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- **Q3 Results**: Revenue growth (+4.4%) offset by EBITDA decline (-11.3%) due to Medicaid volume softness and cost pressures.
- **Strategic Shifts**: $300M+ CapEx reduction for 2026, 5 facility closures, and 500-700 new beds planned for next year.
- **Quality Focus**: 6 consecutive quarters of improved retention, 50+ clinical KPIs tracked, and JV facility showing 47% reduction in depressive symptoms.
- **2025 Outlook**: Adjusted EBITDA revised to $650-660M, with 2026 targeting positive free cash flow.
- **Risks**: Medicaid rate pressure, PLGL expenses, and delayed CMS payments weighing on margins.

**【Management Opening Remarks】**
- Brian Farley provided an overview of the Q3 2025 earnings release, emphasizing forward-looking statements and the importance of GAAP/non-GAAP reconciliations.
- Highlighted Todd Young's recent appointment as CFO and his experience in healthcare finance.

**【CEO Summary Section】**
- **Q3 2025 Results**: Revenue of $851.6 million (+4.4% YoY), Adjusted EBITDA of $173 million (-11.3% YoY) due to Medicaid volume softness and cost pressures.
- **Strategic Adjustments**: Paused $300M+ in CapEx for 2026, focusing on high-return markets; closed 5 underperforming facilities to optimize portfolio.
- **Growth Initiatives**: 500-700 new beds expected in 2026, including JV partnerships with Tufts Medicine and Orlando Health.
- **Quality Investments**: 6 consecutive quarters of improved employee retention; new quality dashboard tracks 50+ KPIs, driving clinical outcomes (e.g., 47% reduction in depressive symptoms at a JV facility).

**【CFO Financial Commentary】**
- **Q3 Financials**: GAAP net income of $42.3 million, Non-GAAP EPS of $0.85 (down 22% YoY). Adjusted EBITDA of $173 million missed internal expectations by $5 million due to bad debt and PLGL expenses.
- **Balance Sheet**: $118.7M cash, $790M available on $1B revolver; net leverage ratio of 3.4x.
- **2025 Outlook**: Revised Adjusted EBITDA guidance to $650-660M (prev. $675-700M), driven by Medicaid rate pressure and volume declines.
- **2026 Outlook**: Free cash flow expected for the full year, with startup losses declining 20-30% YoY.

**【Q&A Key Highlights】**
- **Payer Challenges**: Medicaid managed care plans increasing utilization reviews, leading to shorter lengths of stay and higher denials (e.g., 3%+ incremental bad debt expense).
- **Cost Controls**: Legal expenses down 28% QoQ to $39M; expects further reductions in 2026.
- **CapEx Discipline**: 2026 CapEx guidance of $300-400M (prev. $610-630M), with 150-250 new beds in 2027.
- **Supplemental Payments**: Up to $22M potential EBITDA boost from CMS programs, though timing uncertain due to government shutdown.
- **Free Cash Flow**: 2026 target of positive full-year FCF, driven by reduced CapEx and ramping new beds.


Acadia Healthcare Company, Inc. (ACHC) Q3 2025 Earnings Call Transcript

- **Revenue Growth**: Q2 revenue up 9.2% YoY to $869.2 million, EBITDA +7.5% to $201.8 million.
- **Medicaid Challenges**: Medicaid volumes down 1.2% YoY, offset by +9% commercial and +8% Medicare.
- **Expansion Costs**: Start-up losses up $10 million YTD due to faster bed openings.
- **Free Cash Flow**: Potential 2026 acceleration via $100 million CapEx pause.
- **Risk Management**: $20 million EBITDA drag from underperforming facilities, one with media-related issues.
- **Leadership Change**: Heather Dixon departing; Tim Sides to lead interim CFO.

**【CEO Summary Section】**
- Q2 2025 revenue: $869.2 million (+9.2% YoY), adjusted EBITDA: $201.8 million (+7.5% YoY).
- Medicaid supplementals: $230 million expected in 2025, half at risk of 2028 reductions.
- Capacity expansion: 479 beds added YTD (101 in Q2), 11 new CTCs.
- Volume: Same-facility patient days +1.8% YoY, Medicaid down 1.2% YoY.
- Quality: Technology investments for patient safety and outcomes.
- Leadership: Heather Dixon stepping down; Tim Sides interim CFO.

**【CFO Financial Commentary】**
- Q2 EBITDA margin: 23.2%, Tennessee program contributed $51.8 million.
- Updated 2025 guidance: EBITDA $675-700 million, volume +2-3%, beds 950-1000.
- Liquidity: $131.4 million cash, $828 million credit facility available.
- Start-up costs: $14.2 million Q2, total YTD $28.8 million.

**【Q&A Key Highlights】**
- Medicaid decline: Managed care cost pressures reduced acute care admissions.
- CapEx pause: $100 million to accelerate free cash flow.
- Wage trends: Labor costs 3.5% YoY (down from 7.8%).
- Legal costs: $54 million Q2 on government investigations.

Acadia Healthcare Company, Inc. (ACHC) Q2 2025 Earnings Call Transcript

- **Q1 Financial Resilience**: Revenue and EBITDA in-line with guidance, despite 110bps leap year headwind.
- **Growth Ambition**: 801,000 new beds in 2025, targeting 600-800 beds/year from 2026.
- **Quality Differentiation**: 26,000+ employees supported by premium pay declines and data-driven care.
- **Policy Risk Management**: $20M EBITDA impact from underperforming facilities, with 2025 no material improvement.
- **Liquidity Strength**: $900M credit facility and $91.2M cash to fund expansion.

**【CEO Summary Section】**
- Q1 2025 revenue of $770.5M and adjusted EBITDA of $134.2M aligned with guidance, driven by 2.2% same-facility patient day growth.
- Added 378 new beds (288 from 2 new facilities) and 7 new CTCs, with 801,000 total beds expected in 2025.
- Emphasized quality initiatives, including 24/7 patient monitoring and data-driven care, to enhance recruitment and retention.
- Policy focus on supplemental payments, with Tennessee program approval expected to support Medicaid funding.

**【CFO Financial Commentary】**
- GAAP revenue up slightly YoY, with same-facility revenue per patient day flat due to supplemental payment timing.
- Adjusted EBITDA margin of 17.4%, impacted by $5M EBITDA headwind from facility closures.
- Full-year guidance reaffirmed: $3.0B-$3.1B revenue, $530M-$550M EBITDA, $1.80-$1.90 EPS.
- 2025 startup losses expected at $50M-$55M, with $15M in Q2.
- Cash of $91.2M and $900M available under credit facility, supporting strategic investments.

**【Q&A Key Highlights】**
- **EBITDA Progression**: Q1 startup costs highest, with Tennessee DPP approval key to Q2+ EBITDA growth.
- **Bed Ramp Assumptions**: 5-year ramp for new facilities, with 600-800 beds/year from 2026.
- **CTC Performance**: Sequential revenue flat despite 3% patient growth, due to rate timing and facility closures.
- **Underperforming Facilities**: $20M EBITDA headwind in 2025, with Q4 2025 comp relief.
- **Legal Costs**: Ongoing DOJ/SEC investigations, with Q1 costs reflecting active case management.

Acadia Healthcare (ACHC)-13 May 25-2025 Q1 Earnings call transcript

- **Q4 2024 Results**: $774M revenue (+4.2% YoY), $153.1M Adjusted EBITDA. Full-year 2024: $3.1B revenue (+7.7%).
- **2025 Guidance**: Revenue $3.3-3.4B, EBITDA $675-725M, EPS $2.50-2.80. CapEx $630-690M.
- **Growth Strategy**: 800-1,000 new beds in 2025, targeting 2026 EBITDA growth of 8-10%.
- **Key Risks**: $20M EBITDA headwind from underperforming facilities, +$10M in liability costs.
- **Free Cash Flow**: Expected positive by end of 2026 with declining CapEx.

**【CEO Summary Section】**
- Q4 2024 revenue reached $774 million, up 4.2% YoY, with full-year revenue of $3.1 billion (+7.7%).
- Same-facility patient days grew 3.2% in Q4, stable at 3-4% monthly. Excluding underperforming facilities, growth would have been >5%.
- 2024 bed construction: 1,300 new beds (776 operational), including 577 opened in Q4. 2025 target: 800-1,000 new beds.
- Emphasized patient safety tech investments: EMRs, monitoring devices, quality dashboards.
- Joint ventures with Intermountain Health and Henry Ford Health expanded capacity.

**【CFO Financial Commentary】**
- Q4 2024 Adjusted EBITDA: $153.1 million (19.8% margin). Full-year guidance 2025: $675-725 million.
- Start-up losses Q4: $11.2 million (+$6M YoY). 2025 total start-up costs: $50-55 million.
- 2025 revenue: $3.3-3.4 billion. EPS: $2.50-2.80. CapEx: $630-690 million.
- EBITDA headwind from underperforming facilities: $20 million YoY.
- 2026 outlook: EBITDA growth 8-10%, free cash flow positive.

**【Q&A Key Highlights】**
- **Capital Allocation**: $300M share buyback authorized. 2026+ free cash flow expected.
- **Growth Balance**: Moderate bed growth (600-800/yr) to balance EBITDA and FCF.
- **Supplemental Payments**: 2025 net impact flat to +$15M, but Q1 timing drag of -$10-15M.
- **Liability Costs**: +$10M YoY in professional liability expenses.
- **Underperforming Facilities**: 2025 EBITDA drag of $20M, no upside assumed.
- **Long-Term Outlook**: 7-9% revenue growth, 8-10% EBITDA growth by 2026.

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