AMN Healthcare Acquisition of Stratus Video January 30, 2020 The - - PowerPoint PPT Presentation

The Innovator in Healthcare Workforce Solutions and Staffing Services

AMN Healthcare Acquisition of Stratus Video

January 30, 2020

Forward-Looking Statements

This investor presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, among others, statements concerning the impact the acquisition is expected to have on our adjusted earnings per share, revenue and adjusted EBITDA. The Company bases these forward-looking statements

• n its current expectations, estimates and projections about future events and the industry in which it operates using

information currently available to it. Actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “may,” “estimates,” variations of such words and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. The Company’s actual results could differ materially from those discussed in, or implied by, these forward-looking

• statements. Factors that could cause actual results to differ from those discussed in or implied by the forward-looking

statements contained in this presentation are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and its other periodic reports, its current reports and its other filings with the SEC. Developments subsequent to this presentation are likely to cause these statements to become outdated with the passage of time.

Non-GAAP Measures

This presentation contains certain non-GAAP financial information, which the Company provides as additional

• information. These non-GAAP financial measures include (1) adjusted EBITDA and (2) adjusted EBITDA
• margin. Management believes that adjusted EBITDA and adjusted EBITDA margin serve as industry-wide financial
• measures. A reconciliation of the non-GAAP measures identified in this presentation are included in the Appendix to

this presentation.

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What is Stratus Video?

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Market leader in video remote interpretation for the healthcare industry Market leader in video remote interpretation for the healthcare industry Connecting healthcare patients and providers with on-demand interpreters in over 200 languages Connecting healthcare patients and providers with on-demand interpreters in over 200 languages

Stratus Video Strategic and Financial Rationale

Compelling Market, Business Model and Financial Profile

• Stratus is the clear market leader in high growth Video Remote Interpretation
• Enables providers to improve care and reduce costs for a growing population of patients

and meet federal and state mandated requirements

• Highly scalable platform with proprietary technology designed for healthcare
• High-margin outsourcing model with attractive growth profile and recurring revenue
• Outstanding customer and employee retention

Strategic Benefit to AMN

• Highly aligned with AMN’s total talent solutions strategy
• Common markets with ability to leverage MSP/Enterprise relationships
• Expected to be immediately accretive to AMN’s margins and earnings
• Unique opportunity to participate in the fast-growing markets for virtual care/digital health

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Stratus Video at a Glance

Delivered in Three Key Modalities

Across 1,600+ Healthcare Clients

3,000+ Interpreters

Medically qualified with

• ngoing continuing

education requirements

$1.2 Billion Market

Video remote interpreting is fastest-growth segment Stratus has leading share in video segment

Video

Hospitals Community Health Centers Clinics Ambulatory Surgery Centers

$108M

Revenue in 2019A

$30M

Adjusted EBITDA in 2019A

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$119M

Annualized revenue run rate in 4Q19

$34M

Adjusted EBITDA run rate in 4Q19

Over the Phone In Person

Serving a Growing Population

26M+ Limited English Proficiency | 11M+ Deaf/Hard of Hearing

Note: Stratus financials are unaudited and subject to change

• 35 languages today
• Improves patient experience
• Available on any device, anytime
• Applicable for nearly all in-person

interactions

Stratus Video Core Services Overview

Video 66% In- Person & Other 11% Phone 23%

Video Remote Interpretation

• 200+ languages available
• Covers less common languages and

roll-over support for VRI

• Applicable for inbound patient calls,

scheduled calls

Over-the-Phone Interpretation

• Tech-enabled, efficient deployment
• Enables hospitals use of in-house and

contract interpreters

• Applicable for complicated / sensitive

appointments

In-Person Interpretation

Stratus Revenue Mix

Note: Revenue mix is based on 2019A

Hospital Request Interpreter Response

Provider Requests Interpreter Provider Hires Interpreter Interpreter Arrives Interpreter Receives Requests Interpreter Accepts & Confirms Interpreter Sees Earnings & Ratings

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Stratus Key Financial Metrics

($ in Millions) $68 $84 $108 $- $20 $40 $60 $80 $100 $120 2017 2018 2019 $33 $40 $51 49% 47% 47% 40% 45% 50% 55% 60% 65% 70% $0 $15 $30 $45 $60 2017 2018 2019

Gross Profit and Margin Total Revenue Adjusted EBITDA and Margin

$14 $21 $30 20% 25% 28% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% $0 $15 $30 2017 2018 2019 7

Key Financial Highlights

• Purchase price: $475 million cash
• Proposed financing: $250 million Term Loan,

$175 million revolver draw and $50 cash

• Pro forma leverage: Debt/EBITDA 3.3x
• Immediately accretive to gross margin,

EBITDA margin and adjusted EPS

Stratus financial results are pro forma for acquisitions

Closing Remarks

Highly strategic acquisition that accelerates AMN’s vision of being the market leader and innovator in total talent solutions

Drives significant shareholder value creation

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complementary market for higher growth to AMN’s portfolio of solutions and technology relationships with healthcare providers and patients strong common cultures and fortifies AMN team to AMN Healthcare’s financial performance

UNLOCKS ADDITIVE STRENGTHENS SYNERGISTIC ACCRETIVE

Appendix

Non-GAAP Financial Measures

Twelve Months Ended December 31, ($ in thousands) 2017 2018 2019 Net income $(18,743) $(10,778) $(1,997) Add (deduct): Interest expense $3,313 $ 2,540 $8,015 Depreciation and amortization 8,084 8,436 12,734 Income tax 375 307 116 Reported EBITDA $(6,971) $505 $18,868 Non- Recurring Adjustments 4,788 3,262 4,089 Acquisition Synergies 7,193 8,342 4,679 Proforma Adjustments 8,717 8,716 2,677 Pro forma adjusted EBITDA $13,727 $20,823 $30,312 Stratus uses EBITDA and Adjusted EBITDA, which are Non-GAAP measures, to analyze its operating performance. Because calculation of these measures may differ from similar measures used by other companies, investors should be careful when comparing Stratus’ non-GAAP financial measures to those of other companies. Stratus believes the most directly comparable GAAP measure would be Net Income (loss) from continuing operations, net of disposed business shown in the following reconciliation table.

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