bios-20211104
FALSE000101473900010147392021-11-042021-11-04

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
  
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported)
November 4, 2021
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OPTION CARE HEALTH, INC.
(Exact name of registrant as specified in its charter)
Delaware
001-11993
05-0489664
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification Number)
 
3000 Lakeside Dr. Suite 300N, Bannockburn, IL 60015
(Address of principal executive offices)
 
(312) 940-2443
(Registrant's telephone number, including area code)
 
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:
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. ¨

 Securities registered pursuant to Section 12(b) of the Act:
Title of each ClassTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.0001 par value per shareOPCHNasdaq Global Select Market


















 



Item 2.02. Results of Operations and Financial Condition.

On November 4, 2021, Option Care Health, Inc. issued a press release reporting its third quarter 2021 financial results. A copy of the press release is furnished with this Form 8-K and attached hereto as Exhibit 99.1.
 
The press release includes certain non-GAAP financial measures described therein. Reconciliation between any non-GAAP financial measures presented and the most directly comparable GAAP financial measures is also provided.

The information in this Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.
 
Item 9.01. Financial Statements and Exhibits
 
(d) Exhibits
 
Exhibit No.Description
 
   
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.
 
Option Care Health, Inc.
Date:
November 4, 2021
By:/s/ Michael Shapiro
Michael Shapiro
Chief Financial Officer

Document

 
Exhibit 99.1
 
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OPTION CARE HEALTH ANNOUNCES FINANCIAL RESULTS FOR THE THIRD QUARTER ENDED SEPTEMBER 30, 2021
BANNOCKBURN, IL., November 4, 2021 - Option Care Health, Inc. (the “Company” or “Option Care Health”) (Nasdaq: OPCH), the nation’s largest independent provider of home and alternate site infusion services, announced today financial results for the third quarter ended September 30, 2021.
Third Quarter 2021 Financial Highlights
Net revenue of $891.9 million, up 14.1% compared to $781.6 million in the third quarter of 2020
Gross profit of $203.0 million, or 22.8% of net revenue, up 16.5% compared to $174.2 million, or 22.3% of revenue, in the third quarter of 2020
Net income of $35.5 million, or $0.20 per share, compared to net income of $1.7 million, or $0.01 per share, in the third quarter of 2020
Adjusted EBITDA of $78.0 million, up 31.7% compared to $59.2 million in the third quarter of 2020
Cash flow from operations of $51.2 million compared to a cash flow of $48.3 million in the third quarter of 2020
Cash balances of $200.9 million at the end of the third quarter

John C. Rademacher, Chief Executive Officer, commented, “The Option Care Health team continues to execute on our mission of delivering extraordinary patient care in a challenging environment. The third quarter results reflect the dedication of the entire team and our ability to generate profitable growth and significant cash flow. While navigating the current pandemic situation, we are investing for future growth, including the recently announced acquisition of Infinity Infusion Nursing.”

Full Year 2021 Guidance
For the full year 2021, Option Care Health is revising its financial guidance as follows:
Net Revenue of $3.35 billion to $3.50 billion (unchanged)
Adjusted EBITDA of $283 million to $288 million
Cash Flow from Operations of at least $180 million

Conference Call
The Company will host a conference call this morning at 8:30 a.m. E.T. which can be accessed by dialing (866) 360-3136 and referencing conference ID 2812558; or via a live audio webcast that will be available online at https://investors.optioncarehealth.com. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.
About Option Care Health



Option Care Health is the nation’s largest independent provider of home and alternate site infusion services. With over 5,000 teammates, including approximately 2,900 clinicians, we work compassionately to elevate standards of care for patients with acute and chronic conditions in all 50 states. Through our clinical leadership, expertise and national scale, Option Care Health is reimagining the infusion care experience for patients, customers and teammates. To learn more, please visit our website at OptionCareHealth.com.
Investor Contacts
Mike ShapiroBob East, Asher Dewhurst, Jordan Kohnstam
Chief Financial OfficerWestwicke
T: (312) 940-2538T: (413) 213-0500
mike.shapiro@optioncare.comoptioncarehealth@westwicke.com
Forward-Looking Statements - Safe Harbor
This press release may contain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “believe,” “project,” “estimate,” “expect,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we may make regarding future revenues, future earnings, regulatory developments, market developments, new products and growth strategies, integration activities and the effects of any of the foregoing on our future results of operations or financial conditions.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) changes in laws and regulations applicable to our business model; (ii) changes in market conditions and receptivity to our services and offerings; (iii) results of litigation; (iv) the loss of one or more key payers; and (v) the spread and impact of the COVID-19 pandemic. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not limited to our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, as filed with the SEC.
Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
Note Regarding Use of Non-GAAP Financial Measures
In addition to reporting financial information in accordance with generally accepted accounting principles (GAAP), the Company is also reporting Adjusted EBITDA, which is a non-GAAP financial measure. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be used in isolation or as a substitute or alternative to net income, operating income or any other performance measure derived in accordance with GAAP, or as a substitute or alternative to cash flow from operating activities or



a measure of the Company’s liquidity. In addition, the Company's definition of Adjusted EBITDA may not be comparable to similarly titled non-GAAP financial measures reported by other companies. Adjusted EBITDA, as defined by the Company, represents net income before net interest expense, income tax expense, depreciation and amortization, stock-based compensation expense, and restructuring, integration and other expenses. As part of restructuring, integration and other expenses, the Company may incur significant charges such as the write down of certain long−lived assets, temporary redundant expenses, professional fees, potential retention and severance costs and potential accelerated payments or termination costs for certain of its contractual obligations. Management believes that Adjusted EBITDA provides useful supplemental information regarding the performance of Option Care Health’s business operations and facilitates comparisons to the Company’s historical operating results. For a full reconciliation of Adjusted EBITDA to the most comparable GAAP financial measure, please see the attachment to this earnings release.




  Schedule 1

OPTION CARE HEALTH, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(unaudited)
September 30,December 31,
20212020
ASSETS
CURRENT ASSETS:
   Cash and cash equivalents$200,856 $99,265 
   Accounts receivable, net
355,650 328,340 
   Inventories189,830 158,601 
   Prepaid expenses and other current assets64,848 70,806 
Total current assets811,184 657,012 
NONCURRENT ASSETS:
   Property and equipment, net
106,788 121,149 
   Intangible assets, net343,764 351,052 
   Goodwill1,428,610 1,428,610 
   Other noncurrent assets95,798 89,616 
Total noncurrent assets1,974,960 1,990,427 
TOTAL ASSETS $2,786,144 $2,647,439 
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable$318,561 $282,913 
Other current liabilities167,103 151,110 
Total current liabilities485,664 434,023 
NONCURRENT LIABILITIES:
Long-term debt, net of discount, deferred financing costs and current portion1,117,823 1,115,103 
Other noncurrent liabilities85,177 82,589 
Total noncurrent liabilities1,203,000 1,197,692 
Total liabilities1,688,664 1,631,715 
STOCKHOLDERS’ EQUITY1,097,480 1,015,724 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$2,786,144 $2,647,439 




Schedule 2

OPTION CARE HEALTH, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
 
Three Months Ended September 30,Nine Months Ended September 30,
2021202020212020
NET REVENUE$891,937 $781,609 $2,511,446 $2,227,897 
COST OF REVENUE688,969 607,456 1,944,037 1,729,395 
GROSS PROFIT202,968 174,153 567,409 498,502 
OPERATING COSTS AND EXPENSES:
Selling, general and administrative expenses134,633 123,000 388,930 377,198 
Depreciation and amortization expense15,452 16,597 48,410 54,892 
Total operating expenses150,085 139,597 437,340 432,090 
OPERATING INCOME52,883 34,556 130,069 66,412 
OTHER INCOME (EXPENSE):
Interest expense, net(16,000)(24,583)(52,717)(84,102)
Other, net1,680 (7,554)(7,825)(5,958)
Total other expense(14,320)(32,137)(60,542)(90,060)
INCOME (LOSS) BEFORE INCOME TAXES38,563 2,419 69,527 (23,648)
INCOME TAX EXPENSE3,087 756 5,096 2,267 
NET INCOME (LOSS)$35,476 $1,663 $64,431 $(25,915)
Earnings (loss) per share, basic and diluted$0.20 $0.01 $0.36 $(0.14)



Schedule 3

OPTION CARE HEALTH, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
 
Nine Months Ended September 30,
20212020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)$64,431 $(25,915)
Adjustments to reconcile net income (loss) to net cash provided by operations:
Depreciation and amortization expense52,820 60,054 
Other non-cash adjustments32,842 39,503 
Changes in operating assets and liabilities:
Accounts receivable, net(27,310)3,496 
Inventories(31,472)(39,602)
Accounts payable35,648 66,508 
Other16,300 (2,316)
Net cash provided by operating activities143,259 101,728 
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment(11,744)(12,871)
Other investing cash flows— 541 
Business acquisitions, net of cash acquired(18,852)— 
Net cash used in investing activities(30,596)(12,330)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt355,200 — 
Retirement of debt obligations(352,009)(125,000)
Net proceeds from issuance of common stock— 118,934 
Deferred financing costs(2,880)— 
Other financing cash flows(11,383)(10,341)
Net cash (used in) provided by financing activities(11,072)(16,407)
NET INCREASE IN CASH AND CASH EQUIVALENTS101,591 72,991 
Cash and cash equivalents - beginning of the period99,265 67,056 
CASH AND CASH EQUIVALENTS - END OF PERIOD$200,856 $140,047 




Schedule 4
OPTION CARE HEALTH, INC.
QUARTERLY RECONCILIATION BETWEEN GAAP AND NON-GAAP MEASURES
(IN THOUSANDS)
(UNAUDITED)
Three Months Ended 
 September 30,
Nine Months Ended September 30,
2021202020212020
Consolidated net income (loss)$35,476 $1,663 $64,431 $(25,915)
Interest expense, net16,000 24,583 52,717 84,102 
Income tax expense3,087 756 5,096 2,267 
Depreciation and amortization expense17,115 18,241 52,820 60,054 
Consolidated EBITDA71,678 45,243 175,064 120,508 
EBITDA adjustments
Accounting principle changes and non-cash charges— — — — 
Stock-based incentive compensation2,516 1,170 6,246 2,588 
Loss on extinguishment of debt— 8,349 12,403 8,349 
Restructuring, acquisition, integration and other3,808 4,461 9,342 22,580 
Consolidated adjusted EBITDA$78,002 $59,223 $203,055 $154,025