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"Our focus on client relationships and quality as well as our diversified service offerings have enabled AMN Healthcare to maintain our leading market position, improve gross margins and strengthen our balance sheet through the prolonged economic downturn," said Susan R. Nowakowski, President and Chief Executive Officer of AMN Healthcare. "We continue to take an aggressive and disciplined approach in streamlining and right-sizing our infrastructure, enabling us to adjust to short-term volume trends, while operating with an improved cost structure going forward. At the same time, we are also maintaining our long-term strategy of investing in our future through progress with new service lines."
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Key business highlights include:
For the second quarter of 2009, revenue for the Nurse and Allied staffing segment was $111 million, a decrease of 48% from the same quarter last year and 32% sequentially. The Locum Tenens staffing segment generated revenue of $79 million, a decrease of 6% from the same quarter last year and an increase of 6% sequentially.
Gross margin in the second quarter of 2009 was 27.0%, an increase of 140 bps as compared to 25.6% for the previous quarter and an increase of 60 bps as compared to 26.4% for the same quarter last year. The year over year and sequential increase mainly reflected a shift in business mix and tight management of direct costs.
Selling, general and administrative ("SG&A") expenses (excluding restructuring costs) for the second quarter of 2009 were 19.0% as a percentage of revenue as compared to 19.2% in the same quarter last year. SG&A declined by $22.3 million, or 37%, over the same period in the prior year and by $12.2 million, or 24%, sequentially, due to cost-saving initiatives taking hold as well as $3.5 million in favorable insurance reserve adjustments.
As a result of certain cost-reduction actions, the company recorded $2.2 million in restructuring charges, consisting mainly of severance payments and lease-related charges associated with various facility, branding and back-office consolidations.
Second quarter GAAP net earnings per diluted share was $0.13, including a $0.04 negative impact from restructuring charges, reflecting a decrease compared to $0.25 in the same period in the prior year.
As of June 30, 2009 cash and cash equivalents totaled $23.5 million, compared to $11.3 million as of December 31, 2008. Total debt outstanding was $90.0 million as of June 30, 2009, reflecting a reduction in debt of $56.3 million since December 31, 2008. Total average diluted shares outstanding for the second quarter of 2009 were 32.9 million.
Business Trends and Outlook
During the second quarter of 2009, Nursing and Allied orders continued to show signs of stabilization, although still at levels significantly lower than prior year. Locum Tenens volume (days filled) increased slightly over the first quarter. Pricing and gross margins remained relatively stable overall.
Nowakowski noted continued signs of stabilization and some recent improvement in orders for travel nurse and allied professionals which should translate into stabilizing volumes during the third quarter. Locum Tenens volume and physician permanent placements are expected to be steady compared with the prior quarter. Based on these trends, third quarter consolidated revenue is expected to decline sequentially by approximately 15%. The majority of this decline is driven by volume trends in nurse staffing resulting from the earlier drop in demand levels. Overall gross margins are anticipated to remain consistent.
"We are continuing to focus on maintaining strong relationships and securing preferred contracts with our clients, as well as nurturing our recent new service offerings such as Emergency Medicine staffing, Home Health staffing, and Recruitment Process Outsourcing," added Nowakowski. "At the same time, we are prudently managing our cost structure and balance sheet in order to position ourselves for future investments in new market opportunities that contribute strategic synergies to our core service lines. Despite the uncertainty of when economic recovery will occur, we remain confident in the long-term fundamentals of our industry and focused on laying the groundwork for innovation and growth in future years to drive shareholder value."
About AMN Healthcare Services
AMN Healthcare Services, Inc. is the largest healthcare staffing company in the United States and a leader in all three of its business segments: travel nurse and allied staffing, locum tenens staffing (temporary physician staffing), and physician permanent placement services. AMN Healthcare recruits healthcare professionals both nationally and internationally and places them on variable lengths of assignments and in permanent positions at acute-care hospitals, physician practice groups and other healthcare settings throughout the United States. For more information, visit http://www.amnhealthcare.com.
Conference Call on August 6, 2009
AMN Healthcare Services, Inc.'s second quarter 2009 conference call will be held on Thursday, August 6, 2009, at 5:00 p.m., Eastern Time. A live webcast of the call can be accessed through AMN Healthcare's website at http://www.amnhealthcare.com/investors. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software. Interested parties may participate live via telephone by dialing (800) 230-1092 in the U.S. or (612) 332-0335 internationally. Following the conclusion of the call, a replay of the webcast will be available at the company's website. Alternatively, a telephonic replay of the call will be available at 7:30 p.m. Eastern Time on August 6, 2009, and can be accessed until August 20, 2009 at midnight Eastern Time, by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 106454.
Non-GAAP Measures
This earnings release contains certain non-GAAP financial information. These measures are not in accordance with, or an alternative to, generally accepted accounting principles in the United States ("GAAP"), and may be different from non-GAAP measures reported by other companies. From time to time, additional information regarding non-GAAP financial measures may be made available on the Company's website at http://www.amnhealthcare.com/investors.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The company based these forward-looking statements on its current expectations and projections about future events. Actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as "believe," "anticipate," "expect," "intend," "plan," "will," "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Factors that could cause actual results to differ from those implied by the forward-looking statements contained in this press release are set forth in the company's Annual Report on Form 10-K for the year ended December 31, 2008 and its other quarterly and periodic reports filed with the SEC. These statements reflect the company's current beliefs and are based upon information currently available to it. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated with the passage of time.
(Logo: http://www.newscom.com/cgi-bin/prnh/20060718/LATU121LOGO)
% Chg % Chg Q2 2009 Q2 2008 Q1 2009 ------------------------------------------------------------ Revenue $199 million (36%) (20%) ------------------------------------------------------------ Net Income $4 million (49%) NM ------------------------------------------------------------ Diluted EPS $0.13 (48%) NM ------------------------------------------------------------ Cash Flow from Operations $36 million 206% (3%) ------------------------------------------------------------ Adjusted EBITDA* $18 million (27%) 3% ------------------------------------------------------------ Adjusted Diluted EPS* $0.17 (32%) 55% ------------------------------------------------------------ * See "Supplemental Financial and Operating Data" for a reconciliation of non-GAAP items. NM - Not meaningful
SOURCE AMN Healthcare Services, Inc.
