CCRN
Cross Country Healthcare INC
NASDAQ
8-K: Cross Country Healthcare Reports First Quarter 2024 Results, Revenue Declines Amid Market Challenges
Sentiment:
Quarterly Report
1 May 2024 4:27 PM
Cross Country Healthcare's first quarter 2024 results show a significant year-over-year revenue decrease, though the company highlights growth in physician staffing and homecare.
Worse than expected
The company's revenue, net income, and adjusted EBITDA all decreased significantly year-over-year, indicating worse than expected results.
The company's gross profit margin also declined, further indicating worse than expected results.
The company's diluted EPS and adjusted EPS were also significantly lower than the prior year, indicating worse than expected results.
Summary
- Cross Country Healthcare announced its financial results for the first quarter of 2024, which ended March 31, 2024.
- The company's revenue was $379.2 million, a 39% decrease compared to the same quarter last year and an 8% decrease sequentially.
- Gross profit margin was 20.4%, down 200 basis points year-over-year and 150 basis points sequentially.
- Net income attributable to common stockholders was $2.7 million, a significant drop from $29.4 million in the prior year.
- Diluted earnings per share (EPS) was $0.08, compared to $0.81 in the prior year.
- Adjusted EBITDA was $15.3 million, or 4.0% of revenue, compared to $52.1 million, or 8.4% of revenue, in the prior year.
- Adjusted EPS was $0.19, compared to $0.84 in the prior year.
- The company repurchased approximately 300,000 shares of common stock for $6.4 million during the quarter.
- As of March 31, 2024, the company had $5.2 million in cash and no debt outstanding.
Sentiment
Score: 3
Explanation: The document presents a negative outlook due to significant declines in revenue, profitability, and cash flow. While there are some positive aspects, such as growth in physician staffing and no debt, the overall tone is concerning from an investment perspective.
Positives
- Physician staffing revenue increased by 16% year-over-year.
- Homecare staffing experienced year-over-year revenue growth.
- The company has no debt outstanding as of March 31, 2024.
- The company repurchased 300,000 shares of common stock for $6.4 million.
- The company's first quarter results were within guidance ranges for revenue, adjusted EBITDA, and adjusted EPS.
Negatives
- Consolidated revenue decreased by 39% year-over-year.
- Gross profit margin decreased by 200 basis points year-over-year.
- Net income attributable to common stockholders decreased by 91% year-over-year.
- Adjusted EBITDA decreased by 71% year-over-year.
- Nurse and Allied Staffing revenue decreased by 43% year-over-year.
- Cash flows provided by operations decreased by 87% year-over-year.
Risks
- The company faces near-term headwinds in contingent nursing labor.
- The overall macroeconomic environment, including increased inflation and interest rates, could impact the company.
- The company's ability to attract and retain qualified healthcare personnel is a risk.
- The cost and availability of short-term housing for travel healthcare professionals could impact the business.
- Cybersecurity risks and incidents could affect the company's operations.
- Government regulations and legislative initiatives could impact the business.
- The company's ability to successfully implement its acquisition and development strategies is a risk.
Future Outlook
The company provided guidance for the second quarter of 2024, projecting revenue between $330 million and $340 million, adjusted EBITDA between $10.0 million and $15.0 million, and adjusted EPS between $0.10 and $0.20. These estimates are based on current management expectations and are forward-looking.
Management Comments
- John A. Martins, President and CEO, stated that the first quarter results reflect the company's ability to execute in a challenging market.
- He expressed pleasure with the momentum in physician staffing, homecare, and education.
- He noted near-term headwinds for contingent nursing labor and the company's efforts to right-size its infrastructure.
- He is encouraged by the prospects for growth and improved profitability as the company executes its strategy as a tech-enabled workforce solutions provider.
Industry Context
The results reflect a challenging environment for healthcare staffing, particularly in contingent nursing labor, while highlighting the company's diversification into physician staffing and homecare as potential growth areas. The company is positioning itself as a tech-enabled workforce solutions provider, which aligns with the broader industry trend of leveraging technology to improve efficiency and outcomes.
Comparison to Industry Standards
- Cross Country Healthcare's significant revenue decline of 39% year-over-year in Nurse and Allied Staffing is worse than some of its competitors, such as AMN Healthcare, which has also seen a decline in travel nurse revenue but not to the same extent.
- The company's adjusted EBITDA margin of 4.0% is significantly lower than industry benchmarks, with some competitors maintaining margins closer to 10% or higher.
- The growth in physician staffing is a positive sign, but it is not enough to offset the decline in the larger nurse staffing segment. Competitors with a more diversified portfolio may be better positioned to weather the downturn in travel nursing.
- The company's focus on technology and workforce solutions is in line with industry trends, but its ability to execute this strategy and achieve improved profitability remains to be seen. Competitors like CHG Healthcare are also investing in technology to improve their service offerings.
Stakeholder Impact
- Shareholders will likely be concerned about the significant declines in revenue and profitability.
- Employees may be affected by the company's efforts to right-size its infrastructure.
- Customers may experience changes in service delivery as the company adapts to market conditions.
- Suppliers may be impacted by the company's financial performance.
- Creditors are not impacted as the company has no debt outstanding.
Next Steps
- The company will hold a conference call on May 1, 2024, to discuss the first quarter 2024 financial results.
- The company will continue to execute its strategy as a tech-enabled workforce solutions provider.
- The company will focus on managing the business for the long-term despite near-term headwinds.
Key Dates
- May 1, 2024: Date of the press release and 8-K filing announcing Q1 2024 financial results.
- March 31, 2024: End of the first quarter of 2024, the period covered by the financial results.
Keywords
Healthcare Staffing, Contingent Labor, Physician Staffing, Nurse Staffing, Homecare Staffing, EBITDA, EPS, Revenue, Financial Results, Workforce Solutions
CCRN
Cross Country Healthcare INC
NASDAQ
Sector: TBD
Filings with Classifications
Worse than expected
7 May 2025 4:45 PM
Quarterly Report
- Revenue decreased by 22.6% year-over-year.
- Net loss attributable to common stockholders was $0.5 million, compared to a net income of $2.7 million in the same period last year.
Delay expected
7 May 2025 4:45 PM
Quarterly Report
- The closing of the Aya Merger is expected in the second half of 2025, subject to regulatory approvals, indicating a potential delay due to the FTC's Second Request for additional information.
Worse than expected
7 May 2025 4:28 PM
Earnings Release
- Revenue, net income, and adjusted EBITDA were all down year-over-year.
Worse than expected
16 April 2025 4:33 PM
Form 10-K/A Amendment
- The company did not achieve its minimum performance threshold for Company Annual Adjusted EBITDA of $64 million under the Annual Incentive Plan or $50 million pursuant to the additional element added during the year.
- The company slightly exceeded the threshold performance hurdle of $1.33 billion for Company Annual Revenue.
Worse than expected
5 March 2025 4:45 PM
Annual Results
- The company's revenue decreased by 33.5% year-over-year.
- The company experienced a net loss attributable to common stockholders of $14.6 million, compared to a net income of $72.6 million in the previous year.
Delay expected
5 March 2025 4:45 PM
Annual Results
- The company now expects that the Aya Merger will close in the second half of 2025, subject to the satisfaction of other customary closing conditions, including regulatory approvals, a delay from the previously expected first half of 2025.
Worse than expected
5 March 2025 4:25 PM
Earnings Release
- The company's revenue, net income, and adjusted EBITDA all decreased significantly compared to the prior year.
Delay expected
21 February 2025 5:16 PM
Form DEFA14A Filing
- The merger is delayed due to a second request for information from the FTC, pushing the expected closing to the second half of 2025.
Worse than expected
21 February 2025 5:16 PM
Form DEFA14A Filing
- The merger closing is delayed, which is worse than the initially expected timeline.
Worse than expected
21 February 2025 4:58 PM
Current Report (8-K)
- The merger closing is delayed to the second half of 2025 due to the FTC's Second Request.
Delay expected
21 February 2025 4:58 PM
Current Report (8-K)
- The merger between Cross Country Healthcare and Aya Healthcare is now expected to close in the second half of 2025 due to a second request for information from the FTC.
Delay expected
22 January 2025 4:27 PM
Merger Announcement
- The applicable waiting period under the HSR Act was extended to 11:59 p.m Eastern Time on February 20, 2025.
Better than expected
6 January 2025 10:30 PM
Schedule 13D Filing
- The increase in beneficial ownership by a prominent investment firm like Magnetar Capital is generally viewed as a positive signal by the market, indicating confidence in the company's prospects or valuation.
Better than expected
3 January 2025 6:42 PM
Beneficial Ownership Amendment
- The document indicates an increase in beneficial ownership by a significant institutional investor (Magnetar), which is generally perceived as a positive signal of confidence in the company's future prospects.
- Magnetar's stake has grown to 7.20%, indicating a substantial and growing commitment to the company.
Better than expected
4 December 2024 5:16 PM
Merger Announcement
- The acquisition price represents a significant premium for Cross Country shareholders, indicating a better than expected outcome for them.
Better than expected
4 December 2024 4:50 PM
Merger Announcement
- The acquisition includes a substantial premium of 67% and 68% over recent trading prices, indicating a better than expected outcome for shareholders.
Better than expected
4 December 2024 8:50 AM
Merger Announcement
- The acquisition price represents a significant premium of 67% to Cross Country's closing price on December 3, 2024, indicating a better than expected outcome for shareholders.
Worse than expected
7 November 2024 3:59 PM
Quarterly Report
- The company's revenue decreased by 28.8% year-over-year, indicating a worse performance compared to the previous year.
- Net income attributable to common stockholders decreased significantly from $12.8 million to $2.6 million year-over-year, indicating a worse performance compared to the previous year.
- The Nurse and Allied Staffing segment experienced a 33.2% revenue decline, indicating a worse performance compared to the previous year.
Worse than expected
6 November 2024 4:28 PM
Quarterly Report
- The company's revenue, net income, and adjusted EBITDA all decreased significantly year-over-year, indicating worse than expected results.
- The company's gross profit margin also declined, further contributing to the worse than expected results.
Worse than expected
1 August 2024 10:15 AM
Quarterly Report
- The company's revenue decreased by 37% year-over-year.
- The company reported a net loss of $16.1 million compared to a net income of $21.3 million in the same period last year.
- The Nurse and Allied Staffing segment experienced a significant revenue decline of 41.2%.
Worse than expected
31 July 2024 4:26 PM
Quarterly Report
- The company's revenue, net income, and adjusted EBITDA all decreased significantly year-over-year, indicating worse than expected results.
Worse than expected
9 May 2024 4:05 PM
Current Report
- The company is expecting a $20 million bad debt charge, which is a negative impact on their financials.
Worse than expected
2 May 2024 7:12 AM
Quarterly Report
- The company's revenue decreased by 39% year-over-year, indicating a significant downturn in performance.
- Net income attributable to common stockholders decreased substantially from $29.4 million to $2.7 million, reflecting a significant decline in profitability.
Worse than expected
1 May 2024 4:27 PM
Quarterly Report
- The company's revenue, net income, and adjusted EBITDA all decreased significantly year-over-year, indicating worse than expected results.
- The company's gross profit margin also declined, further indicating worse than expected results.
- The company's diluted EPS and adjusted EPS were also significantly lower than the prior year, indicating worse than expected results.
Worse than expected
1 April 2024 8:00 AM
Proxy Statement
- The company did not achieve its threshold performance hurdles for Company Annual Adjusted EBITDA or Company Annual Revenue in Fiscal 2023, resulting in no awards for the Objective Bonus component for NEOs.
- The company's Fiscal 2023 Adjusted EBITDA margin of 7.2% was below the performance hurdle of 7.5%.
Worse than expected
22 February 2024 6:05 PM
Annual Results
- The company's revenue decreased by 28% year-over-year, indicating worse than expected results.
- Net income attributable to common stockholders decreased significantly, indicating worse than expected results.
Worse than expected
21 February 2024 4:24 PM
Quarterly Report
- The company's revenue, net income, and adjusted EBITDA all decreased significantly year-over-year, indicating worse than expected results.
- The company's guidance for Q1 2024 also indicates a continued decline in financial performance.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.