AMEH - Earnings call transcript Q2 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, ladies and gentlemen, and welcome to the Apollo Medical Holdings Second Quarter 2021 Financial Results Call. All lines have been placed on a listen-only mode and the floor will be open for questions and comments following the presentation. [Operator Instructions] At this time, it is my pleasure to turn the floor over to your host Carolyne Sohn. Ma'am, the floor is yours.

Carolyne Sohn

Thank you, operator, and hello everyone. us. joining for you Thank www.apollomed.net. The press the available Inc's for website Medical the announcing quarter ended Apollo at company's second the is section Holdings, June Investors results of release XX, at XXXX has To provide some supplemental background on website. available its made the on its deck a results, additional Company also of of this will available ApolloMed's be replay A broadcast website at call. made this after conclusion the

"plan", certain that started, statements to Coronavirus information Private and for regarding this and of financial other would December provision remind statements long-term and as pandemic contains of conference discussed such can statements as well continued "outlook" and growth, and get like harbor I These identified we Novel year XXXX. deliver the the meaning everyone to Before Securities the "will" strategy, the by operations, focus, and as impact accompanying integration COVID-XX call XX, things, any herein safe among "future", Act of terms include forward-looking within "believe", to efforts growth "anticipate", respond value, forward-looking be Litigation Company's the operational Reform the the of XXXX, variant ending results. sustainable the on ability environment, delta strategic to business, XXXX guidance acquisition the or ability merger the Company's plans changing "expect",

expectations its statements forward-looking the in are reflected that believes company the Although reasonable.

included and any an by cause Information Company which otherwise, and before forward-looking except required Securities will future statements associated those you uncertainties expectations its no As law. result actual decision. as the new could in a be update that any be information, subject projected. Exchange conditions events, to risks ApolloMed does The investing the to in correct. investment that encourage of market from assurance of today, prove those differ obligation can is review with risks we There to changes or assume with as filings in statements Commission, to to are not making results the about dramatically those

disclaimer X call would for like the refer language, the conference further to information. to Slide Regarding presentation also I you of

will Please an results a Technology follow XXXX Company's those Chief the the Co-CEO, the the Executive will Officer, will growth accompanying and an second Officer, strategy X. second overview for an The with floor on update Chief operational first of then call of On for latest of is quarter Company's half the ahead Sim. provide long-term Operating will discuss and Sim and overview quarter outlook Co-CEO, Company Sim highlights. to ApolloMed's For call, Chairman remarks Dr. go and and opening Dr. of turn With first Slide Chairman Kenneth Chin following you supplement, today's Financial Chief Executive Sim. conclude that, Kenneth Eric of ApolloMed's Dr. the over along the there the and Brandon developments review Company's on Brandon questions. before Officer half with the with XXXX. I'll and

Kenneth Sim

efficiencies existing growth in fueled bottom later nearly Organic in our our across elaborate total and primarily our from Brandon will line. proprietary thank you and growth of on joining technology and into was growth the the of revenue our derived year ApolloMed membership revenue, continued which on solid ApolloMed's pass the our IPAs quarter platform, the operational capitation results. delivering generated Good line Thank second top all This for growth businesses momentum XXXX you represents greater on beginning you, to even second the to call. to which bulk driven by afternoon the Carolyne. revenue. at us of quarter, all discuss the continued

centers in OpEx to decreased a related from our our quarter QX, based of value incentive operational increased second platforms $X fees primarily general also increase efficiencies as our pool well revenue the We pandemic. and in while year. administrative care did our and in we service technology heart savings risk revenues due from quarter. to to their and And as related overall quality this to partner increased result internally, at in recognized drive efforts utilization realizing increased for debt Fee following continued the our hospitals reopening the incurred refinancing, and in million see surgery at also approximately as utilization expenses this

For of total in million prior revenue, period. XXXX, million increase which $XXX.X a year $XXX.X quarter the in we the from second is reported X%

ApolloMed line, reporting June an to bottom revenue total we income was $X.XX ApolloMed the ending to XXXX, a period, which XX% the share Diluted XX, million six increase prior XXXX. reporting a per by up share per earnings for Diluted XX% million. million, $XX.X first achieved XX% was per from $X.XX Zooming attributable to period. for net $XX.X $XXX.X $X million in in earnings attributable net On share more increased to per to the quarter. share the is of out than doubling the X% first half for months the income of increase year

ultimately quarter During decreased on our savings by had with realized a decreased claims pandemic, the call, trend discussed to COVID-XX our brought which first earnings of we business positive expenses. utilization the on due has impact

yet the due delta the during of see we variant. the second added reached introduced XXXX, of the increased to have not by While levels utilization we pre-pandemic uncertainty did utilization quarter

COVID-XX we and past of continue over the believe normalize dissipate impact to eventually Over the ongoing months, time. few will

June. model top continued organic the year, periods. year during Laboratories, providing is for having rapid as and ApolloMed occurs entered prior clear updated an outlook in lines has in guidance on more XX certified purchase first Clinical the these bottom Sun our operating of in raising in half a his remain full year locations in are on guidance Brandon gives capacity our been laboratory lab agreement to of relative strategy. into COVID on months detail us will trends the foodservice Even in our this discussion testing our the We Based execute our growth growth confident results and of a encouraging we couple Southern California. which XXXX. to patients. a provide we testing for added here and genetic and to abilities improved our There busy Sun

of our We Most of also Mateo and completed strategy. an the in a us Francisco. financial serves puts has in agreement of capitalization definitive a to Medical senior debt which we successful California with counties acquire San and stronger San Group, refinancing, our members fully into primarily announced execute us the even on flexibility XX% an Care entered Access Primary provide which diluted to growth IPA position that period Northern recently, greater

and working and workers been with the we at thrilled country expanding and have all the efforts our partnership the across for since COVID are thank MSO to Care Primary I We XXXX to frontline their meet them. team would continued providers like be with Access our to challenges.

has I all and for proprietary to of times. healthcare on over be an during are It and honor to Brandon? will truly elaborate operations all Brandon, our with a been proud a to turn With update provide on technology solutions. and We working will difficult developments you. that, it who continue provider this

Brandon Sim

Sim. Thank you, Dr.

minute like developments, about several at all more recent a Before getting detail take to ApolloMed. I'd frame to of into events these

administrators that put local empowering like size optimize that system, tech foremost physician although succeeded in we we fits tailored operation that system and providers each in and we At for strive care believe integration perspective. clinical, efficiency, enabled serves the strive serve be this financial value-based most do which a for do. we all the to leveraging delivery can believe participants do and our should for a is patient all an technological, company that healthcare on possible The founded positions focus platform, physician are way. helps alike. via to ApolloMed, participate and as and for arrangement, the one care And truly healthcare community do, platform first so cost-effective care and in operating and our to the and we in that We physicians all model. from healthcare we just not patients We in best providing by system automate coordinators optimization

recent commercial a system entirely to de IPA, and The same our just ACO, communities proprietary this demonstrated budget central use note can also by novo well as in MA. it's development more. population, done neutral been IPA Medicare, or Our case, effort Original also allows used I'll of that having our whether do our results. while flexible is platform that be of was as scale. has each an consolidated as platform optimal a of financial across the Medicaid, fashion that for all that efficiencies entire our adapted businesses, operating a platform providing for infrastructure us across our allows that our managed

mentioned platform. Sim continue we this earlier, savings driven to operational of primarily As continued see development Dr. by

excited that are and the operational we course the integrated that process systems claims are and building on I'm out established earlier. margin I care pleased of also out continue to some XX% expanded We that physicians which we to is examples over mentioned across the adjudicated few medical of example, serve. our believe elaborate today of further our the past expansion as technology there automatically are IPA consolidated For via the we business that of and very build come we partnerships communities state we have the to scaling months, the local of platform. that over it

will into First, for daily Lab business administrator Sun of lab agreement functions ApolloMed an serve Clinical excluding with whereby decision all exclusive Sun Labs. we entered as

our affiliated providing core our see to seamless, as business their bringing labs XX and high have and class integrate expansion quality some members. services We locations lab best in comprehensive been nation. more across into the our platform, for experience to and patients We partner care planned working a delivery the physicians growing a

capitalization the of provided since transaction during we the third to acquisition XX% of expect Group, planned the of XXXX. successfully risk members organization of the Medical announced diluted month, services professional Primary that close Last capitated has our We Care to XXXX. fully bearing Access quarter senior

Area be from and based in had Care to value California. very care Mateo. specialty XXX into delivering Bay upon providers in Medicare with ApolloMed San the strong members building care Access family. Primary provide look a forward We primary bringing down the with to Advantage are We Medical will foothold the San over opportunity the Primary serving they've Groups success expand X,XXX Northern Francisco pleased Care in approximately to that Access ApolloMed

will ApolloMed over expertise remarkable and healthcare in in With system of providers they believe have building to make members and our closing we I'll participate value third empowering states way our that in do. anticipate and also look had We other in success based provider team model We thank geographies. place results. local I'd hard care communities to that, this the arrangement quarter in us all our turn can. that local to replicate in our it serving uniquely we centric in the take that the to healthcare work XXXX. to our patient California like We review financial Eric to for any forward continue equipped

Eric Chin

Thank Brandon. you,

earlier, of total revenue primarily Dr. quarter a achieved in XXXX, strong from second organic increase mentioned driven As Sim quarter. we $XXX.X reporting the prior X% of $XXX.X million by in year million, results the the growth,

lag. reported pandemic from XX-month in utilization at partner also our when related and decreased reflect settlements incentives revenues increased We partner the XXXX, these as hospitals hospitals to risk XX revenue pool began a to first our

the This million of in were prior result XXXX direct lives in quarter of our which administrative closer look about savings fully partially membership realized remained increased by from year the members membership, to general XX, a the expenses debt at quarter through the and second consolidated second related $X half Taking of or XXX,XXX operating Total a XXXX. expenses X%, end to approximately result a our Our technology million were increased capitated managed million our was June offset $XXX.X at X.X of IPA. period. company's approximately as primarily million $XXX.X refinancing, ended in of the at the platform.

revenue, net in million second $X was net an XX% As attributable from $XX.X to a ApolloMed increase of result of XXXX. income increased of the million, quarter the

million per of the Our a reported on on numbers million which share prior Adjusted year emphasis in $X.XX the the period. year earnings the which million, place million diluted We second prior share, per per XX% income million gain the other for out assets, was $XX.X IPA, of acquired of EBITDA during the were in which fair these of a the related is increase This that recently non-cash period. $XXX.X period. Company's of a in unrealized quarter Adjusted $XX.X IPO They basis income $XX $X.XX We $XX.X back write-off up XXXX, in from to of period. compares was in impact offset quarter in year a EBITDA EBITDA figures $XX.X second the the share to prior as and from back XX% interest one-time an from passive the the greater investment. by that partner investment million impact aforementioned partners. also a the out XXXX completed included equity excluded method partially of payer the beneficial

of second Our a called solely in that excluded as gain shareholders. are million included in gains and the quarter Brand on benefit they small past These the a plan affiliates, our asset of the New $XX.X XXXX Day. we've sale APC its bucket health for described are

revenue million financial platform. from Total revenues lower was our in prior increase APC. increased the prior due decreased of to technology the income to dividends reduction received June XX, to increased well quarter XX, few June claims result XXXX six the the $XX.X as months a expenses and $XXX ACO, from $XX.X and The Now, ended year half period. XXXX. expenditures million attributable XXXX. million the Net highlights $XXX.X from $XXX.X for from ended primarily million, year period, the for I'll increased reduction for in go OpEx prior due G&A of million to months was to a Total ApolloMed APA, the incurred as primarily year X% a preferred from OpEx million at a six ApolloMed $XXX.X as in first up quickly over of

sheet to to and over the initiatives. well capitalized execute balance Turning we well remain our positioned on growth

with XXXX. completed We we a XX interest million cash increasing debt the past earlier, by mentioned ability annual equivalents, in our while in the the measure financial compared drawdown, growth invest of of on at increasing with cash June and a as this spread $XXX.X Sim second and basis overall $XXX.X liquidity. Dr. to $XXX ended respect refinancing rate million As points to quarter initial reducing our our flexibility covenants and end million to proactive

$XXX.X And to at end from lastly, at Our increased XXXX. at $XXX.X stockholders' capital working to XXXX increased $XXX.X million million December million of total June the $XXX.X XXXX. from million XX, equity XX,

the was second total sheet, $XXX.X at the down further Moving debt end balance the of million. quarter

over Leverage maximum debt ratio in permitted with safely are We covenants our permitted compared back X.XX consolidated interest XXXX. of I'd turn compliance times with And X.XX the the for now compared of Net of remainder consolidated X.XX times. to the times. to Total Ratio a minimum coverage like to XX.XX times discussion Brandon for growth outlook Brandon? to our of and it strategy

Brandon Sim

provider of on infrastructure Thanks Eric. half rapid in for and on or Much platform XXXX first the forward was of scaling spent experience that allow to sacrificing care, patient going investing experience. with our patient

lives update XXXX. longer announced of by I'd MSO also CAIPA a initially which taken to We two million to population and previously an member approximately we continue had on end of expected. working year, we transaction the the provide beginning our towards like reaching at has the growing stated our complete to the goal little of

the provided said, to year. continue projections team our guidance previously in few business trends results there anticipate first That the closely achieved growth in pleased that be Access for Care working full the seeing positive and the are financial weeks. far with year We organic transaction the the next thus closing transaction we XXXX half raising the with and we we and Primary along due are to strong of have across the

EBITDA ending income to Slide and net following to to account and for we million income December million, the of passive million of of non-cash to the $XXX million $XXX to XXXX. ApolloMed $XXX on $XXX.X attributable mentioned income investment that the attributable between to income on now one-time XX, of EBITDA and metrics. million million, anticipate in that are $XX ApolloMed Adjusted EBITDA and million XX our As Eric Adjusted $XXX mind to year Please that in of Revenues net net keep million, greater place $XX million supplement, emphasis the we $XXX.X EBITDA listed for net gain earlier $XX a million. $XX

In this major or these may acquisitions addition, metrics of potential transactions consider the year. any complete other not we do guidance course business over

As material any developments reevaluate we be to arise, sure markets guidance will update as and appropriate. the

received technology of we mission pleased cycle of under that over quarter in Before past created platform. year. community and this and ApolloMed We to investment for providers also are are be patients on pleased the radar and as our value-based stock investments value we second are believe at from execute have forward later productive as with on as our to touch the has story system concluding, waste much recognition do the on in nation lower financial for for a the equipped excess and we continued we improved has virtuous conference increased shift and clinical laser results perhaps confident I'd like flown course quite to our to our cost months. continue we empower are the look the increasingly In the proposition noticed. in uniquely We on the planned a our several as as to eliminating our presentations care dialog by possible. focused summary, delivering The the some outcomes towards profitability ApolloMed investment time briefly a infrastructure continuing you few being are community recent have well with the

it future. near With We are serving and that, in in look local operator, we all for Q&A. to patients communities our the open let's serve up more to proud forward

Brandon Sim

for all time you your Thank today.

Alhambra of dialog visitors firm, all Thank you to area. you. out questions. additional the you Los should in look call. The forward a Investor Angeles Please Group any quarterly again to Relations and with feel be We are to reach our us to with next investors open free to in We offices on to or our welcome always any Equity speaking

Kenneth Sim

you. Thank

Operator

concludes Thank today's for day. you, lines great participation, you this have and a your you disconnect time call. thank We conference may this your at

Astrana Health (ASTH) 8 Aug 212021 Q2 Earnings call transcript