Financial Information for the Company and Its Subsidiaries

3 Months Ended

Mar. 31, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Financial Information for the Company and Its Subsidiaries

20. Financial Information for the Company and Its Subsidiaries

The Company conducts substantially all of its business through its subsidiaries. The 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior Notes and 6.500% Senior Notes are jointly and severally guaranteed on an unsecured senior basis by all of the Company’s subsidiaries that guarantee the Company’s obligations under the Amended and Restated Senior Credit Facility. Presented below is condensed consolidating financial information for the Company and its subsidiaries at March 31, 2020 and December 31, 2019, and for the three months ended March 31, 2020 and 2019. The information segregates the parent company (Acadia Healthcare Company, Inc.), the combined wholly-owned subsidiary guarantors, the combined non-guarantor subsidiaries and eliminations.

Acadia Healthcare Company, Inc.

Condensed Consolidating Balance Sheets

March 31, 2020

(In thousands)

	Parent		Combined Subsidiary Guarantors		Combined Non- Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Current assets:
Cash and cash equivalents	$	—	$	51,340	$	29,664	$	—		$	81,004
Accounts receivable, net		—		272,098		67,407		—			339,505
Other current assets		—		65,346		17,097		—			82,443
Total current assets		—		388,784		114,168		—			502,952
Property and equipment, net		—		1,348,045		1,803,694		—			3,151,739
Goodwill		—		1,992,332		434,368		—			2,426,700
Intangible assets, net		—		58,312		30,740		—			89,052
Deferred tax assets		1,303		—		3,307		(1,303	)		3,307
Investment in subsidiaries		5,390,417		—		—		(5,390,417	)		—
Operating lease right-of-use assets		—		98,166		377,862		—			476,028
Other assets		234,014		48,597		12,214		(226,608	)		68,217
Total assets	$	5,625,734	$	3,934,236	$	2,776,353	$	(5,618,328	)	$	6,717,995
Current liabilities:
Current portion of long-term debt	$	196,072	$	—	$	—	$	—		$	196,072
Accounts payable		—		97,196		37,497		—			134,693
Accrued salaries and benefits		—		82,072		32,718		—			114,790
Current portion of operating lease liabilities		—		18,571		11,100		—			29,671
Other accrued liabilities		11,660		26,021		66,677		—			104,358
Total current liabilities		207,732		223,860		147,992		—			579,584
Long-term debt		2,944,820		—		226,608		(226,608	)		2,944,820
Deferred tax liabilities		—		41,087		45,621		(1,303	)		85,405
Operating lease liabilities		—		85,577		389,169		—			474,746
Derivative instrument liabilities		9,015		—		—		—			9,015
Other liabilities		—		110,923		15,844		—			126,767
Total liabilities		3,161,567		461,447		825,234		(227,911	)		4,220,337
Redeemable noncontrolling interests		—		—		33,491		—			33,491
Total equity		2,464,167		3,472,789		1,917,628		(5,390,417	)		2,464,167
Total liabilities and equity	$	5,625,734	$	3,934,236	$	2,776,353	$	(5,618,328	)	$	6,717,995

Acadia Healthcare Company, Inc.

Condensed Consolidating Balance Sheets

December 31, 2019

(In thousands)

	Parent		Combined Subsidiary Guarantors		Combined Non- Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Current assets:
Cash and cash equivalents	$	—	$	98,943	$	25,249	$	—		$	124,192
Accounts receivable, net		—		266,864		72,911		—			339,775
Other current assets		—		61,508		16,736		—			78,244
Total current assets		—		427,315		114,896		—			542,211
Property and equipment, net		—		1,313,830		1,910,204		—			3,224,034
Goodwill		—		1,992,344		456,787		—			2,449,131
Intangible assets, net		—		58,291		32,066		—			90,357
Deferred tax assets – noncurrent		1,403		—		3,339		(1,403	)		3,339
Operating lease right-of-use assets		—		97,396		404,441		—			501,837
Investment in subsidiaries		5,521,340		—		—		(5,521,340	)		—
Other assets		233,975		48,949		13,127		(227,818	)		68,233
Total assets	$	5,756,718	$	3,938,125	$	2,934,860	$	(5,750,561	)	$	6,879,142
Current liabilities:
Current portion of long-term debt	$	43,679	$	—	$	—	$	—		$	43,679
Accounts payable		—		87,165		39,880		—			127,045
Accrued salaries and benefits		—		89,483		33,069		—			122,552
Current portion of operating lease liabilities		—		17,967		11,173		—			29,140
Other accrued liabilities		33,323		22,672		85,165		—			141,160
Total current liabilities		77,002		217,287		169,287		—			463,576
Long-term debt		3,105,420		—		227,818		(227,818	)		3,105,420
Deferred tax liabilities – noncurrent		—		21,858		51,405		(1,403	)		71,860
Operating lease liabilities		—		85,365		416,887		—			502,252
Derivative instrument liabilities		68,915		—		—		—			68,915
Other liabilities		—		110,445		18,142		—			128,587
Total liabilities		3,251,337		434,955		883,539		(229,221	)		4,340,610
Redeemable noncontrolling interests		—		—		33,151		—			33,151
Total equity		2,505,381		3,503,170		2,018,170		(5,521,340	)		2,505,381
Total liabilities and equity	$	5,756,718	$	3,938,125	$	2,934,860	$	(5,750,561	)	$	6,879,142

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

Three Months Ended March 31, 2020

(In thousands)

	Parent			Combined Subsidiary Guarantors		Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Revenue	$	—		$	474,612	$	308,198		$	—		$	782,810
Salaries, wages and benefits		4,979			261,603		173,734			—			440,316
Professional fees		—			28,558		34,742			—			63,300
Supplies		—			20,859		11,112			—			31,971
Rents and leases		—			8,883		11,941			—			20,824
Other operating expenses		—			63,819		34,710			—			98,529
Depreciation and amortization		—			21,046		20,634			—			41,680
Interest expense, net		14,460			24,159		4,166			—			42,785
Transaction-related expenses		—			1,525		2,024			—			3,549
Total expenses		19,439			430,452		293,063			—			742,954
(Loss) income before income taxes		(19,439	)		44,160		15,135			—			39,856
Equity in earnings of subsidiaries		48,353			—		—			(48,353	)		—
(Benefit from) provision for income taxes		(5,153	)		11,712		(770	)		—			5,789
Net income (loss)		34,067			32,448		15,905			(48,353	)		34,067
Net income attributable to noncontrolling interests		—			—		(604	)		—			(604	)
Net income (loss) attributable to Acadia    Healthcare Company, Inc.	$	34,067		$	32,448	$	15,301		$	(48,353	)	$	33,463
Other comprehensive income:
Foreign currency translation gain		—			—		(122,000	)		—			(122,000	)
Loss on derivative instruments		43,746			—		—			—			43,746
Other comprehensive income (loss)		43,746			—		(122,000	)		—			(78,254	)
Comprehensive income (loss) attributable to Acadia     Healthcare Company, Inc.	$	77,813		$	32,448	$	(106,699	)	$	(48,353	)	$	(44,791	)

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

Three Months Ended March 31, 2019

(In thousands)

	Parent			Combined Subsidiary Guarantors		Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Revenue	$	—		$	459,818	$	300,799		$	—		$	760,617
Salaries, wages and benefits		6,101			254,942		168,536			—			429,579
Professional fees		—			25,368		31,639			—			57,007
Supplies		—			19,384		10,573			—			29,957
Rents and leases		—			8,403		11,904			—			20,307
Other operating expenses		—			59,390		34,475			—			93,865
Depreciation and amortization		—			19,605		20,975			—			40,580
Interest expense, net		19,578			23,018		5,534			—			48,130
Transaction-related expenses		—			3,218		1,103			—			4,321
Total expenses		25,679			413,328		284,739			—			723,746
(Loss) income before income taxes		(25,679	)		46,490		16,060			—			36,871
Equity in earnings of subsidiaries		48,157			—		—			(48,157	)		—
(Benefit from) provision for income taxes		(7,033	)		17,065		(2,672	)		—			7,360
Net income (loss)		29,511			29,425		18,732			(48,157	)		29,511
Net income attributable to noncontrolling interests		—			—		(40	)		—			(40	)
Net income (loss) attributable to Acadia    Healthcare Company, Inc.	$	29,511		$	29,425	$	18,692		$	(48,157	)	$	29,471
Other comprehensive income:
Foreign currency translation gain		—			—		44,481			—			44,481
Loss on derivative instruments		(8,690	)		—		—			—			(8,690	)
Other comprehensive income (loss)		(8,690	)		—		44,481			—			35,791
Comprehensive income (loss) attributable to Acadia     Healthcare Company, Inc.	$	20,821		$	29,425	$	63,173		$	(48,157	)	$	65,262

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2020

(In thousands)

	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Operating activities:
Net income (loss)	$	34,067		$	32,448		$	15,905		$	(48,353	)	$	34,067
Adjustments to reconcile net income (loss)    to net cash (used in) provided by operating activities:
Equity in earnings of subsidiaries		(48,353	)		—			—			48,353			—
Depreciation and amortization		—			21,046			20,634			—			41,680
Amortization of debt issuance costs		3,050			—			—			—			3,050
Equity-based compensation expense		4,979			—			—			—			4,979
Deferred income taxes		101			11,044			141			—			11,286
Other		(101	)		(9	)		3			—			(107	)
Change in operating assets and liabilities:
Accounts receivable, net		—			(5,234	)		2,406			—			(2,828	)
Other current assets		—			(17,887	)		(1,244	)		—			(19,131	)
Other assets		82			(1,593	)		497			(82	)		(1,096	)
Accounts payable and other accrued liabilities		—			17,726			(39,481	)		—			(21,755	)
Accrued salaries and benefits		—			(7,411	)		1,381			—			(6,030	)
Other liabilities		—			2,803			(1,372	)		—			1,431
Net cash (used in) provided by operating activities		(6,175	)		52,933			(1,130	)		(82	)		45,546
Investing activities:
Cash paid for capital expenditures		—			(48,264	)		(21,283	)		—			(69,547	)
Cash paid for real estate acquisitions		—			(3,149	)		—			—			(3,149	)
Proceeds from sale of property and equipment		—			207			—			—			207
Other		—			(1,672	)		—			—			(1,672	)
Net cash used in investing activities		—			(52,878	)		(21,283	)		—			(74,161	)
Financing activities:
Principal payments on long-term debt		(10,621	)		—			(82	)		82			(10,621	)
Common stock withheld for minimum statutory taxes, net		(1,402	)		—			—			—			(1,402	)
Distributions to noncontrolling interests		—			—			(264	)		—			(264	)
Other		—			(423	)		(720	)		—			(1,143	)
Cash provided by (used in) intercompany activity		18,198			(47,235	)		29,037			—			—
Net cash provided by (used in) in financing activities		6,175			(47,658	)		27,971			82			(13,430	)
Effect of exchange rate changes on cash		—			—			(1,143	)		—			(1,143	)
Net (decrease) increase in cash and cash equivalents		—			(47,603	)		4,415			—			(43,188	)
Cash and cash equivalents at beginning of the period		—			98,943			25,249			—			124,192
Cash and cash equivalents at end of the period	$	—		$	51,340		$	29,664		$	—		$	81,004

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2019

(In thousands)

	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Operating activities:
Net income (loss)	$	29,511		$	29,425		$	18,732		$	(48,157	)	$	29,511
Adjustments to reconcile net income (loss) to    net cash (used in) provided by operating activities:
Equity in earnings of subsidiaries		(48,157	)		—			—			48,157			—
Depreciation and amortization		—			19,605			20,975			—			40,580
Amortization of debt issuance costs		2,888			—			—			—			2,888
Equity-based compensation expense		6,101			—			—			—			6,101
Deferred income taxes		(254	)		(678	)		266			—			(666	)
Other		1,993			253			(59	)		—			2,187
Change in operating assets and liabilities:
Accounts receivable, net		—			(15,693	)		3,713			—			(11,980	)
Other current assets		—			(5,484	)		(391	)		—			(5,875	)
Other assets		2,665			(353	)		648			(2,665	)		295
Accounts payable and other accrued liabilities		—			(7,100	)		(8,601	)		—			(15,701	)
Accrued salaries and benefits		—			(7,872	)		2,023			—			(5,849	)
Other liabilities		—			3,317			(1,135	)		—			2,182
Net cash (used in) provided by operating activities		(5,253	)		15,420			36,171			(2,665	)		43,673
Investing activities:
Cash paid for acquisitions, net of cash acquired		—			(40,400	)		—			—			(40,400	)
Cash paid for capital expenditures		—			(45,231	)		(24,017	)		—			(69,248	)
Cash paid for real estate acquisitions		—			(1,066	)		—			—			(1,066	)
Proceeds from sale of property and equipment		—			836			92			—			928
Other		—			(315	)		—			—			(315	)
Net cash used in investing activities		—			(86,176	)		(23,925	)		—			(110,101	)
Financing activities:
Borrowings on revolving credit facility		71,573			—			—			—			71,573
Principal payments on long-term debt		(8,246	)		—			(2,665	)		2,665			(8,246	)
Common stock withheld for minimum statutory taxes, net		(1,327	)		—			—			—			(1,327	)
Other		(2,375	)		(442	)		(680	)		—			(3,497	)
Cash (used in) provided by intercompany activity		(54,372	)		56,570			(2,198	)		—			—
Net cash provided by (used in) in financing activities		5,253			56,128			(5,543	)		2,665			58,503
Effect of exchange rate changes on cash		—			—			1,099			—			1,099
Net (decrease) increase in cash and cash equivalents		—			(14,628	)		7,802			—			(6,826	)
Cash and cash equivalents at beginning of the period		—			32,471			18,039			—			50,510
Cash and cash equivalents at end of the period	$	—		$	17,843		$	25,841		$	—		$	43,684