CCRN
Cross Country Healthcare INC
NASDAQ
8-K: Cross Country Healthcare Reports Mixed Q4 and Full Year 2023 Results Amidst Market Normalization
Sentiment:
Quarterly Report
21 February 2024 4:24 PM
Cross Country Healthcare's Q4 2023 results show a significant year-over-year revenue decline, though the company exceeded the high end of its guidance range, while also achieving a record year of cash flow from operations.
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 guidance for Q1 2024 also indicates a continued decline in financial performance.
Summary
- Cross Country Healthcare announced its financial results for the fourth quarter and full year ended December 31, 2023.
- The company's Q4 revenue was $414 million, a 34% decrease year-over-year and a 6% decrease sequentially.
- Full year revenue reached $2.02 billion, a 28% decrease compared to the previous year.
- Net income attributable to common stockholders for Q4 was $9 million, a 77% decrease year-over-year, and $72.6 million for the full year, a 61% decrease year-over-year.
- Adjusted EBITDA for Q4 was $20.6 million, a 64% decrease year-over-year, and $144.4 million for the full year, a 52% decrease year-over-year.
- The company's cash flow from operations was $12.1 million for the quarter and a record $248.5 million for the year.
- Cross Country Healthcare repurchased 2.3 million shares for $57.6 million in 2023, representing 6.8% of shares outstanding.
- The company ended the year debt-free after repaying $73.9 million on its term loan and paying down its ABL.
- The company invested over $20 million in core technologies including Intellify and XperienceTM.
Sentiment
Score: 4
Explanation: The document presents a mixed picture with significant year-over-year declines in revenue and profitability, but also highlights positive cash flow and strategic investments. The overall sentiment is cautiously negative due to the substantial financial downturn.
Positives
- The company exceeded its revenue guidance for the fourth quarter.
- Physician staffing saw a 26% year-over-year revenue increase.
- The company generated a record $248.5 million in cash flow from operations for the year.
- Cross Country Healthcare successfully paid off all debt, ending the year debt-free.
- The company invested significantly in technology, including Intellify and XperienceTM.
- The company repurchased a significant portion of its shares, demonstrating confidence in its value.
Negatives
- Consolidated revenue decreased by 34% year-over-year in Q4 and 28% for the full year.
- Net income attributable to common stockholders decreased by 77% year-over-year in Q4 and 61% for the full year.
- Adjusted EBITDA decreased by 64% year-over-year in Q4 and 52% for the full year.
- Nurse and Allied Staffing revenue decreased by 38% year-over-year in Q4.
- Average revenue per FTE per day in Nurse and Allied Staffing decreased from $510 to $414 year-over-year.
Risks
- The company faces challenges in the nurse and allied staffing segment due to client right-sizing and normalizing travel bill rates.
- The company's financial performance is subject to the overall macroeconomic environment, including inflation and interest rates.
- The company's ability to attract and retain qualified healthcare personnel is a risk.
- The company's performance is affected by the costs and availability of short-term housing for travel healthcare professionals.
- Cybersecurity risks and incidents could negatively impact the company's business.
- Government regulations and legislative initiatives could affect the company's operations.
- The company's ability to successfully implement its acquisition and development strategies is a risk.
Future Outlook
The company expects Q1 2024 revenue to be between $370 million and $380 million, a 39% to 41% decrease year-over-year, and adjusted EBITDA to be between $13 million and $18 million, a 65% to 75% decrease year-over-year. Adjusted EPS is expected to be between $0.15 and $0.25.
Management Comments
- John A. Martins, President and CEO, stated that the company is proud of its accomplishments in 2023, including the rollout of Intellify and growth in non-travel businesses.
- Management's goal for the coming year is to capitalize on investments, grow the client base, ramp up recent wins, and drive operational efficiency to expand margins.
- The company is well-positioned to make further strategic investments and accretive acquisitions to meet the evolving needs of its clients.
Industry Context
The results reflect a broader trend of normalization in the healthcare staffing industry after a period of high demand during the pandemic. The company's focus on technology and diversification into non-travel staffing areas aligns with industry trends towards more efficient and flexible workforce solutions.
Comparison to Industry Standards
- Cross Country Healthcare's revenue decline of 28% for the full year is significant, indicating a more pronounced impact from market normalization compared to some competitors.
- Competitors like AMN Healthcare have also reported revenue declines, but the magnitude of the decrease varies, suggesting different levels of exposure to the travel nurse market.
- The company's focus on technology investments is in line with industry trends, but the impact on future performance remains to be seen.
- The company's debt-free status is a positive differentiator compared to some competitors who may still carry significant debt.
Stakeholder Impact
- Shareholders will be impacted by the significant decrease in revenue and profitability.
- Employees may be affected by cost-saving initiatives and restructuring.
- Customers may see changes in service offerings as the company focuses on technology and non-travel staffing.
- Suppliers may be impacted by changes in the company's financial performance.
- Creditors are not impacted as the company is debt free.
Next Steps
- The company plans to capitalize on investments made in the business.
- The company aims to grow its client base and ramp up recent wins.
- The company intends to drive operational efficiency to expand margins.
- The company is positioned to make further strategic investments and accretive acquisitions.
Legal Proceedings
- The company incurred $1.1 million in legal fees to settle a wage and hour class action lawsuit.
Key Dates
- December 31, 2023: End of the fourth quarter and full year for which financial results are reported.
- February 21, 2024: Date of the press release and conference call announcing Q4 and full year 2023 financial results.
Keywords
Healthcare Staffing, Nurse Staffing, Physician Staffing, EBITDA, Revenue, Financial Results, Workforce Solutions, Technology Investment, Debt Repayment, Share Repurchase
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.