Taking a strong position in the free-standing emergency room sector that is expanding across the country, Adeptus Health's revenue skyrocketed in the second quarter of 2015.
The Lewisville, Texas-based company opened six facilities in the second quarter and 15 facilities this year, including 12 free-standing emergency facilities in Colorado and Texas. The company also opened its first hospital and two free-standing emergency facilities in Arizona with partner Dignity Health.
In July, as part of its partnership with University of Colorado Health, its 13 free-standing emergency rooms in Colorado were rebranded as UC Health Emergency Room. Adeptus also began construction on two hospitals.
Adeptus Health net patient services revenue skyrocketed 136% to $104.5 million in the second quarter. The increase was attributed to increased patient volumes.
Net operating revenue increased 103% over the previous year to $89.6 million in the second quarter. Adjusted EBITDA ballooned to $22.9 million versus $5.9 million in the prior year, and adjusted earnings per share were $0.44 while GAAP earnings per share were $0.97. Net income attributable to Adeptus Health was $10.6 million. Cash flow from operating activities was $13.0 million versus $0.3 million in prior year.
Also, the company generated net income of $27.7 million for the quarter, compared with a net loss of $9.4 million from the prior year. The jump in net income was due to an increase of $45.4 million in net operating revenue, coupled with the joint venture with University of Colorado Health. But that boost was partially offset by increases in salaries, wages and benefits and other costs related to growth initiatives and an increase in depreciation and amortization expense.
Adeptus went public last year. Its business model revolves around treating patients who have commercial insurance and want convenient access to care. About 85% of Adeptus' revenue comes from Aetna, Blue Cross and Blue Shield, Cigna and UnitedHealthcare health plans.
"We are pleased with the second-quarter results, which reflect our continued strong growth momentum,” Thomas Hall, Adeptus Health chairman and CEO, said in a statement. “As we continue to execute on our strategic plan, both through expanding our network of free-standing emergency rooms and forging partnerships with leading healthcare providers, we are helping to transform the delivery of emergency care in the U.S."
The company said its full-year growth plan includes opening 24 free-standing facilities in total and two hospitals, and it has raised guidance for 2015. Adeptus expects to generate systemwide net patient services revenue of $400 million to $405 million for the full year 2015. It increased its adjusted EBITDA of $69 million to $71 million, and adjusted earnings per share of $1.10 to $1.15 for the full year 2015.
Adeptus is also furthering its political reach. Adeptus has hired its own lobbyists in Washington, D.C., as well as in Ohio. It also has a political action committee, but it raised no money and made no contributions in 2014.