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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

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

ACHC

ACHC fundamentals

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