AMN Healthcare Services Inc

Ladies and gentlemen, thank you for standing by, and welcome to the AMN Healthcare fourth quarter and full year 2019 earnings call. At this time, all participants are in a listen-only mode, and later you will have an opportunity to ask questions. Instructions will be given at that time. If you should require assistance during the call, you may press star and then zero. As a reminder, this conference is being recorded. I would now like to turn the conference over to our host, Randy Reese. Please go ahead.

Good afternoon, everyone. Welcome to AMN HealthCare's fourth quarter and full year 2019 earnings call. A replay of this webcast will be available at amnhealthcare.investorroom.com following the conclusion of this call. Details for the audio replay of the conference call also are in our earnings release issued this afternoon. Various remarks we make during this call about future expectations, projections, plans, events, or circumstances constitute forward-looking statements. These statements reflect the company's current beliefs based upon information currently available to it. Our actual results may differ materially from those indicated by these forward-looking statements as a result of various factors, including those identified in our most recent Form 10-K and subsequent filings with the SEC. The company does not intend to update the guidance or any forward-looking statements provided today prior to its next earnings release. This call contains certain non-GAAP financial information. Information regarding and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in our earnings release and on our financial reports page at amnhealthcare.investorroom.com. On the call today are Susan Salka, Chief Executive Officer, Brian Scott, Chief Financial Officer, Kelly Rakowski, President of Leadership and Search, Ralph Henderson, President of Professional Services and Staffing, and Dan White, President of Workforce Solutions. I will now turn the call over to Susan.

Thanks so much, Randy, and welcome everyone to our fourth quarter and full year 2019 earnings call. The team at AMN is very excited to be entering this new decade in such a strong position and in a promising market. We continue to see the effects of an unprecedented demographic change resulting in increased demand for healthcare services and significant workforce shortages. We help healthcare organizations successfully navigate this high demand era with our total talent solutions. At the same time, the AMN commitment to social responsibility and good governance aligns with our clients and other stakeholders' initiatives and enables us to make a greater positive impact in our communities. Our team has worked hard to become the most trusted, innovative expert in total talent solutions. Working together with healthcare organizations and professionals We are always ready when our clients and their patients need us most. Our strategy progressed in 2019 with the June acquisition of Advanced Medical, an innovative provider of therapy and nurse staffing to both healthcare facilities and schools. This acquisition provided us important capabilities and capacity to address the growing labor needs of our clients across multiple settings. Eight months into the integration, things are going very smoothly, and we continue to be impressed with the talent that has joined the AMN family. Allied Staffing was a standout performer in 2019, reaching $323 million in annual revenue, 29% higher than the previous year. Other high performing but smaller businesses included International Nurse Staffing, rapid response, labor disruption, and our predictive analytics and scheduling business. Our other workforce solution segment revenue reached a record $477 million in 2019, reflecting AMN's focus on increasing our strategic workforce solution capabilities. Within this segment, we consolidated our interim leadership and permanent placement businesses into an integrated leadership solutions division. This move strengthened our go-to-market strategy and bolstered support of our key brands. In January of 2020, we announced the signing of an agreement to acquire Stratus Video, the leader in providing remote video healthcare interpretation services. We are pleased to share that earlier this week, we received regulatory approval for this acquisition and we expect to close tomorrow. Qualified healthcare interpretation, which is mandated by federal and state regulations, is a service that many healthcare organizations do not have the resources to provide for themselves. This acquisition helps further AMN's ability to deliver quality, compassionate patient care, and to increase efficiency. It also aligns with our commitment to equality and inclusion by supporting greater access to care for limited English proficient patients, deaf and hard of hearing individuals, along with their families. In our market leadership position, we feel a responsibility to develop more ways to help our clients deal with the intensifying challenges of labor supply and complex healthcare demands. Some of our new capabilities and solutions will come from internal development. For example, we are working with healthcare professionals to develop mobile applications designed to create a personalized experience. Our team is also providing ways for clinicians to seamlessly interact with us across multiple channels around the clock. For clients, we are enhancing their access to richer data and insights, and we are leveraging our investments in VMS, credentialing, scheduling, and predictive analytics to create a more integrated platform. To further broaden our workforce technology solutions, we recently acquired Before Health, a technology innovator with an integrated float pool management solution and VMS for healthcare facilities. These are just a few examples of how AMN's strategy guides our decisions and execution. Over the next year, we certainly have a lot of work to do to translate these investments into the expected benefits for our clients, candidates, patients, team members, and our shareholders. Fortunately, we have an incredibly talented and committed team, and we feel extremely confident in our ability to meet our high expectations. Now, let's take a few moments to look in the rearview mirror and discuss our strong results for the fourth quarter. We reached another record high in revenue at $587 million. Gross margin was 33.6%, and adjusted EBITDA was $75 million, or 12.9% of revenue. Our nurse and allied segment posted revenue of $389 million, 18% higher year over year, with 6% organic growth. Segment revenue beat expectations on exceptional results in our labor disruption and rapid response nursing businesses. Our largest business, travel nurse staffing, grew revenue 9% year over year. Demand remained very strong in the fourth quarter, and the strength has carried into 2020. Lately, hours and bill rates are also improving, but not quite enough to accelerate new supply into the industry. Allied reported 45% revenue growth in the fourth quarter, including our acquisition of Advanced. Organic growth for the quarter was 7%. As we previously noted and expected, demand in Allied staffing was tempered by a slowdown among our skilled nursing clients due to reimbursement changes. This has been offset by growth in other specialties, particularly speech therapy, imaging, respiratory, and lab professionals. In the first quarter, we expect nurse and allied revenue to be up 14 to 16% year over year with a combination of organic growth and the benefit of our advanced acquisition. In the locum tenens segment, fourth quarter revenue was 78 million. Volume was roughly in line with our expectations but revenue was impacted by a higher mix of lower rate specialties and a negative sales adjustment. Recently, booking trends have been favorable, and we believe locum's revenue will be flat to up slightly year-over-year in the first quarter. Our other workforce solution segment recorded fourth quarter revenue of $120 million, up 2% year-over-year. Our leadership solutions division makes up more than half of this segment's revenue and had a very solid quarter of performance, growing revenue at 7% year over year. Our technology workforce solutions, which include our vendor management systems and workforce optimization, performed well again and grew double digits year over year in the fourth quarter. The one business that was down year over year in this segment is revenue cycle solutions. This was due primarily to disruption created by some organizational changes we made throughout 2019. As we begin the new year, we expect gains in most of the businesses within this segment and are projecting the other workforce solution segment revenue to be up 2% to 3% year over year on an organic basis. With the addition of B4 Health and Stratus, The other workforce solutions revenue is expected to be up 15 to 16 percent year-over-year in the first quarter. Overall, we are very pleased with our latest results and the outlook for 2020. As importantly, we are proud of the impact and commitment to AMN's purpose shared by our extraordinary team members every day. I am inspired by the talents and passion exhibited by my colleagues through both our work with clients and healthcare professionals and in our communities. I can never say enough just how grateful we are for all they do. In a few minutes, Kelly, Ralph, and Dan will join us for the question and answer session. On future calls, we're going to mix things up a bit and we'll include one or two different leaders to discuss particular aspects of our business. For example, we expect to have one of the Stratus leaders join us on our next earnings call. We hope this will provide our investors and analysts with a broader and deeper view into the business. Now I will turn the call over to Brian, who will provide more insights into our financial results.