8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8‑K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report: May 1, 2018

(Date of earliest event reported)

Cotiviti Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

001-37787	46-0595918
(Commission File Number)	(IRS Employer Identification No.)
One Glenlake Parkway
Suite 1400
Atlanta, GA	30328
(Address of principal executive offices)	(Zip Code)

(770) 379-2800

(Registrant’s telephone number, including area code)

115 Perimeter Center Place, Suite 700, Atlanta, GA, 30346

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ]Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02     Results of Operations and Financial Condition.

On May 1, 2018, Cotiviti Holdings, Inc. (the “Company”) issued a press release, attached as Exhibit 99.1 and incorporated herein by reference, announcing the Company’s financial and operating results for the fiscal quarter ended March 31, 2018.

The information contained in this Item 2.02, including Exhibits 99.1 and 99.2 attached hereto, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Act of 1934, as amended, or otherwise subject to the liabilities of Section 18. Furthermore, the information contained in this Item 2.02 and Exhibits 99.1 and 99.2 shall not be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended.

Item 9.01     Financial Statements and Exhibits.

See Exhibit Index.

Exhibit Index

Exhibit Number	Description
99.1 99.2	Cotiviti Holdings, Inc. Press Release dated May 1, 2018 Supplemental Financial Information as of March 31, 2018

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	COTIVITI Holdings, Inc.
	By:	/s/ JONATHAN OLEFSON
		Name: Jonathan Olefson
		Title:  Senior Vice President, General Counsel and Secretary
Date: May 1, 2018

EX-99.1

Exhibit 99.1

Cotiviti Announces First Quarter 2018 Results

Revenue of $219.0 million, up 37% over prior year period

Non-GAAP adjusted revenue of $172.5 million, up 8% over prior year period

Net income of $53.9 million, up 100% over prior year period

Net income per diluted share of $0.57

Non-GAAP adjusted net income per diluted share of $0.41

Non-GAAP adjusted EBITDA of $63.8 million, up 11% over prior year period

ATLANTA, GA, May 1, 2018. (BUSINESS WIRE) - Cotiviti Holdings, Inc. (NYSE:COTV) (“Cotiviti”), a leading provider of payment accuracy and analytics-driven solutions primarily focused on the healthcare industry, today announced financial results for the three months ended March 31, 2018.   Cotiviti will host a conference call on May 2, 2018 at 8:30 a.m. Eastern Time to discuss results.

“Our first quarter results reflect Cotiviti’s ongoing success in delivering significant client value,” said Doug Williams, Chief Executive Officer. “Revenue growth in the first quarter was positively impacted by a $46.6 million Medicare recovery audit contractor (RAC) refunds and appeals liability release.   Excluding the liability release, adjusted net revenue grew 8% reflecting 10% growth in our Healthcare segment driven by the retrospective line of business, and partially offset by an 8% decline in Global Retail.”

Williams continued, “We are very encouraged by the Healthcare revenue generation opportunities we are experiencing with existing clients through contracted scope expansions and cross sell opportunities. In the first quarter, we generated revenue from one new PCA cross sell.  As our clients implement and ramp their scope expansions, policy adoption and cross sells, we are well-positioned to have strong future top line growth for both prospective and retrospective solutions.”

“Adjusted EBITDA increased 11% in the quarter and drove notable margin expansion and cash generation.  This enabled us to continue to reduce our net debt leverage to 2.1x at March 31, 2018,” said Brad Ferguson, Chief Financial Officer. “Our strong leverage profile provides the financial flexibility to support ongoing investments in the business to fuel growth, potential mergers and acquisitions, and the opportunistic repurchase of shares under our share repurchase program.” 

First Quarter 2018 Financial Results

· Total revenue for the quarter increased 37% to $219.0 million, compared to $160.1 million in the first quarter a year ago.  The increase was primarily driven by a $46.6 million refunds and appeals liability release reflected in the RCA line of business.  The liability release was due to the expiration of our original Medicare RAC contract effective January 31, 2018 and based on management’s best estimate of any potential refunds and appeals liability remaining.

· Excluding the liability release, adjusted net revenue grew 8% from the first quarter a year ago. Adjusted net revenue growth was driven by a 10% increase in the adjusted Healthcare segment revenue to $153.8 million. Healthcare benefitted from 13% growth in adjusted RCA revenue, partially offset by a 2% decline in PCA. 

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Total Global Retail revenue declined 8% compared to the same period a year ago, primarily a result of a difficult comparison due to large settlements recorded in the first quarter 2017.

· Net income increased 100% to $53.9 million, or $0.57 per diluted share, compared to $27.0 million or $0.28 per diluted share in the prior year quarter.  First quarter net income was driven by higher revenue primarily from the $46.6 million original Medicare RAC liability release and the growth in our clinical chart validation solutions.

· Non-GAAP adjusted EBITDA for the quarter was $63.8 million, an 11% increase from a year ago.

· Non-GAAP adjusted net income for the quarter was $39.1 million, or $0.41 per diluted share, a 22% increase from a year ago.

2018 Guidance

Cotiviti’s updated full year 2018 guidance includes:

· Total net revenue (including $46.6 million for Medicare RAC appeals release) in a range of $787 million to $807 million;

· Adjusted net revenue1 (excluding the Medicare RAC appeals release) in a range of $740 million to $760 million;

· Net income in a range of $140 million to $155 million;

· Adjusted EBITDA1 in a range of $295 million to $310 million;

· Estimated effective tax rate of approximately 25%, excluding the impact of stock option exercises, restricted stock units and non-deductible stock-based compensation; and

· Fully diluted weighted average shares of approximately 96 million, excluding any future share repurchases.

1. Adjusted Net Revenue, Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per Diluted Share are non-GAAP financial measures.  For an explanation of these as measures of the Company’s operating performance, refer to the reconciliation in “Non-GAAP Financial Measures.”

Conference Call Information

To participate in the conference call on May 2, domestic callers can dial (877) 883-0383 and international callers can dial (412) 902-6506 and provide the following conference passcode: 3845310.  A webcast of the call will be accessible on the Investor page of Cotiviti’s website at http://investors.cotiviti.com.  

Supplemental Financial Information

Supplemental financial information that is not part of this press release is available on the Investor page of Cotiviti’s website at http://investors.cotiviti.com.

About Cotiviti

Cotiviti is a leading provider of payment accuracy and analytics-driven solutions that helps payers, other risk-bearing healthcare organizations and retailers achieve their business objectives. Through a combination of analytics, technology and deep industry expertise, our solutions create insights that unlock value from the complex interactions between clients and their stakeholders. Cotiviti serves a majority of the top 25 U.S. healthcare payers and a majority of the top 10 U.S. retailers. Cotiviti’s passion for creating unique client value drives our focus – Analytics. Insight. Value.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties. All statements other than statements of historical fact or relating to present facts or current conditions included in this press release are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include

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words such as “anticipate,” “estimate,” “expect,” “project,” “seek,” “plan,” “intend,” “believe,” “will,” “may,” “could,” “continue,” “likely,” “should,” and other words.

The forward-looking statements contained in this press release are based on assumptions that we have made in light of our industry experience and our perceptions of historical trends, current conditions, expected future developments and other factors that we believe are appropriate under the circumstances. These statements are not guarantees of performance or results. These assumptions and our future performance or results involve risks and uncertainties (many of which are beyond our control). Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions and the following: system interruptions or failures, including cyber-security breaches, identity theft or other disruptions that could compromise our information; our inability to successfully leverage our existing client base by expanding the volume of claims reviewed and cross-selling additional solutions; our clients declining to renew their agreements with us or renewing at lower performance fee levels; our failure to innovate and develop new solutions for our clients; delays in implementing our solutions; our failure to maintain or upgrade our operational platforms; inability to develop new clients; improvements to healthcare claims and retail billing processes reducing the demand for our solutions or rendering our solutions unnecessary; loss of a large client; early termination provisions in our contracts; our failure to accurately estimate the factors upon which we base our contract pricing; our inability to manage our relationships with information suppliers, software vendors or utility providers; our inability to protect our intellectual property rights, proprietary technology, information, processes and know-how; our inability to execute our business plans including our inability to manage our growth; our inability to successfully integrate and realize synergies from any future acquisitions or strategic partnerships; our inability to realize the book value of intangible assets; our being required to pay significant refunds to CMS under our Medicare RAC contracts or significant changes to the Medicare RAC program; declines in contracts awarded through competitive bidding or our inability to re-procure contracts through the competitive bidding process; our success in attracting and retaining qualified employees and key personnel; our inability to expand our retail business; fluctuations in our results of operations; our failure to maintain effective internal controls; litigation, regulatory or dispute resolution proceedings, including claims or proceedings related to intellectual property infringements or claims not covered by insurance; healthcare spending fluctuations; consolidation among healthcare payers or retailers; slow development of the healthcare payment accuracy market; negative publicity concerning the healthcare payment industry or patient confidentiality and privacy; significant competition for our solutions; risks associated with international operations; general economic, political and market forces and dislocations beyond our control; variations in our revenue between reporting periods due to timing issues; our failure to comply with applicable federal, state, local and international privacy, security and data laws, regulations and standards; changes in regulations governing healthcare administration and policies, including governmental restrictions on the outsourcing of functions such as those that we provide; changes in tax laws and rules or in their interpretation or enforcement; the timing and magnitude of shares purchased under our share repurchase program; risks related to our substantial indebtedness and holding company structure; volatility in bank and capital markets; and provisions in our amended and restated certificate of incorporation. Additional factors or events that could cause our actual performance to differ from these forward-looking statements may emerge from time to time, and it is not possible for us to predict all of them. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, our actual financial condition, results of operations, future performance and business may vary in material respects from the performance projected in these forward-looking statements.

Any forward-looking statement made by us in this press release speaks only as of the date on which it is made. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Non-GAAP Financial Measures

The Company defines Adjusted Net Revenue as total net revenue less non-recurring revenue such as the Medicare RAC refunds and appeals release.  The Company defines Adjusted EBITDA as net income before depreciation and amortization, interest expense, other non-operating (income) expense such as foreign currency translation, income tax

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expense (benefit), transaction-related expenses and other, stock-based compensation and the adjustment related to the original Medicare RAC contract.  The Company defines Adjusted Net Income and Adjusted Net Income per Diluted Share as net income adjusted for non-cash and other non-recurring items. 

Management believes Adjusted Net Revenue is useful because it provides supplemental information about non-recurring revenue that is one-time in nature and should not be considered in run rate revenue expectations.  Management believes Adjusted EBITDA is useful because it provides meaningful supplemental information about our operating performance and facilitates period-to-period comparisons without regard to our financing methods, capital structure or other items that we believe are not indicative of our ongoing operating performance.  Management believes Adjusted Net Income is useful because it provides meaningful supplemental information about our operating performance and facilitates period-to-period comparisons without regard to non-cash expenses and other items that are one-time in nature.  In order to assure that all investors have access to similar data the Company has determined that it is appropriate to provide these non-GAAP financial measures.  Management believes we are enhancing investors’ understanding of our business and our results of operations, as well as assisting them in evaluating how well we are executing our strategic initiatives.  Adjusted EBITDA and Adjusted Net Income are intended as supplemental measures of our performance that is not required by, or presented in accordance with U.S. generally accepted accounting principles, or GAAP.  Adjusted EBITDA and Adjusted Net Income are not determined in accordance with GAAP, and should not be considered in isolation or as an alternative to net income, income from operations, net cash provided by operating, investing or financing activities or other financial statement data presented as indicators of financial performance or liquidity, each as presented in accordance with GAAP.

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Cotiviti Holdings, Inc.

Consolidated Balance Sheets

(In thousands)

	March 31,		December 31,
	2018		2017
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	189,297	$	165,518
Restricted cash		13,941		11,383
Accounts receivable, net of allowance for doubtful accounts of $17 and $176 at March 31, 2018 and December 31, 2017, respectively; and net of estimated allowance for refunds and appeals of $43,690 and $35,434 at March 31, 2018 and December 31, 2017, respectively		73,509		83,756
Prepaid expenses and other current assets		19,758		15,314
Total current assets		296,505		275,971
Property and equipment, net		81,684		77,340
Goodwill		1,251,549		1,251,364
Intangible assets, net		477,630		492,040
Other long-term assets		3,248		2,514
TOTAL ASSETS	$	2,110,616	$	2,099,229
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt	$	19,563	$	18,000
Customer deposits		13,941		11,383
Accounts payable and accrued other expenses		30,259		25,906
Accrued compensation costs		28,006		42,725
Estimated liability for refunds and appeals		9,367		61,607
Total current liabilities		101,136		159,621
Long-term liabilities:
Long-term debt		744,070		749,618
Other long-term liabilities		5,819		5,474
Deferred tax liabilities		88,900		83,048
Total long-term liabilities		838,789		838,140
Total liabilities		939,925		997,761
Commitments and contingencies
Stockholders' equity:
Common stock ($0.001 par value; 600,000,000 shares authorized, 92,941,484 and 92,299,294 issued and outstanding at March 31, 2018 and December 31, 2017, respectively)		93		92
Additional paid-in capital		948,247		933,710
Retained earnings		226,597		172,120
Accumulated other comprehensive loss		(4,246)		(4,454)
Total stockholders' equity		1,170,691		1,101,468
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	2,110,616	$	2,099,229

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Cotiviti Holdings, Inc.

Consolidated Statements of Comprehensive Income

(Unaudited, in thousands except per share data)

	Three Months Ended
	March 31,
	2018		2017
Net revenue	$	219,034	$	160,133
Cost of revenue (exclusive of depreciation and amortization, stated separately below):
Compensation		58,092		56,288
Other costs of revenue		6,473		6,686
Total cost of revenue		64,565		62,974
Selling, general and administrative expenses (exclusive of depreciation and amortization, stated separately below):
Compensation		35,180		24,693
Other selling, general and administrative expenses		18,766		16,879
Total selling, general and administrative expenses		53,946		41,572
Depreciation and amortization of property and equipment		7,242		5,575
Amortization of intangible assets		14,396		15,199
Transaction-related expenses		214		731
Total operating expenses		140,363		126,051
Operating income		78,671		34,082
Other expense (income):
Interest expense		9,177		8,421
Other non-operating (income) expense		(335)		(453)
Total other expense (income)		8,842		7,968
Income before income taxes		69,829		26,114
Income tax expense (benefit)		15,902		(861)
Net income	$	53,927	$	26,975
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		208		57
Change in fair value of derivative instruments		—		(62)
Total other comprehensive income (loss)		208		(5)
Comprehensive income	$	54,135	$	26,970
Earnings per share:
Basic	$	0.58	$	0.30
Diluted		0.57		0.28

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Cotiviti Holdings, Inc.

Consolidated Statements of Cash Flows

(Unaudited, in thousands)

	Three Months Ended
	March 31,
	2018		2017
Cash flows from operating activities:
Net income	$	53,927	$	26,975
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes		5,758		1,877
Depreciation and amortization		21,638		20,774
Stock-based compensation expense		8,646		2,083
Amortization of debt issuance costs		515		645
Accretion of asset retirement obligations		51		48
Changes in operating assets and liabilities:
Accounts receivable		10,247		5,663
Other assets		(5,209)		(2,612)
Accrued compensation		(14,719)		(29,210)
Accounts payable and accrued other expenses		5,515		(841)
Estimated liability for refunds and appeals		(52,240)		(774)
Other long-term liabilities		338		247
Other		249		(303)
Net cash provided by operating activities		34,716		24,572
Cash flows from investing activities:
Expenditures for property and equipment		(12,385)		(9,660)
Net cash used in investing activities		(12,385)		(9,660)
Cash flows from financing activities:
Proceeds from issuance of common stock under equity plans		5,923		7,360
Repayment of debt		(4,500)		(4,500)
Net cash provided by financing activities		1,423		2,860
Effect of foreign exchanges on cash and cash equivalents		25		51
Net increase in cash, cash equivalents and restricted cash		23,779		17,823
Cash, cash equivalents and restricted cash at beginning of period		165,518		110,635
Cash, cash equivalents and restricted cash at end of the period	$	189,297	$	128,458
Supplemental disclosures of cash flow information:
Cash paid for income taxes	$	1,030	$	649
Cash paid for interest		7,900		7,587
Noncash investing activities (accrued property and equipment purchases)		4,750		6,738

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Reconciliation of Net Revenue to Adjusted Net Revenue

	Three Months Ended
	March 31,				Percent
(unaudited, in thousands)	2018		2017		Change
Net revenue	$	219,034	$	160,133	37	%
Original Medicare RAC contract adjustment(a)		46,556		—	NM
Adjusted net revenue	$	172,478	$	160,133	8	%

^(a) Revenue includes $46,556 during the three months ended March 31, 2018 related to the release of the estimated liability for refunds and appeals under our original Medicare RAC contract, which expired on January 31, 2018. This amount was previously recorded as a reduction to revenue in prior periods during the contract term.

Reconciliation of Net Income to Adjusted EBITDA

	Three Months Ended
	March 31,						Percent
(unaudited, in thousands)	2018			2017			Change
Net income	$	53,927		$	26,975		100	%
Adjustments to net income:
Depreciation and amortization		21,638			20,774		4	%
Interest expense		9,177			8,421		9	%
Other non-operating (income) expense(a)		(335)			(453)		(26)	%
Income tax expense (benefit)		15,902			(861)		NM
Transaction-related expenses and other(b)		214			731		(71)	%
Stock-based compensation(c)		8,646			2,083		315	%
Original Medicare RAC contract adjustment(d)		(45,351)			—		NM
Adjusted EBITDA	$	63,818		$	57,670		11	%
% of adjusted revenue		37.0	%		36.0	%

^(a) Represents other non-operating (income) expense that consists primarily of interest income and gains and losses on transactions settled in foreign currencies. Income received for certain sub-leases is included herein.

^(b) Represents transaction-related expenses primarily associated with our secondary offerings as well as certain corporate development activity.

^(c) Represents expense related to equity incentive awards granted to certain employees, officers and non-employee directors as long-term incentive compensation and restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable.

^(d) Represents the release of the estimated liability for refunds and appeals and related expense, under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term.

Reconciliation of Net Income to Adjusted Net Income

	Three Months Ended
	March 31,				Percent
(unaudited, in thousands)	2018		2017		Change
Net income	$	53,927	$	26,975	100	%
Adjustments to net income:
Amortization of acquired intangible assets - non tax deductible		11,377		10,402	9	%
Amortization of acquired intangible assets - tax deductible		3,019		4,797	(37)	%
Transaction-related expenses and other(a)		214		731	(71)	%
Stock-based compensation - non tax deductible(b)		5,767		—	NM
Stock-based compensation - tax deductible(c)		2,879		2,083	38	%
Tax effect of above adjustments(d)		(1,474)		(2,615)	(44)	%
Tax benefit related to equity awards		(2,600)		(10,422)	(75)
Original Medicare RAC contract adjustment, net of tax(e)		(34,013)		—	NM
Adjusted Net Income	$	39,096	$	31,951	22	%
Weighted average shares of common stock - Diluted (000s)		95,252		94,905	NM
Adjusted Net Income per diluted share	$	0.41	$	0.34	21	%

^(a) Represents transaction-related expenses primarily associated with our secondary offerings as well as certain corporate development activity.

^(b) Represents expense related to restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable.

^(c) Represents expense related to equity incentive awards granted to certain employees, officers and non‑employee directors as long‑term incentive compensation. We recognize the related expense for these awards ratably over the vesting period.

^(d) This line represents the tax impact of the amortization of acquired intangible assets - tax deductible and stock-based compensation – tax deductible. The tax rate assumed is 25% and 38% for the three months ended March 31, 2018  and 2017, respectively. 

^(e) Represents the release of the estimated liability for refunds and appeals and related expense, net of tax, under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term.

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Adjusted EBITDA 2018 Guidance Reconciliation

(unaudited, in millions)

	2018 Guidance Range
	Low		High
Net income(a)	$	140	$	155
Adjustments to net income:
Depreciation and amortization		90		90
Interest expense		45		40
Other non-operating (income) expense(b)		(2)		(3)
Income tax expense(c)		37		43
Stock-based compensation(d)		30		30
Original Medicare RAC contract adjustment(e)		(45)		(45)
Adjusted EBITDA	$	295	$	310

^(a) Net income reflects the impact of the release of the estimated liability for refunds and appeals and related expense, under our original Medicare RAC contract, which expired on January 31, 2018.

^(b) Represents other non-operating (income) expense that consists primarily of interest income and gains and losses on transactions settled in foreign currencies. Income received for certain sub-leases is included herein.

^(c) Income tax expense for 2018 assumes an effective tax rate of approximately 25% excluding the impact of the benefit related to stock option exercises, restricted stock units and non-deductible stock-based compensation.

^(d) Represents expense related to equity incentive awards granted to certain employees, officers and non-employee directors as long-term incentive compensation and restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable.

^(e) Represents the release of the estimated liability for refunds and appeals and related expense,  under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term.

Investor and Media Contact

Cotiviti Holdings, Inc.

Jennifer DiBerardino

Vice President, Investor Relations

203-642-0718

Investor.Relations@Cotiviti.commailto:Investor.relations@cotiviti.com

Media@Cotiviti.com

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EX-99.2

Exhibit 99.2

Analytics. Insight. Value. Cotiviti 2018 First Quarter Financial Supplement As of March 31, 2018

Cotiviti Holdings, Inc. 2018 Revenue by Segment Healthcare Retrospective claims accuracy(a) Prospective claims accuracy Other $ 133,923 58,285 8,163 $ 77,516 59,717 2,570 73 % (2) 218 % % Global Retail and Other Retrospective claims accuracy Other 18,663 - 19,674 656 (5) NM % % a)Revenue includes $46,556 during the three months ended March 31, 2018 related to the release of the estimated liability for refunds and appeals under our original Medicare RAC contract, which expired on January 31, 2018. This amount was previously recorded as a reduction to revenue in prior periods during the contract term. Refer to reconciliation of revenue to adjusted net revenue. 2 18,66320,330(8) % $219,034$160,13337 % Total Global Retail and Other Consolidated Net Revenue(a) 200,371139,80343 % Total Healthcare(a) Three Months Ended March 31, 20182017Change (unaudited, $ in thousands)

Cotiviti Holdings, Inc. 2018 Adjusted Net Revenue (Non-GAAP) Original Medicare RAC contract adjustment (a) 46,556 - NM % Adjusted Net Revenue (b) Healthcare Retrospective claims accuracy Prospective claims accuracy Other $ 133,923 58,285 8,163 $ 46,556 - - $ 87,367 58,285 8,163 $ 77,516 59,717 2,570 13 % (2) % 218 % Global Retail and Other Retrospective claims accuracy Other 18,663 - - - 18,663 - 19,674 656 (5) % NM % Total Global Retail and Other Consolidated Net Revenue a)Revenue includes $46,556 during the three months ended March 31, 2018 related to the release of the estimated liability for refunds and appeals under our original Medicare RAC contract, which expired on January 31, 2018. This amount was previously recorded as a reduction to revenue in prior periods during the contract term. b)Adjusted net revenue is a non-GAAP financial measure. Therefore, it should not be considered a substitute for net revenue prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Management believes adjusted net revenue is meaningful as it excludes the impact of a non-recurring revenue adjustment related to the release of a liability associated with our original Medicare RAC contract, which expired on January 31, 2018. 3 18,663-18,66320,330(8) % $219,034$46,556$172,478$160,1338 % 200,37146,556153,815139,80310 % Total Healthcare Three Months Ended March 2018 31, 2017 Net RevenueChange NetAdjusted Net RevenueAdjustment(a)Revenue(b) (unaudited, $ in thousands) $ 172,478 $ 160,133 8 % $ 219,034 $ 160,133 37 % Net Revenue Three Months Ended March 31, 2018 2017 Change (unaudited, $ in thousands) 3

Cotiviti Holdings, Inc. 2018 Consolidated Statement of Operations (unaudited, $ in thousands) Change Net revenue $ 219,034 $ 160,133 37 % Cost of revenue 64,565 62,974 3 % Selling, general and administrative expenses 53,946 41,572 30 % Depreciation and amortization of property and equipment 7,242 5,575 30 % Amortization of intangible assets 14,396 15,199 (5) % Transaction-related expenses 214 731 (71) % Total Operating Expenses 140,363 126,051 11 % Operating income 78,671 34,082 131 % Other expense (income) 8,842 7,968 11 % Income tax expense (benefit) 15,902 (861) NM % Net Income $ 53,927 $ 26,975 100 % Earnings per share: Basic $ 0.58 $ 0.30 Diluted 0.57 0.28 Effective Tax Rate 22.8 % (3.3) % Cost of revenue supplemental information: Cost of revenue $ 64,565 $ 62,974 3 % Stock-based compensation 715 466 53 % Original Medicare RAC contract variable compensation 1,205 - NM % Cost of revenue, adjusted 62,645 62,508 0 % Selling, general and administrative expenses supplemental information: Selling, general and administrative expenses 53,946 41,572 30 % Stock-based compensation 7,931 1,617 390 % Selling, general and administrative expenses, adjusted 46,015 39,955 15 % Total operating expenses (a) 118,511 104,546 13 % Total operating expenses, adjusted (b) $ 108,660 $ 102,463 6 % a) Excludes depreciation and amortization and transaction-related expenses. b) Excludes depreciation and amortization, transaction-related expenses, stock-based compensation and variable compensation related to the original Medicare RAC contract. Three Months Ended March 31, 2018 2017

Cotiviti Holdings, Inc. 2018 Adjusted EBITDA (Non-GAAP) Adjustments to net income: Depreciation and amortization Interest expense Other non-operating (income) expense(a) Income tax expense (benefit) Transaction-related expenses and other(b) Stock-based compensation(c) Original Medicare RAC contract adjustment(d) 21,638 9,177 (335) 15,902 214 8,646 (45,351) 20,774 8,421 (453) (861) 731 2,083 - 4 % 9 % (26) % NM % (71) % 315 % NM % % of adjusted revenue 37.0% 36.0% a) Represents other non-operating (income) expense that consists primarily of interest income and gains and losses on transactions settled in foreign currencies. Income received for certain sub-leases is included herein. Represents transaction-related expenses primarily associated with our secondary offerings as well as certain corporate development activity. Represents expense related to equity incentive awards granted to certain employees, officers and non-employee directors as long-term incentive compensation and restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable. Represents the release of the estimated liability for refunds and appeals and related expense, under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term. b) c) d) 5 $63,818$57,67011 % Adjusted EBITDA $53,927$26,975100 % Net Income Three Months Ended March 31, 20182017Change (unaudited, $ in thousands)

Cotiviti Holdings, Inc. 2018 Adjusted Net Income (Non-GAAP) Adjustments to net income: Amortization of acquired intangible assets - non tax deductible Amortization of acquired intangible assets - tax deductible Transaction-related expenses and other(a) Stock-based compensation - non tax deductible(b) Stock-based compensation - tax deductible(c) Tax effect of above adjustments (d) Tax benefit related to equity awards Original Medicare RAC contract adjustment, net of tax (e) 11,377 3,019 214 5,767 2,879 (1,474) (2,600) (34,013) 10,402 4,797 731 - 2,083 (2,615) (10,422) - 9 % (37) % (71) % NM % 38 % (44) % (75) % NM % Weighted average shares of common stock - Diluted (000s) 95,252 94,905 NM % a) b) Represents transaction-related expenses primarily associated with our secondary offerings as well as certain corporate development activity. Represents expense related to restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable. Represents expense related to equity incentive awards granted to certain employees, officers and non-employee directors as long-term incentive compensation. We recognize the related expense for these awards ratably over the vesting period. This line represents the tax impact of the amortization of acquired intangible assets - tax deductible and stock-based compensation – tax deductible. The tax rate assumed is 25% and 38% for the three months ended March 31, 2018 and 2017, respectively. Represents the release of the estimated liability for refunds and appeals and related expense, net of tax, under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term. c) d) e) 6 $ 0.41 $ 0.34 22 % Adjusted Net Income per Diluted Share $ 39,096 $ 31,951 22 % Adjusted Net Income $ 53,927 $ 26,975 100 % Net Income Three Months Ended March 31, 2018 2017 Change (unaudited, $ in thousands)

Cotiviti Holdings, Inc. 2018 Adjusted EBITDA Guidance (Non-GAAP) Net income reflects the impact of the release of the estimated liability for refunds and appeals and related expense, under our original Medicare RAC contract, which expired on January 31, 2018. Represents other non-operating (income) expense that consists primarily of interest income and gains and losses on transactions settled in foreign currencies. Income received for certain sub-leases is included herein. Income tax expense for 2018 assumes an effective tax rate of approximately 25% excluding the impact of the benefit related to stock option exercises, restricted stock units and non-deductible stock-based compensation. Represents expense related to equity incentive awards granted to certain employees, officers and non-employee directors as long-term incentive compensation and restricted stock issued in connection with the RowdMap Acquisition. We recognize the related expense for these awards ratably over the vesting period or as achievement of performance criteria become probable. Represents the release of the estimated liability for refunds and appeals and related expense, under our original Medicare RAC contract, which expired on January 31, 2018. The gross revenue impact of $46,556 was previously recorded as a reduction to revenue in prior periods during the contract term. j (unaudited, in millions) Low High Net Income (a) 140 $ 155 $ Adjustments to net income: Depreciation and amortization 90 90 Interest expense 45 40 Other non-operating (income) expense (b) (2) (3) Income tax expense (c) 37 43 Stock-based compensation (d) 30 30 Original Medicare RAC contract adjustment (e) (45) (45) Adjusted EBITDA 295 $ 310 $

Cotiviti Holdings, Inc. Cash Flow Data Free cash flow is a non-GAAP financial measure. Therefore, it should not be considered a substitute for income or cash flow data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. The Company defines free cash flow as net cash provided by operating activities less capital expenditures. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. Management believes free cash flow is meaningful as it is used by management and investors as a measure and indicator of the financial strength of the company and its ability to generate cash. Operating Cash Flow $ 34,716 $ 24,572 Capital Expenditures 12,385 9,660 Free Cash Flow (a) $ 22,331 $ 14,912 Repurchase of Common Stock $ - $ - (unaudited, $ in thousands) Three Months Ended March 31, 2018 2017

Cotiviti Holdings, Inc. Consolidated Balance Sheet Data (unaudited) Cash and cash equivalents Total assets Total long-term debt(a) Total liabilities Total stockholders’ equity $ 189,297 2,110,616 763,633 939,925 1,170,691 $ 165,518 2,099,229 767,618 997,761 1,101,468 Net debt leverage Working capital 2.1x 195,369 2.3x 116,350 a) Includes the current portion of our long-term debt and is net of debt issuance costs. 9 December 31, 2017 March 31, 2018 ($ in thousands)

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