Business Wire | Aug 2, 2021 04:05PM EDT

Acadia Healthcare Reports Second Quarter 2021 Results and Increases 2021 Guidance

Aug. 02, 2021

FRANKLIN, Tenn.--(BUSINESS WIRE)--Aug. 02, 2021--Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced financial results for the second quarter ended June 30, 2021.

Second Quarter 2021 Results

The Company reported revenue of $582.2 million for the second quarter of 2021, compared with $491.5 million for the second quarter of 2020. Adjusted EBITDA increased 25.2% to $141.3 million for the second quarter of 2021, compared with $112.8 million for the same period last year. Net income attributable to Acadia stockholders for the second quarter of 2021 was $44.5 million, or $0.49 per diluted share, compared with net income of $41.1 million, or $0.46 per diluted share, for the second quarter of 2020. Adjusted income from continuing operations attributable to Acadia stockholders per diluted share was $0.71 for the second quarter of 2021. Adjustments to income include transaction-related expenses, debt extinguishment costs, loss on impairment and the income tax effect of adjustments to income. A reconciliation of all non-GAAP financial results in this press release begins on page 9. During the second quarter of 2020, the Company recognized $18.1 million in other income from the Provider Relief Fund ("PRF") established by the Coronavirus Aid, Relief, and Economic Security ("CARES") Act.

For the second quarter of 2021, Acadia's same facility revenue increased 18.0% compared with the second quarter of 2020, including an increase in patient days of 9.8% and an increase in revenue per patient day of 7.5%. In the second quarter of 2020, the Company experienced lower patient days due to the impact of the COVID-19 pandemic and related restrictions, which resulted in a year-over-year decline of 0.7% for the second quarter of 2020 compared to the prior year period. Adjusting prior year patient days for the estimated impact from the pandemic, patient days increased approximately 4.8% for the second quarter of 2021. Same facility adjusted EBITDA margin improved 180 basis points to 29.3%.

Debbie Osteen, Chief Executive Officer of Acadia, remarked, "We are pleased with the momentum in our business as Acadia delivered a strong financial and operating performance in the second quarter of 2021. These results reflect increased demand for our behavioral health services and our continued focus on driving efficiencies across our operations. We experienced favorable volume trends, demonstrating the strength of our proven operating model and successful execution of our growth strategy across our service lines, all of which provide exceptional patient care. Importantly, the growing acceptance surrounding mental health and substance abuse issues and the more favorable reimbursement environment for treatment have also been key drivers of demand. We commend the hard work of Acadia's dedicated employees and clinicians who have continued to support more patients who need our help with high quality care in a safe and accessible manner."

Strategic Investments in Long-Term Growth

"Our growth strategy is centered around four distinct pathways that will allow Acadia to reach more patients in both new and existing markets. We are pleased with the progress we have made this year on our strategy, as we have continued to make strategic investments designed to support long-term growth across our service lines. Facility expansions continue to be a key driver of our growth and the best return on investment. Accordingly, we added 86 beds to our operations in the second quarter, which included 72 incremental beds from the opening of a 260-bed state-of-the-art, replacement facility for Belmont Behavioral Hospital. This facility will help meet the growing demand for behavioral health services in the Philadelphia, Pennsylvania, market and surrounding communities. With the opening of the new facility, we recorded a non-cash property impairment of approximately $23.2 million for the existing facility. We expect to meet our goal of adding approximately 300 beds to existing facilities by the end of the year.

"Another important growth opportunity for Acadia is the development of wholly owned de novo facilities, especially in markets with a shortage of beds for behavioral health treatment. On May 24, 2021, we opened Glenwood Behavioral Health Hospital, an 80-bed hospital in Cincinnati, Ohio. This facility provides inpatient psychiatric treatment for those who are struggling with a mental health or a co-occurring substance use disorder.

"We also opened one comprehensive treatment center (CTC) in the second quarter of 2021. We continue to identify underserved markets for the treatment of patients with opioid use disorder and expect to open eight more CTCs this year.

"As health systems across the country look for ways to integrate behavioral health care and expand treatment options, Acadia has developed a favorable reputation as a preferred partner for many leading providers in attractive markets and establishing new joint venture partnerships remains an important pathway for growth. We recently announced a joint venture with Bronson Healthcare, one of Michigan's leading, integrated healthcare systems, to build a new 96-bed facility in Battle Creek, Michigan. With this addition, we now have 13 joint venture partnerships in place with premier health systems to expand our treatment network and improve access to care in more communities around the country.

"We also have continued to identify acquisitions as another important opportunity to extend our market reach. Following regulatory approval, we expect to soon complete the acquisition of Vallejo Behavioral, a 61-bed psychiatric hospital in Vallejo, California, from Adventist Health at the end of the third quarter. We believe the fragmented behavioral healthcare industry offers additional prospects for acquisitions, and we are well positioned with the financial strength to capitalize on these opportunities.

"We believe Acadia has the right strategy in place to continue to expand our network and meet the needs of more patients. As we look ahead to the remainder of 2021 and beyond, we will continue to pursue our growth objectives through bed expansions, wholly owned de novo facilities, strategic joint ventures and acquisitions," added Osteen.

Cash and Liquidity

Acadia's balance sheet remains strong with ample liquidity and capital to invest in and grow its business. As of June 30, 2021, the Company had $185.5 million in cash and cash equivalents. The Company repaid approximately $41 million of debt during the second quarter of 2021, including $35 million on its senior secured revolving credit facility, reducing the outstanding balance to $125 million at June 30, 2021. As of June 30, 2021, the Company had $475 million available under its $600 million revolving credit facility, and its net leverage ratio was approximately 2.4x.

During the second quarter of 2021, the Company received approximately $24 million additional PRF distributions under the CARES Act. The Company is currently evaluating updated PRF reporting guidance to determine whether any of the funds will be recognized or returned. During the second quarter, the Company began repayment of amounts received pursuant to the Medicare Accelerated and Advanced Payment Program under the CARES Act. The Company repaid $7 million of the $45 million of advance payments received in 2020 under the Medicare Accelerated and Advanced Payment Program and will continue to repay the remaining balance on a monthly basis through June 2022. Additionally, the Company expects to repay half of the $39 million of 2020 payroll tax deferrals in the second half of 2021 and the remaining portion in 2022.

Financial Guidance

Acadia today increased the Company's financial guidance for 2021 to reflect the strong operating and financial performance for the first six months of the year and its expectations for the remainder of the year, as follows:

* Revenue in a range of $2.28 billion to $2.32 billion; * Adjusted EBITDA in a range of $530 million to $550 million; * Adjusted earnings per diluted share in a range of $2.50 to $2.70; and * Operating cash flows in a range of $275 million to $310 million.

The Company's guidance does not include discontinued operations or the impact of any future acquisitions, divestitures or transaction-related expenses.

Looking Ahead

Osteen concluded, "We are encouraged by the favorable trends in our business and believe we are well positioned to capitalize on the expected growth in demand for behavioral health services. While the COVID-19 pandemic has brought many challenges, particularly for those people already dealing with mental health and substance abuse, we are encouraged by the heightened awareness of these issues and an increased push for access to treatment. As always, our primary mission is to meet this demand and support the patients and communities we serve. We will continue to focus on providing the highest quality of patient care, while extending our market reach and advancing our position as a leading pure-play behavioral healthcare provider."

Conference Call

Acadia will hold a conference call to discuss its second quarter financial results at 9:00 a.m. Eastern Time on Tuesday, August 3, 2021. A live webcast of the conference call will be available at www.acadiahealthcare.com in the "Investors" section of the website. The webcast of the conference call will be available through September 2, 2021.

About Acadia

Acadia is a leading provider of behavioral healthcare services across the United States. As of June 30, 2021, Acadia operated a network of 229 behavioral healthcare facilities with approximately 10,100 beds in 40 states and Puerto Rico. With more than 20,000 employees serving approximately 70,000 patients daily, Acadia is the largest stand-alone behavioral health company in the U.S. Acadia provides behavioral healthcare services to its patients in a variety of settings, including inpatient psychiatric hospitals, specialty treatment facilities, residential treatment centers and outpatient clinics.

Forward-Looking Information

This press release contains forward-looking statements. Generally, words such as "may," "will," "should," "could," "anticipate," "expect," "intend," "estimate," "plan," "continue," and "believe" or the negative of or other variation on these and other similar expressions identify forward-looking statements. These forward-looking statements are made only as of the date of this press release. We do not undertake to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are based on current expectations and involve risks and uncertainties and our future results could differ significantly from those expressed or implied by our forward-looking statements. Factors that may cause actual results to differ materially include, without limitation, (i) the impact of the COVID-19 pandemic, including, without limitation, disruption to the U.S. economy and financial markets; reduced admissions and patient volumes; increased costs relating to labor, supply chain and other expenditures; and difficulty in collecting patient accounts receivable due to increases in the unemployment rate and the number of underinsured and uninsured patients; (ii) potential difficulties in successfully integrating the operations of acquired facilities or realizing the expected benefits and synergies of our acquisitions, joint ventures and de novo transactions; (iii) Acadia's ability to add beds, expand services, enhance marketing programs and improve efficiencies at its facilities; (iv) potential reductions in payments received by Acadia from government and third-party payors; (v) the occurrence of patient incidents, governmental investigations, litigation and adverse regulatory actions, which could adversely affect the price of our common stock and result in substantial payments and incremental regulatory burdens; (vi) the risk that Acadia may not generate sufficient cash from operations to service its debt and meet its working capital and capital expenditure requirements; and (vii) potential operating difficulties, labor costs, client preferences, changes in competition and general economic or industry conditions that may prevent Acadia from realizing the expected benefits of its business strategies. These factors and others are more fully described in Acadia's periodic reports and other filings with the SEC.

Acadia Healthcare Company, Inc.Condensed Consolidated Statements of Operations(Unaudited) Three Months Ended June Six Months Ended June 30, 30, 2021 2020 2021 2020

(In thousands, except per share amounts) Revenue $ 582,156 $ 491,475 $ 1,133,355 $ 1,000,692

Salaries, wages andbenefits (includingequity-based 309,233 275,258 613,566 562,245 compensation expense of$9,031, $5,808, $16,065and $10,787,respectively)Professional fees 34,696 30,586 66,313 61,637

Supplies 22,633 21,059 43,955 43,255

Rents and leases 9,620 9,493 19,032 18,610

Other operating 73,751 66,171 145,761 134,327 expensesOther income - (18,070 ) - (18,070 )

Depreciation and 25,650 23,331 50,544 46,166 amortizationInterest expense, net 16,687 38,518 45,714 81,083

Debt extinguishment - 3,271 24,650 3,271 costsLoss on impairment 23,214 - 23,214 -

Transaction-related 1,675 5,008 6,285 6,534 expensesTotal expenses 517,159 454,625 1,039,034 939,058

Income from continuing 64,997 36,850 94,321 61,634 operations beforeincome taxesProvision for income 19,333 9,177 25,537 14,983 taxesIncome from continuing 45,664 27,673 68,784 46,651 operationsIncome (loss) fromdiscontinued - 14,041 (12,641 ) 29,130 operations, net oftaxesNet income 45,664 41,714 56,143 75,781

Net income attributable (1,150 ) (635 ) (1,912 ) (1,239 )to noncontrollinginterestsNet income attributable $ 44,514 $ 41,079 $ 54,231 $ 74,542 to Acadia HealthcareCompany, Inc. Basic earnings pershare attributable toAcadia HealthcareCompany, Inc.stockholders:Income from continuingoperations attributable $ 0.50 $ 0.31 $ 0.76 $ 0.52 to Acadia HealthcareCompany, Inc.Income (loss) from $ - $ 0.16 $ (0.15 ) $ 0.33 discontinued operationsNet income attributable $ 0.50 $ 0.47 $ 0.61 $ 0.85 to Acadia HealthcareCompany, Inc. Diluted earnings pershare attributable toAcadia HealthcareCompany, Inc.stockholders:Income from continuingoperations attributable $ 0.49 $ 0.31 $ 0.74 $ 0.51 to Acadia HealthcareCompany, Inc.Income (loss) from $ - $ 0.15 $ (0.14 ) $ 0.33 discontinued operationsNet income attributable $ 0.49 $ 0.46 $ 0.60 $ 0.84 to Acadia HealthcareCompany, Inc. Weighted-average sharesoutstanding:Basic 88,842 87,872 88,543 87,818

Diluted 90,590 88,608 90,381 88,228

Acadia Healthcare Company, Inc.Condensed Consolidated Balance Sheets(Unaudited) June 30, December 31, 2021 2020

(In thousands) ASSETSCurrent assets:Cash and cash equivalents $ 185,546 $ 378,697

Accounts receivable, net 286,522 273,551

Other current assets 103,558 61,332

Current assets held for sale - 1,809,815

Total current assets 575,626 2,523,395

Property and equipment, net 1,651,274 1,622,896

Goodwill 2,103,503 2,105,264

Intangible assets, net 68,463 68,535

Deferred tax assets 3,145 3,209

Operating lease right-of-use assets 101,691 96,937

Other assets 60,299 79,126

Total assets $ 4,564,001 $ 6,499,362

LIABILITIES AND EQUITYCurrent liabilities:Current portion of long-term debt $ 13,281 $ 153,478

Accounts payable 87,223 87,815

Accrued salaries and benefits 133,590 124,912

Current portion of operating lease liabilities 19,254 18,916

Other accrued liabilities 171,867 178,453

Derivative instrument liabilities - 84,584

Current liabilities held for sale - 660,027

Total current liabilities 425,215 1,308,185

Long-term debt 1,443,192 2,968,948

Deferred tax liabilities 73,144 50,017

Operating lease liabilities 89,107 84,029

Other liabilities 118,363 133,412

Total liabilities 2,149,021 4,544,591

Redeemable noncontrolling interests 58,394 55,315

Equity:Common stock 889 880

Additional paid-in capital 2,611,852 2,580,327

Accumulated other comprehensive loss - (371,365 )

Accumulated deficit (256,155 ) (310,386 )

Total equity 2,356,586 1,899,456

Total liabilities and equity $ 4,564,001 $ 6,499,362

Acadia Healthcare Company, Inc.Condensed Consolidated Statements of Cash Flows(Unaudited) Six Months Ended June 30, 2021 2020

(In thousands)Operating activities:Net income $ 56,143 $ 75,781

Adjustments to reconcile net income to net cashprovided by continuing operating activities:Depreciation and amortization 50,544 46,166

Amortization of debt issuance costs 2,463 6,382

Equity-based compensation expense 16,065 10,787

Deferred income taxes 8,457 22,136

Loss (income) from discontinued operations, net 12,641 (29,130 )of taxesDebt extinguishment costs 24,650 3,271

Loss on impairment 23,214 -

Other 828 (955 )

Change in operating assets and liabilities:Accounts receivable, net (12,972 ) 11,015

Other current assets (32,056 ) (9,029 )

Other assets 7,276 1,949

Accounts payable and other accrued liabilities 11,306 40,034

Accrued salaries and benefits 8,823 (1,455 )

Other liabilities (11,121 ) 26,322

Net cash provided by continuing operating 166,261 203,274 activitiesNet cash provided by discontinued operating 253 61,668 activitiesNet cash provided by operating activities 166,514 264,942

Investing activities:Cash paid for capital expenditures (112,953 ) (114,251 )

Proceeds from U.K. Sale 1,511,020 -

Settlement of foreign currency derivatives (84,795 ) -

Proceeds from sale of property and equipment 899 43

Other 4,953 (4,847 )

Net cash provided by (used in) continuing 1,319,124 (119,055 )investing activitiesNet cash used in discontinued investing - (20,874 )activitiesNet cash provided by (used in) investing 1,319,124 (139,929 )activities Financing activities:Borrowings on long-term debt 425,000 450,000

Borrowings on revolving credit facility 430,000 100,000

Principal payments on revolving credit facility (305,000 ) (100,000 )

Principal payments on long-term debt (2,656 ) (21,242 )

Repayment of long-term debt (2,227,935 ) (450,000 )

Payment of debt issuance costs (7,964 ) (10,595 )

Common stock withheld for minimum statutory 13,261 (1,377 )taxes, netDistributions to noncontrolling interests (633 ) (451 )

Other (6,929 ) (854 )

Net cash used in continuing financing activities (1,682,856 ) (34,519 )

Net cash used in discontinued financing - (1,490 )activitiesNet cash used in financing activities (1,682,856 ) (36,009 )

Effect of exchange rate changes on cash 4,067 (1,257 )

Net (decrease) increase in cash and cash (193,151 ) 87,747 equivalents, including cash classified withincurrent assets held for saleLess: cash classified within current assets held - (44,268 )for saleNet (decrease) increase in cash and cash (193,151 ) 43,479 equivalentsCash and cash equivalents at beginning of the 378,697 124,192 periodCash and cash equivalents at end of the period $ 185,546 $ 167,671

Acadia Healthcare Company, Inc.Operating Statistics(Unaudited, Revenue in thousands) Three Months Ended June 30, Six Months Ended June 30, 2021 2020 % 2021 2020 % Change Change

U.S. SameFacilityResults ^(1)Revenue $ 576,170 $ 488,259 18.0 % $ 1,121,969 $ 996,521 12.6 %

Patient 706,128 643,010 9.8 % 1,375,853 1,294,941 6.2 %DaysAdmissions 46,494 41,009 13.4 % 90,307 84,453 6.9 %

Average 15.2 15.7 -3.1 % 15.2 15.3 -0.6 %Length ofStay ^(2)Revenueper $ 816 $ 759 7.5 % $ 815 $ 770 6.0 %PatientDayAdjusted 29.3 % 27.5 % 180 27.9 % 25.6 % 230EBITDA bps bpsmargin U.S.FacilityResultsRevenue $ 582,156 $ 491,475 18.5 % $ 1,133,355 $ 1,000,692 13.3 %

Patient 712,634 648,518 9.9 % 1,387,125 1,306,520 6.2 %DaysAdmissions 46,974 41,158 14.1 % 91,138 84,761 7.5 %

Average 15.2 15.8 -3.7 % 15.2 15.4 -1.3 %Length ofStay^ (2)Revenueper $ 817 $ 758 7.8 % $ 817 $ 766 6.7 %PatientDayAdjusted 28.5 % 27.4 % 110 27.3 % 25.5 % 180EBITDA bps bpsmargin(1) Same facility results for the periods presented include facilities we have operated for more than one year and exclude certain closed services.(2) Average length of stay is defined as patient days divided by admissions.^(1) Same facility results for the periods presented include facilities we haveoperated for more than one year and exclude certain closed services.^(2) Average length of stay is defined as patient days divided by admissions.Acadia Healthcare Company, Inc.Reconciliation of Net Income Attributable to Acadia Healthcare Company, Inc. toAdjusted EBITDA(Unaudited) Three Months Ended June Six Months Ended June 30, 30, 2021 2020 2021 2020

(in thousands) Net incomeattributable to $ 44,514 $ 41,079 $ 54,231 $ 74,542 Acadia HealthcareCompany, Inc.Net incomeattributable to 1,150 635 1,912 1,239 noncontrollinginterests(Income) loss fromdiscontinued - (14,041 ) 12,641 (29,130 )operations, net oftaxesProvision for income 19,333 9,177 25,537 14,983 taxesInterest expense, net 16,687 38,518 45,714 81,083

Depreciation and 25,650 23,331 50,544 46,166 amortizationEBITDA 107,334 98,699 190,579 188,883

Adjustments:Equity-based 9,031 5,808 16,065 10,787 compensation expense(a)Transaction-related 1,675 5,008 6,285 6,534 expenses (b)Debt extinguishment - 3,271 24,650 3,271 costs (c)Loss on impairment 23,214 - 23,214 - (d)Adjusted EBITDA $ 141,254 $ 112,786 $ 260,793 $ 209,475

Adjusted EBITDA 24.3 % 22.9 % 23.0 % 20.9 %margin See footnotes on page12.Acadia Healthcare Company, Inc.Reconciliation of Net Income Attributable to Acadia Healthcare Company, Inc. toAdjusted Income Attributable to Acadia Healthcare Company, Inc.(Unaudited) Three Six Months Months Ended Ended June 30, June 30, 2021 2021 (in thousands, except per share amounts) Net income attributable to Acadia Healthcare Company, $ 44,514 $ 54,231 Inc.Loss from discontinued operations, net of taxes - 12,641

Adjustments to income:Transaction-related expenses (b) 1,675 6,285

Debt extinguishment costs (c) - 24,650

Loss on impairment (d) 23,214 23,214

Provision for income taxes 19,333 25,537

Adjusted income from continuing operations before 88,736 146,558 income taxes attributable to Acadia HealthcareCompany, Inc.Income tax effect of adjustments to income (e) 24,583 40,201

Adjusted income from continuing operations $ 64,153 $ 106,357 attributable to Acadia Healthcare Company, Inc. Weighted-average shares outstanding - diluted 90,590 90,381

Adjusted income from continuing operations $ 0.71 $ 1.18 attributable to Acadia Healthcare Company, Inc. perdiluted share Three Six Months Months Ended Ended June 30, June 30, 2020 2020 (in thousands, except per share amounts)Net income attributable to Acadia Healthcare Company, $ 41,079 $ 74,542 Inc.Income from discontinued operations, net of taxes (14,041 ) (29,130 )

Adjustments to income:Transaction-related expenses (b) 5,008 6,534

Debt extinguishment costs (c) 3,271 3,271

Provision for income taxes 9,177 14,983

Adjusted income from continuing operations before 44,494 70,200 income taxes attributable to Acadia HealthcareCompany, Inc.Adjusted income from discontinued operations before 13,313 30,408 income taxesAdjusted income before income taxes attributable to 57,807 100,608 Acadia Healthcare Company, Inc.Income tax effect of adjustments to income (d) 9,677 15,810

Adjusted income attributable to Acadia Healthcare $ 48,130 $ 84,798 Company, Inc. Weighted-average shares outstanding - diluted 88,608 88,228

Adjusted income attributable to Acadia Healthcare $ 0.54 $ 0.96 Company, Inc. per diluted share ^(3) (3) For the three and six months ended June 30, 2020, Adjusted income attributable to Acadia Healthcare Company, Inc. per diluted share includes Adjusted income from discontinued operations before income taxes and is not directly comparable to Adjusted income from continuing operations attributable to Acadia Healthcare Company, Inc. per diluted share for the three and six months ended June 30, 2021. Interest expense, which has been significantly reduced following debt repayments in the first quarter of 2021, is recorded in income from continuing operations and not allocated to discontinued operations because such allocation would not be meaningful. Therefore, 2020 reflects consolidated results inclusive of discontinued operations, and 2021 reflects only continuing operations.See footnotes on page 12.^(3) For the three and six months ended June 30, 2020, Adjusted incomeattributable to Acadia Healthcare Company, Inc. per diluted share includesAdjusted income from discontinued operations before income taxes and is notdirectly comparable to Adjusted income from continuing operations attributableto Acadia Healthcare Company, Inc. per diluted share for the three and sixmonths ended June 30, 2021. Interest expense, which has been significantlyreduced following debt repayments in the first quarter of 2021, is recorded inincome from continuing operations and not allocated to discontinued operationsbecause such allocation would not be meaningful. Therefore, 2020 reflectsconsolidated results inclusive of discontinued operations, and 2021 reflectsonly continuing operations. See footnotes on page 12.Acadia Healthcare Company, Inc.Discontinued Operations Supplemental Financial Information(Unaudited)

Statements of Discontinued Operations

Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020

(in thousands)

Revenue $ - $ 258,836 $ 62,520 $ 532,429



Salaries, wages and benefits - 152,345 35,937 305,674

Professional fees - 28,028 6,815 60,277

Supplies - 9,065 2,217 18,840

Rents and leases - 11,334 2,509 23,041

Other operating expenses - 26,429 6,682 56,802

Depreciation and - 18,114 - 36,959 amortizationInterest expense, net - 208 10 428

Loss on sale - - 14,254 -

Transaction-related expenses - 233 6,265 2,256

Total expenses - 245,756 74,689 504,277

Income (loss) from - 13,080 (12,169 ) 28,152 discontinued operationsbefore income taxes(Benefit from) provision for - (961 ) 472 (978 )income taxesIncome (loss) from - 14,041 (12,641 ) 29,130 discontinued operations, netof taxes





Reconciliation of Income (Loss) from Discontinued Operations to

Adjusted Income from Discontinued Operations before Income Taxes



Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020

(in thousands)

Income (loss) from $ - $ 14,041 $ (12,641 ) $ 29,130 discontinued operations, netof taxes

Adjustments to income:

Transaction-related expenses - 233 6,265 2,256 (b)Loss on sale (f) - - 14,254 -

Provision for (benefit from) - (961 ) 472 (978 )income taxesAdjusted income from $ - $ 13,313 $ 8,350 $ 30,408 discontinued operationsbefore income taxes

See footnotes on page 12.

Acadia Healthcare Company, Inc.Footnotes We have included certain financial measures in this press release, includingEBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted income fromcontinuing operations before income taxes attributable to Acadia HealthcareCompany, Inc., Adjusted income from continuing operations attributable toAcadia Healthcare Company, Inc., Adjusted income from discontinued operationsbefore income taxes and Adjusted income attributable to Acadia HealthcareCompany, Inc., which are "non-GAAP financial measures" as defined under therules and regulations promulgated by the SEC. We define EBITDA as net income adjusted for net income attributable tononcontrolling interests, loss (income) from discontinued operations, net oftaxes, provision for income taxes, net interest expense and depreciation andamortization. We define Adjusted EBITDA as EBITDA adjusted for equity-basedcompensation expense, transaction-related expenses, debt extinguishment costsand loss on impairment. We define Adjusted income from continuing operationsbefore income taxes attributable to Acadia Healthcare Company, Inc. as netincome adjusted for loss from discontinued operations, net of taxes,transaction-related expenses, debt extinguishment costs, loss on impairment,provision for income taxes and income tax effect of adjustments to income. Wedefine Adjusted EBITDA margin as Adjusted EBITDA divided by revenue. We defineAdjusted income from continuing operations attributable to Acadia HealthcareCompany, Inc. as net income attributable to Acadia Healthcare Company, Inc.adjusted for loss from discontinued operations, net of taxes,transaction-related expenses, debt extinguishment costs, loss on impairment andprovision for income taxes. We define Adjusted income from discontinuedoperations before income taxes as (loss) income from discontinued operations,net of taxes, adjusted for transaction-related expenses, loss on sale andprovision for (benefit from) income taxes. We define Adjusted income attributable to Acadia Healthcare Company, Inc. asthe sum of Adjusted income from continuing operations before income taxesattributable to Acadia Healthcare Company, Inc., Adjusted income fromdiscontinued operations before income taxes and income tax effect ofadjustments to income. The non-GAAP financial measures presented herein are supplemental measures ofour performance and are not required by, or presented in accordance with,generally accepted accounting principles in the United States ("GAAP"). Thenon-GAAP financial measures presented herein are not measures of our financialperformance under GAAP and should not be considered as alternatives to netincome or any other performance measures derived in accordance with GAAP or asan alternative to cash flow from operating activities as measures of ourliquidity. Our measurements of these non-GAAP financial measures may not becomparable to similarly titled measures of other companies. We have includedinformation concerning the non-GAAP financial measures in this press releasebecause we believe that such information is used by certain investors asmeasures of a company's historical performance. We believe these measures arefrequently used by securities analysts, investors and other interested partiesin the evaluation of issuers of equity securities, many of which presentsimilar non-GAAP financial measures when reporting their results. Because thenon-GAAP financial measures are not measurements determined in accordance withGAAP and are thus susceptible to varying calculations, the non-GAAP financialmeasures, as presented, may not be comparable to other similarly titledmeasures of other companies. Our presentation of these non-GAAP financialmeasures should not be construed as an inference that our future results willbe unaffected by unusual or nonrecurring items. (a) Represents the equity-based compensation expense of Acadia. (b) Represents transaction-related expenses incurred by Acadia primarilyrelated to termination, restructuring, strategic review, acquisition and othersimilar costs. (c) Represents debt extinguishment costs recorded during the first quarter of2021 in connection with the redemption of the 5.625% Senior Notes and 6.500%Senior Notes and the termination of the Prior Credit Facility and during thesecond quarter of 2020 in connection with the redemption of the 6.125% SeniorNotes and 5.125% Senior Notes. (d) The Company opened a 260-bed replacement hospital in Pennsylvania andrecorded a non-cash property impairment charge of $23.2 million for theexisting facility. (e) Represents the income tax effect of adjustments to income based on taxrates of 27.7% and 16.7% for the three months ended June 30, 2021 and 2020,respectively, and 27.4% and 15.7% for the six months ended June 30, 2021 and2020, respectively. The Company recorded a $1.6 million tax benefit from ASU2016-09 "Improvements to Employee Share-Based Payment Accounting" in the sixmonths ended June 30, 2021, which has been excluded from the adjusted taxprovision. (f) Represents the adjustments to the loss on sale recorded in connection withthe U.K. sale to reflect an increase in the U.K. carrying value. View source version on businesswire.com: https://www.businesswire.com/news/home/20210802005710/en/

CONTACT: Gretchen Hommrich Director, Investor Relations (615) 861-6000