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): December 31, 2018
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
(Exact name of Registrant as Specified in Its Charter)
|
Delaware |
001-35547 |
36-4392754 |
|
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
222 Merchandise Mart Plaza, Suite 2024,
Chicago, Illinois 60654
(Address of Principal Executive Offices) (Zip Code)
Registrant’s Telephone Number, Including Area Code: (800) 334-8534
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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 (see General instructions A.2. below):
|
☐ |
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. ☐
1
Item 2.01 Completion of Acquisition or Disposition of Assets
On December 31, 2018, Allscripts Healthcare, LLC, a North Carolina limited liability company (“ Healthcare LLC ”) and wholly-owned subsidiary of Allscripts Healthcare Solutions, Inc., a Delaware corporation (“ Allscripts ”), and Allscripts Next, LLC, a Delaware limited liability company and wholly-owned subsidiary of Healthcare LLC (“ Next LLC ” and, together with Healthcare LLC, the “ Seller ”), completed the previously announced transactions contemplated by that certain Unit Purchase Agreement (the “ Purchase Agreement ”), dated as of December 7, 2018, by and among Seller, ACP Accelerate I LLC, a Delaware limited liability company, ACP Accelerate II LLC, a Delaware limited liability company, TA XII-A, L.P., a Delaware limited partnership, TA XII-B, L.P. a Delaware limited partnership, TA Investors XII L.P., a Delaware limited partnership, the California State Teachers’ Retirement System, White Plaza Group Trust, Performance EFFEM PE Fund, L.P.: Series 2018, a Delaware limited partnership, GI Netsmart Holdings LLC, a Delaware limited liability company, Pacific Opportunity LP, a Delaware limited partnership, Pacific Opportunity II LP, a Delaware limited partnership, and Bay Opportunities LP, a Delaware limited partnership, (collectively, the “ Purchasers ”), and, solely for the limited purposes set forth therein, Allscripts, pursuant to which the Seller sold to the Purchasers, severally and upon the terms and conditions of the Purchase Agreement, all of the Class A Common Units (the “ Units ”) of Netsmart LLC, a Delaware limited liability company (the “ Company ”), held by it (the “ Sale ”) in exchange for $566,610,567, plus up to $8,389,433 in the event the Company’s Net Debt Amount is less than the Target Net Debt Amount (each as defined in the Purchase Agreement) as of the end of the day on December 31, 2018 (as determined following the closing pursuant to the terms of the Purchase Agreement).
Allscripts’ unaudited pro forma consolidated financial information giving effect to the Sale is filed as Exhibit 99.1hereto.
The foregoing description of the Purchase Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement, a copy of which is attached as Exhibit 2.1 to our Form 8-K filed with the Securities and Exchange Commission on December 11, 2018, which is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(b) Pro forma financial information .
Allscripts’ unaudited pro forma consolidated financial information giving effect to the Sale is filed as Exhibit 99.1 hereto.
(d) Exhibits:
|
|
|
|
||
|
Exhibit No. |
|
Description |
|
|
|
|
|
|
|
|
|
2.1 |
|
|
||
|
|
|
|
|
|
|
99.1 |
|
|
||
|
|
||||
|
|
||||
2
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.
|
|
|
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC. |
||
|
Date: January 7, 2019 |
|
|
|
|
|
|
|
By: |
|
/s/ Dennis M. Olis |
|
|
|
|
|
Dennis M. Olis Chief Financial Officer |
3
Exhibit 99.1
Allscripts Healthcare Solutions, Inc.
Summary of Unaudited Pro Forma Financial Information
(Dollars in thousands, except per share amounts )
Overview
On December 31, 2018, Allscripts Healthcare Solutions, Inc. (“the Company”) sold all of the Class A Common Units of Netsmart LLC, Delaware limited liability company (“Netsmart”) held by several of the Company’s wholly-owned subsidiaries in exchange for $566.6 million plus up to $8.4 million in the event Netsmart’s Net Debt Amount is less than the Target Debt Amount as defined by in the Unit Purchase Agreement as of the end of the day on December 31, 2018 (as determined following the closing pursuant to the terms of the Unit Purchase Agreement).
Basis of Presentation
The unaudited pro forma consolidated balance sheet as of September 30, 2018 has been prepared to give effect to the elimination of Netsmart’s assets, liabilities and equity balances as a result of the disposition of Netsmart as if it had occurred on September 30, 2018. The unaudited pro forma consolidated statement of operations for the nine months ended September 30, 2018 and the years ended December 31, 2017 and 2016 have been prepared to give effect to the elimination of revenues and costs as a result of the disposition of Netsmart as if it had occurred on January 1, 2017.
The unaudited financial information for the Company was derived from, and should be read in conjunction with, the Company’s unaudited interim consolidated financial statements included in its Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) on November 2, 2018 and the audited consolidated financial statements for the years ended December 31, 2017 and 2016 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 26, 2018.
The pro forma adjustments are described in the notes to the unaudited pro forma financial information. The unaudited pro forma financial information included herein is for informational purposes only and is not necessarily indicative of what the Company's historical financial performance and financial position would have been without the consolidation of Netsmart. In addition, the unaudited pro forma financial information is not necessarily indicative of the Company’s results to be expected in the future.
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2018
|
(In thousands, except per share amounts) |
|
Allscripts Historical (A) |
|
|
Netsmart Historical |
|
|
|
Sale of Netsmart |
|
|
|
Pro Forma |
|
|
||||
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
111,775 |
|
|
$ |
(14,050 |
) |
|
|
$ |
566,611 |
|
(D) |
|
$ |
664,336 |
|
|
|
Restricted cash |
|
|
8,016 |
|
|
|
(3,717 |
) |
|
|
|
|
|
|
|
|
4,299 |
|
|
|
Accounts receivable, net of allowance of $61,926 as of September 30, 2018 |
|
|
520,381 |
|
|
|
(71,624 |
) |
(E) |
|
|
|
|
|
|
|
448,757 |
|
|
|
Contract assets |
|
|
71,745 |
|
|
|
(10,887 |
) |
|
|
|
|
|
|
|
|
60,858 |
|
|
|
Prepaid expenses and other current assets |
|
|
131,826 |
|
|
|
(17,170 |
) |
|
|
|
|
|
|
|
|
114,656 |
|
|
|
Total current assets |
|
|
843,743 |
|
|
|
(117,448 |
) |
|
|
|
566,611 |
|
|
|
|
1,292,906 |
|
|
|
Fixed assets, net |
|
|
160,225 |
|
|
|
(30,715 |
) |
|
|
|
|
|
|
|
|
129,510 |
|
|
|
Software development costs, net |
|
|
239,359 |
|
|
|
(39,510 |
) |
|
|
|
|
|
|
|
|
199,849 |
|
|
|
Intangible assets, net |
|
|
873,635 |
|
|
|
(420,999 |
) |
|
|
|
|
|
|
|
|
452,636 |
|
|
|
Goodwill |
|
|
2,207,967 |
|
|
|
(814,666 |
) |
|
|
|
|
|
|
|
|
1,393,301 |
|
|
|
Deferred taxes, net |
|
|
5,566 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
5,566 |
|
|
|
Contract assets - long-term |
|
|
52,555 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
52,555 |
|
|
|
Other assets |
|
|
135,030 |
|
|
|
(1,958 |
) |
|
|
|
|
|
|
|
|
133,072 |
|
|
|
Total assets |
|
$ |
4,518,080 |
|
|
$ |
(1,425,296 |
) |
|
|
$ |
566,611 |
|
|
|
$ |
3,659,395 |
|
|
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEETS (CONTINUED)
AS OF SEPTEMBER 30, 2018
|
(In thousands, except per share amounts) |
|
Allscripts Historical (A) |
|
|
Netsmart Historical |
|
|
|
Sale of Netsmart |
|
|
|
Pro Forma |
|
|
||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
126,709 |
|
|
$ |
(12,910 |
) |
|
|
$ |
95,228 |
|
(F) |
|
$ |
209,027 |
|
|
|
Accrued expenses |
|
|
120,326 |
|
|
|
(12,436 |
) |
|
|
|
|
|
|
|
|
107,890 |
|
|
|
Accrued compensation and benefits |
|
|
107,799 |
|
|
|
(20,923 |
) |
|
|
|
|
|
|
|
|
86,876 |
|
|
|
Deferred revenue |
|
|
506,568 |
|
|
|
(68,775 |
) |
|
|
|
|
|
|
|
|
437,793 |
|
|
|
Current maturities of long-term debt |
|
|
19,516 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
19,516 |
|
|
|
Current maturities of non-recourse long-term debt - Netsmart |
|
|
4,257 |
|
|
|
(4,257 |
) |
|
|
|
|
|
|
|
|
0 |
|
|
|
Current maturities of capital lease obligations |
|
|
9,190 |
|
|
|
(8,118 |
) |
|
|
|
|
|
|
|
|
1,072 |
|
|
|
Total current liabilities |
|
|
894,365 |
|
|
|
(127,419 |
) |
|
|
|
95,228 |
|
|
|
|
862,174 |
|
|
|
Long-term debt |
|
|
1,002,026 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
1,002,026 |
|
|
|
Non-recourse long-term debt - Netsmart |
|
|
788,489 |
|
|
|
(788,489 |
) |
|
|
|
|
|
|
|
|
0 |
|
|
|
Long-term capital lease obligations |
|
|
4,606 |
|
|
|
(2,814 |
) |
|
|
|
|
|
|
|
|
1,792 |
|
|
|
Deferred revenue |
|
|
21,804 |
|
|
|
(4,977 |
) |
|
|
|
|
|
|
|
|
16,827 |
|
|
|
Deferred taxes, net |
|
|
124,294 |
|
|
|
(62,668 |
) |
|
|
|
|
|
|
|
|
61,626 |
|
|
|
Other liabilities |
|
|
95,575 |
|
|
|
(4,089 |
) |
|
|
|
|
|
|
|
|
91,486 |
|
|
|
Liabilities attributable to discontinued operations |
|
|
2,261 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
2,261 |
|
|
|
Total liabilities |
|
|
2,933,420 |
|
|
|
(990,456 |
) |
|
|
|
95,228 |
|
|
|
|
2,038,192 |
|
|
|
Redeemable convertible non-controlling interest - Netsmart |
|
|
467,981 |
|
|
|
(467,981 |
) |
|
|
|
|
|
|
|
|
0 |
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock: $0.01 par value, 1,000 shares authorized, no shares issued and outstanding as of September 30, 2018 |
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
0 |
|
|
|
Common stock: $0.01 par value, 349,000 shares authorized as of September 30, 2018; 270,506 and 174,707 shares issued and outstanding as of September 30, 2018, respectively |
|
|
2,708 |
|
|
|
(102,084 |
) |
|
|
|
102,084 |
|
|
|
|
2,708 |
|
|
|
Treasury stock: at cost, 96,099 as of September 30, 2018 |
|
|
(423,521 |
) |
|
|
0 |
|
|
|
|
|
|
|
|
|
(423,521 |
) |
|
|
Additional paid-in capital |
|
|
1,765,103 |
|
|
|
108,832 |
|
|
|
|
|
|
|
|
|
1,873,935 |
|
|
|
Accumulated (deficit) retained earnings |
|
|
(251,363 |
) |
|
|
26,290 |
|
|
|
|
369,299 |
|
(D) |
|
|
144,226 |
|
|
|
Accumulated other comprehensive loss |
|
|
(5,452 |
) |
|
|
0 |
|
|
|
|
|
|
|
|
|
(5,452 |
) |
|
|
Total Allscripts Healthcare Solutions, Inc.'s stockholders' equity |
|
|
1,087,475 |
|
|
|
33,038 |
|
|
|
|
471,383 |
|
|
|
|
1,591,896 |
|
|
|
Non-controlling interest |
|
|
29,204 |
|
|
|
103 |
|
|
|
|
|
|
|
|
|
29,307 |
|
|
|
Total stockholders’ equity |
|
|
1,116,679 |
|
|
|
33,141 |
|
|
|
|
471,383 |
|
|
|
|
1,621,203 |
|
|
|
Total liabilities and stockholders’ equity |
|
$ |
4,518,080 |
|
|
|
(1,425,296 |
) |
|
|
$ |
566,611 |
|
|
|
$ |
3,659,395 |
|
|
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018
|
|
|
|
|
|
|
Pro Forma Adjustments |
|
|
|
|
|
|
|
|||||
|
(In thousands, except per share amounts) |
|
Allscripts Historical (B) |
|
|
Netsmart Historical |
|
|
Intercompany Activity (C) |
|
|
|
Pro Forma |
|
|
||||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
$ |
996,569 |
|
|
$ |
(157,479 |
) |
|
$ |
85 |
|
|
|
$ |
839,175 |
|
|
|
Client services |
|
|
565,213 |
|
|
|
(103,455 |
) |
|
|
6,682 |
|
|
|
|
468,440 |
|
|
|
Total revenue |
|
|
1,561,782 |
|
|
|
(260,934 |
) |
|
|
6,767 |
|
|
|
|
1,307,615 |
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
|
328,534 |
|
|
|
(45,213 |
) |
|
|
103 |
|
|
|
|
283,424 |
|
|
|
Client services |
|
|
480,231 |
|
|
|
(75,107 |
) |
|
|
6,666 |
|
|
|
|
411,790 |
|
|
|
Amortization of software development and acquisition-related assets |
|
|
101,008 |
|
|
|
(24,991 |
) |
|
|
0 |
|
|
|
|
76,017 |
|
|
|
Total cost of revenue |
|
|
909,773 |
|
|
|
(145,311 |
) |
|
|
6,769 |
|
|
|
|
771,231 |
|
|
|
Gross profit |
|
|
652,009 |
|
|
|
(115,623 |
) |
|
|
(2 |
) |
|
|
|
536,384 |
|
|
|
Selling, general and administrative expenses |
|
|
425,365 |
|
|
|
(74,390 |
) |
|
|
0 |
|
|
|
|
350,975 |
|
|
|
Research and development |
|
|
220,066 |
|
|
|
(17,845 |
) |
|
|
93 |
|
|
|
|
202,314 |
|
|
|
Asset impairment charges |
|
|
30,075 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
30,075 |
|
|
|
Amortization of intangible and acquisition-related assets |
|
|
37,210 |
|
|
|
(17,665 |
) |
|
|
84 |
|
|
|
|
19,629 |
|
|
|
Loss from operations |
|
|
(60,707 |
) |
|
|
(5,723 |
) |
|
|
(179 |
) |
|
|
|
(66,609 |
) |
|
|
Interest expense |
|
|
(80,843 |
) |
|
|
43,917 |
|
|
|
0 |
|
|
|
|
(36,926 |
) |
|
|
Other loss, net |
|
|
(590 |
) |
|
|
7 |
|
|
|
0 |
|
|
|
|
(583 |
) |
|
|
Gain on sale of businesses, net |
|
|
172,258 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
172,258 |
|
|
|
Impairment of long-term investments |
|
|
(15,487 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
|
(15,487 |
) |
|
|
Equity in net income of unconsolidated investments |
|
|
529 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
529 |
|
|
|
Income from continuing operations before income taxes |
|
|
15,160 |
|
|
|
38,201 |
|
|
|
(179 |
) |
|
|
|
53,182 |
|
|
|
Income tax benefit (provision) |
|
|
3,020 |
|
|
|
(8,938 |
) |
|
|
0 |
|
|
|
|
(5,918 |
) |
|
|
Income from continuing operations, net of tax |
|
|
18,180 |
|
|
|
29,263 |
|
|
|
(179 |
) |
|
|
|
47,264 |
|
|
|
Income from discontinued operations, net of tax |
|
|
3,731 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
3,731 |
|
|
|
Net income |
|
|
21,911 |
|
|
|
29,263 |
|
|
|
(179 |
) |
|
|
|
50,995 |
|
|
|
Less: Net loss attributable to non-controlling interests |
|
|
3,494 |
|
|
|
0 |
|
|
|
(149 |
) |
|
|
|
3,345 |
|
|
|
Less: Accretion of redemption preference on redeemable convertible non-controlling interest - Netsmart |
|
|
(36,446 |
) |
|
|
36,446 |
|
|
|
0 |
|
|
|
|
0 |
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders |
|
$ |
(11,041 |
) |
|
$ |
65,709 |
|
|
$ |
(328 |
) |
|
|
$ |
54,340 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.09 |
) |
|
$ |
0.37 |
|
|
$ |
0.00 |
|
|
|
$ |
0.28 |
|
|
|
Discontinued operations |
|
|
0.03 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
|
0.03 |
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders per share |
|
$ |
(0.06 |
) |
|
$ |
0.37 |
|
|
$ |
0.00 |
|
|
|
$ |
0.31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.09 |
) |
|
$ |
0.37 |
|
|
$ |
0.00 |
|
|
|
$ |
0.28 |
|
|
|
Discontinued operations |
|
|
0.03 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
|
0.03 |
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders per share |
|
$ |
(0.06 |
) |
|
$ |
0.37 |
|
|
$ |
0.00 |
|
|
|
$ |
0.31 |
|
|
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2017
|
|
|
|
|
|
|
Pro Forma Adjustments |
|
|
|
|
|
|
|
|||||
|
(In thousands, except per share amounts) |
|
Allscripts Historical (B) |
|
|
Netsmart Historical |
|
|
Intercompany Activity (C) |
|
|
|
Pro Forma |
|
|
||||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
$ |
1,156,391 |
|
|
$ |
(199,194 |
) |
|
$ |
990 |
|
|
|
$ |
958,187 |
|
|
|
Client services |
|
|
649,951 |
|
|
|
(119,880 |
) |
|
|
9,450 |
|
|
|
|
539,521 |
|
|
|
Total revenue |
|
|
1,806,342 |
|
|
|
(319,074 |
) |
|
|
10,440 |
|
|
|
$ |
1,497,708 |
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
|
368,192 |
|
|
|
(51,886 |
) |
|
|
807 |
|
|
|
|
317,113 |
|
|
|
Client services |
|
|
541,388 |
|
|
|
(87,762 |
) |
|
|
9,445 |
|
|
|
|
463,071 |
|
|
|
Amortization of software development and acquisition-related assets |
|
|
114,601 |
|
|
|
(29,876 |
) |
|
|
0 |
|
|
|
|
84,725 |
|
|
|
Total cost of revenue |
|
|
1,024,181 |
|
|
|
(169,524 |
) |
|
|
10,252 |
|
|
|
|
864,909 |
|
|
|
Gross profit |
|
|
782,161 |
|
|
|
(149,550 |
) |
|
|
188 |
|
|
|
|
632,799 |
|
|
|
Selling, general and administrative expenses |
|
|
486,271 |
|
|
|
(85,588 |
) |
|
|
5 |
|
|
|
|
400,688 |
|
|
|
Research and development |
|
|
220,219 |
|
|
|
(18,024 |
) |
|
|
87 |
|
|
|
|
202,282 |
|
|
|
Amortization of intangible and acquisition-related assets |
|
|
33,754 |
|
|
|
(16,465 |
) |
|
|
56 |
|
|
|
|
17,345 |
|
|
|
Income from operations |
|
|
41,917 |
|
|
|
(29,473 |
) |
|
|
40 |
|
|
|
|
12,484 |
|
|
|
Interest expense |
|
|
(87,479 |
) |
|
|
49,939 |
|
|
|
0 |
|
|
|
|
(37,540 |
) |
|
|
Other income, net |
|
|
413 |
|
|
|
(925 |
) |
|
|
0 |
|
|
|
|
(512 |
) |
|
|
Impairment and losses on long-term investments |
|
|
(165,290 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
|
(165,290 |
) |
|
|
Equity in net income of unconsolidated investments |
|
|
821 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
821 |
|
|
|
Loss from continuing operations before income taxes |
|
|
(209,618 |
) |
|
|
19,541 |
|
|
|
40 |
|
|
|
|
(190,037 |
) |
|
|
Income tax benefit |
|
|
50,767 |
|
|
|
(45,253 |
) |
|
|
0 |
|
|
|
|
5,514 |
|
|
|
Loss from continuing operations, net of tax |
|
|
(158,851 |
) |
|
|
(25,712 |
) |
|
|
40 |
|
|
|
|
(184,523 |
) |
|
|
Income from discontinued operations, net of tax |
|
|
4,676 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
4,676 |
|
|
|
Net loss |
|
|
(154,175 |
) |
|
|
(25,712 |
) |
|
|
40 |
|
|
|
|
(179,847 |
) |
|
|
Less: Net loss attributable to non-controlling interests |
|
|
1,566 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
1,566 |
|
|
|
Less: Accretion of redemption preference on redeemable convertible non-controlling interest - Netsmart |
|
|
(43,850 |
) |
|
|
43,850 |
|
|
|
0 |
|
|
|
|
0 |
|
|
|
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders |
|
$ |
(196,459 |
) |
|
$ |
18,138 |
|
|
$ |
40 |
|
|
|
$ |
(178,281 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(1.12 |
) |
|
$ |
0.10 |
|
|
$ |
0.00 |
|
|
|
$ |
(1.02 |
) |
|
|
Discontinued operations |
|
|
0.03 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
|
0.03 |
|
|
|
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per share |
|
$ |
(1.09 |
) |
|
$ |
0.10 |
|
|
$ |
0.00 |
|
|
|
$ |
(0.99 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(1.12 |
) |
|
$ |
0.10 |
|
|
$ |
0.00 |
|
|
|
$ |
(1.02 |
) |
|
|
Discontinued operations |
|
|
0.03 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
|
0.03 |
|
|
|
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per share |
|
$ |
(1.09 |
) |
|
$ |
0.10 |
|
|
$ |
0.00 |
|
|
|
$ |
(0.99 |
) |
|
ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2016
|
|
|
|
|
|
|
Pro Forma Adjustments |
|
|
|
|
|
|
|
|||||
|
(In thousands, except per share amounts) |
|
Allscripts Historical (B) |
|
|
Netsmart Historical (A) |
|
|
Intercompany Activity (C) |
|
|
|
Pro Forma |
|
|
||||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
$ |
1,003,618 |
|
|
$ |
(106,882 |
) |
|
$ |
2,563 |
|
|
|
$ |
899,299 |
|
|
|
Client services |
|
|
546,281 |
|
|
|
(66,479 |
) |
|
|
6,968 |
|
|
|
|
486,770 |
|
|
|
Total revenue |
|
|
1,549,899 |
|
|
|
(173,361 |
) |
|
|
9,531 |
|
|
|
|
1,386,069 |
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software delivery, support and maintenance |
|
|
331,055 |
|
|
|
(38,938 |
) |
|
|
2,115 |
|
|
|
|
294,232 |
|
|
|
Client services |
|
|
459,174 |
|
|
|
(46,718 |
) |
|
|
6,867 |
|
|
|
|
419,323 |
|
|
|
Amortization of software development and acquisition-related assets |
|
|
88,631 |
|
|
|
(17,416 |
) |
|
|
0 |
|
|
|
|
71,215 |
|
|
|
Total cost of revenue |
|
|
878,860 |
|
|
|
(103,072 |
) |
|
|
8,982 |
|
|
|
|
784,770 |
|
|
|
Gross profit |
|
|
671,039 |
|
|
|
(70,289 |
) |
|
|
549 |
|
|
|
|
601,299 |
|
|
|
Selling, general and administrative expenses |
|
|
392,865 |
|
|
|
(58,331 |
) |
|
|
(13 |
) |
|
|
|
334,521 |
|
|
|
Research and development |
|
|
187,906 |
|
|
|
(9,399 |
) |
|
|
27 |
|
|
|
|
178,534 |
|
|
|
Asset impairment charges |
|
|
4,650 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
4,650 |
|
|
|
Amortization of intangible and acquisition-related assets |
|
|
25,847 |
|
|
|
(9,971 |
) |
|
|
8 |
|
|
|
|
15,884 |
|
|
|
Income from operations |
|
|
59,771 |
|
|
|
7,412 |
|
|
|
527 |
|
|
|
|
67,710 |
|
|
|
Interest expense |
|
|
(68,141 |
) |
|
|
38,663 |
|
|
|
0 |
|
|
|
|
(29,478 |
) |
|
|
Other income, net |
|
|
1,087 |
|
|
|
(258 |
) |
|
|
0 |
|
|
|
|
829 |
|
|
|
Equity in net loss of unconsolidated investments |
|
|
(7,501 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
|
(7,501 |
) |
|
|
Loss from continuing operations before income taxes |
|
|
(14,784 |
) |
|
|
45,817 |
|
|
|
527 |
|
|
|
|
31,560 |
|
|
|
Income tax benefit (expense) |
|
|
17,814 |
|
|
|
(18,123 |
) |
|
|
0 |
|
|
|
|
(309 |
) |
|
|
Net income |
|
|
3,030 |
|
|
|
27,694 |
|
|
|
527 |
|
|
|
|
31,251 |
|
|
|
Less: Net income attributable to non-controlling interests |
|
|
(146 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
|
(146 |
) |
|
|
Less: Accretion of redemption preference on redeemable convertible non-controlling interest - Netsmart |
|
|
(28,536 |
) |
|
|
28,536 |
|
|
|
0 |
|
|
|
|
0 |
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders |
|
$ |
(25,652 |
) |
|
$ |
56,230 |
|
|
$ |
527 |
|
|
|
$ |
31,105 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.14 |
) |
|
$ |
0.30 |
|
|
$ |
0.00 |
|
|
|
$ |
0.16 |
|
|
|
Diluted |
|
$ |
(0.14 |
) |
|
$ |
0.30 |
|
|
$ |
0.00 |
|
|
|
$ |
0.16 |
|
|
|
The Company's Unaudited Pro Forma Consolidated Balance Sheet as of September 30, 2018, the Unaudited Pro Forma Consolidated Statement of Operations for the Nine Months Ended September 30, 2018 and the Years Ended December 31, 2017 and 2016 include the following: |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) |
As reported in the Quarterly Report on Form 10-Q filed by the Company with the SEC on November 2, 2018. Netsmart activity for the year ended December 31, 2016 includes activity from March 17, 2016 through December 31, 2016. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(B) |
As reported in the Annual Report on Form 10-K filed by the Company with the SEC on February 26, 2018. During the first quarter of 2018, the Company changed the presentation of certain bundled revenue streams. Such revenue was previously included as part of software, delivery, support and maintenance revenue. Under the new presentation, such revenue is included as part of client services revenue. The revenue previously reported for the years ended December 31, 2017 and 2016 has been recast to match to the new presentation by reducing software delivery, support and maintenance and increasing client services by $18.3 and $8.7 million, respectively. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C) |
Represents intercompany transactions that would not have been eliminated if Netsmart's results were not consolidated. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(D) |
Represents the proceeds and gain, net of tax from the sale of Netsmart as if it had occurred on September 30, 2018. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(E) |
Netsmart's balance for allowance for doubtful accounts was $13,238 as of September 30, 2018. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(F) |
The pro forma tax rate of 20.5% differs from the blended federal and state statutory rate of 26% due to the application of valuation allowances relating to use of NOLs and tax credits. |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|