Quarterly revenue of $1.13 billion, 4% above high end of guidance;
GAAP EPS of $1.88 and adjusted EPS of $2.48

DALLAS, Feb. 16, 2023 -- AMN Healthcare Services, Inc. (NYSE: AMN), the leader and innovator in total talent solutions for healthcare organizations across the United States, today announced its fourth quarter and full year 2022 financial results. Financial highlights are as follows:

Dollars in millions, except per share amounts.

* See “Non-GAAP Measures” below for a discussion of our use of non-GAAP items and the table entitled “Non-GAAP Reconciliation Tables” for a reconciliation of non-GAAP items.

2022 & Recent Highlights

• High vacancies and voluntary turnover in healthcare continue to support demand for our total talent solutions. AMN is moving aggressively to help clients deliver high-quality care at a manageable cost.


• Despite tough year-over-year comparisons, AMN delivered Q4 2022 financial results that exceeded our expectations for all business segments.


• Our VMS and MSP solutions in 2022 surpassed $12 billion in gross spend under management.


• Full year operating cash flow was $654 million, and we ended the year with $65 million in cash and $850 million of debt.


• We expanded our revolving credit facility to $750 million while maintaining the same pricing and extending its maturity by three years.


• The Board of Directors increased our stock repurchase authorization by $500 million. Including $275 million of buybacks since November 2022, we have $551 million remaining on the authorization.


• Strong cash flows and increased borrowing capacity bolster our commitment to a robust capital deployment strategy that includes internal investments and potential acquisitions and stock repurchases.


• AMN was awarded the National Association of Corporate Directors Diversity, Equity and Inclusion Award. This honor called out our board and company-wide DEI practices and the powerful impact they make for all stakeholders.

"I am profoundly grateful for the work our highly skilled professionals and AMN team members did with the nation's vitally important healthcare organizations in 2022," said Cary Grace, AMN President and Chief Executive Officer. "This was a year of extraordinary demand, and our team responded as never before to place more than 250,000 greatly needed healthcare professionals in temporary and permanent roles. Through the year, we also dealt with rapid change, flexing from unprecedented demand to helping clients optimize their workforce to manage the cost of delivering high-quality outcomes.

"I am excited to be leading the AMN team with the opportunities we have in front of us," Ms. Grace added. "Our team is deeply committed to improving access to services for patients and clients as well as providing attractive work opportunities for healthcare professionals. The healthcare sector faces a future in which demand for care outpaces the supply of talent necessary to provide it. Clients are increasingly looking for broader workforce solutions, and as the market leader we are well positioned to serve this need."

Fourth Quarter 2022 Results

Consolidated revenue for the quarter was $1.126 billion, a 17% decrease over prior year and 1% lower than prior quarter. Net income was $82 million (7.3% of revenue), or $1.88 per diluted share, compared with $116 million (8.5% of revenue), or $2.42 per diluted share, in the same quarter last year. Adjusted diluted EPS was $2.48 compared with $2.95 in the year-ago quarter.

Revenue for the Nurse and Allied Solutions segment was $825 million, flat sequentially and lower by 24% year over year, comparing against a quarter that saw some of the highest labor shortages of the pandemic. Travel Nurse revenue was down 24% year over year and was flat sequentially. Allied revenue rose by 6% year over year and was 3% higher sequentially. Labor disruption revenue in the quarter was $10 million.

The Physician and Leadership Solutions segment reported revenue of $168 million, higher by 2% year over year and down 4% sequentially. Locum tenens revenue of $103 million grew 4% year over year and was down 2% versus the prior quarter. Interim leadership revenue was 4% higher year over year and down 5% sequentially. Search revenue was lower by 10% year over year and 13% quarter over quarter.

Technology and Workforce Solutions segment revenue was $133 million reflecting an increase of 14% year over year and lower by 1% sequentially. Language interpretation services powered the segment's growth, with revenue of $58 million up 23% year over year and 5% compared with the prior quarter. VMS revenue of $55 million grew by 5% year over year and was down 9% sequentially reflecting the normalizing trend in staffing demand and bill rates.

Consolidated gross margin was 33.3%, higher by 140 basis points year over year and lower by 50 basis points sequentially. The year-over-year improvement stemmed primarily from a revenue mix shift toward higher-margin businesses.

SG&A expenses were $219 million or 19.5% of revenue, compared with $239 million, or 17.5% of revenue, in the same quarter last year. SG&A was $215 million, or 18.9% of revenue, in the previous quarter. Year over year, employee and office expenses were lower with less revenue and a more normal operating environment. The quarter-over-quarter increase was driven primarily by higher allowances for credit losses.

Income from operations was $119 million, or 10.6% of revenue, compared with $169 million, or 12.4% of revenue, in the same quarter last year. Adjusted EBITDA was $175 million, with a year-over-year decrease of 22%. Adjusted EBITDA margin was 15.5%, lower by 80 basis points year over year and a decrease of 50 basis points sequentially. Adjusted EBITDA margin exceeded guidance due to operating leverage on above-guidance revenue.

Full Year 2022 Results

Full year 2022 consolidated revenue was $5.243 billion, a 32% increase from prior year. Full year net income was $444 million (8.5% of revenue), or $9.90 per diluted share, compared with $327 million (8.2% of revenue), or $6.81 per diluted share, in the prior year. Adjusted diluted EPS was $11.90 compared with $8.03 in 2021.

Nurse and Allied Solutions segment revenue was $3.982 billion, a year-over-year increase of 33%. The Physician and Leadership Solutions segment recorded revenue of $698 million, 17% higher compared with the prior year. Technology and Workforce Solutions segment revenue was $563 million, 41% higher year over year.

Full year consolidated gross margin was 32.7% compared with 32.9% for the prior year. Growth of our Nurse and Allied Solutions segment and compensation increases for our healthcare professionals were mostly offset by a revenue mix shift toward our high-margin Technology and Workforce Solutions segment.

Full year consolidated SG&A expenses were $937 million, representing 17.9% of revenue as compared to $730 million, representing 18.3% of revenue, for the prior year. The year-over-year increase in SG&A expenses was primarily due to increased employee expenses as we added resources to deal with growth.

Full year income from operations was $647 million, or 12.3% of revenue, compared with $478 million, or 12.0% of revenue, in the prior year. Adjusted EBITDA was $847 million, a year-over-year increase of 33%. Adjusted EBITDA margin was 16.1%, 20 basis points higher year over year.

At December 31, 2022, cash and cash equivalents totaled $65 million. Cash flow from operations was $115 million for the quarter and $654 million for the full year, including payment of $24 million in payroll taxes that had been deferred under the CARES Act. Capital expenditures were $25 million in the quarter and $76 million for the year. The Company ended the year with total debt outstanding of $850 million and a net leverage ratio of 1.0 to 1.

On February 10, 2023, the Company closed on a $750 million revolving credit facility, adding $350 million to its borrowing capacity. Pricing was converted to SOFR from LIBOR with the same terms for drawn interest rate and undrawn capacity fees, with maturity extended by three years to February 2028. The expanded credit facility also includes an increased accordion capacity to $700 million and other improved terms.

In the fourth quarter of 2022 and first quarter 2023 to date, the Company spent $274.8 million before broker fees to repurchase 2,393,046 shares of its stock. The Company's Board of Directors approved an additional $500 million for its share repurchase authorization on February 7, 2023. As of that date, $551 million remained under the authorization.

First Quarter 2023 Outlook

*Note: Guidance percentage metrics are approximate. For a reconciliation of adjusted EBITDA margin, see the table entitled “Reconciliation of Guidance Operating Margin to Guidance Adjusted EBITDA Margin” below.

Consolidated revenue in the first quarter of 2023 is projected to be 27-29% lower than the record-high revenue of the year-ago period. Nurse and Allied Solutions segment revenue is expected to be flat sequentially and 32-34% below prior year. We expect Physician and Leadership Solutions segment revenue in the first quarter to be down 10-12% year over year. Technology and Workforce Solutions segment revenue also is expected to be down 10-12% year over year. Guidance assumes an immaterial amount of labor disruption revenue in the quarter.

Gross margin is expected to be higher by approximately 90 basis points year over year, driven by an improved Nurse and Allied margin and a revenue mix shift toward our higher-margin businesses.

Other first quarter estimates include depreciation expense of $14 million, non-cash amortization expense of $22 million, stock-based compensation expense of $9 million, interest expense of $9 million, integration and other expenses of $3 million, an adjusted tax rate of 28%, and 42.0 million weighted average diluted shares.

Conference Call on February 16, 2023

AMN Healthcare Services, Inc. (NYSE: AMN), the leader and innovator in total talent solutions for healthcare, will host a conference call to discuss its fourth quarter and full year 2022 financial results and first quarter 2023 outlook on Thursday, February 16, 2023, at 5:00 p.m. Eastern Time. A live webcast of the call can be accessed through this webcast link, which also will be available at AMN Healthcare’s investor relations website. Interested parties may participate live via telephone by registering at this conference call link. Please follow the link and register with a valid e-mail address. A PIN will be provided to you with dial-in instructions. If you lose track of these details, please re-register at the conference call link above.

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