Modivcare reports fourth quarter and full year 2021 financial results
Denver--(business wire)--modivcare inc. (the “company” or “modivcare”) (nasdaq: modv), a technology-enabled healthcare services company that provides a suite of integrated supportive care solutions focused on improving patient outcomes, today reported financial results for the three months and full year ended december 31, 2021. fourth quarter 2021 highlights: service revenue of $575.8 million, a 44% increase as compared to $398.5 million in the fourth quarter of 2020 loss from continuing operations, net of tax, was $31.5 million, or a loss of $2.25 per common share, primarily as a result of the loss related to our matrix investment of $36.8 million, net of tax adjusted ebitda of $57.5 million, adjusted net income of $29.8 million and adjusted eps of $2.11 per diluted common share net cash provided by operating activities during the quarter of $12.1 million, finishing the year with cash and cash equivalents of $133.1 million full year 2021 highlights: service revenue of $1,996.9 million, a 46% increase as compared to $1,368.7 million in 2020 loss from continuing operations, net of tax, was $6.3 million, or $0.45 per common share, primarily as result of the loss related to our matrix investment of $38.3 million, net of tax adjusted ebitda of $205.0 million, adjusted net income of $112.2 million and adjusted eps of $7.89 per diluted common share net cash provided by operating activities in 2021 of $186.8 million completed $500.0 million offering of senior unsecured notes due 2029 closed acquisition of care finders total care llc ("care finders"), expanding personal care segment closed acquisition of vri intermediate holdings, llc ("vri"), creating remote patient monitoring segment matrix, on a standalone basis, incurred a net loss of $122.9 million and adjusted ebitda of $67.5 million subsequent events: on january 10, 2022, modivcare announced the realignment of its home-based services under a new business division, modivcare home, which is composed of the company’s personal care, remote monitoring, and nutritional meal delivery services. jason e. anderson has been promoted to lead the new division. the company’s financial reporting segments have not been affected by this realignment. on february 3, 2022, modivcare inc. entered into a new senior secured revolving credit facility with total borrowing capacity of $325.0 million and a maturity date in february 2027. this new facility was undrawn at closing and replaces the company’s prior $225.0 million revolving credit facility. “over the past year, we have significantly expanded and enhanced our platform at modivcare to provide integrated supportive care solutions to the 30 million patients we serve,” said daniel e. greenleaf, modivcare’s president and chief executive officer. “modivcare is leading the charge to address social determinants of health through our technology-enabled suite of services that drive better patient outcomes and are intended to lower the overall cost of care. as we move into 2022, we are excited to offer our patients and partners access to our entire platform of personal care, transportation, monitoring, and meals services. by providing these services in a coordinated manner, modivcare is transforming the way care is delivered into the home, while also introducing a new platform for value-based care. our accomplishments this past year would not have been possible without the tireless and compassionate efforts of our modivcare team members, transportation providers, and caregivers.” heath sampson, chief financial officer added, “modivcare reported strong financial results in the fourth quarter of 2021, delivering meaningful growth in revenue and adjusted ebitda. as we continue to expand our integrated supportive care platform, we expect to generate meaningful long-term growth and returns for investors, while maintaining a strong balance sheet.” fourth quarter 2021 results for the fourth quarter of 2021, the company reported revenue of $575.8 million, an increase of 44% from $398.5 million in the fourth quarter of 2020. the quarter-over-quarter increase in revenue was primarily driven by an additional $103.2 million in the personal care segment related to the acquisition of care finders in september 2021, as well as a full quarter of simplura revenue in the current year. the revenue increase was further attributed to the introduction of our remote patient monitoring segment resulting from the acquisition of vri in september 2021, which added $16.1 million of revenue. additionally, the quarter-over-quarter increase was driven by $58.0 million of revenue related to our nemt segment due to higher trip volume in the fourth quarter of 2021 compared to the depressed trip volume in the prior year period due to the covid-19 pandemic. operating income was $20.3 million, or 4% of revenue, in the fourth quarter of 2021, compared to $20.9 million, or 5% of revenue, in the fourth quarter of 2020. loss from continuing operations, net of tax, was $31.5 million, or $2.25 per common share in the fourth quarter of 2021, compared to $2.9 million, or $0.21 per common share, in the fourth quarter of 2020. the fourth quarter loss was primarily attributable to a $36.8 million loss in our equity investment in matrix. adjusted ebitda was $57.5 million or 10.0% of revenue, in the fourth quarter of 2021, compared to $51.7 million, or 13.0% of revenue, in the fourth quarter of 2020. adjusted net income in the fourth quarter of 2021 was $29.8 million or $2.11 per diluted common share, compared to $28.7 million, or $2.00 per diluted common share, in the fourth quarter of 2020. adjusted ebitda and adjusted net income increased in the fourth quarter of 2021 due to contributions from the care finders and vri acquisitions, as well as a full quarter contribution from the acquisition of simplura in november 2020. this was partially offset by higher transportation costs associated with the higher trip volume, and higher corporate general and administrative cost, as the company made investments in its employees and technology to support our growth. full year 2021 results for the full year 2021, the company reported revenue of $1,996.9 million, an increase of 46% from $1,368.7 million in 2020. operating income was $89.8 million, or 4% of revenue, for 2021, compared to $123.2 million, or 9% of revenue, for 2020. loss from continuing operations, net of tax, in 2021 was $6.3 million, or $0.45 per common share, compared to income from continuing operations, net of tax, of $89.6 million, or $2.45 per common share, in 2020. adjusted ebitda for 2021 was $205.0 million or 10% of revenue, compared to $189.2 million, or 14% of revenue, in 2020. adjusted net income for 2021 was $112.2 million or $7.89 per diluted common share, compared to $112.8 million, or $8.25 per diluted common share, for 2020. matrix medical network for the fourth quarter of 2021, matrix’s revenue was $81.4 million, a decrease of 33% from $121.9 million in the fourth quarter of 2020. matrix had an operating loss of $2.0 million for the fourth quarter of 2021, compared to an operating loss of $9.7 million for the fourth quarter of 2020. modivcare recorded a fourth quarter 2021 loss of $36.8 million, net of tax, related to its matrix equity investment compared to a loss of $2.7 million, net of tax, for the fourth quarter of 2020. modivcare's loss related to matrix in the fourth quarter of 2021 was primarily due to a non-cash impairment of goodwill of $111.4 million. for the fourth quarter of 2021, matrix recorded adjusted ebitda of $10.0 million, or 12% of revenue, compared to $16.3 million, or 13% of revenue, for the fourth quarter of 2020. matrix’s revenue and adjusted ebitda in the fourth quarter 2021 were negatively impacted by lower revenue in its clinical solutions segment, as the company experienced significant benefits in the prior year from employee health and wellness services related to covid-19 testing and vaccines in this segment. this was partially offset by favorable pricing and mix benefits in the clinical care segment during the fourth quarter of 2021. for the full year 2021, matrix's revenue was $398.3 million, a decrease of 4% from full year 2020. adjusted ebitda for 2021 was $67.5 million, or 17% of revenue, compared to $113.3 million, or 27% of revenue, in 2020. as of december 31, 2021, matrix had $260.6 million of net debt and modivcare's ownership interest was 43.6%. investor presentation and conference call modivcare will hold a conference call to discuss its financial results on friday, february 25, 2022 at 8:00 a.m. et. to access the call, please dial: us toll-free: 1 (877) 423 9820 international: 1 (201) 493 6749 you may also access the conference call via webcast at investors.modivcare.com, where the call also will be archived. about modivcare modivcare inc. (“modivcare”) (nasdaq: modv) is a technology-enabled healthcare services company that provides a suite of integrated supportive care solutions for public and private payors and their patients. our value-based solutions address the social determinants of health (sdoh), enable greater access to care, reduce costs, and improve outcomes. we are a leading provider of non-emergency medical transportation (nemt), personal and home care, remote patient monitoring, medication management and meal delivery. modivcare also holds a minority equity interest in cchn group holdings, inc. and its subsidiaries (“matrix medical network”), which partners with leading health plans and providers nationally, delivering a broad array of assessment and care management services to individuals that improves health outcomes and health plan financial performance. to learn more about modivcare, please visit www.modivcare.com. non-gaap financial measures and adjustments in addition to the financial measures prepared in accordance with generally accepted accounting principles in the united states ("gaap"), this press release includes ebitda and adjusted ebitda for the company and its segments, as well as adjusted net income and adjusted eps for the company, which are performance measures that are not recognized under gaap. ebitda is defined as income (loss) from continuing operations, net of taxes, before: (1) interest expense, net, (2) provision (benefit) for income taxes and (3) depreciation and amortization. adjusted ebitda is calculated as ebitda before certain items, including (as applicable): (1) restructuring and related charges, including severance and office closure and professional services costs, (2) certain transaction and related costs, (3) cash settled equity, (4) stock-based compensation, (5) covid-19 related costs, net of grant income, and (6) equity in net (income) loss of investee. adjusted net income is defined as income from continuing operations, net of taxes, before certain items, including (1) restructuring and related charges including severance and office closure and professional services costs, (2) certain transaction and related costs, (3) cash settled equity, (4) stock-based compensation, (5) equity in net (income) loss of investee, (6) intangible amortization expense, (7) covid-19 related costs, net of grant income, (8) tax impacts from the coronavirus aid, relief, and economic security act (the "cares act"), and (9) the income tax impact of such adjustments. adjusted eps is calculated as adjusted net income less (as applicable): (1) dividends on convertible preferred stock and (2) income allocated to participating securities, divided by the diluted weighted-average number of common shares outstanding as calculated for adjusted net income. our non-gaap performance measures exclude certain expenses and amounts that are not driven by our core operating results and may be one time in nature. excluding these expenses makes comparisons with prior periods as well as to other companies in our industry more meaningful. we believe such measures allow investors to gain a better understanding of the factors and trends affecting the ongoing operations of our business. we consider our core operations to be the ongoing activities to provide services from which we earn revenue, including direct operating costs and indirect costs to support these activities. in addition, our net income or loss in equity investee is excluded from these measures, as we do not have the ability to manage the venture, allocate resources within the venture, or directly control its operations or performance. our non-gaap financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-gaap financial measures differently. in addition, there are limitations in using non-gaap financial measures because they are not prepared in accordance with gaap, may be different from non-gaap financial measures used by other companies, and exclude expenses that may have a material impact on our reported financial results. the presentation of non-gaap financial measures is not intended to be considered in isolation from or as a substitute for the most directly comparable financial measures prepared in accordance with gaap. we urge you to review the reconciliations of our non-gaap financial measures to the most directly comparable gaap financial measures included below, and not to rely on any single financial measure to evaluate our business. forward-looking statements certain statements contained in this press release constitute “forward-looking statements” within the meaning of the private securities litigation reform act of 1995. these statements are predictive in nature and are frequently identified by the use of terms such as “may,” “will,” “should,” “expect,” “believe,” “estimate,” “intend,” and similar words indicating possible future expectations, events or actions. such forward-looking statements are based on current expectations, assumptions, estimates and projections about our business and our industry, and are not guarantees of our future performance. these statements are subject to a number of known and unknown risks, uncertainties and other factors, many of which are beyond our ability to control or predict, which may cause actual events to be materially different from those expressed or implied herein, including but not limited to: government or private insurance program funding reductions or limitations; alternative payment models or the transition of medicaid and medicare beneficiaries to managed care organizations, or mcos; our inability to control reimbursement rates received for our services; cost containment initiatives undertaken by private third-party payors; the effects of a public health emergency; inadequacies in, or security breaches of, our information technology systems, including the systems intended to protect our clients’ privacy and confidential information; any changes in the funding, financial viability or our relationships with our payors; pandemic infectious diseases, including the covid-19 pandemic; disruptions to our contact center operations caused by health epidemics or pandemics like covid-19; delays in collection, or non-collection, of our accounts receivable, particularly during any business integration; an impairment of our long-lived assets; any failure to maintain or to develop further reliable, efficient and secure information technology systems; an inability to attract and retain qualified employees; any acquisition or acquisition integration efforts; our contracts not surviving until the end of their stated terms, or not being renewed or extended; our failure to compete effectively in the marketplace; our not being awarded contracts through the government’s requests for proposals process, or our awarded contracts not being profitable; any failure to satisfy our contractual obligations or to maintain existing pledged performance and payment bonds; a failure to estimate accurately the cost of performing our contracts; any misclassification of the drivers we engage as independent contractors rather than as employees; significant interruptions in our communication and data services; not successfully executing on our strategies in the face of our competition; any inability to maintain relationships with existing patient referral sources; any failure to obtain the consent of the new york department of health to manage the day to day operations of our licensed in-home personal care services agency business that we acquired with our personal care segment; acquired unknown liabilities in connection with the acquisition of our personal care segment; changes in the case-mix of our personal care patients, or changes in payor mix or payment methodologies; our loss of existing favorable managed care contracts; our experiencing shortages in qualified employees and management; labor disputes or disruptions, in particular in new york; becoming subject to malpractice or other similar claims; and our reliance on our matrix investment segment's financial condition. the company has provided additional information about the risks facing our business in our annual report on form 10-k and subsequent filings most recently filed with the securities and exchange commission. you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made and are expressly qualified in their entirety by the cautionary statements set forth herein and in our filings with the securities and exchange commission, which you should read in their entirety before making an investment decision with respect to our securities. we undertake no obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise, except as required by applicable law. --financial tables to follow-- modivcare inc. unaudited condensed consolidated statements of operations (in thousands except share and per share data) three months ended december 31, year ended december 31, 2021 2020 2021 2020 service revenue, net $ 575,775 $ 398,509 $ 1,996,892 $ 1,368,675 grant income 1,941 — 5,441 — operating expenses: service expense 445,128 314,485 1,584,298 1,078,795 general and administrative expense 91,995 54,104 271,266 140,539 depreciation and amortization 20,331 8,984 56,998 26,183 total operating expenses 557,454 377,573 1,912,562 1,245,517 operating income 20,262 20,936 89,771 123,158 other expenses: interest expense, net 14,669 15,481 49,081 17,599 income from continuing operations before income taxes and equity method investment 5,593 5,455 40,690 105,559 provision for income taxes 232 5,626 8,729 22,356 equity in net (income) loss of investee, net of tax 36,826 2,734 38,250 (6,411 ) income (loss) from continuing operations, net of tax (31,465 ) (2,905 ) (6,289 ) 89,614 loss from discontinued operations, net of tax (64 ) (160 ) (296 ) (778 ) net income (loss) $ (31,529 ) $ (3,065 ) $ (6,585 ) $ 88,836 net income (loss) attributable to common stockholders $ (31,529 ) $ (3,065 ) $ (6,585 ) $ 32,471 basic earnings (loss) per common share: continuing operations $ (2.25 ) $ (0.21 ) $ (0.45 ) $ 2.45 discontinued operations — (0.01 ) (0.02 ) (0.06 ) basic earnings (loss) per common share $ (2.25 ) $ (0.22 ) $ (0.47 ) $ 2.39 diluted earnings (loss) per common share: continuing operations $ (2.25 ) $ (0.21 ) $ (0.45 ) $ 2.43 discontinued operations — (0.01 ) (0.02 ) (0.06 ) diluted earnings (loss) per common share $ (2.25 ) $ (0.22 ) $ (0.47 ) $ 2.37 weighted-average number of common shares outstanding: basic 13,998,487 14,159,965 14,054,060 13,567,323 diluted 13,998,487 14,159,965 14,054,060 13,683,308 modivcare inc. unaudited condensed consolidated balance sheets (in thousands) december 31, 2021 2020 assets current assets: cash and cash equivalents $ 133,139 $ 183,281 accounts receivable, net of allowance 233,121 197,943 other current assets (1) 43,574 38,304 total current assets 409,834 419,528 operating lease right-of-use assets 43,750 30,928 property and equipment, net 53,549 27,544 goodwill and intangible assets, net 1,415,000 790,579 equity investment 83,069 137,466 other long-term assets 22,223 19,868 total assets $ 2,027,425 $ 1,425,913 liabilities and stockholders' equity current liabilities: accounts payable $ 8,690 $ 8,464 accrued contract payables 281,586 101,705 accrued expenses and other current liabilities 119,563 116,620 accrued transportation costs 103,294 79,674 current portion of operating lease liabilities 9,873 8,277 deferred revenue 4,228 2,923 total current liabilities 527,234 317,663 long-term debt, net of deferred financing costs 975,225 485,980 operating lease liabilities, less current portion 34,524 23,437 long-term contracts payables — 72,183 other long-term liabilities (2) 117,175 115,039 total liabilities 1,654,158 1,014,302 stockholders' equity stockholders' equity 373,267 411,611 total liabilities and stockholders' equity $ 2,027,425 $ 1,425,913 (1) includes inventories, other receivables, prepaid expenses and other current assets and short-term restricted cash. (2) includes other long-term liabilities and deferred tax liabilities. modivcare inc. unaudited condensed consolidated statements of cash flows (in thousands) year ended december 31, 2021 2020 operating activities net income (loss) $ (6,585 ) $ 88,836 depreciation and amortization 56,998 26,182 stock-based compensation 5,904 3,930 equity in net (income) loss of investee 53,092 (8,860 ) deferred income taxes (17,691 ) 11,919 reduction of right of use asset 11,330 9,238 other non-cash items 434 (2,609 ) changes in working capital 83,358 219,799 net cash provided by operating activities 186,840 348,435 investing activities purchase of property and equipment (21,316 ) (12,150 ) acquisitions, net of cash acquired (664,309 ) (622,862 ) net cash used in investing activities (685,625 ) (635,012 ) financing activities proceeds from debt 625,000 737,000 repayment of debt (125,000 ) (237,000 ) repurchase of common stock, for treasury (39,994 ) (10,186 ) payment of debt issuance costs (13,486 ) (15,633 ) proceeds from common stock issued pursuant to stock option exercise 3,227 25,413 restricted stock surrendered for employee tax payment (896 ) (267 ) preferred stock redemption payment — (88,771 ) preferred stock dividends — (1,987 ) other financing activities — (309 ) net cash provided by financing activities 448,851 408,260 net change in cash and cash equivalents (49,934 ) 121,683 cash, cash equivalents and restricted cash at beginning of period 183,356 61,673 cash, cash equivalents and restricted cash at end of period $ 133,422 $ 183,356 modivcare inc. unaudited reconciliation of non-gaap financial measures segment information and adjusted ebitda (in thousands) three months ended december 31, 2021 nemt personal care rpm matrix investment total continuing operations service revenue, net $ 402,528 $ 157,194 $ 16,053 $ — $ 575,775 grant income — 1,941 — — 1,941 operating expenses: service expense 316,715 123,575 4,838 — 445,128 general and administrative expense 61,626 24,814 5,555 — 91,995 depreciation and amortization 7,314 9,036 3,981 — 20,331 total operating expenses 385,655 157,425 14,374 — 557,454 operating income 16,873 1,710 1,679 — 20,262 other expenses: interest expense, net 14,669 — — — 14,669 income from continuing operations before income taxes and equity method investment 2,204 1,710 1,679 — 5,593 provision (benefit) for income taxes (48 ) (65 ) 345 — 232 equity in net loss of investee, net of tax — — — 36,826 36,826 income (loss) from continuing operations, net of tax 2,252 1,775 1,334 (36,826 ) (31,465 ) interest expense, net 14,669 — — — 14,669 provision (benefit) for income taxes (48 ) (65 ) 345 — 232 depreciation and amortization 7,314 9,036 3,981 — 20,331 ebitda 24,187 10,746 5,660 (36,826 ) 3,767 restructuring and related charges (1) 9,666 304 — — 9,970 transaction costs (2) 2,968 3,463 721 — 7,152 cash settled equity 20 — — — 20 stock-based compensation 1,068 (58 ) — — 1,010 covid-19 related costs, net of grant income 101 (1,340 ) — — (1,239 ) equity in net loss of investee, net of taxes — — — 36,826 36,826 adjusted ebitda $ 38,010 $ 13,115 $ 6,381 $ — $ 57,506 (1) restructuring and related charges include professional fees for strategic initiatives of $4,106 and severance and office close costs of $5,458. (2) transaction costs consist of fees incurred in the acquisitions of care finders and vri. modivcare inc. unaudited reconciliation of non-gaap financial measures segment information and adjusted ebitda (in thousands) three months ended december 31, 2020 nemt personal care matrix investment total continuing operations service revenue, net $ 344,539 $ 53,970 $ — $ 398,509 operating expenses: service expense 271,978 42,507 — 314,485 general and administrative expense 46,776 7,328 — 54,104 depreciation and amortization 7,317 1,667 — 8,984 total operating expenses 326,071 51,502 — 377,573 operating income 18,468 2,468 — 20,936 other expenses: interest expense, net 15,481 — — 15,481 income from continuing operations before income taxes and equity method investment 2,987 2,468 — 5,455 provision for income taxes 4,548 1,078 — 5,626 equity in net loss of investee, net of tax — — 2,734 2,734 income (loss) from continuing operations, net of tax (1,561 ) 1,390 (2,734 ) (2,905 ) interest expense, net 15,481 — — 15,481 provision for income taxes 4,548 1,078 — 5,626 depreciation and amortization 7,317 1,667 — 8,984 ebitda 25,785 4,135 (2,734 ) 27,186 restructuring and related charges (1) 2,901 — — 2,901 transaction costs (2) 7,919 — — 7,919 cash settled equity (3) 9,180 — — 9,180 stock-based compensation (3) 929 — — 929 covid-19 related costs 200 655 — 855 equity in net loss of investee, net of taxes — — 2,734 2,734 adjusted ebitda $ 46,914 $ 4,790 $ — $ 51,704 (1) restructuring and related charges include professional fees for strategic initiatives of $2,009 and severance and office close costs of $892. (2) transaction costs consist of fees incurred in the acquisition of simplura. (3) adjusted ebitda for q4 of 2020 was recast to show the impact of stock-based compensation and cash settled equity, which the company is now including for purposes of this calculation. modivcare inc. unaudited reconciliation of non-gaap financial measures segment information and adjusted ebitda (in thousands) twelve months ended december 31, 2021 nemt personal care rpm matrix investment total continuing operations service revenue, net $ 1,483,696 $ 495,579 $ 17,617 $ — $ 1,996,892 grant income — 5,441 — — 5,441 operating expenses: service expense 1,186,185 392,508 5,605 — 1,584,298 general and administrative expense 195,332 70,163 5,771 — 271,266 depreciation and amortization 29,058 23,759 4,181 — 56,998 total operating expenses 1,410,575 486,430 15,557 — 1,912,562 operating income 73,121 14,590 2,060 — 89,771 other expenses: interest expense, net 49,081 — — — 49,081 income from continuing operations before income taxes and equity method investment 24,040 14,590 2,060 — 40,690 provision for income taxes 4,978 3,299 452 — 8,729 equity in net loss of investee, net of tax — — — 38,250 38,250 income (loss) from continuing operations, net of tax 19,062 11,291 1,608 (38,250 ) (6,289 ) interest expense, net 49,081 — — — 49,081 provision for income taxes 4,978 3,299 452 — 8,729 depreciation and amortization 29,058 23,759 4,181 — 56,998 ebitda 102,179 38,349 6,241 (38,250 ) 108,519 restructuring and related charges (1) 20,881 304 — — 21,185 transaction costs (2) 17,937 6,930 721 — 25,588 cash settled equity 9,165 — — — 9,165 stock-based compensation 4,775 18 — — 4,793 covid-19 related costs, net of grant income 719 (3,211 ) — — (2,492 ) equity in net loss of investee, net of tax — — — 38,250 38,250 adjusted ebitda $ 155,656 $ 42,390 $ 6,962 $ — $ 205,008 (1) restructuring and related charges include professional fees for strategic initiatives of $13,725 and severance and office close costs of $7,156. (2) transaction costs consist of fees incurred in the acquisitions of care finders and vri. modivcare inc. unaudited reconciliation of non-gaap financial measures segment information and adjusted ebitda (in thousands) twelve months ended december 31, 2020 nemt personal care matrix investment total continuing operations service revenue, net $ 1,314,705 $ 53,970 $ — $ 1,368,675 operating expenses: service expense 1,036,288 42,507 — 1,078,795 general and administrative expense 133,212 7,327 — 140,539 depreciation and amortization 24,516 1,667 — 26,183 total operating expenses 1,194,016 51,501 — 1,245,517 operating income 120,689 2,469 — 123,158 other expenses: interest expense, net 17,599 — — 17,599 income from continuing operations before income taxes and equity method investment 103,090 2,469 — 105,559 provision for income taxes 21,279 1,077 — 22,356 equity in net income of investee, net of tax — — (6,411 ) (6,411 ) income from continuing operations, net of tax 81,811 1,392 6,411 89,614 interest expense, net 17,599 — — 17,599 provision for income taxes 21,279 1,077 — 22,356 depreciation and amortization 24,516 1,667 — 26,183 ebitda 145,205 4,136 6,411 155,752 restructuring and related charges (1) 6,179 — — 6,179 transaction costs (2) 12,619 — — 12,619 cash settled equity (3) 16,071 — — 16,071 stock-based compensation (3) 3,776 — — 3,776 covid-19 related costs 549 655 — 1,204 equity in net income of investee, net of tax — — (6,411 ) (6,411 ) adjusted ebitda $ 184,399 $ 4,791 $ — $ 189,190 (1) restructuring and related charges include professional fees for strategic initiatives of $3,249 and severance and office close costs of $2,930. (2) transaction costs consist of fees incurred in the acquisitions of simplura and national medtrans. (3) adjusted ebitda for ytd of 2020 was recast to show the impact of stock-based compensation and cash settled equity, which the company is now including for purposes of this calculation. modivcare inc. unaudited summary financial information of equity investment in matrix medical network (1) (in thousands) three months ended december 31, twelve months ended december 31, 2021 2020 2021 2020 revenue $ 81,430 $ 121,923 $ 398,260 $ 414,622 operating expense 76,665 114,396 365,674 327,616 depreciation and amortization 6,773 17,188 31,270 47,594 operating income (loss) (2,008 ) (9,661 ) 1,316 39,412 other expense (income) goodwill impairment 111,358 — 111,358 — interest expense 4,274 4,526 16,776 19,790 provision (benefit) for income taxes (1,884 ) (5,409 ) (3,920 ) 4,484 net income (loss) (115,756 ) (8,778 ) (122,898 ) 15,138 interest 43.6 % 43.6 % 43.6 % 43.6 % net income (loss) - equity investment (50,470 ) (3,827 ) (53,584 ) 6,600 management fee and other 194 487 492 2,260 equity in net gain (loss) of investee $ (50,276 ) $ (3,340 ) $ (53,092 ) $ 8,860 december 31, 2021 2020 cash $ 57,844 $ 70,295 net debt (2) $ 260,606 $ 251,455 (1) the results of our equity method investment are excluded from the calculation of modivcare's adjusted ebitda and adjusted net income. (2) net debt represents long-term debt including the current portion, excluding deferred financing costs, less cash. modivcare inc. unaudited reconciliation of non-gaap financial measures adjusted ebitda: matrix medical network (1) (in thousands) three months ended december 31, twelve months ended december 31, 2021 2020 2021 2020 revenue $ 81,430 $ 121,923 $ 398,260 $ 414,622 operating expense 76,665 114,396 365,674 327,616 depreciation and amortization 6,773 17,188 31,270 47,594 operating income (loss) (2,008 ) (9,661 ) 1,316 39,412 other expense (income) goodwill impairment 111,358 — 111,358 — interest expense 4,274 4,526 16,776 19,790 provision (benefit) for income taxes (1,884 ) (5,409 ) (3,920 ) 4,484 net income (loss) (115,756 ) (8,778 ) (122,898 ) 15,138 depreciation and amortization 6,773 17,188 31,270 47,594 interest expense 4,274 4,526 16,776 19,790 provision (benefit) for income taxes (1,884 ) (5,409 ) (3,920 ) 4,484 ebitda (106,593 ) 7,527 (78,772 ) 87,006 asset impairment 111,358 — 111,358 — management fees 362 1,055 2,787 4,893 restructuring expense 2,967 4,759 20,657 8,540 integration costs — 67 169 67 severance costs 160 22 1,529 1,255 covid-19 related costs 138 1,865 1,301 8,464 transaction costs 1,650 983 8,464 3,034 adjusted ebitda $ 10,042 $ 16,278 $ 67,493 $ 113,259 (1) modivcare accounts for its proportionate share of matrix's results using the equity method. matrix's adjusted ebitda is not included within modivcare's adjusted ebitda in any period presented. modivcare inc. unaudited reconciliation of non-gaap financial measures adjusted net income and adjusted net income per common share: (in thousands, except share and per share data) three months ended december 31, twelve months ended december 31, 2021 2020 2021 2020 income (loss) from continuing operations, net of tax $ (31,465 ) $ (2,905 ) $ (6,289 ) $ 89,614 restructuring and related charges (1) 9,970 2,901 21,185 6,179 transaction costs (2) 7,152 7,919 25,588 12,619 cash settled equity (3) 20 9,180 9,165 16,071 stock-based compensation (3) 1,010 929 4,793 3,776 equity in net loss (income) of investee 36,826 2,734 38,250 (6,411 ) intangible amortization expense 16,424 6,475 44,251 16,694 transaction-related financing expense — 9,000 6,630 9,000 covid-19 related costs (1,239 ) 855 (2,492 ) 1,204 tax impact of the cares act — — — (10,984 ) tax effected impact of adjustments (8,896 ) (8,365 ) (28,840 ) (15,900 ) adjusted net income $ 29,802 $ 28,723 $ 112,241 $ 121,862 dividends on convertible preferred stock — — — (1,988 ) income allocated to participating securities — — — (7,052 ) adjusted net income available to common stockholders $ 29,802 $ 28,723 $ 112,241 $ 112,822 adjusted eps $ 2.11 $ 2.00 $ 7.89 $ 8.25 diluted weighted-average number of common shares outstanding 14,149,143 14,354,225 14,224,302 13,683,308 (1) restructuring and related charges include severance, organizational consolidation costs and professional fees. (2) transaction costs include certain transaction-related expenses, primarily for the simplura, care finders and vri acquisitions. (3) adjusted net income for the three and twelve months ended december 31, 2020 was recast to show the impact of stock-based compensation and cash settled equity, which the company is now including for purposes of this calculation.
