AMN - Earnings call transcript Q4 2019 | AMN Healthcare Services, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to AMN Healthcare Fourth Quarter and Full Year 2019 Earnings Call. At this time, all participants are in a listen-only mode. And later you will have an opportunity to ask questions. Instructions will be given at that time. [Operator Instructions] As a reminder, this conference is being recorded.

to conference like host, to now Reece. Randy would turn over the your I ahead. go Please

Randle Reece

be everyone. of release afternoon, full A webcast for our the earnings and AMN earnings call. this call year call. amnhealthcare.investorroom.com Details will also conclusion this in of of audio Good afternoon. replay to conference XXXX issued Welcome replay this Healthcare’s the at following the available fourth quarter are

forward-looking plans, make information we about this These events company’s or the during constitute it. currently upon projections, remarks Various future current circumstances call statements. to based reflect statements expectations, beliefs available

actual with Our of provided these various materially next SEC. not does the XX-K our update those result forward-looking those its earnings including release. indicated Form identified in The guidance statements company results by forward-looking differ to or may any factors, most today intend a filings statements the to subsequent as prior recent from and

to these page our directly and certain included regarding in our measures earnings Information contains non-GAAP GAAP amnhealthcare.investorroom.com. are comparable Reports Financial non-GAAP information. call on This financial measures reconciliations the at release and of most

Leadership Staffing; call Search; of of Salka, today are of Officer; Henderson, Executive Scott, Ralph Workforce Financial and and Dan the Officer; White, Rakowski, Professional Solutions. President Chief Services Chief President Kelly On Brian Susan and President

now I call over turn the will to Susan.

Susan Salka

full excited quarter promising strong Thanks call. at a everyone very in so a welcome much in is year entering be to market. XXXX earnings and this And and our fourth to team AMN new position such Randy. The decade

increased talent demand era, this and organizations care effects with of help successfully demand an navigate We demographic significant our health continue resulting We services unprecedented the health total to in care change, solutions. for high workforce shortages. see

positive the clients other greater At AMN governance to in with responsibility initiatives aligns to our our good make stakeholder’s and and a us impact communities. commitment the social enables and time, same

and Working solutions. innovative ready most has are talent in organizations and professionals, most. their care need Our we expert become total together us to worked our with the patients hard always clients trusted health team when

the progressed acquisition Our both and and strategy of us June facilities This capacity schools. important nurse an innovative acquisition our the labor of the to in capabilities XXXX Advanced very therapy settings. staffing and across has multiple to provided growing address to And with health needs provider care be integration family. of AMN months talent joined impressed clients the we are into with Eight continue smoothly. going the things that Medical,

year. XX% but included labor standout scheduling staffing, in and reaching the than a previous high was analytics higher annual Staffing performer Other smaller XXXX performing, predictive and our revenue, rapid Allied million businesses disruption response, $XXX in business. nurse international

million capabilities. Solutions leadership segment, Our brands. other interim solutions integrated a our XXXX, this of and division. leadership This our reflecting support permanent and strategic AMN’s increasing Within record in on segment our strengthened focus workforce to strategy revenue key market reached bolstered solutions our businesses go consolidated we placement Workforce $XXX an move into

providing remote In of the services. healthcare the acquire in video to Video, signing of agreement January Stratus announced leader interpretation we an XXXX,

We are regulatory acquisition week, earlier expect share approval we this received this close pleased and that tomorrow. to we to for

to and acquisition do patient federal state deliver to provide regulations not a interpretation, that care, by efficiency. and is healthcare further many the increase helps Qualified AMN’s This themselves. is which for compassionate service healthcare mandated quality, to organizations resources have ability

of death and with inclusion English hard proficient aligns also our hearing supporting for and access with by equality It their care families. along patients, individuals, commitment to greater limited to

our supply In intensifying deal health clients ways challenges our to market more position, labor the leadership of care we a develop responsibility complex help and feel demand. with to

and new Some development. internal come from capabilities will solutions our of

a professionals personalized to are For with we to care create health experience. mobile designed example, working develop applications,

Our providing clock. seamlessly for ways to team with also across channels us is the around interact clinicians multiple

leveraging we platform. are and enhancing in access and our data scheduling analytics integrated we clients, richer insights to their For VMS, investments create more predictive credentialing, to are a and

broaden bXhealth, and technology how a acquired These solutions, our with few an management examples pool just healthcare integrated execution. recently for float innovator and workforce VMS further our guides are a technology we solution strategy AMN’s facilities. of To decisions

lot our for Over certainly year, next do our expected team into benefits clients, we to and translate to candidates, the a the shareholders. have of investments these patients, work members

incredibly in Fortunately, ability we committed team feel extremely and to our talented an our expectations. and we confident meet have high

discuss high to in and our look rearview strong $XXX revenue in Now, We the the moments reached let’s for quarter. million. at a results mirror fourth take few record another

Gross margin revenue. was XX.X% $XX EBITDA was of XX.X% million or and adjusted

and Nurse year-over-year Allied million, $XXX segment XX% Our of revenue growth. with posted X% organic higher

revenue our beat expectations exceptional Segment results disruption nursing labor rapid response on in and businesses.

year-over-year. business X% revenue largest Our Nurse grew travel staffing

Demand rates are in Lately strength to supply into but enough accelerate industry. quite strong remained very and into hours bill the improving, also and the quarter has XXXX. fourth not the new carried

reported Allied fourth growth in including the was Advanced. acquisition of quarter for growth Organic quarter, revenue X%. XX% the our

particularly previously and professionals. expected, among therapy, offset nursing our growth imaging, by has Allied due skilled This noted lab speech in and slowdown clients we by demand to reimbursement been a As tempered respiratory Staffing other in changes. was specialties,

the revenue quarter, a to of to XX% year-over-year be first combination our Nurse of with expect and growth organic Allied Advanced the up benefit we In and XX% acquisition.

segment, roughly but of Tenens lower with quarter sales revenue was was by million. Locum specialties higher mix in rate a fourth our and negative Volume the In expectations, line revenue impacted a was adjustment. $XX

flat the Locum's quarter. in revenue and year-over-year favorable first Recently to trends booking been will be believe have slightly up we

of Solutions revenue year-over-year. recorded fourth Other million, quarter Workforce $XXX up Our segment X%

revenue performance division X% and up than more Solutions very quarter segment's at had half Our this of makes year-over-year. Leadership revenue of a solid growing

include grew performed Our optimization the year-over-year and and again Vendor our Systems Management in Solutions fourth Technology which Workforce well double-digits workforce quarter.

due primarily solutions. disruption to by made changes was down that some business This throughout segment was revenue this one is organizational The year-over-year in created XXXX. cycle we

X% most basis. Year, segment New this an in X% be year-over-year on the Workforce gains of begin Solutions expect to within businesses revenue are the organic we to segment and the Other projecting up we As

the With Workforce the be in other and expected up quarter. revenue year-over-year Solutions bXhealth XX% addition to is Stratus, first to the XX% of

Overall, XXXX. very outlook with and our we are latest for results the pleased

the we every impact commitment are our proud purpose importantly, members As AMN’s to of day. team and shared by extraordinary

through and I enough we never the they exhibited how health professionals are can talent by our inspired just am and I all and colleagues by my say passion grateful with care our communities. clients for work in do. both

up we'll two include to for will of In business. our to different a discuss Ralph one bit us join the particular calls, mix On session. a leaders few and or things minutes Dan future and question-and-answer we're Kelly, aspects going

next on into us provide we For example, expect deeper of the have this will the earnings a Stratus' hope leaders investors We call. one business. our and and view analysts to join our broader with

who turn to over provide into Brian, financial the will insights I call our Now will results. more

Brian Scott

million the disruption our $XX segment Thank range. and end labor from good revenue came guidance The the you more our of Susan from Nurse outperformance afternoon was expected revenue quarter quarter. about activity with in $XXX than above Allied everyone. million high Fourth of and

up and basis points X% Reported and the up revenue basis XX.X%, from an last year-over-year. basis, XX% points XXX revenue X% On from quarter. quarter for sequentially XX was margin year-over-year. both was Gross last grew sequentially and organic year

in Nurse favorable increase an Allied with along mix Solutions the margin in margin the high segment. disruption year-over-year our higher labor resulted and The shift segments Other business from within Workforce revenue a

an increase basis, Fourth and by prior prior disruption than quarter the revenue organic up X% sequentially. segment revenue year labor segment million, in was On and up this was over driven $XXX Nurse Allied quarter. X% XX% higher revenue year

in by was from in about Our rapid travel rapid X%, international prior year assignments some rates. double-digits in businesses year. over average the contracted reflecting response an The bill nurse response the and grew bill rate improvement up prior increase

XXX and and XX margin, prior revenue. XX gross basis basis and gross XX.X% mainly basis better EBITDA prior to response XXX points labor sequentially. basis margin rapid higher-margin of points points XX.X% year of this disruption prior than Nurse and was segment's due than up With higher year up higher Allied points margin quarter, from the was

quarter sequential year on the Fourth Tenens revenue than segment X% prior less down a $XX Locum million X% was basis. of and

quarter of million. $X noted, about As the adjustments Susan sales unfavorable included

XX.X% points points This Gross higher impact year had than sales normal the in and on sequentially. XXX which was points about than XX of down basis prior lower adjustments of quarter, the these margin the was result basis decline basis margin. XX a

adjustment the fourth Segment EBITDA gross $XXX Workforce quarter, with X.X% X% favorable a revenue in offset down and lower reserve recorded up malpractice Other SG&A. Solutions by X% was in was year-over-year sequentially. million margin segment $XXX,XXX margin a

of XX.X% mix XX% in XX.X% increased XXX revenue, a SG&A million of quarter points $XXX were expenses to with margin same business million mainly gross of year-over-year, last $XXX or Segment due shift. Consolidated year. compared revenue the or favorable basis

about year-over-year Advanced increase adjustment to $X Silversheet strategy. to acquisitions, million The reserve the our higher $X and earn-out includes million and the of expenses from employee-related million $X drive from SG&A growth Advanced an

points was quarter and was Adjusted the EBITDA XX in higher margin guidance expected million revenue. labor large year-over-year. up above XX% of higher of in higher XX EBITDA our than was than sequentially. Fourth from EBITDA margin higher adjusted $XX basis XX.X% quarter basis year-over-year part the points disruption

in share of of the with quarter. income was ago net the reported share per in earnings per earnings million compared $X.XX diluted and fourth We $X.XX quarter. $XX year Adjusted $X.XX

the quarter in XX% was basis. an was XX% GAAP adjusted tax and Our rate income on

sales tax is a same and year. from was for nine-day Days for was the Our expected provided XX quarter. rate the the by Cash operations days, $XX quarter last $XXX XX% year. quarter million in million to first end quarter full at outstanding be improvement the

Capital total fourth was equivalents our leverage quarter outstanding At totaled and million. time and the December X. cash quarter our end, million ratio expenditures to in was were At X our $XX million. $XXX $XX debt XXst,

$XXX credit fund million our are purchase acquisition to We Susan on for a new year $XXX Video As million. facility, of $XX a purchase loan, tomorrow and a mentioned, the cash from intend we million to price close million the using term revolving on draw five Stratus $XXX expecting hand.

a both X.X% to at at pro times and based point of interest leverage calculated The on a our on X loan are using ratio X will ratio the plus X closing. rate approximately leverage be forma rate spread term a LIBOR and revolver assuming

up $XX XX% turn quarter This date let’s XX% of The guidance. Now, of of to the year-over-year. $XXX revenue Video Stratus includes from to million, company revenue acquisition. million $XXX first from consolidated million expects to

be be expenses revenue On to are an organic expected be to up percent of basis, Gross revenue to margin XX.X% is X%. SG&A X% will projected XX.X% XX.X%. a to to consolidated XX.X%. as

stock-based of expenses external other $X.X of Adjusted be about XX.X%. is to compensation EBITDA million. margin Included integration, million XX.X% to and in $X acquisition, is expected expense SG&A and

and million, million. Other estimates include expected expense interest expense count first following; of XX.X share the $X.X $X.X $XX.X million, quarter be is depreciation to million of amortization of shares. XXXX expense Diluted

couple A of other to note. items

are the analysis just intangible starting We valuation Stratus. for

is So, subject quarterly expense the change. amortization to

depreciation, and of quarter. the impact addition only Stratus reflect the the in interest for expense amounts half In our amortization, results having

now we’d And to for questions. like call up the open

Operator

Sommer first Tobey One ahead. go please. [Operator of from comes from line question SunTrust. Instructions] Please go Our the Please ahead. moment

Tobey Sommer

wondering required could Thanks. to if higher new drive start what to the I into such is you think on you staffing sufficiently supply was market? comment that rates nurse draws bill

Ralph Henderson

Hey, We did Toby. quarter. improvement is question. for Thank in Ralph. see the you This the some

that our little bit. are it to back called just We're X%. not - guidance And a think levels. actually out strengthening XXXX we we up I has about QX

where another two we're first probably So, three or that’s from at, at I of quarter. the points guess end would

getting over be three years. supply Locum as would has helpful to the our it well travel our to come where of back nursing tepid in businesses pricing into in that Allied past been pretty terms So, very as

Tobey Sommer

you revenue if strengthening guidance bit all bill So, growth the just price? have almost in the the from a rate is

Ralph Henderson

No. It's not.

it's Brian might the know mix. think I and exact -

in it's business is the bit we quarter business a it other the I of some volume. is being - But by for of offset of think first also quite example, have talking the skilled the some from areas about nursing off headwinds some from and increases in business. if facilities Allied in you're our price,

Tobey Sommer

Okay.

Brian Scott

This is Brian.

still traditional Nurse But working the through of some gap that business we've On narrowing we're about in significantly. is heads talked Travel XXXX. the

quarter, seeing now response but improve as the seeing So month business. well. there's a growth rapid we’re Nurse by first still little in our talked the in more the We we're traditional that and about Travel month international price

Tobey Sommer

you of Okay. question just I industry see in positioning a space. of the about the Locum to Could market talk the business the wanted where on ask Tenens you growth competitive kind rate? the

And been have space. I'm the in then curious in I'm moves And industry. VMS in There interested the there too? some on the strategic perspective Locum your

Ralph Henderson

that Ralph. anything else And add take anyone would great. This shot. has else to I'll is the be first if

We it slightly, past and but - emergency was closer rate, X% has On probably and the pretty up probably rate. probably generally by slowed. the they're market in several decreases the range in it we hospitalist. of years, almost It's growth significant to growth to all bill over medicine driven to said flat because

The to VMS marketplace begun has change.

think have we previously, world launched in probably as some top two six providers I think all one the the that of VMS marketplace. when now of of Locum’s We years ago now. were anchor I players in MSP sort

there more in the market. Now are

getting businesses. just to gone And separate that question, a as a - through third was there the difficult kind to of to the sure look positioning which opposed to want our of make one so firm kind We've part market. three of I our period in

in us We businesses. have to as were separate that able execute we place to three technology than allows better

think so see return I to some And starting growth. we're to

out you would up quarter, year-over-year. the specialties example. If been if other our X% those fourth the have those medicine out across take for two took growth emergency take hospitals specialties In at you

Susan Salka

in our a little only bit Locum. more of MSP a partners our those with positioning on partners. in and who it strategy cases, not of contingent. even that locums Locums as Allied to MSP those Tobey just but house might that can have want and been talent very want bring more as We they insight to nursing relates solution both but well deliberately partners us provider, And as non-clinical so just And perm use provide more whole working total some

our very it might and of types we an which we’ve so solutions through kinds also use can And on system deliberately multiple been and those more focused platform. might that be support of services clients VMS, MSP might Medifast be

landscape also are those are you’re have capabilities, change I need clients because others seeing of kinds the competitive that mid that more they seeing so And so think of of the sort that larger size to what it's to want.

need get partner provider, around all analytics. provide solutions. to what their want of need some the They a In those single they single spending. arms that They cases can a they’re

have surprised see been Workforce to of their to now So VMS all a I’m not to at resistant that start Solutions, some change the competitors positioning and bit.

Tobey Sommer

to firm? in your you of being financial for comment about targets we where the Okay. update long-term me and position Last Could question in Susan. goals kind are poised us on for

Susan Salka

I really an was we It's market as even also revenue than our interesting over course period. times last into decade like more today three When time we that moment. probably reflect more million. back size. we Sure. the were significantly increased Tobey, around our here XXXX ten over XXXX, just times for of We've are $XXX that And cap a think coming

serve all you’ve a but that's also create MSP, profile. order as And with imagine better to done the the been VMS you in added with clients our way in of into of evolution the adding can financial along every through there businesses Solutions. of to step and And this And been Workforce other that we've starting then organization but us. better,

through to with need don't you. I all go So it

hitting we’ve an I see are hope more to previously solution AMN’s of But honestly, we enterprise that ourselves that today. clients. We up, as step bring of surpassed by partner XXXX major there $X as like XXXX, we our evolution goal to because talent billion. and Quite another in stated be already had total here, I for value get position

goals we sign can So I and lay that's a them. think achieve that out really good

back as but good of some because have and us goals bit in made with some We growth achieving the it. some of taking our of of recall, of held expected particular. businesses progress margins that we businesses, margins you in step was in a staffing back those of our lack EBITDA One certainly around also in Locum’s and that a

XX rates seeing could long acquisitions And basis add like do points to demand kind I have of acquisition. in achieve EBITDA us way bigger environment an that we go that the certainly, margins think on towards to just an those We'll about bill types that Video Stratus that and we're step a progress the that environment with provide a of margins. basis that. for annualized giving in our today

very still focused goals. on those we’re So

a for an prepared ahead to I you gives and aren’t it quite hopefully, us. We the still idea But set kind date that that out opportunity of where we are of yet. lies of think

Tobey Sommer

Thank you.

Susan Salka

Thanks, Tobey.

Operator

A.J. of go from Please Suisse. comes ahead. from Rice the Question line Credit

Caleb Harris

Harris Caleb A.J. on Yes. This is for

to a wanted on Just touch little more. demand bit

winter be with in I is said that later quarter the coming little usual the think than a last fourth to assignments quarter weaker bit expected season. you

on that for And orders that's your the around anything first comment you increase you're any causing in Can if on seeing then flu, what orders? on quarter? the

Ralph Henderson

Caleb. Thanks is question. the for Hi, Ralph. This

trends positive seen have all demand businesses. We of across our

I’ll or seeing Locums higher increase an our nursing demand in business, our start overall. So level, Allied, and they’ve all

above QX above talked being think But winter neighborhood prior Our our our year. January. got demand on from particularly larger to year. a our call, last customers of of little in later those XX% bit that the prior And about was pushed in one needs you're right, I start we

done meeting needs. we we those good job And of those so those requirements, winter have have seen customers. needs And for a

the demand as acceleration year-over-year demand. of QX remains QX same in terms to So about

much the flu. On activity, the related a haven't flu activity season, we amount very of very seen small to

are not small an seem impact. very higher, environments the incidences a or that that of having staff. very, be Although, the to we into It of somebody doesn't sends occurring whether flue one just impact,

had we our expected. that changes. been And flu come. by it flu surprised no incremental before tomorrow point, we've this And But no And something mean doesn't guidance. at Maybe that that. won't in

Kelly Rakowski

on bit and I'll perm a chime well. in just little the seeing side what we're Caleb, leadership And as Rakowski. on is this Kelly

perm in a physician saw the significant On we demand. increase

over and see Sequentially, care, health couple continue of we behavioral year. and last significantly, have systems for demand the that over particularly last quarters primary to larger as specialties. And medical

as And interim leaders where see a softness we in we're behaviors partnership mentioned we're their them level Susan although, strategic with and assigned working bit more our the partner, did demand. quarter change to little leadership, a total seeing of in last and interim talent a side-by-side highest of

year. as And back, the just is well. tied as of that starting we start that we to the mentioned Ralph some see now that nursing But we're think to trends come

Caleb Harris

was Okay. - of Great had that sort and VMS was and/ financial the strategic they I solution? sort area? know a what And wanted you of mentioned you acquisition sizable And that mentioned how of or they to the that health on before touch impact? some rationale I was Were key in competitor financial that sort there?

Susan Salka

I'll is Sure, that. Caleb. This Susan. take

in they'll revenue the $X growing little be that's and a team over focused that few a They million, innovative They're very different technology, is the nicely. a So a quarter bringing very areas. have quarter. into

is really hospital. tool imagine manage float-pools the, for One the mentioned. They've way that any can their fantastic efficiency, done as clients I individual management which they job float-pool that in of a internal solution you that a helps building create

other other even their just for large a more into complex than that. have manage to But of systems, integrated is it but burdensome part workforce more systems very They including and VMSs. equation, staffing tool a

up internal quickly partners. itself staff So the jobs a to by particular rules, do can filled related great job floating of it's through aren't ensuring setting staffing that, the that if system

some have they fantastic So clients.

a we that's a AMN and a optimization certainly that type the will of have And create -- ability other the again our widespread in efficiency solution really things of to But of clients. limited And asked is this from with there. been works. other we'll We've staff out lot go-to-market need. have solution accelerate for this

facilities utilized tool want have VMS other staffing used can that in-house also by they MSP can vendors by addition, a is to fantastic providers. their manage utilized or it actually be In who be and

They have some fantastic industry. MSP clients the within

AMN team, overall. they’re with great a technology, team and working well it's very think we So already the great a

Caleb Harris

more Sort more And of nurse were you broadly. that about Allied, Tobey's view and guys the more sort the different you in X% growth specifically travel is Allied rate to travel? X% do market Locum just something Travel the as the in it to this of What Nurse in similar then Nurse at Or one question Okay. point? the side, on than talking that? and

Kelly Rakowski

if at with of of look very maybe international course Ralph to short-term the XX out. traditional assignments in of would XX would assignments I I all-encompassing multi-month travel – nursing I span multi-week more is our assignments, six it think months, something of which start leave nursing to more -- But I’ll ask and can XX first assignment. to Well, I'll chime because or plus contracted weeks all and they're can eight weeks here

terms of they're staffing are some say a majority And the international. of permanent them But contingency. also to similar I'd for need they’re cases short in filling converting serving term of permanent in staff. the in vast case often in

just segment. those I if And rates. individual really you So, in as each some totality at can would nice to growth look more opposed to get do that, you

and international response, fact double-digits year. In rapid growing last were

XX week you combine travel the gives the traditional that that bit if a it glimpse. brings it the of a into But down you hopefully Collectively, little business business travel single-digits. with

has plenty double-digits. several really The last Supply growing XX traditional been Demand been travel discussing quarters. be to the business as constraint. of the there challenge not week is demand the we've has

mid see supply even into and some if market, supply the continue to we continue rates - we roll. to go we the incremental week would traditional high-single-digits if business to higher if So than up be we begin bill to quite into rise, it have that could ought honestly the get as to able XX that come see

bit little bag a more a of mixed The therapy is because various strong. the of is Allied disciplines. business very And

reimbursement because headwind that changes. nursing, of Although in skilled we've had

where been. and been growth biggest But imaging, has lab has the respiratory

it's that last grown over decade. look In has really amazing the at quite how to business fact, particular

to So add? Ralph, want you anything else

Ralph Henderson

schools, respiratory And been mentioned, diversity You lab, a covered a being also growing the rate. down. has Allied of nursing business The and as of actually then, it. positive, imaging, because fast the the at specialties skilled most Susan the

about business schools XX% year-over-year. up our think is I

Caleb Harris

helpful. Thanks lot. a That’s Okay.

Operator

from question Jefferies. of Plagman Next go Jason line the ahead. Please from comes

Jason Plagman

good Hey, afternoon.

I you going some premium So premium called last to out rapid back that - business obviously the travel and at nursing, the in quarter mentioned the pickup believe response. seeing you've you're

on your heading the that trajectory represented But of any in kind - And premium heading total XXXX? is of what comments like into assignments looking what that mix QX? percentage of

Brian Scott

Yes. Jason is Brian. this

You said as we mentioned up has it picked again.

think what's of away that talking I utilize exact -- from we're if often. percentage finding the just our determinant shifting our more We're that's only services. how about clients

different when traditional They're of they they that of may opportunities. more really becomes pulling a on clinicians need flip them. but to a If it's If need, have response, may a in. urgent it they having -- spectrum more order rapid

all the all weeks, way really mentioned at two-year allows client the of to eight six the assignment the meet for national time. need I business from that to way the us As to

ago, XXXX. has a percentage of up. off years levels the we're to the We're were give but We're not that exact of So in the gone definitely couple quarter. saw going bottom back number to we every we not

rising back with pricing growth half between rapid back and the more It's staffing kind -- through up have quickly not demand so to more response underlying our or not that surprising traditional seeing been of of rates. of the and go steadily had and the forth going clients last of critical year,

fill opportunity increase industry to to bit But more little the standard the more foundation rates go those supply will about likely a the to back into for up more hopefully jobs also good the first that's permanent quarter. with conversations it in well. as bring clients So

Jason Plagman

then in any the out or expect Great. comment on QX? your what from seeing has in That's -- flows that that is assignments client. that be how from largest demand QX? Or progressing flattened helpful. the order you're from that to we to and should a And continue headwind Is

Ralph Henderson

news Yes. Good on that one.

with While In had par did that as quarters impact the will prior it QX we year. QX, in year. prior last it about be expect it same the on

Jason Plagman

QX. growth should Okay. on segment, Great. mid-single And XXXX? X% trajectory X% as cycle, start little to in wanted that switching the could how some closer to OWS in X% but to a segment? to that you're expecting framing X% I in through for to you'll digits organic progress comps the Any bit, you XXXX accelerate items easier know then maybe lap the gears ask be rev I the OWS we

Brian Scott

Jason this is off Kelly then give Brian. some well. it and I'll as just kick color

think look pretty likely QX. for couple of it's to quarters, gave the similar we guidance for the I to next more

the stable comp are at now of the business think. a We replacing will stable the the that team's with quarters some saw lower really be negative job but still foundation. to level. two three of really cycle build The a I revenue a it they But nice starting and done turnover for next to

color So the as of part on a if kind is go give probably that QX QX into starting point opportunities more and some solutions. are baseline we in leadership that. I'll let Kelley

Kelly Rakowski

more in can Those more volume. solutions that they I'd of move and acceleration, we to continue as There's are where our as closely RPO are to our good places faster. of that strengthen revenue clients our to the kinds could see a solution. relationships we couple tie bring MSP talent total some seeing steady of RPO, Jason say, And capabilities we Yes. RPO

Also last we've couple the scale pipeline each quarters up analytics of new side. consulting signings we a square technology so smart the our particularly technology where very quickly and predictive of had as very there solutions in on can several scheduling our well and both strong as

could So there some are where areas acceleration. some see we

Jason Plagman

last me. Got one And for it.

years. QX? activity the looking for your you if should record can How that we for that's pipeline, the And an last is be in looking XXXX? how on contract of match Just XXXX MSP what's thinking both that update two years

Dan White

take one. Thanks, that Jason. Dan. This is I’ll

up ended mentioned, XX% improvement. ever year year-over-year a being you with as sales XXXX about best So, our MSP

signed, how and We - only they little spend about live go over now total. the in grow. when which $X.X just contracts year-over-year also over color gross an a XX% management, but not improvement That's had reflects a in they billion bit

more ever Another than nice trend contracts five at getting that, or seeing we're renewing more that before really years we're are is that also.

about me asked We've started is the is things how of very off you’d well. QX going. One

a have that client contracts already of been signed. We have number

in We $XX million have today. contracting

gives stuff me XXXX great continue confidence will that strong for a of All year us. that be to

though important I think the contracts base to maybe than ability is just our even more cross-sell.

Health If our you to clients little gives lines of some by top accounts, things look in Stratus or which XX%, great XXXX our at like them grew take confidence other and me into quickly. over of additions bring more a service added number these that BX we the portfolio the can XX or

Jason Plagman

Thanks. Great.

Operator

Marcon we ahead. of And do from question go Instructions] Baird. Please [Operator have a Mark the from line

Mark Marcon

afternoon, everybody. labor year? you I were total the revenue? more and was $XX for know Good total was the than how with it quarter was expecting. and What disruption, both much was the million wondering the I

Brian Scott

it million Yes, closer have is -- already into built had We the quarter, quarter -- some that our we for guidance. which to some was maturity call. third of $XX

For $XX the over low little similar in XXs. both XXXX of amount a kind million, and full year, it pretty at XXXX was

So two record years by the way.

year, QX because variable out be why that call so it's too it's reason more pretty it really want far. through remainder we'll don't have any can There the of revenue just this Actually any don't we here speaks not because at And pretty first at the which I So the we specifically have to certain the been but activity kind point. through has will all out of we're happen. - call we it for quarter, much quiet it's -- going be to always don't sitting assume quarter-to-quarter. as that's quarter halfway this whether to

Mark Marcon

and of up we would assignment think like Okay. about quarter. think the in flow typical fourth you just we sequentially And the how about providers number how of should in what ended on seeing terms or sequential

Brian Scott

from to QX normal QX a you - like mean? So

Mark Marcon

Yes.

Brian Scott

Yes. the little a quarter being see. guidance we -- travel gave fourth softer for I we particularly we nursing normally talked the say about bit than

Some that to timing of winter the tied being the starts. of

it QX. So, what in generally from in with see normally our QX below we'd came expectation. line But to

of underlying first where we've up be, see We're nice down reflective volume that's true expecting both and on up would strike are actually looking of, a end that – and QX. really bit, the considering little a guidance. quarter, Now, typical actually having the That's well into -- in in performance QX Stratus sequentially nursing, in as little be I we from pretty really kind a mean even of the the looking revenue as seen locums, bit our to the seasonality flat. guidance to maybe, amount business based to growth of QX the as in excluding

So seeing good first trends the as going we're into quarter.

Mark Marcon

we to in which half from we of higher. of great. a a at got look take puts takes of you've about and should – And that for Stratus can guidance EBITDA quarter XX.X%, benefit terms is a then, in Stratus. Okay, think what are the XX.X% but from perspective terms the adjusting How the year-over-year

Brian Scott

mentioned, about what that, The Susan basis a on say to full just – points. Stratus, XX as Yes. adds basis, I'd is quarter closer

with quarter. expectation essentially that the of we're So first XX with tomorrow, and of about the closing picking points basis EBITDA in up margin

QX. guidance So push down you to gave to is the that about back which would for we XX%, similar

is still range. then, performance of, kind you QX. the, underlying And Stratus business in operating that organic in So add into XX%

And you impact full you from think quarter second the a just so, again, quarter, add, would obviously, Stratus. about as

Mark Marcon

then… And Great.

Brian Scott

would through year, to continue, margin we move we'd operating we leverage. in more see we obviously, improvement we expect pick growth start As up see the to the would as the

that decent and the line I QX QX. fourth give we sight for As into of third quarter. and you move But think should a

Mark Marcon

more bill mean, sure get high. supply? level systems breakthrough? would I is tight are heard that high. So really others orders When you it is. What's Demand and can a I'm you healthcare stopping to from where how that the some rates from raising they've actually of really the

Susan Salka

the than seeing as improved X% Well, say, we range. that, in even going It's the quarter. increases as first quarter some said, progress, accelerating. fourth nice in And more are quarter, into we've you that saw first exit underlying the it's we I'd

you those think cautious find they I get being So supply. how need much rates to to the about appropriately increase them

needs and Now, to response when bill rate underlying that they more the rapid a use sign more increase. that's regular clinicians, usually

they higher-bill those rather need that perhaps jobs rapid rate can lower-cost urgent fill response. at more So traditional than the having with with that travelers,

we very So, progresses. nice are progress. about thoughtful just how say, making I'd They're that actually being

Mark Marcon

all X%, I'm a of mean I take data. got Okay. sorts sure change, more mean, like X%? you've at when a how of would X% elasticity, of looked much step it - you've I

Susan Salka

We have.

you But variables… always We have, inputs Mark. and as would multiple expect, there's

Mark Marcon

Sure.

Susan Salka

That feed analysis. that into

going certainly, hit a say But, be to call we we sign. number good would are break start and particular would hesitant if if So That X%. number. loose I to things above that to a get be very

and we're strong. remain rates, at which more are now, supply rebook we very even say, optimistic I'd levels seeing improving the about

getting we're so, close. I think, And

Mark Marcon

I that's And clients solution to really pools. it years your conversation seems - me. that their remember currently How kind of a because Great. really relative a with is intuitive position to Ralph, regards trend. you a with what's float - that's them? many before And And using to having of clearly interesting many and ago then, are a

Susan Salka

agree. I innovative. so is the I business there and technology. team Yes. this again love the And just

business don't So would thank that. fantastic for you actually ways. a think some really much are clients prestigious happen have recognizing and overlap also that because as other you as be newer they to in We our impressive they clients have

fact some that to in table be large but they I have gives the to to to and we can possible. bring other referenceable capability, able our that more much us also strategic go is that show accounts clients the But think what credibility

we opportunity of there existing lot think So a here with is our clients.

but companies not are of in have that created scheduling technology in, there's bXhealth their just extent honestly the systems with to cloud-based, mobile sort silo. quite integrated [ph] doesn't is secret It's standalone enabled, it in comes There being sauce bXhealth beyond this the And integrated has that's capabilities, space the other that with innovation a terms with very certainly not been in providers. staffing where but what also some other hospital well has legacy that much really of systems it done.

Mark Marcon

sounds And stabilized cycle, we're decent in things going great. and forward? That's a like have then shape revenue it

Susan Salka

Yes.

are others felt been business, we've to spots put more where then but there within I a little the the it. parts a are and way bright coding position. It's certainly a think that's There a stable of of great contraction. such bit as business CDI the

made healthy think which the over much we've year way order in set disruption. we needed the feel the more And factor to to we that last a it's changes moving business very stage the of for grow a were in forward. Again

brands brought Peak together you there's and a also that two always MedPartners when We do and bit of disruption.

that is to So a grow reasonable into middle year go that poised of sort we part we feel begin through the and timeframe. we probably as of to the are

Mark Marcon

and confirm of - talk can to from that the flow of definitely pay And just pace you but wouldn't debt, you equity any just down the the you're two? envisioning over cash my wanted to about is then just And do year that. operations delevering absolutely next Great. the to assumption raise an

Brian Scott

Brian. a is be both got facility very to at a now No. for blend of Sure. the with solid in long-term This acquisition. intend point. We've structure We this tomorrow on we'll drawing mixed unsecured debt don't that debt credit with and the

Again plenty covenants. we've I for room X of revolver and a loan also basis our the as got a mentioned, term within X-year resetting it's year new

pre-payable. to X.X So of at be be with expected leverage debt that we'll the be all pro able - times forma to closing, will

to down. immediately take flow cash able paying So and start our we're

of full cash If you flow million. XXXX in at look year operating our $XXX

free flow million. $XXX up basis, a So under cash - you're a on just little

on basis $XX between of $XX flow you kind and of expected of it we sense that to generate million. kind quarterly So a gives cash the a this year million

to to as well. use And so, we'll that delever be able

mentioned, as when below we when So transaction, leverage to three be call the announced by times year. we the the expect would end we of I this had even

about sheet. So we really the good balance feel position our on

Mark Marcon

Terrific. Thank you.

Operator

of question ahead. from have a Blair. from Please William we Tim line Mulrooney Next go the

Tim Mulrooney

way into quarter on What's ask the On bottom Stratus? line. Good my first baked I to afternoon. Thanks Mark's the wanted from questions. Stratus. guide for taking question a different

if If from you numbers quarter. you year, take the of full just maybe last million assume I'd about you us million did $X $X - kind a gave for

about So seem it's about given million a $X right? half quarter does

Brian Scott

probably Pretty range. X.X% in more close. It's the

it's margin. So EBITDA XX% running a as mentioned, I at about

for So XX%, if the give quarter. a pretty at the sense expectation you the you of it should million take good $XX

Tim Mulrooney

to Perfect. said not I'm specifically? Thank So up margin gross exactly that? see but story, mix that several due you shift, the quarters? in the And just how it's I'm Solutions, think you. you because XXX driving next the sure Workforce those what's carrying favorable Other are to And through do mix newer I points shifts the was basis what maybe was --

Brian Scott

Sure. Within Yes. OWS.

business So part of revenue the it is cycle being downed.

Tim Mulrooney

Yes.

Brian Scott

than other margin lines. business gross It has a the lower

on nice ones, favorable we a that the growth purely has business that leadership impact some our EBITDA top search just margin. relative then a gross of on in that, down And and saw So other by business. being to

VMS, the margin those strength as average were is both We've -- margin well. in a perm than for which business, Avantis in got slightly particularly up technology the and our margin as higher physician higher-than-average -- as well higher the carry nicely a businesses year-over-year segment

forward business into as similar first well. quarter were that be terms similar with higher-margin think I as they it going you influenced as the because the -- about pretty In now profile expectation of pretty would will be It expectation, of you then now. Stratus mean roll we as

Tim Mulrooney

expect this you through XXXX lapse carry ago there happen is would dynamic itself. a to Stratus this - start excluding me. excuse dynamic So or point XXXX, basically this to or which that several at - quarters Did

Brian Scott

So would move the revenue we we to start business but again, the across we the also businesses. through see growth will year, expect to other cycle would improve as see

And will unlikely gross it's change So that actually margin business on -- profile XX%. is mentioned margin Stratus that significant. closer I the to

So are but margins bit actually little a as EBITDA well. lower, higher

see from don't being that in other the you're going big a that think added influence But change will those are for segment a of downdraft - than to where have little we a an bit quarter. will a in going I Stratus full forward. So

Tim Mulrooney

Okay.

can given us of with pause Video, overall? for acquisitions Thank strategy about applied update capital M&A, the how give Brian, now should these on an XXXX? in sheet? Or And Should and digest for it a Stratus me. while the expect one towards balance deleveraging acquisitions you more we you cash allocation think Medical you. we Okay. Advanced the

Susan Salka

start I’ll that. Maybe with Sure.

certainly still looking pause. could yes. solutions We perhaps the particular. Solutions, have and to be things is opportunities complete won't There Workforce should be capacity technology So strategic a that at in short additions answer tuck-in they're I or if be our guess

that But well to we down very paying just the very, are has but there. but still making focused finish resources aligning we of sure some very which gone also things our integration we’ll not to be on have debt successful advance,

course not staffing a Stratus, there's of then organization might there front there's as Stratus, and it integration And not so on because much as they office. integrate different I platforms, have the if say were will be systems very as to with much

Certainly front they as interwoven with much office things. we may be might heavily not back if even few back integrating there. and then their office a are be there But

lighter lift from So integration an it's quantity probably a standpoint.

Tim Mulrooney

Okay. Thank you, Susan.

Operator

next question And the Henry ahead. Please of from comes from go our line Chien BMO.

Henry Chien

everybody. afternoon, Hey, good

of moving So couple trends. make I some want understand I of there's just the sure a parts. to

core profitability So I of there? in organic the Just first understand standpoint, growth the the the guess excluding change EBITDA, of the like acquisitions? from was what sort to business

Brian Scott

quarter? fourth the In

Henry Chien

quarter. fourth the in Yes Yes.

Brian Scott

of out quarter just kind really and EBITDA. I slightly at have Yes. if EBITDA margin the than core a impact. they the I higher we profile know business. To the mean run I been don't – of would most the notable break mean advance margin the

the be So pretty saw this it from strike. We about a talked we margin. underlying XX% would EBITDA the similar a ex margin impact

So in the fourth influence again was that a quarter. bigger

But impact an strikes about recent reported not kind different the more a the Again or forward. with organic on with impact we It's impact generally basis Stratus that move meaningful will margin. of that this QX. of of the talked a if on of have you the going acquisition now in

Henry Chien

Okay.

Brian Scott

big QX other a it's way. not influence

Henry Chien

down Allied then slowing the step sense. is changes doing well anything any having for be X% understand keeping but reimbursement that travel impact say growth the That this just throughout other is just so organic aware not I volume changes from from And I going down to mid payment to And year? single-digit the some underlying range. there and volume sort trend, guess, right. of? should quite stepped from the makes All of some potential like of Okay. we'll just or out in I range just Is be else to X% the on

Susan Salka

missing. you're home of at I course PDGM We beginning and last but industry. was that don't anything change that of our build was directly health knew about the the year, No do. clients a affecting the there's receive reimbursement introduced don't else think it reimbursement year we that's There that

that And we so hit how therapy and they first affect resources it. utilize it can quarter, so again case the in in anticipating this were

been bit their offset So or we other where disciplines fairly other resources so successful to increased far some began the of many utilization of of providers health of settings and fact, have have nurses. to an redirect with there's a And our that. in been home

another And is our would to it out bit. to really much don't but of that overall part of so part of still how a why play probably moving kind small an be business fairly I there. think that little still to needs we in we be want actually a out, call That wait see impact which will it's

Henry Chien

Okay. All Thanks, Thanks, guys. Got everyone. it. right.

Brian Scott

Henry. Thanks,

Operator

And there in this phone queue time. further the are at no questions

Susan Salka

Wonderful. Okay.

really patience you for While wish we work And as join appreciate that really at beginning about Valentine's your know the we of AMN that. We're glad but Thank we through with today. difficulties team some technical everybody family. Day us. you excited call you wonderful the we'll our could us celebrating a now all Stratus the tomorrow. ones, includes that loved I will the that all also be very be joining joining

Thank evening. great you. a have everyone So

Operator

replay X:XX gentlemen, for p.m. be February And after will available through this ladies today conference XX. Thursday and

XXXX-XXX-XXXX by services. again XXXXXXX. XXXXXXX. conference You for And today. for that participation and does replay our XXX-XXX-XXXX. and International dial system executive XXX-XXX-XXXX may may are access conferencing using numbers at an and the access with participants time conclude X-XXX-XXX-XXXX code access you entering the Those your for Thank dialing code of any AT&T AT&T

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AMN Healthcare Services (AMN) 13 Feb 202019 Q4 Earnings call transcript