 149 186 Increase in redeemable limited partners' capital for adjustment to fair value, with offsetting decrease in stockholders' equity — 26,685 Decrease in redeemable limited partners' capital, with offsetting increase in stockholders' equity related to quarterly exchanges by member owners — (2,437) Net increase in deferred tax assets related to departures and quarterly exchanges by member owners and other adjustments — 331 Net increase in deferred tax assets related to final exchange by member owners — 284,852 Reclassification of redeemable limited partners' capital to additional paid in capital — 1,754,607 Decrease in additional paid-in capital related to notes payable to members, net of discounts — 438,967 Net increase in additional paid-in capital related to departures and quarterly exchanges by member owners and other adjustments — 37,319 Increase in additional paid-in capital related to final exchange by member owners — 517,526 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
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 Three Months Ended September 30, September 30, 2021 June 30, 2021 2021 2020 FFF $ 126,493 $ 120,548 $ 5,945 $ 4,574 Exela 26,000 — — — Prestige 15,236 14,478 758 1,052 Other investments 18,553 18,198 355 301 Total investments $ 186,282 $ 153,224 $ 7,058 $ 5,927 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities | The following table represents the Company’s financial assets and liabilities, which are measured at fair value on a recurring basis (in thousands): Fair Value of Financial Assets and Liabilities Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs September 30, 2021 Cash equivalents $ 75 $ 75 $ — $ — Deferred compensation plan assets 60,559 60,559 — — Total assets 60,634 60,634 — — Earn-out liabilities 24,368 — — 24,368 Total liabilities $ 24,368 $ — $ — $ 24,368 June 30, 2021 Cash equivalents $ 75 $ 75 $ — $ — Deferred compensation plan assets 65,051 65,051 — — Total assets 65,126 65,126 — — Earn-out liabilities 24,249 — — 24,249 FFF put right 64,110 — — 64,110 Total liabilities $ 88,359 $ — $ — $ 88,359 |
Fair Value Measurement Inputs and Valuation Assumptions | The Company utilized the following assumptions to estimate the fair value of the Put and Call Rights at June 30, 2021: June 30, 2021 Annual FFF EBITDA growth rate 2.5-10.8% Annual revenue growth rate 2.5-6.3% Correlation 80.0 % Weighted average cost of capital 14.0 % Asset volatility 30.0 % Credit spread 0.8 % Acurity and Nexera Earn-out (a) Input assumptions As of September 30, 2021 As of June 30, 2021 Probability of transferred member renewal percentage < 50% 5.0 % 5.0 % Probability of transferred member renewal percentage between 50% and 65% 10.0 % 10.0 % Probability of transferred member renewal percentage between 65% and 80% 25.0 % 25.0 % Probability of transferred member renewal percentage > 80% 60.0 % 60.0 % Credit spread 0.8 % 0.9 % _________________________________ (a) The Acurity and Nexera earn-out liability was initially valued as of February 28, 2020. |
Reconciliation of Earn-out Liabilities and FFF Put Rights | A reconciliation of the Company’s Put Right and earn-out liabilities is as follows (in thousands): Beginning Balance Purchases (Settlements) (a) (Gain)/Loss (b) Ending Balance Three Months Ended September 30, 2021 Earn-out liabilities $ 24,249 — 119 24,368 FFF put right 64,110 (64,110) — — Total Level 3 liabilities $ 88,359 $ (64,110) $ 119 $ 24,368 Three Months Ended September 30, 2020 Earn-out liabilities $ 33,151 $ (9,073) $ (1,061) $ 23,017 FFF put right 36,758 — 1,919 38,677 Total Level 3 liabilities $ 69,909 $ (9,073) $ 858 $ 61,694 _________________________________ (a) Purchases (Settlements) for the three months ended September 30, 2021 includes non-cash gain recognized as a result the termination of the FFF Put Right and the derecognition of the FFF Put Right liability. Purchases (Settlements) for the three months ended September 30, 2020 includes the full earn-out from the acquisition of Stanson Health, Inc. in November 2018, which had been earned but not yet paid as of September 30, 2020. |
Reconciliation of FFF Call Rights | A reconciliation of the Company’s Put Right and earn-out liabilities is as follows (in thousands): Beginning Balance Purchases (Settlements) (a) (Gain)/Loss (b) Ending Balance Three Months Ended September 30, 2021 Earn-out liabilities $ 24,249 — 119 24,368 FFF put right 64,110 (64,110) — — Total Level 3 liabilities $ 88,359 $ (64,110) $ 119 $ 24,368 Three Months Ended September 30, 2020 Earn-out liabilities $ 33,151 $ (9,073) $ (1,061) $ 23,017 FFF put right 36,758 — 1,919 38,677 Total Level 3 liabilities $ 69,909 $ (9,073) $ 858 $ 61,694 _________________________________ (a) Purchases (Settlements) for the three months ended September 30, 2021 includes non-cash gain recognized as a result the termination of the FFF Put Right and the derecognition of the FFF Put Right liability. Purchases (Settlements) for the three months ended September 30, 2020 includes the full earn-out from the acquisition of Stanson Health, Inc. in November 2018, which had been earned but not yet paid as of September 30, 2020. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets, net consisted of the following (in thousands): Useful Life September 30, 2021 June 30, 2021 Member relationships 14.7 years $ 386,100 $ 386,100 Technology 6.1 years 186,017 186,017 Customer relationships 9.6 years 70,830 70,830 Trade names 7.4 years 24,610 24,610 Non-compete agreements 5.3 years 11,315 11,315 Other (a) 10.2 years 7,682 7,682 Total intangible assets 686,554 686,554 Accumulated amortization (300,801) (289,912) Total intangible assets, net $ 385,753 $ 396,642 _________________________________ (a) Includes a $1.0 million indefinite-lived asset that was acquired through the HDP acquisition. |
DEBT AND NOTES PAYABLE (Tables)
DEBT AND NOTES PAYABLE (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt and Notes Payable | Long-term debt and notes payable consisted of the following (in thousands): September 30, 2021 June 30, 2021 Credit Facility $ 175,000 $ 75,000 Notes payable to members 371,129 394,943 Other notes payable 5,749 8,628 Total debt and notes payable 551,878 478,571 Less: current portion (271,828) (174,243) Total long-term debt and notes payable $ 280,050 $ 304,328 |
REDEEMABLE LIMITED PARTNERS' _2
REDEEMABLE LIMITED PARTNERS' CAPITAL (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Temporary Equity Disclosure [Abstract] | |
Changes in Redeemable Limited Partners' Capital | The tables below provide a summary of the changes in redeemable limited partners’ capital from June 30, 2020 to September 30, 2020 (in thousands). There were no changes in redeemable limited partner’s capital subsequent to July 31, 2020. Receivables From Limited Partners Redeemable Limited Partners' Capital Total Redeemable Limited Partners' Capital June 30, 2020 $ (995) $ 1,721,304 $ 1,720,309 Distributions applied to receivables from limited partners 141 — 141 Net income attributable to non-controlling interest in Premier LP — 11,845 11,845 Distributions to limited partners — (1,936) (1,936) Exchange of Class B common units for Class A common stock by member owners — (2,437) (2,437) Adjustment of redeemable limited partners' capital to redemption amount — 26,685 26,685 Reclassification to permanent equity 854 (1,755,461) (1,754,607) September 30, 2020 $ — $ — $ — |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Numerator and Denominator Used for Basic and Diluted Earnings 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, 2021 2020 Numerator for basic earnings per share: Net income attributable to stockholders (a) $ 122,004 $ 118,998 Numerator for diluted earnings per share: Net income attributable to stockholders (a) $ 122,004 $ 118,998 Net loss attributable to non-controlling interest (698) — Net income (b) 121,306 118,998 Denominator for earnings per share: Basic weighted average shares outstanding (c) 122,945 99,575 Effect of dilutive securities: (d) Stock options 310 253 Restricted stock 492 302 Performance share awards 826 — Diluted weighted average shares and assumed conversions 124,573 100,130 Earnings per share attributable to stockholders: Basic earnings per share attributable to stockholders $ 0.99 $ 1.20 Diluted earnings per share attributable to stockholders $ 0.97 $ 1.19 _________________________________ (a) Net income attributable to stockholders was calculated as follows (in thousands): Three Months Ended September 30, 2021 2020 Net income $ 121,306 $ 157,528 Net loss (income) attributable to non-controlling interest 698 (11,845) Adjustment of redeemable limited partners’ capital to redemption amount — (26,685) Net income attributable to stockholders $ 122,004 $ 118,998 (b) For the three months ended September 30, 2021 and 2020, the tax expense related to the Company retaining the portion of net loss (income) attributable to income from non-controlling interest was calculated as a component of the income tax provision for the three months ended September 30, 2021 and 2020. (c) Weighted average number of common shares used for basic earnings per share excludes the impact of all potentially issuable dilutive shares of Class A common stock for the three months ended September 30, 2021 and 2020. (d) For the three months ended September 30, 2021, the effect of 0.3 million stock options and restricted stock units were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. Additionally, the effect of 0.2 million performance share awards was excluded from diluted weighted average shares outstanding as the awards had not satisfied the applicable performance criteria at the end of the period. For the three months ended September 30, 2020, the effect of 0.7 million stock options and restricted stock units and 22.4 million Class B common units were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. Additionally, the effect of 0.6 million performance share awards was excluded from diluted weighted average shares outstanding as the awards had not satisfied the applicable performance criteria at the end of the period. |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock-based Compensation Expense and Resulting Tax Benefits | Stock-based compensation expense and the resulting deferred tax benefits were as follows (in thousands): Three Months Ended September 30, 2021 2020 Pre-tax stock-based compensation expense $ 7,554 $ 7,229 Deferred tax benefit (a) 1,281 1,110 Total stock-based compensation expense, net of tax $ 6,273 $ 6,119 _________________________________ (a) For the three months ended September 30, 2021 and 2020, the deferred tax benefit was reduced by $0.7 million and $0.8 million, respectively, attributable to stock-based compensation expense that is nondeductible for tax purposes pursuant to Section 162(m) as amended by the Tax Cuts and Jobs Act of 2017. |
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, 2021: 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, 2021 990,301 $ 35.27 1,731,002 $ 35.56 2,163,006 $ 30.32 Granted 576,575 $ 37.76 651,392 $ 37.18 — $ — Vested/exercised (156,158) $ 42.73 (588,142) $ 43.74 (745,407) $ 30.71 Forfeited (103,034) $ 33.41 (147,825) $ 31.75 (12,025) $ 36.54 Outstanding at September 30, 2021 1,307,684 $ 35.63 1,646,427 $ 33.62 1,405,574 $ 30.07 Stock options outstanding and exercisable at September 30, 2021 1,405,574 $ 30.07 |
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, 2021: 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, 2021 990,301 $ 35.27 1,731,002 $ 35.56 2,163,006 $ 30.32 Granted 576,575 $ 37.76 651,392 $ 37.18 — $ — Vested/exercised (156,158) $ 42.73 (588,142) $ 43.74 (745,407) $ 30.71 Forfeited (103,034) $ 33.41 (147,825) $ 31.75 (12,025) $ 36.54 Outstanding at September 30, 2021 1,307,684 $ 35.63 1,646,427 $ 33.62 1,405,574 $ 30.07 Stock options outstanding and exercisable at September 30, 2021 1,405,574 $ 30.07 |
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, 2021: 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, 2021 990,301 $ 35.27 1,731,002 $ 35.56 2,163,006 $ 30.32 Granted 576,575 $ 37.76 651,392 $ 37.18 — $ — Vested/exercised (156,158) $ 42.73 (588,142) $ 43.74 (745,407) $ 30.71 Forfeited (103,034) $ 33.41 (147,825) $ 31.75 (12,025) $ 36.54 Outstanding at September 30, 2021 1,307,684 $ 35.63 1,646,427 $ 33.62 1,405,574 $ 30.07 Stock options outstanding and exercisable at September 30, 2021 1,405,574 $ 30.07 |
Schedule of Unrecognized Stock-Based Compensation Expense | Unrecognized stock-based compensation expense at September 30, 2021 was as follows (in thousands). At September 30, 2021, there was no unrecognized stock-based compensation expense for outstanding stock options. Unrecognized Stock-Based Compensation Expense Weighted Average Amortization Period Restricted stock $ 31,788 2.5 years Performance share awards 33,266 2.1 years Total unrecognized stock-based compensation expense $ 65,054 2.3 years |
Schedule of Aggregate Intrinsic Value of Stock Options | The aggregate intrinsic value of stock options at September 30, 2021 was as follows (in thousands): Intrinsic Value of Stock Options Outstanding and exercisable $ 12,218 Exercised during the year ended September 30, 2021 $ 4,748 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments under noncancelable operating leases with initial lease terms in excess of one year were as follows (in thousands): September 30, 2021 June 30, 2021 2022 (a) $ 8,910 $ 11,738 2023 12,131 12,012 2024 12,267 12,145 2025 12,301 12,177 2026 9,005 8,878 Thereafter 1,324 1,293 Total future minimum lease payments 55,938 58,243 Less: imputed interest 4,840 5,289 Total operating lease liabilities (b) $ 51,098 $ 52,954 _________________________________ (a) As of September 30, 2021, future minimum lease payments are for the period from October 1, 2021 to June 30, 2022. (b) As of September 30, 2021, total operating lease liabilities included $10.1 million within other current liabilities in the Condensed Consolidated Balance Sheets. |
SEGMENTS (Tables)
SEGMENTS (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | The following table presents disaggregated revenue by business segment and underlying source (in thousands): Three Months Ended September 30, 2021 2020 Net revenue: Supply Chain Services Net administrative fees $ 149,462 $ 132,645 Other services and support 8,924 5,592 Services 158,386 138,237 Products 118,430 115,415 Total Supply Chain Services (a) 276,816 253,652 Performance Services (a) 88,331 93,235 Net revenue $ 365,147 $ 346,887 _________________________________ (a) Includes intersegment revenue that is eliminated in consolidation. Intersegment revenue is not separately identified in Segments as the amounts are not material. Additional segment information related to depreciation and amortization expense, capital expenditures and total assets was as follows (in thousands): Three Months Ended September 30, 2021 2020 Depreciation and amortization expense (a) : Supply Chain Services $ 13,144 $ 8,802 Performance Services 16,109 19,757 Corporate 2,232 2,119 Total depreciation and amortization expense $ 31,485 $ 30,678 Capital expenditures: Supply Chain Services $ 8,157 $ 2,876 Performance Services 11,023 18,371 Corporate 1,870 3,735 Total capital expenditures $ 21,050 $ 24,982 September 30, 2021 June 30, 2021 Total assets: Supply Chain Services $ 1,593,084 $ 1,550,300 Performance Services 1,014,850 1,043,608 Corporate 958,990 928,939 Total assets 3,566,924 3,522,847 Eliminations (b) (4) 51 Total assets, net $ 3,566,920 $ 3,522,898 _________________________________ (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 unaudited Segment Adjusted EBITDA, a Non-GAAP financial measure, is as follows (in thousands): Three Months Ended September 30, 2021 2020 Income before income taxes $ 140,339 $ 62,547 Equity in net income of unconsolidated affiliates (a) (7,058) (5,927) Interest and investment loss, net 2,788 2,119 (Gain) loss on FFF put and call rights (b) (64,110) 1,919 Other (income) expense 320 (3,683) Operating income 72,279 56,975 Depreciation and amortization 20,596 17,474 Amortization of purchased intangible assets 10,889 13,204 Stock-based compensation (c) 7,751 7,375 Acquisition and disposition related expenses 3,421 2,845 Equity in net income of unconsolidated affiliates (a) 7,058 5,927 Deferred compensation plan income (expense) (d) (318) 2,907 Other expense, net 27 4,036 Non-GAAP Adjusted EBITDA $ 121,703 $ 110,743 Segment Non-GAAP Adjusted EBITDA: Supply Chain Services (e) $ 129,269 $ 102,649 Performance Services (e) 23,715 37,116 Corporate (31,281) (29,022) Non-GAAP Adjusted EBITDA $ 121,703 $ 110,743 _________________________________ (a) Refer to Note 4 - Investments for more information. (b) Refer to Note 5 - Fair Value Measurements for more information. (c) Includes non-cash employee stock-based compensation expense and stock purchase plan expense of $0.2 million and $0.1 million for the three months ended September 30, 2021 and 2020, respectively. (d) Represents realized and unrealized gains and losses and dividend income on deferred compensation plan assets. (e) Includes intersegment revenue which is eliminated in consolidation. |
ORGANIZATION - Narrative (Detai
ORGANIZATION - Narrative (Details) | 3 Months Ended |
Sep. 30, 2021health_systemsegment | |
Segment Reporting Information [Line Items] | |
Number of business segments | segment | 2 |
Performance Services | |
Segment Reporting Information [Line Items] | |
Number of sub-brands | health_system | 3 |
ORGANIZATION - Supplementary Ca
ORGANIZATION - Supplementary Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Supplementary non-cash investing and financing activities: | ||
Increase in treasury stock related to a payable as a result of applying trade date accounting when recording the repurchase of Class A common stock | $ 4,477 | $ 0 |
Non-cash additions to property and equipment | 1,628 | 1,083 |
Accrued dividend equivalents | 149 | 186 |
Increase in redeemable limited partners' capital for adjustment to fair value, with offsetting decrease in stockholders' equity | 0 | 26,685 |
Decrease in redeemable limited partners' capital, with offsetting increase in stockholders' equity related to quarterly exchanges by member owners | 0 | (2,437) |
Net increase in deferred tax assets related to departures and quarterly exchanges by member owners and other adjustments | 0 | 331 |
Net increase in deferred tax assets related to final exchange by member owners | 0 | 284,852 |
Reclassification of redeemable limited partners' capital to additional paid in capital | 0 | 1,754,607 |
Decrease in additional paid-in capital related to notes payable to members, net of discounts | 0 | 438,967 |
Net increase in additional paid-in capital related to departures and quarterly exchanges by member owners and other adjustments | 0 | 37,319 |
Increase in additional paid-in capital related to final exchange by member owners | $ 0 | $ 517,526 |
BUSINESS ACQUISITIONS (Details)
BUSINESS ACQUISITIONS (Details) - USD ($) $ in Thousands | Mar. 01, 2021 | Sep. 30, 2021 | Jun. 30, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 999,913 | $ 999,913 | |
Invoice Delivery Services, LP Assets | |||
Business Acquisition [Line Items] | |||
Aggregate amount to be paid | $ 80,700 | ||
Credit facility borrowings used to pay for the acquisition | 80,000 | ||
Fair value of intangible assets acquired | 22,400 | ||
Goodwill | $ 57,700 |
INVESTMENTS - Schedule of Inves
INVESTMENTS - Schedule of Investments in Unconsolidated Affiliates (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | $ 186,282 | $ 153,224 | |
Equity in Net Income | 7,058 | $ 5,927 | |
FFF | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 126,493 | 120,548 | |
Equity in Net Income | 5,945 | 4,574 | |
Exela | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 26,000 | 0 | |
Equity in Net Income | 0 | 0 | |
Prestige | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 15,236 | 14,478 | |
Equity in Net Income | 758 | 1,052 | |
Other investments | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying Value | 18,553 | $ 18,198 | |
Equity in Net Income | $ 355 | $ 301 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) $ in Thousands | Jul. 29, 2021USD ($) | Sep. 30, 2021USD ($)health_system | Sep. 30, 2020USD ($) | Jun. 30, 2021 |
Schedule of Equity Method Investments [Line Items] | ||||
Gain (loss) on FFF put and call rights | $ | $ 64,110 | $ (1,919) | ||
ExPre Holdings, LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest through subsidiary (as a percent) | 15.00% | |||
Number of health systems with ownership interest | health_system | 11 | |||
PRAM Holdings, LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest through subsidiary (as a percent) | 26.00% | |||
Number of health systems with ownership interest | health_system | 16 | |||
PSCI | FFF | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest through subsidiary (as a percent) | 49.00% | 49.00% | ||
Gain (loss) on FFF put and call rights | $ | $ 64,100 | |||
ExPre Holdings, LLC | Exela | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest through subsidiary (as a percent) | 6.00% | |||
PRAM Holdings, LLC | Prestige | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest through subsidiary (as a percent) | 20.00% |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Financial Assets and Liabilities (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 |
Assets | ||
Cash equivalents | $ 75 | $ 75 |
Deferred compensation plan assets | 60,559 | 65,051 |
Total assets | 60,634 | 65,126 |
Liabilities | ||
Earn-out liabilities | 24,368 | 24,249 |
FFF put right | 64,110 | |
Total liabilities | 24,368 | 88,359 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets | ||
Cash equivalents | 75 | 75 |
Deferred compensation plan assets | 60,559 | 65,051 |
Total assets | 60,634 | 65,126 |
Liabilities | ||
Earn-out liabilities | 0 | 0 |
FFF put right | 0 | |
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Deferred compensation plan assets | 0 | 0 |
Total assets | 0 | 0 |
Liabilities | ||
Earn-out liabilities | 0 | 0 |
FFF put right | 0 | |
Total liabilities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Deferred compensation plan assets | 0 | 0 |
Total assets | 0 | 0 |
Liabilities | ||
Earn-out liabilities | 24,368 | 24,249 |
FFF put right | 64,110 | |
Total liabilities | $ 24,368 | $ 88,359 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) | 3 Months Ended | ||
Sep. 30, 2021USD ($) | Jun. 30, 2021USD ($) | Aug. 11, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assumed market interest rate (percent) | 1.60% | 1.60% | |
Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Earn-out liabilities | $ 24,400,000 | $ 24,200,000 | |
Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Minimum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Earn-out liabilities | $ 0 | $ 30,000,000 | |
Annual FFF EBITDA growth rate | Valuation Technique, Equity Value per Share Calculation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
FFF Put Rights input assumptions (in years) | 6 years | 6 years | |
Annual FFF EBITDA growth rate | Valuation Technique, Equity Value per Share Calculation | Minimum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value assumptions for FFF Put Rights (percent) | 0.025 | ||
Annual revenue growth rate | Valuation Technique, Equity Value per Share Calculation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
FFF Put Rights input assumptions (in years) | 6 years | 6 years | |
Annual revenue growth rate | Valuation Technique, Equity Value per Share Calculation | Minimum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value assumptions for FFF Put Rights (percent) | 0.025 | ||
Credit spread | Valuation Technique, Equity Value per Share Calculation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value assumptions for FFF Put Rights (percent) | 0.008 | 0.008 | |
FFF call right | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Call right, exercisable term, key event (in days) | 180 days | ||
Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
FFF call right | $ 0 | $ 0 | |
Earn-out liabilities | 24,368,000 | 24,249,000 | |
Level 1 | Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Current portion of deferred compensation plan assets | 6,000,000 | 5,500,000 | |
Earn-out liabilities | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Imputed interest (percent) | 1.80% | ||
Notes payable, difference between fair value and carrying value | 100,000 | 100,000 | |
Level 2 | Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Earn-out liabilities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value Measurement Input Assumptions (Details) | Sep. 30, 2021 | Jun. 30, 2021 |
Valuation Technique, Equity Value per Share Calculation | Correlation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.800 | |
Valuation Technique, Equity Value per Share Calculation | Weighted average cost of capital | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.140 | |
Valuation Technique, Equity Value per Share Calculation | Asset volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.300 | |
Valuation Technique, Equity Value per Share Calculation | Credit spread | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.008 | 0.008 |
Valuation Technique, Estimated Future Earnings | Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Probability of transferred member renewal percentage less that 50% | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Earn-out input assumptions (percent) | 0.050 | 0.050 |
Valuation Technique, Estimated Future Earnings | Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Probability of transferred member renewal percentage between 50% and 65% | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Earn-out input assumptions (percent) | 0.100 | 0.100 |
Valuation Technique, Estimated Future Earnings | Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Probability of transferred member renewal percentage between 65% and 80% | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Earn-out input assumptions (percent) | 0.250 | 0.250 |
Valuation Technique, Estimated Future Earnings | Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Probability of transferred member renewal percentage > 80% | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Earn-out input assumptions (percent) | 0.600 | 0.600 |
Valuation Technique, Estimated Future Earnings | Acurity, Inc. (“Acurity”) and Nexera, Inc. (“Nexera”) | Credit spread | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Earn-out input assumptions (percent) | 0.008 | 0.009 |
Minimum | Valuation Technique, Equity Value per Share Calculation | Annual FFF EBITDA growth rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.025 | |
Minimum | Valuation Technique, Equity Value per Share Calculation | Annual revenue growth rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.025 | |
Maximum | Valuation Technique, Equity Value per Share Calculation | Annual FFF EBITDA growth rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.108 | |
Maximum | Valuation Technique, Equity Value per Share Calculation | Annual revenue growth rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value assumptions for FFF Put Rights (percent) | 0.063 |
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, 2021 | Sep. 30, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | $ 88,359 | $ 69,909 |
Purchases (Settlements) | (64,110) | (9,073) |
(Gain) Loss | 119 | 858 |
Ending Balance | 24,368 | 61,694 |
Earn-out liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 24,249 | 33,151 |
Purchases (Settlements) | 0 | (9,073) |
(Gain) Loss | 119 | (1,061) |
Ending Balance | 24,368 | 23,017 |
FFF put right | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning Balance | 64,110 | 36,758 |
Purchases (Settlements) | (64,110) | 0 |
(Gain) Loss | 0 | 1,919 |
Ending Balance | $ 0 | $ 38,677 |
CONTRACT BALANCES - Contract As
CONTRACT BALANCES - Contract Assets, Deferred Revenue and Capitalized Contract Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue recognized | $ 7.3 | $ (2.5) |
Revenue recognized from performance obligations satisfied in previous periods | 1.4 | |
Net administrative fees | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue recognized associated with a change in net administration fee revenue | 1.8 | 0.2 |
License and Service | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue recognized associated with revised forecasts underlying contracts with variable consideration components | $ (0.4) | $ (2.7) |
CONTRACT BALANCES - Remaining P
CONTRACT BALANCES - Remaining Performance Obligation (Details) $ in Millions | Sep. 30, 2021USD ($) |
Revenue from Contract with Customer [Abstract] | |
Transaction price allocated to remaining performance obligation | $ 588.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation to be satisfied (percent) | 47.00% |
Remaining performance obligation satisfaction period (in months) | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation to be satisfied (percent) | 27.00% |
Remaining performance obligation satisfaction period (in months) | 12 months |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Goodwill [Line Items] | |||
Goodwill | $ 999,913 | $ 999,913 | |
Intangible asset amortization | 10,889 | $ 13,204 | |
Supply Chain Services | |||
Goodwill [Line Items] | |||
Goodwill | $ 388,500 | ||
Performance Services | |||
Goodwill [Line Items] | |||
Goodwill | $ 611,400 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Jun. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 686,554 | $ 686,554 |
Accumulated amortization | (300,801) | (289,912) |
Total intangible assets, net | 385,753 | 396,642 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible asset | $ 1,000 | |
Member relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 14 years 8 months 12 days | |
Total intangible assets | $ 386,100 | 386,100 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 6 years 1 month 6 days | |
Total intangible assets | $ 186,017 | 186,017 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 9 years 7 months 6 days | |
Total intangible assets | $ 70,830 | 70,830 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 7 years 4 months 24 days | |
Total intangible assets | $ 24,610 | 24,610 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 5 years 3 months 18 days | |
Total intangible assets | $ 11,315 | 11,315 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 10 years 2 months 12 days | |
Total intangible assets | $ 7,682 | $ 7,682 |
DEBT AND NOTES PAYABLE - Schedu
DEBT AND NOTES PAYABLE - Schedule of Long-Term Debt and Notes Payable (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 |
Debt Instrument [Line Items] | ||
Total debt and notes payable | $ 551,878 | $ 478,571 |
Less: current portion | (271,828) | (174,243) |
Total long-term debt and notes payable | 280,050 | 304,328 |
Credit Facility | ||
Debt Instrument [Line Items] | ||
Total debt and notes payable | 175,000 | 75,000 |
Notes Payable | Notes payable to members | ||
Debt Instrument [Line Items] | ||
Total debt and notes payable | 371,129 | 394,943 |
Notes Payable | Other notes payable | ||
Debt Instrument [Line Items] | ||
Total debt and notes payable | $ 5,749 | $ 8,628 |
DEBT AND NOTES PAYABLE - Credit
DEBT AND NOTES PAYABLE - Credit Facility (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Oct. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Line of Credit Facility [Line Items] | ||||
Outstanding borrowings | $ 551,878 | $ 478,571 | ||
Proceeds from credit facility | 175,000 | $ 100,000 | ||
Payments on credit facility | $ 75,000 | $ 25,000 | ||
Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate (percent) | 1.09% | |||
Credit facility, unused capacity commitment fee (percent) | 0.10% | |||
Indebtedness or guarantee threshold | $ 75,000 | |||
Outstanding borrowings | 175,000 | |||
Available borrowing capacity | 824,900 | |||
Proceeds from credit facility | 175,000 | |||
Payments on credit facility | $ 75,000 | |||
Credit Facility | Subsequent Event | ||||
Line of Credit Facility [Line Items] | ||||
Payments on credit facility | $ 50,000 | |||
Credit Facility | LIBOR | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.00% | |||
Credit Facility | LIBOR | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.50% | |||
Credit Facility | Prime Rate | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.00% | |||
Credit Facility | Prime Rate | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.50% |
DEBT AND NOTES PAYABLE - Notes
DEBT AND NOTES PAYABLE - Notes Payable (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2021 | Jun. 30, 2021 | Aug. 11, 2020 | |
Level 2 | |||
Debt Instrument [Line Items] | |||
Imputed interest (percent) | 1.80% | ||
Notes Payable | Minimum | |||
Debt Instrument [Line Items] | |||
Notes payable, stated maturity period | 3 years | ||
Notes Payable | Maximum | |||
Debt Instrument [Line Items] | |||
Notes payable, stated maturity period | 5 years | ||
Notes payable to members | Notes Payable | |||
Debt Instrument [Line Items] | |||
Notes payable | $ 371.1 | $ 394.9 | |
Imputed interest | (13.9) | (15.8) | |
Notes payable included in current portion of long-term debt | 96.4 | 95.9 | |
Other notes payable | Notes Payable | |||
Debt Instrument [Line Items] | |||
Notes payable | 5.7 | 8.6 | |
Notes payable included in current portion of long-term debt | $ 0.4 | $ 3.3 |
REDEEMABLE LIMITED PARTNERS' _3
REDEEMABLE LIMITED PARTNERS' CAPITAL - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 14 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | |
Temporary Equity [Line Items] | |||
Adjustment of redeemable limited partners' capital to redemption amount | $ 0 | $ (26,685) | |
Limited Partner | |||
Temporary Equity [Line Items] | |||
Adjustment of redeemable limited partners’ capital to redemption amount | $ 0 | $ 26,685 | $ 0 |
REDEEMABLE LIMITED PARTNERS' _4
REDEEMABLE LIMITED PARTNERS' CAPITAL - Changes in Redeemable Limited Partners' Capital (Details) - USD ($) $ in Thousands | 3 Months Ended | 14 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | |
Increase (Decrease) in Temporary Equity | |||
Exchange of Class B common units for Class A common stock by member owners | $ (2,437) | ||
Limited Partner | |||
Increase (Decrease) in Temporary Equity | |||
Redeemable limited partners' capital, beginning balance | 1,720,309 | ||
Distributions applied to receivables from limited partners | 141 | ||
Net income attributable to non-controlling interest in Premier LP | 11,845 | ||
Distributions to limited partners | (1,936) | ||
Exchange of Class B common units for Class A common stock by member owners | (2,437) | ||
Adjustment of redeemable limited partners’ capital to redemption amount | $ 0 | 26,685 | $ 0 |
Reclassification to permanent equity | (1,754,607) | ||
Redeemable limited partners' capital, ending balance | 0 | ||
Limited Partner | Receivables From Limited Partners | |||
Increase (Decrease) in Temporary Equity | |||
Redeemable limited partners' capital, beginning balance | (995) | ||
Distributions applied to receivables from limited partners | 141 | ||
Reclassification to permanent equity | 854 | ||
Redeemable limited partners' capital, ending balance | 0 | ||
Limited Partner | Redeemable Limited Partners' Capital | |||
Increase (Decrease) in Temporary Equity | |||
Redeemable limited partners' capital, beginning balance | 1,721,304 | ||
Net income attributable to non-controlling interest in Premier LP | 11,845 | ||
Distributions to limited partners | (1,936) | ||
Exchange of Class B common units for Class A common stock by member owners | (2,437) | ||
Adjustment of redeemable limited partners’ capital to redemption amount | 26,685 | ||
Reclassification to permanent equity | (1,755,461) | ||
Redeemable limited partners' capital, ending balance | $ 0 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 21, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Aug. 05, 2021 | Jun. 30, 2021 |
Class of Stock [Line Items] | ||||||
Stock repurchase, average price (in usd per share) | $ 39.04 | |||||
Stock repurchase, total purchase price | $ 42,600 | $ 42,628 | ||||
Common Class A | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares outstanding (in shares) | 122,680,693 | 122,680,693 | 122,533,051 | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||
Stock repurchase, authorized amount | $ 250,000 | |||||
Stock repurchased during period (in shares) | 1,100,000 | |||||
Per share amount of dividends (in dollars per share) | $ 0.20 | $ 0.19 | ||||
Common Class A | Subsequent Event | ||||||
Class of Stock [Line Items] | ||||||
Dividends declared (in usd per share) | $ 0.20 |
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 | 14 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | |
Numerator for basic earnings per share: | |||
Net income attributable to stockholders | $ 122,004 | $ 118,998 | |
Numerator for diluted earnings per share: | |||
Adjusted net income | 122,004 | 118,998 | |
Net loss attributable to non-controlling interest | (698) | 0 | |
Net income | $ 121,306 | $ 118,998 | |
Denominator for earnings per share: | |||
Basic weighted average shares outstanding (in shares) | 122,945 | 99,575 | |
Effect of dilutive securities: | |||
Diluted weighted average shares and assumed conversions (in shares) | 124,573 | 100,130 | |
Earnings per share attributable to stockholders: | |||
Basic earnings per share attributable to stockholders (in dollars per share) | $ 0.99 | $ 1.20 | |
Diluted earnings per share attributable to stockholders (in dollars per share) | $ 0.97 | $ 1.19 | |
Net income | $ 121,306 | $ 157,528 | |
Net loss (income) attributable to non-controlling interest | 698 | (11,845) | |
Net income attributable to stockholders | $ 122,004 | $ 118,998 | |
Common Class B Unit | |||
Earnings per share attributable to stockholders: | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 22,400 | ||
Stock options | |||
Effect of dilutive securities: | |||
Effect of dilutive securities (in shares) | 310 | 253 | |
Earnings per share attributable to stockholders: | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 300 | 700 | |
Restricted Stock | |||
Effect of dilutive securities: | |||
Effect of dilutive securities (in shares) | 492 | 302 | |
Performance share awards | |||
Effect of dilutive securities: | |||
Effect of dilutive securities (in shares) | 826 | 0 | |
Earnings per share attributable to stockholders: | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 200 | 600 | |
Limited Partner | |||
Earnings per share attributable to stockholders: | |||
Adjustment of redeemable limited partners’ capital to redemption amount | $ 0 | $ (26,685) | $ 0 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected effective income tax rate (percent) | 26.00% | 26.00% |
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) | 14.8 | |
Number of shares available for grant (shares) | 4.6 | |
Performance share awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period (in years) | 3 years | |
Stock options | 2013 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period (in years) | 3 years | |
Award term (in years) | 10 years | |
Options, expiration period (in months) | 12 months | |
Employee | Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period (in years) | 3 years | |
Director | Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period (in years) | 1 year |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of Stock-based Compensation Expense and Resulting Tax Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | ||
Pre-tax stock-based compensation expense | $ 7,554 | $ 7,229 |
Deferred tax benefit | 1,281 | 1,110 |
Share-based Payment Arrangement, Expense, after Tax | 6,273 | 6,119 |
Stock-based compensation expense not deductible for tax purposes | $ 700 | $ 800 |
STOCK-BASED COMPENSATION - Sc_2
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, 2021$ / sharesshares | |
Restricted Stock | |
Number of Awards | |
Outstanding, beginning balance (in shares) | shares | 990,301 |
Granted (in shares) | shares | 576,575 |
Vested/exercised (in shares) | shares | (156,158) |
Forfeited (in shares) | shares | (103,034) |
Outstanding, ending balance (in shares) | shares | 1,307,684 |
Weighted Average Fair Value at Grant Date | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 35.27 |
Granted (in dollars per share) | $ / shares | 37.76 |
Vested/exercised (in dollars per share) | $ / shares | 42.73 |
Forfeited (in dollars per share) | $ / shares | 33.41 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 35.63 |
Performance Share Awards | |
Number of Awards | |
Outstanding, beginning balance (in shares) | shares | 1,731,002 |
Granted (in shares) | shares | 651,392 |
Vested/exercised (in shares) | shares | (588,142) |
Forfeited (in shares) | shares | (147,825) |
Outstanding, ending balance (in shares) | shares | 1,646,427 |
Weighted Average Fair Value at Grant Date | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 35.56 |
Granted (in dollars per share) | $ / shares | 37.18 |
Vested/exercised (in dollars per share) | $ / shares | 43.74 |
Forfeited (in dollars per share) | $ / shares | 31.75 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 33.62 |
Stock options | |
Number of Options | |
Outstanding, beginning balance (in shares) | shares | 2,163,006 |
Granted (in shares) | shares | 0 |
Vested/exercised (in shares) | shares | (745,407) |
Forfeited (in shares) | shares | (12,025) |
Outstanding, ending balance (in shares) | shares | 1,405,574 |
Stock options outstanding and exercisable (in shares) | shares | 1,405,574 |
Weighted Average Exercise Price | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 30.32 |
Granted (in dollars per share) | $ / shares | 0 |
Vested/exercised (in dollars per share) | $ / shares | 30.71 |
Forfeited (in dollars per share) | $ / shares | 36.54 |
Outstanding, ending balance (in dollars per share) | $ / shares | 30.07 |
Stock options outstanding and exercisable (in dollars per share) | $ / shares | $ 30.07 |
STOCK-BASED COMPENSATION - Sc_3
STOCK-BASED COMPENSATION - Schedule of Unrecognized Stock-Based Compensation Expense (Details) $ in Thousands | 3 Months Ended |
Sep. 30, 2021USD ($) | |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 0 |
2013 Equity Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 65,054 |
Weighted Average Amortization Period | 2 years 3 months 18 days |
2013 Equity Incentive Plan | Restricted Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 31,788 |
Weighted Average Amortization Period | 2 years 6 months |
2013 Equity Incentive Plan | Performance share awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Stock-Based Compensation Expense | $ 33,266 |
Weighted Average Amortization Period | 2 years 1 month 6 days |
STOCK-BASED COMPENSATION - Sc_4
STOCK-BASED COMPENSATION - Schedule of Aggregate Intrinsic Value of Stock Options (Details) - 2013 Equity Incentive Plan $ in Thousands | 3 Months Ended |
Sep. 30, 2021USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding and exercisable | $ 12,218 |
Exercised during the year ended September 30, 2021 | $ 4,748 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2022 | |
Income Tax Contingency [Line Items] | |||
Income tax expense (benefit) | $ 19,033 | $ (94,981) | |
Effective tax rate (percent) | 14.00% | (152.00%) | |
Effective ta rate after excluding effect of one-time deferred tax benefit (percent) | 24.00% | ||
Tax credit carryforward, valuation allowance | $ 15,300 | ||
Forecast | |||
Income Tax Contingency [Line Items] | |||
Deferred tax asset valuation allowance | $ 32,900 | ||
Income tax benefit | $ 17,600 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease expense | $ 2,600 | $ 3,400 | |
Weighted average remaining lease term (in years) | 4 years 7 months 6 days | ||
Weighted average discount rate (percent) | 4.00% | ||
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
Remainder of the year | $ 8,910 | ||
Year one | 12,131 | $ 11,738 | |
Year two | 12,267 | 12,012 | |
Year three | 12,301 | 12,145 | |
Year four | 9,005 | 12,177 | |
Year five | 8,878 | ||
Thereafter | 1,324 | ||
Thereafter | 1,293 | ||
Total future minimum lease payments | 55,938 | 58,243 | |
Less: imputed interest | 4,840 | 5,289 | |
Total operating lease liabilities | $ 51,098 | $ 52,954 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other current liabilities | ||
Operating lease liability included in other liabilities, current | $ 10,100 |
SEGMENTS - Narrative (Details)
SEGMENTS - Narrative (Details) | 3 Months Ended |
Sep. 30, 2021segment | |
Segment Reporting [Abstract] | |
Number of reportable business segments | 2 |
SEGMENTS - Schedule of Segment
SEGMENTS - Schedule of Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | |||
Net revenue | $ 365,147 | $ 346,887 | |
Total depreciation and amortization expense | 31,485 | 30,678 | |
Total capital expenditures | 21,050 | 24,982 | |
Total assets | 3,566,920 | $ 3,522,898 | |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization expense | 2,232 | 2,119 | |
Total capital expenditures | 1,870 | 3,735 | |
Total assets | 958,990 | 928,939 | |
Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total assets | (4) | 51 | |
Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 276,816 | 253,652 | |
Supply Chain Services | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization expense | 13,144 | 8,802 | |
Total capital expenditures | 8,157 | 2,876 | |
Total assets | 1,593,084 | 1,550,300 | |
Performance Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 88,331 | 93,235 | |
Performance Services | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total depreciation and amortization expense | 16,109 | 19,757 | |
Total capital expenditures | 11,023 | 18,371 | |
Total assets | 1,014,850 | 1,043,608 | |
Operating Segments and Corporate Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Total assets | 3,566,924 | $ 3,522,847 | |
Net administrative fees | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 149,462 | 132,645 | |
Net administrative fees | Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 149,462 | 132,645 | |
Other services and support | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 97,255 | 98,827 | |
Other services and support | Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 8,924 | 5,592 | |
Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 246,717 | 231,472 | |
Services | Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 158,386 | 138,237 | |
Products | |||
Segment Reporting Information [Line Items] | |||
Net revenue | 118,430 | 115,415 | |
Products | Supply Chain Services | |||
Segment Reporting Information [Line Items] | |||
Net revenue | $ 118,430 | $ 115,415 |
SEGMENTS - Reconciliation of In
SEGMENTS - Reconciliation of Income Before Income Taxes to Segment Adjusted EBITDA (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||
Income before income taxes | $ 140,339 | $ 62,547 |
Equity in net income of unconsolidated affiliates | (7,058) | (5,927) |
Interest and investment loss, net | 2,788 | 2,119 |
(Gain) loss on FFF put and call rights | (64,110) | 1,919 |
Other (income) expense | 320 | (3,683) |
Operating income | 72,279 | 56,975 |
Depreciation and amortization | 20,596 | 17,474 |
Amortization of purchased intangible assets | 10,889 | 13,204 |
Stock-based compensation | 7,751 | 7,375 |
Acquisition and disposition related expenses | 3,421 | 2,845 |
Equity in net income of unconsolidated affiliates | 7,058 | 5,927 |
Deferred compensation plan income (expense) | (318) | 2,907 |
Other expense, net | 27 | 4,036 |
Non-GAAP Adjusted EBITDA | 121,703 | 110,743 |
Employee Stock Purchase Plan (ESPP) | ||
Segment Reporting Information [Line Items] | ||
Stock-based compensation | 200 | 100 |
Operating Segments | Supply Chain Services | ||
Segment Reporting Information [Line Items] | ||
Non-GAAP Adjusted EBITDA | 129,269 | 102,649 |
Operating Segments | Performance Services | ||
Segment Reporting Information [Line Items] | ||
Non-GAAP Adjusted EBITDA | 23,715 | 37,116 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Non-GAAP Adjusted EBITDA | $ (31,281) | $ (29,022) |