Agiliti Announces Financial Results for Second Quarter 2021 and Raises Full Year 2021 Guidance
August 12, 2021 at 16:10 PM EDT
Agiliti, Inc. (NYSE: AGTI) (“Agiliti”), a nationwide provider of healthcare technology management and service solutions to the United States healthcare industry, today announced its financial results for the quarter ended June 30, 2021, and raised its full-year guidance for 2021.
Second Quarter 2021 Highlights
“Our strong results from Q2 and our increased guidance for the year reflect our confidence in this team’s ability to consistently execute on our strategy,” said Tom Leonard, Chief Executive Officer. “We remain focused on meeting the needs of our customers—helping them navigate the ongoing impact of COVID-19 while also supporting their long-term operational objectives. Agiliti holds a unique and essential role supporting our nation’s healthcare system, and our strong track record and performance further demonstrate that the services we provide are always necessary and in high demand.”
Second Quarter and First Half 2021 Financial Results
Total revenue for the three months ended June 30, 2021, was $250.5 million, representing a 35.3 percent increase from total revenue of $185.2 million for the same period of 2020. Total revenue for the six months ended June 30, 2021, was $485.8 million, representing a 33.3 percent increase from total revenue of $364.4 million for the same period of 2020.
Net loss for the three months ended June 30, 2021, was $5.2 million compared to a net income of $0.8 million for the same period of 2020. Net income for the six months ended June 30, 2021, was $4.4 million, representing a $16.2 million increase compared to a net loss of $11.8 million for the same period of 2020.
Adjusted EBITDA for the three months ended June 30, 2021, was $77.7 million, a 35.3 percent increase from Adjusted EBITDA of $57.4 million for the same period of 2020. Adjusted EBITDA for the six months ended June 30, 2021, was $163.9 million, a 54.4 percent increase from Adjusted EBITDA of $106.2 million for same period of 2020.
On August 10, 2021, Agiliti and the U.S. Department of Health and Human Services (“HHS”) and the Assistant Secretary for Preparedness and Response extended Agiliti’s agreement for the comprehensive maintenance and management services of medical ventilator equipment for a period of 60 days from the initial contract expiration date of July 27, 2021. The Company expects that HHS will issue a public request for proposal and make a new contract award prior to the September 27, 2021 expiration of the extension period. Agiliti intends to compete for the new contract award.
2021 Financial Outlook
For the full year 2021, the Company now expects revenue to be in the range of $965 million to $980 million, an increase from the prior range of $950 million to $975 million, representing growth of 25 to 27 percent. In addition, the Company now expects Adjusted EBITDA to be in the range of $280 million to $290 million, an increase from the prior range of $275 million to $285 million, representing growth of 20 to 24 percent. Consistent with its previously reported guidance, the Company expects capital expenditures for 2021 to be in the range of $65 million to $70 million.
Conference Call Information
Agiliti will hold a conference call to discuss its 2021 second quarter results on Thursday, August 12, at 5 p.m. Eastern Time (4 p.m. Central Time).
The conference call can be accessed live over the phone by dialing 1-877-407-0792 or for international callers, 1-201-689-8263. A replay will be available two hours after the call and can be accessed by dialing 1-844-512-2921, or for international callers, 1-412-317-6671. The passcode for the live call and the replay is 13721390. The replay will be available until August 19, 2021.
Interested investors and other parties may view a simultaneous webcast of the conference call by visiting the Agiliti Investor Relations site at https://investors.agilitihealth.com. The webcast replay will be available for a limited time shortly following the call.
Agiliti is an essential service provider to the U.S. healthcare industry with solutions that help support a more efficient, safe and sustainable healthcare delivery system. Agiliti serves more than 7,000 national, regional and local acute care and alternate site providers across the U.S. For more than eight decades, Agiliti has delivered medical equipment management and service solutions that help healthcare providers reduce costs, increase operating efficiencies and support optimal patient outcomes.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Agiliti, Inc., believes statements in this presentation looking forward in time, including preliminary results, involve risks and uncertainties. The following factors, among others, could adversely affect our business, operations and financial condition causing our actual results to differ materially from those expressed in any forward-looking statements: our history of net losses and substantial interest expense; our need for substantial cash to operate and expand our business as planned; our substantial outstanding debt and debt service obligations; restrictions imposed by the terms of our debt; a decrease in the number of patients our customers are serving; our ability to effect change in the manner in which health care providers traditionally procure medical equipment; the absence of long-term commitments with customers; our ability to renew contracts with group purchasing organizations and integrated delivery networks; changes in reimbursement rates and policies by third-party payors; the impact of health care reform initiatives; the impact of significant regulation of the health care industry and the need to comply with those regulations; the effect of prolonged negative changes in domestic and global economic conditions; difficulties or delays in our continued expansion into certain of our businesses/geographic markets and developments of new businesses/geographic markets; additional credit risks in increasing business with home care providers and nursing homes, impacts of equipment product recalls or obsolescence; increases in vendor costs that cannot be passed through to our customers; and other Risk Factors as detailed in our final prospectus filed with the Securities and Exchange Commission (“SEC”), on April 26, 2021, and our quarterly reports on Form 10-Q.
EBITDA is defined as earnings attributable to Agiliti, Inc. before interest expense, income taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding non-cash shared-based compensation expense, management fees and other non-recurring gains, expenses or losses, transaction costs, remeasurement of the tax receivable agreement and loss on extinguishment of debt. In addition to using EBITDA and Adjusted EBITDA internally as measures of operational performance, we disclose them externally to assist analysts, investors and lenders in their comparisons of operational performance, valuation and debt capacity across companies with differing capital, tax and legal structures. We believe the investment community frequently uses EBITDA and Adjusted EBITDA in the evaluation of similarly situated companies. Adjusted EBITDA is also used by the Company as a factor to determine the total amount of incentive compensation to be awarded to executive officers and other employees. EBITDA and Adjusted EBITDA, however, are not measures of financial performance under accounting principles generally accepted in the United States of America (“GAAP”) and should not be considered as alternatives to, or more meaningful than, net income as measures of operating performance or to cash flows from operating, investing or financing activities or as measures of liquidity. Since EBITDA and Adjusted EBITDA are not measures determined in accordance with GAAP and are thus susceptible to varying interpretations and calculations, EBITDA and Adjusted EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. EBITDA and Adjusted EBITDA do not represent amounts of funds that are available for management’s discretionary use. EBITDA and Adjusted EBITDA presented may not be the same as EBITDA and Adjusted EBITDA calculations as defined in the First Lien Credit Facilities.
(1) Represents management fees and buyout termination fee under the Advisory Services Agreement, which was subsequently terminated in connection with the initial public offering and employee related non-recurring expenses. (2) Represents costs associated with potential mergers and acquisitions and are primarily related to the Northfield Acquisition for the six months ended June 30, 2021. (3) Represents the change in the fair value of the tax receivable agreement. (4) Loss on extinguishment of debt consists of the write-off of the unamortized deferred financing costs and debt discount and an additional 1% redemption price related to the repayment of our Second Lien Term Loan and the write-off of the unamortized deferred financing costs related to the amendment of our Revolving Credit Facility. (5) Represents the tax benefit or provision associated with the reconciling items between net income (loss) and Adjusted Net Income. To determine the aggregate tax effect of the reconciling items, we utilized statutory income tax rates ranging from 0% to 26%, depending upon the applicable jurisdictions of each adjustment.