Delaware
|
|
35-2477140
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
13034 Ballantyne Corporate Place
Charlotte, North Carolina
|
|
28277
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of Each Class
|
|
Name of Each Exchange on Which Registered
|
Class A Common Stock, $0.01 Par Value
|
|
NASDAQ Global Select Market
|
Large accelerated filer
|
x
|
|
Accelerated filer
|
o
|
|
Non-accelerated filer
|
o
|
Smaller reporting company
|
o
|
|
Emerging growth company
|
o
|
|
|
|
|
Page
|
ITEM 1.
|
||
ITEM 1A.
|
||
ITEM 1B.
|
||
ITEM 2.
|
||
ITEM 3.
|
||
ITEM 4.
|
||
PART II
|
||
ITEM 5.
|
||
ITEM 6.
|
||
ITEM 7.
|
||
ITEM 7A.
|
||
ITEM 8.
|
||
ITEM 9.
|
||
ITEM 9A.
|
||
ITEM 9B.
|
||
|
|
|
|
PART III
|
|
ITEM 10.
|
||
ITEM 11.
|
||
ITEM 12.
|
||
ITEM 13.
|
||
ITEM 14.
|
||
|
PART IV
|
|
ITEM 15.
|
||
ITEM 16.
|
FORM 10-K SUMMARY
|
|
|
•
|
competition which could limit our ability to maintain or expand market share within our industry;
|
•
|
consolidation in the healthcare industry;
|
•
|
potential delays recognizing or increasing revenue if the sales cycle or implementation period takes longer than expected;
|
•
|
the terminability of member participation in our GPO programs with limited or no notice, or the failure of a significant number of members to renew their GPO participation agreements;
|
•
|
the rate at which the markets for our SaaS informatics products and services develop;
|
•
|
the dependency of our members on payments from third-party payers;
|
•
|
our reliance on administrative fees that we receive from GPO suppliers;
|
•
|
our ability to maintain third-party provider and strategic alliances or enter into new alliances;
|
•
|
our ability to timely offer new and innovative products and services;
|
•
|
the portion of revenues we receive from our largest members;
|
•
|
risks and expenses related to future acquisition opportunities and integration of acquisitions;
|
•
|
financial and operational risks associated with investments in or loans to businesses that we do not control, particularly early stage companies;
|
•
|
potential litigation;
|
•
|
our reliance on Internet infrastructure, bandwidth providers, data center providers and other third parties and our own systems for providing services to our users;
|
•
|
data loss or corruption due to failures or errors in our systems and service disruptions at our data centers, or breaches or failures of our security measures;
|
•
|
the financial, operational and reputational consequences of cyber-attacks or other data security breaches that disrupt our operations or result in the dissemination of proprietary or confidential information about us or our members or other third parties;
|
•
|
our ability to use, disclose, de-identify or license data and to integrate third-party technologies;
|
•
|
our use of "open source" software;
|
•
|
changes in pharmaceutical industry pricing benchmarks;
|
•
|
our inability to grow our integrated pharmacy business or maintain current patients due to increases in the safety risk profiles of prescription drugs or the withdrawal of prescription drugs from the market, or our inability to maintain and expand our existing base of drugs in our integrated pharmacy operations;
|
•
|
our dependency on contract manufacturing facilities located in various parts of the world;
|
•
|
our ability to attract, hire, integrate and retain key personnel;
|
•
|
adequate protection of our intellectual property and potential claims against our use of the intellectual property of third parties;
|
•
|
potential sales and use tax liability in certain jurisdictions;
|
•
|
changes in tax laws that materially impact our tax rate, income tax expense, cash flows or tax receivable agreement ("TRA") liabilities;
|
•
|
our indebtedness and our ability to obtain additional financing on favorable terms, including our ability to renew or replace our existing long-term credit facility at maturity;
|
•
|
fluctuation of our quarterly cash flows, revenues and results of operations;
|
•
|
changes and uncertainty in the political, economic or regulatory environment affecting healthcare organizations, including with respect to the status of the Patient Protection and Affordable Care Act, as amended by the Healthcare and Education Reconciliation Act of 2010, collectively referred to as the "ACA";
|
•
|
our compliance with complex international, federal and state laws governing financial relationships among healthcare providers and the submission of false or fraudulent healthcare claims;
|
•
|
interpretation and enforcement of current or future antitrust laws and regulations;
|
•
|
compliance with complex federal and state privacy, security and breach notification laws;
|
•
|
compliance with current or future laws, rules or regulations adopted by the Food & Drug Administration ("FDA") applicable to our software applications that may be considered medical devices;
|
•
|
compliance with, and potential changes to, extensive federal, state and local laws, regulations and procedures governing our integrated pharmacy operations;
|
•
|
risks inherent in the filling, packaging and distribution of pharmaceuticals, including the counseling required to be provided by our pharmacists for dispensing of products;
|
•
|
our holding company structure and dependence on distributions from Premier Healthcare Alliance, L.P. ("Premier LP");
|
•
|
different interests among our member owners or between us and our member owners;
|
•
|
the ability of our member owners to exercise significant control over us, including through the election of all of our directors;
|
•
|
exemption from certain corporate governance requirements due to our status as a "controlled company" within the meaning of the NASDAQ rules;
|
•
|
the terms of agreements between us and our member owners;
|
•
|
payments made under the TRAs to Premier LP's limited partners and our ability to realize the expected tax benefits related to the acquisition of Class B common units from Premier LP's limited partners;
|
•
|
changes to Premier LP's allocation methods or examinations or changes in interpretation of applicable tax laws and regulations by various taxing authorities that may increase a tax-exempt limited partner's risk that some allocated income is unrelated business taxable income;
|
•
|
provisions in our certificate of incorporation and bylaws and the Amended and Restated Limited Partnership Agreement of Premier LP (as amended, the "LP Agreement") and provisions of Delaware law that discourage or prevent strategic transactions, including a takeover of us;
|
•
|
failure to maintain an effective system of internal controls over financial reporting or an inability to remediate any weaknesses identified and the related costs of remediation;
|
•
|
the number of shares of Class A common stock that will be eligible for sale or exchange in the near future and the dilutive effect of such issuances;
|
•
|
our lack of current plans to pay cash dividends on our Class A common stock;
|
•
|
the timing and number of shares of Class A common stock re-purchased by the Company pursuant to our current or any future Class A common stock repurchase program;
|
•
|
possible future issuances of common stock, preferred stock, limited partnership units or debt securities and the dilutive effect of such issuances; and
|
•
|
the risk factors discussed under the heading "Risk Factors" in Item 1A herein.
|
•
|
improve the efficiency and effectiveness of the healthcare supply chain;
|
•
|
deliver improvement in cost, quality and safety;
|
•
|
innovate and enable success in emerging healthcare delivery and payment models to manage the health of populations; and
|
•
|
utilize data and analytics to drive increased connectivity, and clinical, financial and operational improvement.
|
|
Year Ended June 30,
|
|||
|
2018
|
2017
|
2016
|
3 Year Average
|
GPO retention rate
(a)
|
98%
|
99%
|
97%
|
98%
|
SaaS institutional renewal rate
(b)
|
97%
|
95%
|
92%
|
95%
|
(a)
|
The GPO retention rate is calculated based upon the aggregate purchasing volume among all members participating in our GPO for such fiscal year less the annualized GPO purchasing volume for departed members for such fiscal year, divided by the aggregate purchasing volume among all members participating in our GPO for such fiscal year.
|
(b)
|
The SaaS institutional renewal rate is calculated based upon the total number of members that have SaaS revenue in a given period that also have revenue in the corresponding prior year period divided by the total number of members that have SaaS revenue in the same period of the prior year.
|
(i)
|
as to how we will use and disclose the protected health information within certain allowable parameters established by HIPAA,
|
(ii)
|
that we will implement reasonable and appropriate administrative, organizational, physical and technical safeguards to protect such information from impermissible use or disclosure,
|
(iii)
|
that we will enter into similar agreements with our agents and subcontractors that have access to the information,
|
(iv)
|
that we will report breaches of unsecured protected health information, security incidents and other inappropriate uses or disclosures of the information, and
|
(v)
|
that we will assist the covered entity with certain of its duties under HIPAA.
|
•
|
failing to integrate the operations and personnel of the acquired businesses in an efficient, timely manner;
|
•
|
failure of a selling party to produce all material information during the pre-acquisition due diligence process, or to meet their obligations under post-acquisition agreements;
|
•
|
potential liabilities of an acquired company, some of which may not become known until after the acquisition;
|
•
|
an acquired company's lack of compliance with laws and governmental rules and regulations, and the related costs and expenses necessary to bring such company into compliance;
|
•
|
an acquired company's general information technology controls or their legacy third-party providers may not be sufficient to prevent unauthorized access or transactions, cyber-attacks or other data security breaches;
|
•
|
managing the potential disruption to our ongoing business;
|
•
|
distracting management focus from our existing core businesses;
|
•
|
encountering difficulties in identifying and acquiring products, technologies, or businesses that will help us execute our business strategy;
|
•
|
entering new markets in which we have little to no experience;
|
•
|
impairing relationships with employees, members, and strategic partners;
|
•
|
failing to implement or remediate controls, procedures and policies appropriate for a public company at acquired companies lacking such financial, disclosure or other controls, procedures and policies, potentially resulting in a material weakness in our internal controls over financial reporting;
|
•
|
the amortization of purchased intangible assets;
|
•
|
incurring expenses associated with an impairment of all or a portion of goodwill and other intangible assets due to the failure of certain acquisitions to realize expected benefits; and
|
•
|
diluting the share value and voting power of existing stockholders.
|
•
|
damage from fire, power loss, and other natural disasters;
|
•
|
communications failures;
|
•
|
software and hardware errors, failures, and crashes;
|
•
|
security breaches and computer viruses and similar disruptive problems; and
|
•
|
other potential interruptions.
|
•
|
finance unanticipated working capital requirements;
|
•
|
develop or enhance our technological infrastructure and our existing products and services;
|
•
|
fund strategic relationships;
|
•
|
respond to competitive pressures; and
|
•
|
acquire complementary businesses, assets, technologies, products or services.
|
•
|
make it difficult for us to satisfy our obligations, including making interest payments on our other debt obligations;
|
•
|
limit our ability to obtain additional financing to operate our business;
|
•
|
require us to dedicate a substantial portion of our cash flow to payments on our debt, reducing our ability to use our cash flow to fund capital expenditures and working capital and other general operational requirements;
|
•
|
limit our flexibility to execute our business strategy and plan for and react to changes in our business and the healthcare industry;
|
•
|
place us at a competitive disadvantage relative to some of our competitors that have less debt than us;
|
•
|
limit our ability to pursue acquisitions; and
|
•
|
increase our vulnerability to general adverse economic and industry conditions, including changes in interest rates or a downturn in our business or the economy.
|
•
|
our ability to offer new and innovative products and services;
|
•
|
regulatory changes, including changes in healthcare laws;
|
•
|
unforeseen legal expenses, including litigation and settlement costs;
|
•
|
the purchasing and budgeting cycles of our members;
|
•
|
the lengthy sales cycles for our products and services, which may cause significant delays in generating revenues or an inability to generate revenues;
|
•
|
pricing pressures with respect to our future sales;
|
•
|
the timing and success of new product and service offerings by us or by our competitors;
|
•
|
member decisions regarding renewal or termination of their contracts, especially those involving our larger member relationships;
|
•
|
the amount and timing of costs related to the maintenance and expansion of our business, operations and infrastructure;
|
•
|
the amount and timing of costs related to the development, adaptation, acquisition, or integration of acquired technologies or businesses;
|
•
|
the financial condition of our current and potential new members; and
|
•
|
general economic and market conditions and conditions specific to the healthcare industry.
|
•
|
register our company and list our FDA-regulated products with the FDA;
|
•
|
obtain pre-market clearance from the FDA based on demonstration of substantial equivalence to a legally marketed device before marketing our regulated products;
|
•
|
obtain FDA approval by demonstrating the safety and effectiveness of the regulated products prior to marketing;
|
•
|
submit to inspections by the FDA; and
|
•
|
comply with various FDA regulations, including the agency’s quality system regulation, medical device reporting regulations, requirements for medical device modifications, increased rigor of the secure development life cycle in the development of medical devices and the interoperability of medical devices and electronic health records, requirements for clinical investigations, corrections and removal reporting regulations, and post-market surveillance regulations.
|
•
|
divide our Board of Directors into three classes with staggered three-year terms, which may delay or prevent a change of our management or a change in control;
|
•
|
authorize our Board of Directors to issue “blank check” preferred stock in order to increase the aggregate number of outstanding shares of capital stock and thereby make a takeover more difficult and expensive;
|
•
|
do not permit cumulative voting in the election of directors, which would otherwise allow less than a majority of stockholders to elect director candidates;
|
•
|
do not permit stockholders to take action by written consent other than during the period in which we qualify as a “controlled company” within the meaning of NASDAQ rules;
|
•
|
provide that special meetings of the stockholders may be called only by or at the direction of the Board of Directors, the chair of our Board or the chief executive officer;
|
•
|
require advance notice to be given by stockholders of any stockholder proposals or director nominees;
|
•
|
require a super-majority vote of the stockholders to amend our certificate of incorporation; and
|
•
|
allow our Board of Directors to make, alter or repeal our bylaws but only allow stockholders to amend our bylaws upon the approval of 66
2
/
3
% or more of the voting power of all of the outstanding shares of our capital stock entitled to vote.
|
|
Price Range of Common Stock
|
|||||
|
High
|
Low
|
||||
Fiscal Year Ended June 30, 2018
|
|
|
||||
Fourth Quarter
|
$
|
37.25
|
|
$
|
28.81
|
|
Third Quarter
|
$
|
35.10
|
|
$
|
29.07
|
|
Second Quarter
|
$
|
35.06
|
|
$
|
27.16
|
|
First Quarter
|
$
|
36.50
|
|
$
|
30.87
|
|
|
|
|
||||
Fiscal Year Ended June 30, 2017
|
|
|
||||
Fourth Quarter
|
$
|
36.28
|
|
$
|
31.42
|
|
Third Quarter
|
$
|
32.86
|
|
$
|
29.15
|
|
Second Quarter
|
$
|
32.79
|
|
$
|
28.27
|
|
First Quarter
|
$
|
34.35
|
|
$
|
30.61
|
|
•
|
our Class A common stock;
|
•
|
the NASDAQ Composite stock index (“NASDAQ Composite index”); and
|
•
|
a customized peer group of twelve companies selected by us (the “Peer Group”).
|
Value of Investment as of Stated Date:
|
|
|
|
|
|
|
||||||||||||
Company/Index Name
|
9/26/2013
|
6/30/2014
|
6/30/2015
|
6/30/2016
|
6/30/2017
|
6/30/2018
|
||||||||||||
Premier, Inc. Class A Common Stock
|
$
|
100.00
|
|
$
|
94.62
|
|
$
|
125.48
|
|
$
|
106.69
|
|
$
|
117.46
|
|
$
|
118.69
|
|
NASDAQ Composite index
|
$
|
100.00
|
|
$
|
118.49
|
|
$
|
135.09
|
|
$
|
133.18
|
|
$
|
169.67
|
|
$
|
208.54
|
|
Peer Group
(a)
|
$
|
100.00
|
|
$
|
103.97
|
|
$
|
117.74
|
|
$
|
111.67
|
|
$
|
125.21
|
|
$
|
123.73
|
|
(a)
|
Assumes $100 invested on September 26, 2013 for stocks and September 30, 2013 for index, including reinvestment of dividends. As noted above, we have not paid any cash dividends during the period covered by the graph.
|
(b)
|
Includes the performance of (i) IHS Markit, Ltd beginning on July 13, 2016 and (ii) Advisory Board Company through November 17, 2017, its last trading day on NASDAQ.
|
|
Year ended June 30,
|
||||||||||||||
Consolidated Statements of Income Data:
|
2018
|
2017
(1)
|
2016
(2)
|
2015
(3)
|
2014
(4, 5)
|
||||||||||
Net revenue:
|
|
|
|
|
|
||||||||||
Net administrative fees
(6)
|
$
|
643,839
|
|
$
|
557,468
|
|
$
|
498,394
|
|
$
|
457,020
|
|
$
|
464,837
|
|
Other services and support
|
372,133
|
|
363,087
|
|
337,554
|
|
270,748
|
|
233,186
|
|
|||||
Services
|
1,015,972
|
|
920,555
|
|
835,948
|
|
727,768
|
|
698,023
|
|
|||||
Products
|
645,284
|
|
534,118
|
|
326,646
|
|
279,261
|
|
212,526
|
|
|||||
Net revenue
|
1,661,256
|
|
1,454,673
|
|
1,162,594
|
|
1,007,029
|
|
910,549
|
|
|||||
Cost of revenue
|
798,291
|
|
680,048
|
|
457,056
|
|
396,910
|
|
307,625
|
|
|||||
Gross profit
|
862,965
|
|
774,625
|
|
705,538
|
|
610,119
|
|
602,924
|
|
|||||
Other operating income
(7)
:
|
|
|
|
|
|
||||||||||
Remeasurement of tax receivable agreement liabilities
|
177,174
|
|
5,447
|
|
4,818
|
|
—
|
|
—
|
|
|||||
Other operating income
|
177,174
|
|
5,447
|
|
4,818
|
|
|
|
|||||||
Operating expenses:
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
443,639
|
|
410,918
|
|
408,429
|
|
332,004
|
|
294,421
|
|
|||||
Research and development
|
1,423
|
|
3,107
|
|
2,925
|
|
2,937
|
|
3,389
|
|
|||||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
9,136
|
|
3,062
|
|
|||||
Operating expenses
|
500,509
|
|
462,352
|
|
444,408
|
|
344,077
|
|
300,872
|
|
|||||
Operating income
|
539,630
|
|
317,720
|
|
265,948
|
|
266,042
|
|
302,052
|
|
|||||
Other income (expense), net
(8)
|
(22,826
|
)
|
213,571
|
|
18,934
|
|
5,085
|
|
58,274
|
|
|||||
Income before income taxes
|
516,804
|
|
531,291
|
|
284,882
|
|
271,127
|
|
360,326
|
|
|||||
Income tax expense
|
259,234
|
|
81,814
|
|
49,721
|
|
36,342
|
|
27,709
|
|
|||||
Net income
|
257,570
|
|
449,477
|
|
235,161
|
|
234,785
|
|
332,617
|
|
|||||
Net (income) loss attributable to non-controlling interest in S2S Global
(9)
|
—
|
|
—
|
|
—
|
|
(1,836
|
)
|
(949
|
)
|
|||||
Net income attributable to non-controlling interest in Premier LP
(10)
|
(224,269
|
)
|
(336,052
|
)
|
(193,547
|
)
|
(194,206
|
)
|
(303,336
|
)
|
|||||
Net income attributable to non-controlling interest
|
(224,269
|
)
|
(336,052
|
)
|
(193,547
|
)
|
(196,042
|
)
|
(304,285
|
)
|
|||||
Adjustment of redeemable limited partners' capital to redemption amount
|
157,581
|
|
(37,176
|
)
|
776,750
|
|
(904,035
|
)
|
(2,741,588
|
)
|
|||||
Net income (loss) attributable to stockholders
|
$
|
190,882
|
|
$
|
76,249
|
|
$
|
818,364
|
|
$
|
(865,292
|
)
|
$
|
(2,713,256
|
)
|
|
|
|
|
|
|
||||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
||||||||||
Basic
|
53,518
|
|
49,654
|
|
42,368
|
|
35,681
|
|
25,633
|
|
|||||
Diluted
|
137,340
|
|
50,374
|
|
145,308
|
|
35,681
|
|
25,633
|
|
|||||
|
|
|
|
|
|
||||||||||
Earnings (loss) per share attributable to stockholders:
|
|
|
|
|
|
||||||||||
Basic
|
$
|
3.57
|
|
$
|
1.54
|
|
$
|
19.32
|
|
$
|
(24.25
|
)
|
$
|
(105.85
|
)
|
Diluted
(11)
|
$
|
1.36
|
|
$
|
1.51
|
|
$
|
0.97
|
|
$
|
(24.25
|
)
|
$
|
(105.85
|
)
|
|
June 30,
|
||||||||||||||
Consolidated Balance Sheets Data:
|
2018
|
2017
|
2016
|
2015
|
2014
|
||||||||||
Cash, cash equivalents and marketable securities, current
|
$
|
152,386
|
|
$
|
156,735
|
|
$
|
266,576
|
|
$
|
387,189
|
|
$
|
291,606
|
|
Working capital (deficit)
(12)
|
$
|
(20,264
|
)
|
$
|
(162,775
|
)
|
$
|
136,827
|
|
$
|
275,533
|
|
$
|
188,527
|
|
Property and equipment, net
|
$
|
206,693
|
|
$
|
187,365
|
|
$
|
174,080
|
|
$
|
147,625
|
|
$
|
134,551
|
|
Total assets
|
$
|
2,312,216
|
|
$
|
2,507,836
|
|
$
|
1,855,383
|
|
$
|
1,530,191
|
|
$
|
1,246,656
|
|
Deferred revenue
(13)
|
$
|
39,785
|
|
$
|
44,443
|
|
$
|
54,498
|
|
$
|
39,824
|
|
$
|
15,694
|
|
Total liabilities
|
$
|
818,870
|
|
$
|
1,031,506
|
|
$
|
669,614
|
|
$
|
568,461
|
|
$
|
472,293
|
|
Redeemable limited partners' capital
(14)
|
$
|
2,920,410
|
|
$
|
3,138,583
|
|
$
|
3,137,230
|
|
$
|
4,079,832
|
|
$
|
3,244,674
|
|
Class A common stock
|
$
|
575
|
|
$
|
519
|
|
$
|
460
|
|
$
|
377
|
|
$
|
324
|
|
Treasury stock, at cost
(15)
|
$
|
(150,058
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Additional paid-in capital
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Accumulated deficit
|
$
|
(1,277,581
|
)
|
$
|
(1,662,772
|
)
|
$
|
(1,951,878
|
)
|
$
|
(3,118,474
|
)
|
$
|
(2,469,873
|
)
|
Total stockholders' deficit
|
$
|
(1,427,064
|
)
|
$
|
(1,662,253
|
)
|
$
|
(1,951,461
|
)
|
$
|
(3,118,102
|
)
|
$
|
(2,470,311
|
)
|
(1)
|
Amounts include the results of operations of (i) Acro Pharmaceutical Services LLC and Community Pharmacy Services, LLC (collectively, "Acro Pharmaceuticals") from August 23, 2016, the date of acquisition of all of the membership interests of Acro Pharmaceuticals, and (ii) Innovatix and Essensa from December 2, 2016, the date of acquisition of all the membership interests of Innovatix and Essensa. Prior to December 2, 2016, we held 50% of the membership interests in Innovatix, and reported equity in net income of Innovatix within other income (expense), net in the Consolidated Statements of Income. See
Note 3 - Business Acquisitions
to the audited consolidated financial statements of this Annual Report for further information related to acquisitions completed during the year ended June 30, 2017.
|
(2)
|
Amounts include the results of operations of InFlowHealth, LLC ("InFlow"), CECity.com, Inc. ("CECity") and Healthcare Insights, LLC ("HCI"), from October 1, 2015, August 20, 2015 and July 31, 2015, respectively, the dates of acquisition of all the membership interests of InFlow, all the outstanding shares of CECity, and all the membership interests of HCI, respectively. See
Note 3 - Business Acquisitions
to the audited consolidated financial statements of this Annual Report for further information related to acquisitions completed during the year ended June 30, 2016.
|
(3)
|
Amounts include the results of operations of TheraDoc, Inc. ("TheraDoc") and Aperek, Inc. ("Aperek"), from September 1, 2014 and August 29, 2014, respectively, the dates of acquisition of all the outstanding shares of common stock of TheraDoc and Aperek, respectively. Further, on February 2, 2015, we purchased the remaining
40%
of the outstanding limited liability company membership interests of S2S Global, our direct sourcing business. See
Note 3 - Business Acquisitions
to the audited consolidated financial statements of this Annual Report for further information related to acquisitions completed during the year ended June 30, 2015.
|
(4)
|
Amounts include the results of operations of MEMdata, LLC ("MEMdata"), Meddius, L.L.C. ("Meddius") and SYMMEDRx, LLC ("SYMMEDRx"), from April 7, 2014, October 31, 2013 and July 19, 2013, respectively, the dates of acquisition of all the outstanding shares of common stock of MEMdata, Meddius and SYMMEDRx.
|
(5)
|
Immediately following the completion of the IPO on October 1, 2013, PHSI, a corporation through which we historically conducted the majority of our business, became our consolidated subsidiary and is considered our predecessor for accounting purposes. Accordingly, PHSI's consolidated financial statements are our historical financial statements, for periods prior to October 1, 2013. The historical consolidated financial statements of PHSI are reflected herein based on PHSI's historical ownership interests of Premier LP and its consolidated subsidiaries.
|
(6)
|
We are contractually required under the GPO participation agreements to pay most member owners revenue shares from Premier LP generally equal to
30%
of all gross administrative fees collected by Premier LP based upon purchasing by such member owner's owned, leased, managed and affiliated facilities through our GPO supplier contracts. Certain non-owner members operate under contractual relationships that provide for a specific revenue share that differs from the
30%
revenue share that we provide to our member owners under the GPO participation agreements.
|
(7)
|
Other operating income includes the adjustment to TRA liabilities. Changes in estimated TRA liabilities that are the result of a change in tax accounting method, including the impacts of the TCJA, are recorded as a component of other operating income in the Consolidated Statements of Income. Changes in estimated TRA liabilities that are related to new basis changes as a result of the exchange of Class B common units for a like number of shares of Class A common stock or as a result of departed
|
(8)
|
Other income (expense), net, consists primarily of a one-time gain of
$205.1 million
related to the remeasurement of our historical 50% equity method investment in Innovatix to fair value upon acquisition of Innovatix and Essensa on December 2, 2016 which occurred during the year ended June 30, 2017. In addition, other income (expense), net includes equity in net income of unconsolidated affiliates that is generated from our equity method investments. Our equity method investments primarily consist of our 49% ownership in FFF Enterprises, Inc. ("FFF"), and prior to the acquisition of Innovatix and Essensa, included our 50% ownership interest in Innovatix. Other income (expense), net, also includes net changes in the fair values of the FFF put and call rights (see Note 5 - Fair Value Measurements), interest income and expense, realized and unrealized gains or losses on deferred compensation plan assets, gains or losses on the disposal of assets, and realized gains and losses on our marketable securities.
|
(9)
|
Premier Supply Chain Improvement, Inc. ("PSCI") owns a
100%
voting and economic interest in S2S Global as a result of its February 2, 2015 purchase of the remaining 40% non-controlling interest in S2S Global. Prior to February 2, 2015, PSCI owned a
60%
voting and economic interest in S2S Global. Net (income) loss attributable to non-controlling interest in S2S Global represents the portion of net (income) loss attributable to the non-controlling equity holders of S2S Global prior to the February 2, 2015 purchase.
|
(10)
|
Net income attributable to non-controlling interest in Premier LP represents the portion of net income attributable to the limited partners of Premier LP, which was
60%
at
June 30, 2018
, and may change each period as member ownership changes.
|
(11)
|
The Company corrected prior period information within the current period financial statements related to a specific component used in calculating the tax effect on Premier, Inc. net income for purposes of diluted earnings (loss) per share. Diluted earnings per share for fiscal 2016 was previously stated at $1.33 per share and has been corrected to $0.97 per share. The Company believes the correction is immaterial and the amount had no impact on the Company’s overall financial condition, results of operations or cash flows.
|
(12)
|
Working capital represents the excess (deficit) of total current assets less total current liabilities. At
June 30, 2018
, working capital includes the
$100.3 million
current portion of long-term debt which is recorded within current liabilities.
|
(13)
|
Deferred revenue is primarily related to deferred subscription fees and deferred consulting fees in our Performance Services segment and consists of unrecognized revenue related to advanced member invoicing or member payments received prior to fulfillment of our revenue recognition criteria.
|
(14)
|
Redeemable limited partners' capital represents the member owners' ownership of Premier LP through their ownership of Class B common units. We are required to repurchase a limited partner's interest in Premier LP upon such limited partner's withdrawal from Premier LP, or such limited partner's failure to comply with the applicable purchase commitments under the historical limited partnership agreement of Premier LP. Redeemable limited partners' capital is classified as temporary equity in the mezzanine section of the accompanying Consolidated Balance Sheets as the withdrawal is at the option of each limited partner and the conditions of the repurchase are not solely within our control. We record redeemable limited partners' capital at the greater of the book value or redemption amount per the LP Agreement at the reporting date, with the corresponding offset to additional paid-in-capital and accumulated deficit.
|
(15)
|
Pursuant to our previously announced 2018 stock repurchase program, we purchased approximately
6.4 million
shares of Class A common stock at an average price of
$31.16
per share for a total purchase price of
$200.0 million
during fiscal 2018.
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net revenue
|
$
|
1,661,256
|
|
$
|
1,454,673
|
|
$
|
1,162,594
|
|
Net income
|
$
|
257,570
|
|
$
|
449,477
|
|
$
|
235,161
|
|
Non-GAAP Adjusted EBTIDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
(a)
|
The Company has corrected prior period information within the current period financial statements related to a specific component used in calculating the tax effect on Premier, Inc. net income for purposes of diluted earnings per share. Diluted earnings per share for fiscal 2016 was previously stated at $1.33 per share and has been corrected to $0.97 per share. The Company believes the correction is immaterial and the corrected amount had no impact on the Company’s overall financial condition, results of operations or cash flows.
|
|
Year Ended June 30,
|
||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||||||||
|
Amount
|
% of Net Revenue
|
|
Amount
|
% of Net Revenue
|
|
Amount
|
% of Net Revenue
|
|||||||||
Certain Non-GAAP Financial Data:
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted EBITDA
|
$
|
543,049
|
|
33
|
%
|
|
$
|
501,591
|
|
34
|
%
|
|
$
|
440,975
|
|
38
|
%
|
Adjusted Fully Distributed Net Income
|
$
|
317,098
|
|
19
|
%
|
|
$
|
267,299
|
|
18
|
%
|
|
$
|
233,259
|
|
20
|
%
|
Adjusted Fully Distributed Earnings Per Share
|
$
|
2.31
|
|
nm
|
|
|
$
|
1.89
|
|
nm
|
|
|
$
|
1.61
|
|
nm
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
257,570
|
|
$
|
449,477
|
|
$
|
235,161
|
|
Interest and investment loss, net
|
5,300
|
|
4,512
|
|
1,021
|
|
|||
Income tax expense
|
259,234
|
|
81,814
|
|
49,721
|
|
|||
Depreciation and amortization
|
71,312
|
|
58,884
|
|
51,102
|
|
|||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
|||
EBITDA
|
648,863
|
|
643,014
|
|
370,059
|
|
|||
Stock-based compensation
|
29,799
|
|
26,860
|
|
49,081
|
|
|||
Acquisition related expenses
|
8,335
|
|
15,790
|
|
15,804
|
|
|||
Strategic and financial restructuring expenses
|
2,512
|
|
31
|
|
268
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
ERP implementation expenses
|
1,000
|
|
2,028
|
|
4,870
|
|
|||
Acquisition related adjustment - revenue
|
300
|
|
18,049
|
|
5,624
|
|
|||
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(205,146
|
)
|
—
|
|
|||
Loss on disposal of long-lived assets
|
2,376
|
|
2,422
|
|
—
|
|
|||
Loss on FFF put and call rights
|
22,036
|
|
3,935
|
|
—
|
|
|||
Impairment on investments
|
5,002
|
|
—
|
|
—
|
|
|||
Other expense
|
—
|
|
55
|
|
87
|
|
|||
Adjusted EBITDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
|
|
|
|
||||||
Income before income taxes
|
$
|
516,804
|
|
$
|
531,291
|
|
$
|
284,882
|
|
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(205,146
|
)
|
—
|
|
|||
Equity in net income of unconsolidated affiliates
|
(1,174
|
)
|
(14,745
|
)
|
(21,647
|
)
|
|||
Interest and investment loss, net
|
5,300
|
|
4,512
|
|
1,021
|
|
|||
Loss on disposal of long-lived assets
|
2,376
|
|
2,422
|
|
—
|
|
|||
Other expense (income)
|
16,324
|
|
(614
|
)
|
1,692
|
|
|||
Operating income
|
539,630
|
|
317,720
|
|
265,948
|
|
|||
Depreciation and amortization
|
71,312
|
|
58,884
|
|
51,102
|
|
|||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
|||
Stock-based compensation
|
29,799
|
|
26,860
|
|
49,081
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Acquisition related expenses
|
8,335
|
|
15,790
|
|
15,804
|
|
|||
Strategic and financial restructuring expenses
|
2,512
|
|
31
|
|
268
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
ERP implementation expenses
|
1,000
|
|
2,028
|
|
4,870
|
|
|||
Acquisition related adjustment - revenue
|
300
|
|
18,049
|
|
5,624
|
|
|||
Equity in net income of unconsolidated affiliates
|
1,174
|
|
14,745
|
|
21,647
|
|
|||
Impairment on investments
|
5,002
|
|
—
|
|
—
|
|
|||
Deferred compensation plan income (expense)
|
3,960
|
|
4,020
|
|
(1,605
|
)
|
|||
Other income
|
1,752
|
|
584
|
|
—
|
|
|||
Adjusted EBITDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
|
|
|
|
||||||
Segment Adjusted EBITDA:
|
|
|
|
||||||
Supply Chain Services
|
$
|
535,380
|
|
$
|
493,763
|
|
$
|
439,013
|
|
Performance Services
|
123,429
|
|
121,090
|
|
110,787
|
|
|||
Corporate
|
(115,760
|
)
|
(113,262
|
)
|
(108,825
|
)
|
|||
Adjusted EBITDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net income attributable to stockholders
|
$
|
190,882
|
|
$
|
76,249
|
|
$
|
818,364
|
|
Adjustment of redeemable limited partners' capital to redemption amount
|
(157,581
|
)
|
37,176
|
|
(776,750
|
)
|
|||
Net income attributable to non-controlling interest in Premier LP
|
224,269
|
|
336,052
|
|
193,547
|
|
|||
Income tax expense
|
259,234
|
|
81,814
|
|
49,721
|
|
|||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
|||
Stock-based compensation
|
29,799
|
|
26,860
|
|
49,081
|
|
|||
Acquisition related expenses
|
8,335
|
|
15,790
|
|
15,804
|
|
|||
Strategic and financial restructuring expenses
|
2,512
|
|
31
|
|
268
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
ERP implementation expenses
|
1,000
|
|
2,028
|
|
4,870
|
|
|||
Acquisition related adjustment - revenue
|
300
|
|
18,049
|
|
5,624
|
|
|||
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(205,146
|
)
|
—
|
|
|||
Loss on disposal of long-lived assets
|
2,376
|
|
2,422
|
|
—
|
|
|||
Loss on FFF put and call rights
|
22,036
|
|
3,935
|
|
—
|
|
|||
Impairment on investments
|
5,002
|
|
—
|
|
—
|
|
|||
Other expense
|
1
|
|
55
|
|
—
|
|
|||
Non-GAAP adjusted fully distributed income before income taxes
|
466,438
|
|
438,195
|
|
388,765
|
|
|||
Income tax expense on fully distributed income before income taxes
(a)
|
149,340
|
|
170,896
|
|
155,506
|
|
|||
Non-GAAP Adjusted Fully Distributed Net Income
|
$
|
317,098
|
|
$
|
267,299
|
|
$
|
233,259
|
|
|
|
|
|
||||||
Reconciliation of denominator for earnings (loss) per share attributable to stockholders to Non-GAAP Adjusted Fully Distributed Earnings per Share
|
|||||||||
Weighted average:
|
|
|
|
||||||
Common shares used for basic earnings per share and diluted earnings (loss) per share
|
53,518
|
|
49,654
|
|
42,368
|
|
|||
Potentially dilutive shares
|
822
|
|
720
|
|
2,366
|
|
|||
Conversion of Class B common units
|
83,000
|
|
90,816
|
|
100,574
|
|
|||
Weighted average fully distributed shares outstanding - diluted
|
137,340
|
|
141,190
|
|
145,308
|
|
(a)
|
Reflects income tax expense at an estimated effective income tax rate of
32%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2018
,
39%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2017
and
40%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2016
.
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Earnings per share attributable to stockholders
|
$
|
3.57
|
|
$
|
1.54
|
|
$
|
19.32
|
|
Adjustment of redeemable limited partners' capital to redemption amount
|
(2.94
|
)
|
0.75
|
|
(18.33
|
)
|
|||
Net income attributable to non-controlling interest in Premier LP
|
4.19
|
|
6.77
|
|
4.57
|
|
|||
Income tax expense
|
4.84
|
|
1.65
|
|
1.17
|
|
|||
Amortization of purchased intangible assets
|
1.04
|
|
0.97
|
|
0.78
|
|
|||
Stock-based compensation
|
0.56
|
|
0.54
|
|
1.16
|
|
|||
Acquisition related expenses
|
0.16
|
|
0.32
|
|
0.37
|
|
|||
Strategic and financial restructuring expenses
|
0.05
|
|
—
|
|
0.01
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(3.31
|
)
|
(0.11
|
)
|
(0.11
|
)
|
|||
ERP implementation expenses
|
0.02
|
|
0.04
|
|
0.11
|
|
|||
Acquisition related adjustment - revenue
|
0.01
|
|
0.36
|
|
0.13
|
|
|||
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(4.13
|
)
|
—
|
|
|||
Loss on disposal of long-lived assets
|
0.04
|
|
0.05
|
|
—
|
|
|||
Loss on FFF put and call rights
|
0.41
|
|
0.08
|
|
—
|
|
|||
Impairment on investments
|
0.09
|
|
—
|
|
—
|
|
|||
Impact of corporation taxes
(a)
|
(2.80
|
)
|
(3.45
|
)
|
(3.67
|
)
|
|||
Impact of dilutive shares
(b)
|
(3.62
|
)
|
(3.49
|
)
|
(3.90
|
)
|
|||
Non-GAAP Adjusted Fully Distributed Earnings Per Share
|
$
|
2.31
|
|
$
|
1.89
|
|
$
|
1.61
|
|
(a)
|
Reflects income tax expense at an estimated effective income tax rate of
32%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2018
,
39%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2017
and
40%
of Non-GAAP adjusted fully distributed income before income taxes for
the year ended June 30, 2016
.
|
(b)
|
Reflects impact of dilutive shares, primarily attributable to the assumed conversion of all Class B common units for Class A common stock.
|
|
Year Ended June 30,
|
||||||||
Supply Chain Services
|
2018
|
2017
|
2016
|
||||||
Net revenue:
|
|
|
|
||||||
Net administrative fees
|
$
|
643,839
|
|
$
|
557,468
|
|
$
|
498,394
|
|
Other services and support
|
11,454
|
|
9,704
|
|
4,385
|
|
|||
Services
|
655,293
|
|
567,172
|
|
502,779
|
|
|||
Products
|
645,284
|
|
534,118
|
|
326,646
|
|
|||
Net revenue
|
1,300,577
|
|
1,101,290
|
|
829,425
|
|
|||
Cost of revenue:
|
|
|
|
||||||
Services
|
4,880
|
|
5,432
|
|
3,123
|
|
|||
Products
|
610,892
|
|
497,269
|
|
293,816
|
|
|||
Cost of revenue
|
615,772
|
|
502,701
|
|
296,939
|
|
|||
Gross profit
|
684,805
|
|
598,589
|
|
532,486
|
|
|||
Operating expenses:
|
|
|
|
||||||
Selling, general and administrative
|
166,725
|
|
155,860
|
|
120,344
|
|
|||
Amortization of purchased intangible assets
|
20,115
|
|
12,472
|
|
348
|
|
|||
Operating expenses
|
186,840
|
|
168,332
|
|
120,692
|
|
|||
Operating income
|
$
|
497,965
|
|
$
|
430,257
|
|
$
|
411,794
|
|
Depreciation and amortization
|
1,618
|
|
1,737
|
|
1,053
|
|
|||
Amortization of purchased intangible assets
|
20,115
|
|
12,472
|
|
348
|
|
|||
Acquisition related expenses
|
8,606
|
|
17,192
|
|
4,466
|
|
|||
Acquisition related adjustment - revenue
|
—
|
|
17,440
|
|
—
|
|
|||
Equity in net income of unconsolidated affiliates
|
1,904
|
|
14,684
|
|
21,352
|
|
|||
Impairment on investments
|
4,002
|
|
—
|
|
—
|
|
|||
Other income (expense)
|
1,170
|
|
(19
|
)
|
—
|
|
|||
Non-GAAP Segment Adjusted EBITDA
|
$
|
535,380
|
|
$
|
493,763
|
|
$
|
439,013
|
|
|
Year Ended June 30,
|
||||||||
Performance Services
|
2018
|
2017
|
2016
|
||||||
Net revenue:
|
|
|
|
||||||
Other services and support
|
$
|
360,679
|
|
$
|
353,383
|
|
$
|
333,169
|
|
Net revenue
|
360,679
|
|
353,383
|
|
333,169
|
|
|||
Cost of revenue:
|
|
|
|
||||||
Services
|
182,519
|
|
177,323
|
|
160,117
|
|
|||
Cost of revenue
|
182,519
|
|
177,323
|
|
160,117
|
|
|||
Gross profit
|
178,160
|
|
176,060
|
|
173,052
|
|
|||
Operating expenses:
|
|
|
|
||||||
Selling, general and administrative
|
114,088
|
|
101,405
|
|
120,958
|
|
|||
Research and development
|
1,418
|
|
2,278
|
|
2,064
|
|
|||
Amortization of purchased intangible assets
|
35,331
|
|
35,855
|
|
32,706
|
|
|||
Operating expenses
|
150,837
|
|
139,538
|
|
155,728
|
|
|||
Operating income
|
$
|
27,323
|
|
$
|
36,522
|
|
$
|
17,324
|
|
Depreciation and amortization
|
60,476
|
|
49,444
|
|
43,793
|
|
|||
Amortization of purchased intangible assets
|
35,331
|
|
35,855
|
|
32,706
|
|
|||
Acquisition related expenses
|
(271
|
)
|
(1,401
|
)
|
11,340
|
|
|||
Acquisition related adjustment - revenue
|
300
|
|
609
|
|
5,624
|
|
|||
Equity in net income (loss) of unconsolidated affiliates
|
(730
|
)
|
61
|
|
—
|
|
|||
Impairment on investments
|
1,000
|
|
—
|
|
—
|
|
|||
Non-GAAP Segment Adjusted EBITDA
|
$
|
123,429
|
|
$
|
121,090
|
|
$
|
110,787
|
|
|
Year Ended June 30,
|
||||||||
Corporate
|
2018
|
2017
|
2016
|
||||||
Other operating income:
|
|
|
|
||||||
Remeasurement of tax receivable agreement liabilities
|
$
|
177,174
|
|
$
|
5,447
|
|
$
|
4,818
|
|
Other operating income
|
177,174
|
|
5,447
|
|
4,818
|
|
|||
Operating expenses:
|
|
|
|
||||||
Selling, general and administrative
|
$
|
162,826
|
|
$
|
153,677
|
|
$
|
167,127
|
|
Research and development
|
6
|
|
829
|
|
861
|
|
|||
Operating expenses
|
$
|
162,832
|
|
$
|
154,506
|
|
$
|
167,988
|
|
Operating income (loss)
|
$
|
14,342
|
|
$
|
(149,059
|
)
|
$
|
(163,170
|
)
|
Depreciation and amortization
|
9,217
|
|
7,703
|
|
6,256
|
|
|||
Stock-based compensation
|
29,799
|
|
26,860
|
|
49,082
|
|
|||
Strategic and financial restructuring expenses
|
2,512
|
|
31
|
|
268
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
ERP implementation expenses
|
1,000
|
|
2,028
|
|
4,869
|
|
|||
Deferred compensation plan income (expense)
|
3,960
|
|
4,020
|
|
(1,606
|
)
|
|||
Equity in net income of unconsolidated affiliates
|
—
|
|
—
|
|
294
|
|
|||
Other income
|
584
|
|
602
|
|
—
|
|
|||
Non-GAAP Adjusted EBITDA
|
$
|
(115,760
|
)
|
$
|
(113,262
|
)
|
$
|
(108,825
|
)
|
|
Year Ended June 30,
|
|||||
|
2018
|
2017
|
||||
Net cash provided by (used in):
|
|
|
||||
Operating activities
|
$
|
507,706
|
|
$
|
392,247
|
|
Investing activities
|
(92,680
|
)
|
(465,053
|
)
|
||
Financing activities
|
(419,375
|
)
|
(19,276
|
)
|
||
Net decrease in cash and cash equivalents
|
$
|
(4,349
|
)
|
$
|
(92,082
|
)
|
|
Year Ended June 30,
|
|||||
|
2018
|
2017
|
||||
Net cash provided by operating activities
|
$
|
507,706
|
|
$
|
392,247
|
|
Purchases of property and equipment
|
(92,680
|
)
|
(71,372
|
)
|
||
Distributions to limited partners of Premier LP
|
(79,255
|
)
|
(90,434
|
)
|
||
Payments to limited partners of Premier LP related to tax receivable agreements
(a)
|
—
|
|
(13,959
|
)
|
||
Non-GAAP Free Cash Flow
|
$
|
335,771
|
|
$
|
216,482
|
|
(a)
|
The timing of TRA payments has shifted to July due to the change in our federal tax filing deadline, which has been extended one month to April. Although we did not make a TRA payment in fiscal 2018, we did make a
$17.9 million
TRA payment to limited partners in July of fiscal 2019.
|
|
|
Payments Due by Period
|
|||||||||||||
Contractual Obligations
|
Total
|
Less Than 1 Year
|
1-3 Years
|
3-5 Years
|
Greater Than 5 Years
|
||||||||||
Tax receivable agreement liabilities
(a)
|
$
|
255,101
|
|
$
|
17,925
|
|
$
|
33,542
|
|
$
|
31,085
|
|
$
|
172,549
|
|
Operating lease obligations
(b)
|
87,434
|
|
12,158
|
|
21,999
|
|
21,941
|
|
31,336
|
|
|||||
Notes payable
(c)
|
7,212
|
|
250
|
|
5,602
|
|
1,360
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
349,747
|
|
$
|
30,333
|
|
$
|
61,143
|
|
$
|
54,386
|
|
$
|
203,885
|
|
(a)
|
Estimated payments due to limited partners under TRAs are based on 85% of the estimated amount of tax savings we expect to receive, generally over a 15-year period.
|
(b)
|
Future contractual obligations for leases represent future minimum payments under noncancelable operating leases primarily for office space.
|
(c)
|
Notes payable are generally non-interest bearings and represent an aggregate principal amount of
$7.2 million
owed to departed member owners, payable over five years from the respective departure dates.
|
|
June 30, 2018
|
June 30, 2017
|
||||
Assets
|
|
|
||||
Cash and cash equivalents
|
$
|
152,386
|
|
$
|
156,735
|
|
Accounts receivable (net of $1,841 and $1,812 allowance for doubtful accounts, respectively)
|
185,874
|
|
159,745
|
|
||
Inventory
|
66,139
|
|
50,426
|
|
||
Prepaid expenses and other current assets
|
23,325
|
|
35,164
|
|
||
Due from related parties
|
894
|
|
6,742
|
|
||
Total current assets
|
428,618
|
|
408,812
|
|
||
Property and equipment (net of $297,591 and $236,460 accumulated depreciation, respectively)
|
206,693
|
|
187,365
|
|
||
Intangible assets (net of $153,635 and $99,198 accumulated amortization, respectively)
|
322,115
|
|
377,962
|
|
||
Goodwill
|
906,545
|
|
906,545
|
|
||
Deferred income tax assets
|
305,624
|
|
482,484
|
|
||
Deferred compensation plan assets
|
44,577
|
|
41,518
|
|
||
Investments in unconsolidated affiliates
|
94,053
|
|
92,879
|
|
||
Other assets
|
3,991
|
|
10,271
|
|
||
Total assets
|
$
|
2,312,216
|
|
$
|
2,507,836
|
|
|
|
|
||||
Liabilities, redeemable limited partners' capital and stockholders' deficit
|
|
|
||||
Accounts payable
|
$
|
60,130
|
|
$
|
42,815
|
|
Accrued expenses
|
64,257
|
|
55,857
|
|
||
Revenue share obligations
|
78,999
|
|
72,078
|
|
||
Limited partners' distribution payable
|
15,465
|
|
24,951
|
|
||
Accrued compensation and benefits
|
64,112
|
|
53,506
|
|
||
Deferred revenue
|
39,785
|
|
44,443
|
|
||
Current portion of tax receivable agreements
|
17,925
|
|
17,925
|
|
||
Current portion of long-term debt
|
100,250
|
|
227,993
|
|
||
Other liabilities
|
7,959
|
|
32,019
|
|
||
Total current liabilities
|
448,882
|
|
571,587
|
|
||
Long-term debt, less current portion
|
6,962
|
|
6,279
|
|
||
Tax receivable agreements, less current portion
|
237,176
|
|
321,796
|
|
||
Deferred compensation plan obligations
|
44,577
|
|
41,518
|
|
||
Deferred tax liabilities
|
17,569
|
|
48,227
|
|
||
Other liabilities
|
63,704
|
|
42,099
|
|
||
Total liabilities
|
818,870
|
|
1,031,506
|
|
||
|
|
|
|
|
|
June 30, 2018
|
June 30, 2017
|
||||
Redeemable limited partners' capital
|
2,920,410
|
|
3,138,583
|
|
||
Stockholders' deficit:
|
|
|
||||
Class A common stock, $0.01 par value, 500,000,000 shares authorized; 57,530,733 shares issued and 52,761,177 shares outstanding at June 30, 2018 and 51,943,281 shares issued and outstanding at June 30, 2017
|
575
|
|
519
|
|
||
Class B common stock, $0.000001 par value, 600,000,000 shares authorized; 80,335,701 and 87,298,888 shares issued and outstanding at June 30, 2018 and June 30, 2017, respectively
|
—
|
|
—
|
|
||
Treasury stock, at cost; 4,769,556 shares
|
(150,058
|
)
|
—
|
|
||
Additional paid-in-capital
|
—
|
|
—
|
|
||
Accumulated deficit
|
(1,277,581
|
)
|
(1,662,772
|
)
|
||
Accumulated other comprehensive income (loss)
|
—
|
|
—
|
|
||
Total stockholders' deficit
|
(1,427,064
|
)
|
(1,662,253
|
)
|
||
Total liabilities, redeemable limited partners' capital and stockholders' deficit
|
$
|
2,312,216
|
|
$
|
2,507,836
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net revenue:
|
|
|
|
||||||
Net administrative fees
|
$
|
643,839
|
|
$
|
557,468
|
|
$
|
498,394
|
|
Other services and support
|
372,133
|
|
363,087
|
|
337,554
|
|
|||
Services
|
1,015,972
|
|
920,555
|
|
835,948
|
|
|||
Products
|
645,284
|
|
534,118
|
|
326,646
|
|
|||
Net revenue
|
1,661,256
|
|
1,454,673
|
|
1,162,594
|
|
|||
Cost of revenue:
|
|
|
|
||||||
Services
|
187,399
|
|
182,775
|
|
163,240
|
|
|||
Products
|
610,892
|
|
497,273
|
|
293,816
|
|
|||
Cost of revenue
|
798,291
|
|
680,048
|
|
457,056
|
|
|||
Gross profit
|
862,965
|
|
774,625
|
|
705,538
|
|
|||
Other operating income:
|
|
|
|
||||||
Remeasurement of tax receivable agreement liabilities
|
177,174
|
|
5,447
|
|
4,818
|
|
|||
Other operating income
|
177,174
|
|
5,447
|
|
4,818
|
|
|||
Operating expenses:
|
|
|
|
||||||
Selling, general and administrative
|
443,639
|
|
410,918
|
|
408,429
|
|
|||
Research and development
|
1,423
|
|
3,107
|
|
2,925
|
|
|||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
|||
Operating expenses
|
500,509
|
|
462,352
|
|
444,408
|
|
|||
Operating income
|
539,630
|
|
317,720
|
|
265,948
|
|
|||
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
205,146
|
|
—
|
|
|||
Equity in net income of unconsolidated affiliates
|
1,174
|
|
14,745
|
|
21,647
|
|
|||
Interest and investment income (loss), net
|
(5,300
|
)
|
(4,512
|
)
|
(1,021
|
)
|
|||
Loss on disposal of long-lived assets
|
(2,376
|
)
|
(2,422
|
)
|
—
|
|
|||
Other income (expense)
|
(16,324
|
)
|
614
|
|
(1,692
|
)
|
|||
Other income (expense), net
|
(22,826
|
)
|
213,571
|
|
18,934
|
|
|||
Income before income taxes
|
516,804
|
|
531,291
|
|
284,882
|
|
|||
Income tax expense
|
259,234
|
|
81,814
|
|
49,721
|
|
|||
Net income
|
257,570
|
|
449,477
|
|
235,161
|
|
|||
Net income attributable to non-controlling interest in Premier LP
|
(224,269
|
)
|
(336,052
|
)
|
(193,547
|
)
|
|||
Adjustment of redeemable limited partners' capital to redemption amount
|
157,581
|
|
(37,176
|
)
|
776,750
|
|
|||
Net income attributable to stockholders
|
$
|
190,882
|
|
$
|
76,249
|
|
$
|
818,364
|
|
|
|
|
|
||||||
Weighted average shares outstanding:
|
|
|
|
||||||
Basic
|
53,518
|
|
49,654
|
|
42,368
|
|
|||
Diluted
|
137,340
|
|
50,374
|
|
145,308
|
|
|||
|
|
|
|
||||||
Earnings per share attributable to stockholders:
|
|
|
|
||||||
Basic
|
$
|
3.57
|
|
$
|
1.54
|
|
$
|
19.32
|
|
Diluted
|
$
|
1.36
|
|
$
|
1.51
|
|
$
|
0.97
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net income
|
$
|
257,570
|
|
$
|
449,477
|
|
$
|
235,161
|
|
Net unrealized gain (loss) on marketable securities
|
—
|
|
128
|
|
(110
|
)
|
|||
Total comprehensive income
|
257,570
|
|
449,605
|
|
235,051
|
|
|||
Less: comprehensive income attributable to non-controlling interest
|
(224,269
|
)
|
(336,137
|
)
|
(193,470
|
)
|
|||
Comprehensive income attributable to stockholders
|
$
|
33,301
|
|
$
|
113,468
|
|
$
|
41,581
|
|
|
Class A
Common Stock
|
Class B
Common Stock
|
Treasury Stock
|
Additional Paid-In Capital
|
Accumulated Deficit
|
Accumulated Other Comprehensive Income (Loss)
|
Total Stockholders' Deficit
|
||||||||||||||||||||
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||
Balance at June 30, 2015
|
37,669
|
|
$
|
377
|
|
106,383
|
|
$
|
—
|
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(3,118,474
|
)
|
$
|
(5
|
)
|
$
|
(3,118,102
|
)
|
Redemption of limited partners
|
—
|
|
—
|
|
(2,527
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Exchange of Class B common units for Class A common stock by member owners
|
7,723
|
|
77
|
|
(7,723
|
)
|
—
|
|
—
|
|
—
|
|
267,604
|
|
—
|
|
—
|
|
267,681
|
|
|||||||
Increase in additional paid-in capital related to quarterly exchange by member owners and departure of member owners
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
35,431
|
|
—
|
|
—
|
|
35,431
|
|
|||||||
Issuance of Class A common stock under equity incentive plan
|
523
|
|
5
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,552
|
|
—
|
|
—
|
|
3,557
|
|
|||||||
Issuance of Class A common stock under employee stock purchase plan
|
81
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,728
|
|
—
|
|
—
|
|
2,729
|
|
|||||||
Stock-based compensation expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
48,670
|
|
—
|
|
—
|
|
48,670
|
|
|||||||
Repurchase of vested restricted units for employee tax-withholding
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(7,863
|
)
|
—
|
|
—
|
|
(7,863
|
)
|
|||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
235,161
|
|
—
|
|
235,161
|
|
|||||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(193,547
|
)
|
—
|
|
(193,547
|
)
|
|||||||
Net unrealized loss on marketable securities
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(38
|
)
|
(38
|
)
|
|||||||
Final remittance of net income attributable to S2S Global before February 1, 2015
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,890
|
)
|
—
|
|
(1,890
|
)
|
|||||||
Adjustment to redeemable limited partners' capital to redemption amount
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(350,122
|
)
|
1,126,872
|
|
—
|
|
776,750
|
|
|||||||
Balance at June 30, 2016
|
45,996
|
|
$
|
460
|
|
96,133
|
|
$
|
—
|
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(1,951,878
|
)
|
$
|
(43
|
)
|
$
|
(1,951,461
|
)
|
Exchange of Class B units for Class A common stock by member owners
|
4,851
|
|
48
|
|
(4,851
|
)
|
—
|
|
—
|
|
—
|
|
157,323
|
|
—
|
|
—
|
|
157,371
|
|
|||||||
Exchange of Class B units for cash by member owners
|
—
|
|
—
|
|
(3,810
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Redemption of limited partners
|
—
|
|
—
|
|
(173
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Increase in additional paid-in capital related to quarterly exchange by member owners
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
35,141
|
|
—
|
|
—
|
|
35,141
|
|
|||||||
Issuance of Class A common stock under equity incentive plan
|
1,021
|
|
10
|
|
—
|
|
—
|
|
—
|
|
—
|
|
9,158
|
|
—
|
|
—
|
|
9,168
|
|
|||||||
Issuance of Class A common stock under employee stock purchase plan
|
75
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,482
|
|
—
|
|
—
|
|
2,483
|
|
|
Class A
Common Stock
|
Class B
Common Stock
|
Treasury Stock
|
Additional Paid-In Capital
|
Accumulated Deficit
|
Accumulated Other Comprehensive Income (Loss)
|
Total Stockholders' Deficit
|
||||||||||||||||||||
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||
Stock-based compensation expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
26,470
|
|
—
|
|
—
|
|
26,470
|
|
|||||||
Repurchase of vested restricted units for employee tax-withholding
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(17,717
|
)
|
—
|
|
—
|
|
(17,717
|
)
|
|||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
449,477
|
|
—
|
|
449,477
|
|
|||||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(336,052
|
)
|
—
|
|
(336,052
|
)
|
|||||||
Net realized loss on marketable securities
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
43
|
|
43
|
|
|||||||
Adjustment of redeemable limited partners' capital to redemption amount
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(212,857
|
)
|
175,681
|
|
—
|
|
(37,176
|
)
|
|||||||
Balance at June 30, 2017
|
51,943
|
|
$
|
519
|
|
87,299
|
|
$
|
—
|
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(1,662,772
|
)
|
$
|
—
|
|
$
|
(1,662,253
|
)
|
Exchange of Class B units for Class A common stock by member owners
|
6,531
|
|
49
|
|
(6,531
|
)
|
—
|
|
(1,649
|
)
|
50,071
|
|
166,001
|
|
—
|
|
—
|
|
216,121
|
|
|||||||
Redemption of limited partners
|
—
|
|
—
|
|
(432
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Decrease in additional paid-in capital related to quarterly exchange by member owners, including associated TRA revaluation
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,766
|
)
|
—
|
|
—
|
|
(5,766
|
)
|
|||||||
Issuance of Class A common stock under equity incentive plan
|
623
|
|
6
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8,013
|
|
—
|
|
—
|
|
8,019
|
|
|||||||
Issuance of Class A common stock under employee stock purchase plan
|
82
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,618
|
|
—
|
|
—
|
|
2,619
|
|
|||||||
Treasury stock
|
(6,418
|
)
|
—
|
|
—
|
|
—
|
|
6,418
|
|
(200,129
|
)
|
—
|
|
—
|
|
—
|
|
(200,129
|
)
|
|||||||
Stock-based compensation expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
29,408
|
|
—
|
|
—
|
|
29,408
|
|
|||||||
Repurchase of vested restricted units for employee tax-withholding
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,965
|
)
|
—
|
|
—
|
|
(5,965
|
)
|
|||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
257,570
|
|
—
|
|
257,570
|
|
|||||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(224,269
|
)
|
—
|
|
(224,269
|
)
|
|||||||
Adjustment of redeemable limited partners' capital to redemption amount
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(194,309
|
)
|
351,890
|
|
—
|
|
157,581
|
|
|||||||
Balance at June 30, 2018
|
52,761
|
|
$
|
575
|
|
80,336
|
|
$
|
—
|
|
4,769
|
|
$
|
(150,058
|
)
|
$
|
—
|
|
$
|
(1,277,581
|
)
|
$
|
—
|
|
$
|
(1,427,064
|
)
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Operating activities
|
|
|
|
||||||
Net income
|
$
|
257,570
|
|
$
|
449,477
|
|
$
|
235,161
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||||
Depreciation and amortization
|
126,759
|
|
107,211
|
|
84,156
|
|
|||
Equity in net income of unconsolidated affiliates
|
(1,174
|
)
|
(14,745
|
)
|
(21,647
|
)
|
|||
Deferred income taxes
|
232,990
|
|
60,562
|
|
25,714
|
|
|||
Stock-based compensation
|
29,408
|
|
26,470
|
|
48,670
|
|
|||
Remeasurement of tax receivable agreement liabilities
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(205,146
|
)
|
—
|
|
|||
Loss on disposal of long-lived assets
|
2,376
|
|
2,422
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
||||||
Accounts receivable, prepaid expenses and other current assets
|
(14,291
|
)
|
3,365
|
|
(37,250
|
)
|
|||
Other assets
|
(824
|
)
|
6,821
|
|
(9,638
|
)
|
|||
Inventories
|
(15,713
|
)
|
(16,349
|
)
|
3,937
|
|
|||
Accounts payable, accrued expenses and other current liabilities
|
32,767
|
|
(24,482
|
)
|
50,313
|
|
|||
Long-term liabilities
|
6,673
|
|
(901
|
)
|
(4,195
|
)
|
|||
Loss on FFF put and call rights
|
22,036
|
|
3,935
|
|
—
|
|
|||
Other operating activities
|
6,303
|
|
(946
|
)
|
1,067
|
|
|||
Net cash provided by operating activities
|
$
|
507,706
|
|
$
|
392,247
|
|
$
|
371,470
|
|
Investing activities
|
|
|
|
||||||
Purchases of property and equipment
|
$
|
(92,680
|
)
|
$
|
(71,372
|
)
|
$
|
(76,990
|
)
|
Purchase of marketable securities
|
—
|
|
—
|
|
(19,211
|
)
|
|||
Proceeds from sale of marketable securities
|
—
|
|
48,013
|
|
386,372
|
|
|||
Acquisition of Innovatix, LLC and Essensa Ventures, LLC, net of cash acquired
|
—
|
|
(319,717
|
)
|
—
|
|
|||
Acquisition of Acro Pharmaceuticals, net of cash acquired
|
—
|
|
(62,892
|
)
|
—
|
|
|||
Acquisition of CECity.com, Inc., net of cash acquired
|
—
|
|
—
|
|
(398,261
|
)
|
|||
Acquisition of Healthcare Insights, LLC, net of cash acquired
|
—
|
|
—
|
|
(64,274
|
)
|
|||
Acquisition of InFlowHealth, LLC
|
—
|
|
—
|
|
(6,088
|
)
|
|||
Investment in unconsolidated affiliates
|
—
|
|
(65,660
|
)
|
(3,250
|
)
|
|||
Distributions received on equity investments in unconsolidated affiliates
|
—
|
|
6,550
|
|
22,093
|
|
|||
Other investing activities
|
—
|
|
25
|
|
(27
|
)
|
|||
Net cash used in investing activities
|
$
|
(92,680
|
)
|
$
|
(465,053
|
)
|
$
|
(159,636
|
)
|
Financing activities
|
|
|
|
||||||
Payments made on notes payable
|
$
|
(8,002
|
)
|
$
|
(5,486
|
)
|
$
|
(2,143
|
)
|
Proceeds from credit facility
|
30,000
|
|
425,000
|
|
150,000
|
|
|||
Payments on credit facility
|
(150,000
|
)
|
(205,000
|
)
|
(150,000
|
)
|
|||
Proceeds from exercise of stock options under equity incentive plans
|
8,019
|
|
9,168
|
|
3,552
|
|
|||
Proceeds from issuance of Class A common stock under stock purchase plan
|
2,619
|
|
2,483
|
|
2,317
|
|
|||
Repurchase of vested restricted units for employee tax-withholding
|
(5,965
|
)
|
(17,717
|
)
|
(7,863
|
)
|
|||
Settlement of exchange of Class B units by member owners
|
—
|
|
(123,331
|
)
|
—
|
|
|||
Distributions to limited partners of Premier LP
|
(79,255
|
)
|
(90,434
|
)
|
(92,707
|
)
|
|||
Payments to limited partners of Premier LP related to tax receivable agreements
|
—
|
|
(13,959
|
)
|
(10,805
|
)
|
|||
Repurchase of Class A common stock (held as treasury stock)
|
(200,129
|
)
|
—
|
|
—
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Earn-out liability payment to GNYHA Holdings
|
(16,662
|
)
|
—
|
|
—
|
|
|||
Final remittance of net income attributable to former S2S Global minority shareholder
|
—
|
|
—
|
|
(1,890
|
)
|
|||
Net cash used in financing activities
|
$
|
(419,375
|
)
|
$
|
(19,276
|
)
|
$
|
(109,539
|
)
|
Net increase (decrease) in cash and cash equivalents
|
(4,349
|
)
|
(92,082
|
)
|
102,295
|
|
|||
Cash and cash equivalents at beginning of year
|
156,735
|
|
248,817
|
|
146,522
|
|
|||
Cash and cash equivalents at end of year
|
$
|
152,386
|
|
$
|
156,735
|
|
$
|
248,817
|
|
|
|
|
|
||||||
Supplemental schedule of non cash investing and financing activities:
|
|
|
|
||||||
Increase (decrease) in redeemable limited partners' capital for adjustment to fair value, with offsetting decrease (increase) in additional paid-in-capital and accumulated deficit
|
$
|
(157,581
|
)
|
$
|
37,176
|
|
$
|
(776,750
|
)
|
Reduction in redeemable limited partners' capital, with offsetting increase in common stock and additional paid-in capital related to quarterly exchange by member owners
|
$
|
216,122
|
|
$
|
157,371
|
|
$
|
267,681
|
|
Reduction in redeemable limited partners' capital for limited partners' distribution payable
|
$
|
15,465
|
|
$
|
24,951
|
|
$
|
22,493
|
|
Distributions utilized to reduce subscriptions, notes, interest and accounts receivable from member owners
|
$
|
1,972
|
|
$
|
2,049
|
|
$
|
5,407
|
|
Net increase in deferred tax assets related to quarterly exchanges by member owners and other adjustments
|
$
|
86,788
|
|
$
|
114,605
|
|
$
|
94,839
|
|
Net increase in tax receivable agreement liabilities related to quarterly exchanges by member owners and other adjustments
|
$
|
92,554
|
|
$
|
79,463
|
|
$
|
59,408
|
|
Net increase (decrease) in additional paid-in capital related to quarterly exchanges by member owners and other adjustments
|
$
|
(5,766
|
)
|
$
|
35,141
|
|
$
|
35,431
|
|
Net increase in investments in unconsolidated affiliates related to deferred taxes attributed to the net fair value of FFF enterprises, Inc. put and call rights, with offsetting increases in deferred tax assets and deferred tax liabilities
|
$
|
—
|
|
$
|
15,460
|
|
$
|
—
|
|
Payable to member owners incurred upon repurchase of ownership interest
|
$
|
942
|
|
$
|
416
|
|
$
|
3,556
|
|
|
June 30, 2018
|
June 30, 2017
|
||||
Assets
|
|
|
||||
Current
|
$
|
393,863
|
|
$
|
385,477
|
|
Noncurrent
|
1,577,974
|
|
1,616,539
|
|
||
Total assets of Premier LP
|
$
|
1,971,837
|
|
$
|
2,002,016
|
|
|
|
|
||||
Liabilities
|
|
|
||||
Current
|
$
|
457,172
|
|
$
|
560,582
|
|
Noncurrent
|
128,793
|
|
134,635
|
|
||
Total liabilities of Premier LP
|
$
|
585,965
|
|
$
|
695,217
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Premier LP net income
|
$
|
371,131
|
|
$
|
522,310
|
|
$
|
275,955
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net cash provided by (used in):
|
|
|
|
||||||
Operating activities
|
$
|
534,643
|
|
$
|
439,746
|
|
$
|
393,352
|
|
Investing activities
|
(92,680
|
)
|
(465,053
|
)
|
(159,636
|
)
|
|||
Financing activities
|
(457,673
|
)
|
(51,290
|
)
|
(150,330
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
(15,710
|
)
|
(76,597
|
)
|
83,386
|
|
|||
Cash and cash equivalents at beginning of year
|
133,451
|
|
210,048
|
|
126,662
|
|
|||
Cash and cash equivalents at end of year
|
$
|
117,741
|
|
$
|
133,451
|
|
$
|
210,048
|
|
|
Acquisition Date Fair Value
|
||
Cash paid at closing
|
$
|
227,500
|
|
Cash paid on January 10, 2017
|
97,500
|
|
|
Purchase price
|
325,000
|
|
|
Additional cash paid at closing
|
10,984
|
|
|
Adjusted purchase price
|
335,984
|
|
|
Earn-out liability
|
16,662
|
|
|
Receivable from GNYHA Holdings, LLC
|
(3,000
|
)
|
|
Total consideration paid
|
349,646
|
|
|
Cash acquired
|
(16,267
|
)
|
|
Net consideration
|
333,379
|
|
|
50% ownership interest in Innovatix
|
218,356
|
|
|
Payable to Innovatix and Essensa
|
(5,765
|
)
|
|
Enterprise value
|
545,970
|
|
|
|
|
||
Accounts receivable
|
21,242
|
|
|
Prepaid expenses and other current assets
|
686
|
|
|
Fixed assets
|
3,476
|
|
|
Intangible assets
|
241,494
|
|
|
Total assets acquired
|
266,898
|
|
|
Accrued expenses
|
5,264
|
|
|
Revenue share obligations
|
7,011
|
|
|
Other current liabilities
|
694
|
|
|
Total liabilities assumed
|
12,969
|
|
|
Deferred tax liability
|
42,636
|
|
|
Goodwill
|
$
|
334,677
|
|
|
Acquisition Date Fair Value
|
||
Purchase price
|
$
|
400,000
|
|
Working capital adjustment
|
(28
|
)
|
|
Total purchase price
|
399,972
|
|
|
Less: cash acquired
|
(1,708
|
)
|
|
Total purchase price, net of cash acquired
|
398,264
|
|
|
Accounts receivable
|
3,877
|
|
|
Other current assets
|
295
|
|
|
Property and equipment
|
605
|
|
|
Intangible assets
|
125,400
|
|
|
Total assets acquired
|
130,177
|
|
|
Other current liabilities
|
5,871
|
|
|
Total liabilities assumed
|
5,871
|
|
|
Goodwill
|
$
|
273,958
|
|
|
Carrying Value
|
|
Equity in Net Income (Loss)
|
|||||||||||||
|
June 30,
|
|
Year Ended June 30,
|
|||||||||||||
|
2018
|
2017
|
|
2018
|
2017
|
2016
|
||||||||||
FFF
|
$
|
91,804
|
|
$
|
85,520
|
|
|
$
|
6,283
|
|
$
|
4,400
|
|
$
|
—
|
|
Bloodbuy
|
1,918
|
|
2,066
|
|
|
(147
|
)
|
(119
|
)
|
(65
|
)
|
|||||
PharmaPoint
|
—
|
|
4,232
|
|
|
(4,232
|
)
|
(340
|
)
|
(379
|
)
|
|||||
Innovatix
|
—
|
|
—
|
|
|
—
|
|
10,743
|
|
21,797
|
|
|||||
Other investments
|
331
|
|
1,061
|
|
|
(730
|
)
|
61
|
|
294
|
|
|||||
Total investments
|
$
|
94,053
|
|
$
|
92,879
|
|
|
$
|
1,174
|
|
$
|
14,745
|
|
$
|
21,647
|
|
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
Significant Other Observable Inputs
(Level 2)
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
June 30, 2018
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
62,684
|
|
$
|
62,684
|
|
$
|
—
|
|
$
|
—
|
|
FFF call right
|
610
|
|
—
|
|
—
|
|
610
|
|
||||
Deferred compensation plan assets
|
48,215
|
|
48,215
|
|
—
|
|
—
|
|
||||
Total assets
|
$
|
111,509
|
|
$
|
110,899
|
|
$
|
—
|
|
$
|
610
|
|
FFF put right
|
$
|
42,041
|
|
$
|
—
|
|
$
|
—
|
|
$
|
42,041
|
|
Total liabilities
|
$
|
42,041
|
|
$
|
—
|
|
$
|
—
|
|
$
|
42,041
|
|
|
|
|
|
|
||||||||
June 30, 2017
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
22,218
|
|
$
|
22,218
|
|
$
|
—
|
|
$
|
—
|
|
FFF call right
|
4,655
|
|
—
|
|
—
|
|
4,655
|
|
||||
Deferred compensation plan assets
|
47,202
|
|
47,202
|
|
—
|
|
—
|
|
||||
Total assets
|
$
|
74,075
|
|
$
|
69,420
|
|
$
|
—
|
|
$
|
4,655
|
|
Earn-out liabilities
|
$
|
21,310
|
|
$
|
—
|
|
$
|
—
|
|
$
|
21,310
|
|
FFF put right
|
24,050
|
|
—
|
|
—
|
|
24,050
|
|
||||
Total liabilities
|
$
|
45,360
|
|
$
|
—
|
|
$
|
—
|
|
$
|
45,360
|
|
|
Beginning Balance
|
Purchases (Settlements)
|
Gain (Loss)
|
Ending Balance
|
||||||||
Year ended June 30, 2018
|
|
|
|
|
||||||||
FFF call right
|
$
|
4,655
|
|
$
|
—
|
|
$
|
(4,045
|
)
|
$
|
610
|
|
Total Level 3 assets
|
$
|
4,655
|
|
$
|
—
|
|
$
|
(4,045
|
)
|
$
|
610
|
|
Earn-out liabilities
|
$
|
21,310
|
|
$
|
(21,125
|
)
|
$
|
185
|
|
$
|
—
|
|
FFF put right
|
24,050
|
|
—
|
|
(17,991
|
)
|
42,041
|
|
||||
Total Level 3 liabilities
|
$
|
45,360
|
|
$
|
(21,125
|
)
|
$
|
(17,806
|
)
|
$
|
42,041
|
|
|
|
|
|
|
||||||||
Year ended June 30, 2017
|
|
|
|
|
||||||||
FFF call right
|
$
|
—
|
|
$
|
10,361
|
|
$
|
(5,706
|
)
|
$
|
4,655
|
|
Total Level 3 assets
|
$
|
—
|
|
$
|
10,361
|
|
$
|
(5,706
|
)
|
$
|
4,655
|
|
Earn-out liabilities
|
$
|
4,128
|
|
$
|
16,662
|
|
$
|
(520
|
)
|
$
|
21,310
|
|
FFF put right
|
—
|
|
25,821
|
|
1,771
|
|
24,050
|
|
||||
Total Level 3 liabilities
|
$
|
4,128
|
|
$
|
42,483
|
|
$
|
1,251
|
|
$
|
45,360
|
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Trade accounts receivable
|
$
|
150,426
|
|
$
|
130,126
|
|
Managed services receivable
|
35,766
|
|
31,383
|
|
||
Other
|
1,523
|
|
48
|
|
||
Total accounts receivable
|
187,715
|
|
161,557
|
|
||
Allowance for doubtful accounts
|
(1,841
|
)
|
(1,812
|
)
|
||
Accounts receivable, net
|
$
|
185,874
|
|
$
|
159,745
|
|
|
June 30,
|
||||||
|
Useful life
|
2018
|
2017
|
||||
Capitalized software
|
2-5 years
|
$
|
409,017
|
|
$
|
340,271
|
|
Computer hardware
|
3-5 years
|
68,057
|
|
57,320
|
|
||
Furniture and other equipment
|
5 years
|
8,284
|
|
8,218
|
|
||
Leasehold improvements
|
Lesser of estimated useful life or term of lease
|
18,926
|
|
18,016
|
|
||
Total property and equipment
|
|
504,284
|
|
423,825
|
|
||
Accumulated depreciation and amortization
|
|
(297,591
|
)
|
(236,460
|
)
|
||
Property and equipment, net
|
|
$
|
206,693
|
|
$
|
187,365
|
|
|
|
June 30,
|
|||||
|
Useful Life
|
2018
|
2017
|
||||
Member relationships
|
14.7 years
|
$
|
220,100
|
|
$
|
220,100
|
|
Technology
|
5.0 years
|
142,317
|
|
143,727
|
|
||
Customer relationships
|
8.3 years
|
48,120
|
|
48,120
|
|
||
Trade names
|
8.3 years
|
22,710
|
|
22,710
|
|
||
Distribution network
|
10.0 years
|
22,400
|
|
22,400
|
|
||
Favorable lease commitments
|
10.1 years
|
11,393
|
|
11,393
|
|
||
Non-compete agreements
|
5.9 years
|
8,710
|
|
8,710
|
|
||
Total intangible assets
|
|
475,750
|
|
477,160
|
|
||
Accumulated amortization
|
|
(153,635
|
)
|
(99,198
|
)
|
||
Total intangible assets, net
|
|
$
|
322,115
|
|
$
|
377,962
|
|
2019
|
$
|
53,941
|
|
2020
|
49,077
|
|
|
2021
|
27,953
|
|
|
2022
|
24,964
|
|
|
2023
|
23,890
|
|
|
Thereafter
|
139,290
|
|
|
Total amortization expense
(a)
|
$
|
319,115
|
|
(a)
|
Estimated aggregate amortization expense for the next five fiscal years and thereafter excludes amortization on technology under development, which was classified as technology in the total intangible assets, net table, of
$3.0 million
at
June 30, 2018
.
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Supply Chain Services
|
$
|
235,485
|
|
$
|
255,601
|
|
Performance Services
|
86,630
|
|
122,361
|
|
||
Total intangible assets, net
|
$
|
322,115
|
|
$
|
377,962
|
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Supply Chain Services
|
$
|
400,348
|
|
$
|
400,348
|
|
Performance Services
|
506,197
|
|
506,197
|
|
||
Total goodwill
|
$
|
906,545
|
|
$
|
906,545
|
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Deferred loan costs, net
|
$
|
506
|
|
$
|
1,051
|
|
FFF call right
|
610
|
|
4,655
|
|
||
Other
|
2,875
|
|
4,565
|
|
||
Total other long-term assets
|
$
|
3,991
|
|
$
|
10,271
|
|
|
|
|
June 30,
|
|||||||
|
Commitment Amount
|
Due Date
|
2018
|
2017
|
||||||
Credit Facility
|
$
|
750,000
|
|
June 24, 2019
|
$
|
100,000
|
|
$
|
220,000
|
|
Notes payable
|
—
|
|
Various
|
7,212
|
|
14,272
|
|
|||
Total debt
|
|
|
107,212
|
|
234,272
|
|
||||
Less: current portion
|
|
|
(100,250
|
)
|
(227,993
|
)
|
||||
Total long-term debt
|
|
|
$
|
6,962
|
|
$
|
6,279
|
|
2019
|
$
|
250
|
|
2020
|
2,046
|
|
|
2021
|
3,556
|
|
|
2022
|
416
|
|
|
2023
|
944
|
|
|
Thereafter
|
—
|
|
|
Total principal payments
|
$
|
7,212
|
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Deferred rent
|
$
|
13,402
|
|
$
|
14,045
|
|
Reserve for uncertain tax positions
|
8,261
|
|
3,819
|
|
||
Earn-out liability, less current portion
|
—
|
|
185
|
|
||
FFF put right
|
42,041
|
|
24,050
|
|
||
Total other long-term liabilities
|
$
|
63,704
|
|
$
|
42,099
|
|
|
Receivables From Limited Partners
|
Redeemable Limited Partners' Capital
|
Accumulated Other Comprehensive Income (Loss)
|
Total Redeemable Limited Partners' Capital
|
||||||||
June 30, 2015
|
$
|
(11,633
|
)
|
$
|
4,091,473
|
|
$
|
(8
|
)
|
$
|
4,079,832
|
|
Distributions applied to receivables from limited partners
|
5,407
|
|
—
|
|
—
|
|
5,407
|
|
||||
Redemption of limited partners
|
—
|
|
(4,281
|
)
|
—
|
|
(4,281
|
)
|
||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
193,547
|
|
—
|
|
193,547
|
|
||||
Distributions to limited partners
|
—
|
|
(92,767
|
)
|
—
|
|
(92,767
|
)
|
||||
Net unrealized loss on marketable securities
|
—
|
|
—
|
|
(77
|
)
|
(77
|
)
|
||||
Exchange of Class B common units for Class A common stock by member owners
|
—
|
|
(267,681
|
)
|
—
|
|
(267,681
|
)
|
||||
Adjustment of redeemable limited partners' capital to redemption amount
|
—
|
|
(776,750
|
)
|
—
|
|
(776,750
|
)
|
||||
June 30, 2016
|
$
|
(6,226
|
)
|
$
|
3,143,541
|
|
$
|
(85
|
)
|
$
|
3,137,230
|
|
Distributions applied to receivables from limited partners
|
2,049
|
|
—
|
|
—
|
|
2,049
|
|
|
Receivables From Limited Partners
|
Redeemable Limited Partners' Capital
|
Accumulated Other Comprehensive Income (Loss)
|
Total Redeemable Limited Partners' Capital
|
||||||||
Redemption of limited partners
|
—
|
|
(416
|
)
|
—
|
|
(416
|
)
|
||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
336,052
|
|
—
|
|
336,052
|
|
||||
Distributions to limited partners
|
—
|
|
(92,892
|
)
|
—
|
|
(92,892
|
)
|
||||
Net realized loss on marketable securities
|
—
|
|
—
|
|
85
|
|
85
|
|
||||
Exchange of Class B common units for Class A common stock by member owners
|
—
|
|
(157,371
|
)
|
—
|
|
(157,371
|
)
|
||||
Exchange of Class B common units for cash by member owners
|
—
|
|
(123,330
|
)
|
—
|
|
(123,330
|
)
|
||||
Adjustment of redeemable limited partners' capital to redemption amount
|
—
|
|
37,176
|
|
—
|
|
37,176
|
|
||||
June 30, 2017
|
$
|
(4,177
|
)
|
$
|
3,142,760
|
|
$
|
—
|
|
$
|
3,138,583
|
|
Distributions applied to receivables from limited partners
|
1,972
|
|
—
|
|
—
|
|
1,972
|
|
||||
Redemption of limited partners
|
—
|
|
(942
|
)
|
—
|
|
(942
|
)
|
||||
Net income attributable to non-controlling interest in Premier LP
|
—
|
|
224,269
|
|
—
|
|
224,269
|
|
||||
Distributions to limited partners
|
—
|
|
(69,770
|
)
|
—
|
|
(69,770
|
)
|
||||
Exchange of Class B common units for Class A common stock by member owners
|
—
|
|
(216,121
|
)
|
—
|
|
(216,121
|
)
|
||||
Adjustment of redeemable limited partners' capital to redemption amount
|
—
|
|
(157,581
|
)
|
—
|
|
(157,581
|
)
|
||||
June 30, 2018
|
$
|
(2,205
|
)
|
$
|
2,922,615
|
|
$
|
—
|
|
$
|
2,920,410
|
|
Date
|
Distribution
(a)
|
||
August 24, 2017
|
$
|
24,951
|
|
November 22, 2017
|
$
|
20,752
|
|
February 22, 2018
|
$
|
20,396
|
|
May 24, 2018
|
$
|
13,157
|
|
(a)
|
Distributions are equal to Premier LP's total taxable income from the preceding fiscal quarter-to-date period for each respective distribution date multiplied by the Company's standalone effective combined federal, state and local income tax rate for each respective distribution date. Premier LP expects to make a
$15.5
million quarterly distribution on or before August 23, 2018. The distribution is reflected in limited partners' distribution payable in the accompanying Consolidated Balance Sheets at
June 30, 2018
.
|
Date of Quarterly Exchange
|
Number of Class B Common Units Exchanged
|
Reduction in Redeemable Limited Partners' Capital
|
|||
July 31, 2017
|
1,231,410
|
|
$
|
42,976
|
|
October 31, 2017
|
3,651,294
|
|
119,289
|
|
|
January 31, 2018
|
1,006,435
|
|
32,659
|
|
|
April 30, 2018
|
642,566
|
|
21,197
|
|
|
|
6,531,705
|
|
$
|
216,121
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Numerator for basic earnings per share:
|
|
|
|
||||||
Net income attributable to stockholders
|
$
|
190,882
|
|
$
|
76,249
|
|
$
|
818,364
|
|
|
|
|
|
||||||
Numerator for diluted earnings per share:
|
|
|
|
||||||
Net income attributable to stockholders
|
$
|
190,882
|
|
$
|
76,249
|
|
$
|
818,364
|
|
Adjustment of redeemable limited partners' capital to redemption amount
|
(157,581
|
)
|
—
|
|
(776,750
|
)
|
|||
Net income attributable to non-controlling interest in Premier LP
|
224,269
|
|
—
|
|
193,547
|
|
|||
Net income
|
257,570
|
|
76,249
|
|
235,161
|
|
|||
Tax effect on Premier, Inc. net income
(a)
|
(70,257
|
)
|
—
|
|
(93,836
|
)
|
|||
Adjusted net income
|
$
|
187,313
|
|
$
|
76,249
|
|
$
|
141,325
|
|
|
|
|
|
||||||
Denominator for basic earnings per share:
|
|
|
|
||||||
Weighted average shares
(b)
|
53,518
|
|
49,654
|
|
42,368
|
|
|||
|
|
|
|
||||||
Denominator for diluted earnings per share:
|
|
|
|
||||||
Weighted average shares
(b)
|
53,518
|
|
49,654
|
|
42,368
|
|
|||
Effect of dilutive securities:
(c)
|
|
|
|
||||||
Stock options
|
275
|
|
286
|
|
348
|
|
|||
Restricted stock
|
295
|
|
215
|
|
589
|
|
|||
Performance share awards
|
252
|
|
219
|
|
1,429
|
|
|||
Class B shares outstanding
|
83,000
|
|
—
|
|
100,574
|
|
|||
Weighted average shares and assumed conversions
|
137,340
|
|
50,374
|
|
145,308
|
|
|||
|
|
|
|
||||||
Basic earnings per share
|
$
|
3.57
|
|
$
|
1.54
|
|
$
|
19.32
|
|
Diluted earnings per share
|
$
|
1.36
|
|
$
|
1.51
|
|
$
|
0.97
|
|
(a)
|
Represents income tax expense related to Premier, Inc. retaining the portion of net income attributable to income from non-controlling interest in Premier, LP for the purpose of diluted earnings (loss) per share.
|
(b)
|
Weighted average number of common shares used for basic earnings per share excludes weighted average shares of non-vested stock options, non-vested restricted stock, non-vested performance share awards and Class B shares outstanding for
the years ended June 30, 2018, 2017 and 2016
.
|
(c)
|
For
the year ended June 30, 2018
, the effect of
1.6 million
stock options were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. For
the year ended June 30, 2017
, the effect of
90.8 million
Class B common units exchangeable for Class A common shares and
1.3 million
stock options were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. For
the year ended June 30, 2016
, the effect of
1.3 million
stock options were excluded from diluted weighted average share outstanding as they had an anti-dilutive effect.
|
Quarterly Exchange by Member Owners
|
Class B Common Shares Retired Upon Exchange
(a)
|
Class B Common Shares Outstanding After Exchange
(a)
|
Class A Common Shares Outstanding After Exchange
(b)
|
Percentage of Combined Voting Power Class B/Class A Common Stock
|
|||
July 31, 2017
|
1,231,410
|
|
86,067,478
|
|
53,212,057
|
|
62%/38%
|
October 31, 2017
|
3,651,294
|
|
82,416,184
|
|
57,215,143
|
|
59%/41%
|
January 31, 2018
|
1,006,435
|
|
81,169,319
|
|
54,829,086
|
|
60%/40%
|
April 30, 2018
|
642,566
|
|
80,335,701
|
|
52,585,392
|
|
60%/40%
|
July 31, 2018
(c)
|
816,468
|
|
79,519,233
|
|
53,256,897
|
|
60%/40%
|
(a)
|
The number of Class B common shares retired or outstanding are equivalent to the number of Class B common units retired upon exchange or outstanding after the exchange, as applicable.
|
(b)
|
The number of Class A common shares outstanding after exchange also includes activity related to the Company's share repurchase program (see Note 14 - Stockholders' Deficit), equity incentive plan (see Note 16 - Stock-Based Compensation) and departed member owners (see Note 13 - Redeemable Limited Partners' Capital).
|
(c)
|
As the quarterly exchange occurred on July 31, 2018, the impact of the exchange is not reflected in the consolidated financial statements for
the year ended June 30, 2018
.
|
|
Restricted Stock
|
|
Performance Share Awards
|
|
Stock Options
|
||||||||||||
|
Number of Awards
|
Weighted Average Fair Value at Grant Date
|
|
Number of Awards
|
Weighted Average Fair Value at Grant Date
|
|
Number of Options
|
Weighted Average Exercise Price
|
|||||||||
Outstanding at June 30, 2017
|
576,988
|
|
$
|
32.92
|
|
|
1,085,872
|
|
$
|
32.79
|
|
|
3,372,499
|
|
$
|
30.31
|
|
Granted
|
261,966
|
|
$
|
32.92
|
|
|
700,733
|
|
$
|
32.62
|
|
|
560,497
|
|
$
|
32.79
|
|
Vested/exercised
|
(183,988
|
)
|
$
|
31.89
|
|
|
(352,867
|
)
|
$
|
31.73
|
|
|
(284,490
|
)
|
$
|
30.65
|
|
Forfeited
|
(49,093
|
)
|
$
|
32.71
|
|
|
(115,691
|
)
|
$
|
32.55
|
|
|
(149,255
|
)
|
$
|
33.70
|
|
Outstanding at June 30, 2018
|
605,873
|
|
$
|
33.25
|
|
|
1,318,047
|
|
$
|
33.00
|
|
|
3,499,251
|
|
$
|
30.53
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Stock options outstanding and exercisable at June 30, 2018
|
|
|
|
|
|
|
2,501,734
|
|
$
|
29.56
|
|
|
Unrecognized Stock-Based Compensation Expense
|
Weighted Average Amortization Period
|
||
Restricted stock
|
$
|
8,233
|
|
1.65 years
|
Performance share awards
|
17,924
|
|
1.70 years
|
|
Stock options
|
6,620
|
|
1.77 years
|
|
Total unrecognized stock-based compensation expense
|
$
|
32,777
|
|
1.70 years
|
|
Intrinsic Value of Stock Options
|
||
Outstanding and exercisable
|
$
|
17,091
|
|
Expected to vest
|
3,398
|
|
|
Total outstanding
|
$
|
20,489
|
|
|
|
||
Exercised during the year ended June 30, 2018
|
$
|
1,157
|
|
|
June 30,
|
||
|
2018
|
2017
|
2016
|
Expected life
(a)
|
6 years
|
6 years
|
6 years
|
Expected dividend
(b)
|
—
|
—
|
—
|
Expected volatility
(c)
|
29.4% - 32.3%
|
32.0% - 33.0%
|
32.7% - 33.5%
|
Risk-free interest rate
(d)
|
1.9% - 2.9%
|
1.3% - 2.1%
|
1.2% - 1.8%
|
Weighted average option grant date fair value
|
$9.48 - $11.42
|
$10.48 - $12.00
|
$11.11 - $12.40
|
(a)
|
The
six
-year expected life (estimated period of time outstanding) of stock options granted was estimated using the "Simplified Method" which utilizes the midpoint between the vesting date and the end of the contractual term. This method was utilized for the stock options due to the lack of historical exercise behavior of Premier's employees.
|
(b)
|
No dividends are expected to be paid over the contractual term of the stock options granted, resulting in the use of a
zero
expected dividend rate.
|
(c)
|
The expected volatility rate is based on the observed historical volatilities of comparable companies.
|
(d)
|
The risk-free interest rate was interpolated from the
five
-year and
seven
-year Constant Maturity Treasury rate published by the United States Treasury as of the date of the grant.
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Current:
|
|
|
|
||||||
Federal
|
$
|
22,103
|
|
$
|
16,638
|
|
$
|
19,765
|
|
State
|
4,141
|
|
4,614
|
|
4,242
|
|
|||
Total current expense
|
26,244
|
|
21,252
|
|
24,007
|
|
|||
Deferred:
|
|
|
|
||||||
Federal
|
232,673
|
|
49,392
|
|
15,703
|
|
|||
State
|
317
|
|
11,170
|
|
10,011
|
|
|||
Total deferred expense
|
232,990
|
|
60,562
|
|
25,714
|
|
|||
Provision for income taxes
|
$
|
259,234
|
|
$
|
81,814
|
|
$
|
49,721
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Computed tax expense
|
$
|
145,015
|
|
$
|
185,952
|
|
$
|
99,709
|
|
Partnership income not subject to tax
|
(70,257
|
)
|
(85,142
|
)
|
(85,063
|
)
|
|||
State taxes (net of federal benefit)
|
12,901
|
|
9,823
|
|
664
|
|
|||
Remeasurement adjustments and other permanent items
|
(53,151
|
)
|
(78,998
|
)
|
1,051
|
|
|||
Expense (benefit) on subsidiaries treated separately for income tax purposes
|
(983
|
)
|
18,660
|
|
(7,497
|
)
|
|||
Change in valuation allowance
|
(33,106
|
)
|
26,829
|
|
36,279
|
|
|||
Deferred tax remeasurement
|
256,787
|
|
9,950
|
|
8,080
|
|
|||
Other
|
2,028
|
|
(5,260
|
)
|
(3,502
|
)
|
|||
Provision for income taxes
|
$
|
259,234
|
|
$
|
81,814
|
|
$
|
49,721
|
|
Effective income tax rate
|
50.2
|
%
|
15.4
|
%
|
17.5
|
%
|
|
June 30,
|
|||||
|
2018
|
2017
|
||||
Deferred tax asset
|
|
|
||||
Partnership basis differences in Premier LP
|
$
|
298,306
|
|
$
|
473,193
|
|
Stock compensation
|
18,347
|
|
23,037
|
|
||
Accrued expenses
|
32,543
|
|
44,096
|
|
||
Net operating losses and credits
|
35,444
|
|
47,629
|
|
||
Other
|
12,103
|
|
11,856
|
|
||
Total deferred tax assets
|
396,743
|
|
599,811
|
|
||
Valuation allowance for deferred tax assets
|
(58,681
|
)
|
(91,787
|
)
|
||
Net deferred tax assets
|
338,062
|
|
508,024
|
|
||
Deferred tax liability
|
|
|
||||
Purchased intangible assets and depreciation
|
(49,855
|
)
|
(71,994
|
)
|
||
Other liabilities
|
(152
|
)
|
(1,774
|
)
|
||
Net deferred tax asset
|
$
|
288,055
|
|
$
|
434,256
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Beginning of year balance
|
$
|
5,043
|
|
$
|
4,381
|
|
$
|
3,436
|
|
Increases in prior period tax positions
|
12,965
|
|
101
|
|
318
|
|
|||
Decreases in prior period tax positions
|
(179
|
)
|
(870
|
)
|
(201
|
)
|
|||
Reductions on settlements and lapse in statute of limitations
|
(611
|
)
|
(22
|
)
|
(721
|
)
|
|||
Increases in current period tax positions
|
1,261
|
|
1,453
|
|
1,549
|
|
|||
End of year balance
|
$
|
18,479
|
|
$
|
5,043
|
|
$
|
4,381
|
|
2019
|
$
|
12,158
|
|
2020
|
11,220
|
|
|
2021
|
10,779
|
|
|
2022
|
10,945
|
|
|
2023
|
10,996
|
|
|
Thereafter
|
31,336
|
|
|
Total future minimum lease payments
|
$
|
87,434
|
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Net revenue:
|
|
|
|
||||||
Supply Chain Services
|
|
|
|
||||||
Net administrative fees
|
$
|
643,839
|
|
$
|
557,468
|
|
$
|
498,394
|
|
Other services and support
|
11,454
|
|
9,704
|
|
4,385
|
|
|||
Services
|
655,293
|
|
567,172
|
|
502,779
|
|
|||
Products
|
645,284
|
|
534,118
|
|
326,646
|
|
|||
Total Supply Chain Services
|
1,300,577
|
|
1,101,290
|
|
829,425
|
|
|||
Performance Services
|
360,679
|
|
353,383
|
|
333,169
|
|
|||
Net revenue
|
$
|
1,661,256
|
|
$
|
1,454,673
|
|
$
|
1,162,594
|
|
|
|
|
|
||||||
Depreciation and amortization expense
(a)
:
|
|
|
|
||||||
Supply Chain Services
|
$
|
21,734
|
|
$
|
14,209
|
|
$
|
1,401
|
|
Performance Services
|
95,808
|
|
85,299
|
|
76,500
|
|
|||
Corporate
|
9,217
|
|
7,703
|
|
6,255
|
|
|||
Total depreciation and amortization expense
|
$
|
126,759
|
|
$
|
107,211
|
|
$
|
84,156
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
||||||
Supply Chain Services
|
$
|
1,691
|
|
$
|
483
|
|
$
|
914
|
|
Performance Services
|
80,900
|
|
66,686
|
|
62,337
|
|
|||
Corporate
|
10,089
|
|
4,203
|
|
13,739
|
|
|||
Total capital expenditures
|
$
|
92,680
|
|
$
|
71,372
|
|
$
|
76,990
|
|
|
|
|
|
||||||
|
|
June 30,
|
|||||||
Total assets:
|
|
2018
|
2017
|
||||||
Supply Chain Services
|
|
$
|
991,837
|
|
$
|
1,017,023
|
|
||
Performance Services
|
|
860,409
|
|
888,862
|
|
||||
Corporate
|
|
459,970
|
|
601,951
|
|
||||
Total assets
|
|
$
|
2,312,216
|
|
$
|
2,507,836
|
|
(a)
|
Includes amortization of purchased intangible assets.
|
|
Year Ended June 30,
|
||||||||
|
2018
|
2017
|
2016
|
||||||
Income before income taxes
|
$
|
516,804
|
|
$
|
531,291
|
|
$
|
284,882
|
|
Remeasurement gain attributable to acquisition of Innovatix, LLC
|
—
|
|
(205,146
|
)
|
—
|
|
|||
Equity in net income of unconsolidated affiliates
(a)
|
(1,174
|
)
|
(14,745
|
)
|
(21,647
|
)
|
|||
Interest and investment loss, net
(b)
|
5,300
|
|
4,512
|
|
1,021
|
|
|||
Loss on disposal of long-lived assets
|
2,376
|
|
2,422
|
|
—
|
|
|||
Other expense (income)
|
16,324
|
|
(614
|
)
|
1,692
|
|
|||
Operating income
|
539,630
|
|
317,720
|
|
265,948
|
|
|||
Depreciation and amortization
|
71,312
|
|
58,884
|
|
51,102
|
|
|||
Amortization of purchased intangible assets
|
55,447
|
|
48,327
|
|
33,054
|
|
|||
Stock-based compensation
(c)
|
29,799
|
|
26,860
|
|
49,081
|
|
|||
Acquisition related expenses
|
8,335
|
|
15,790
|
|
15,804
|
|
|||
Strategic and financial restructuring expenses
(d)
|
2,512
|
|
31
|
|
268
|
|
|||
Remeasurement of tax receivable agreement liabilities
(e)
|
(177,174
|
)
|
(5,447
|
)
|
(4,818
|
)
|
|||
ERP implementation expenses
(f)
|
1,000
|
|
2,028
|
|
4,870
|
|
|||
Acquisition related adjustment - revenue
(g)
|
300
|
|
18,049
|
|
5,624
|
|
|||
Equity in net income of unconsolidated affiliates
(a)
|
1,174
|
|
14,745
|
|
21,647
|
|
|||
Impairment on investments
(a)
|
5,002
|
|
—
|
|
—
|
|
|||
Deferred compensation plan income (expense)
(h)
|
3,960
|
|
4,020
|
|
(1,605
|
)
|
|||
Other income
|
1,752
|
|
584
|
|
—
|
|
|||
Adjusted EBITDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
|
|
|
|
||||||
Segment Adjusted EBITDA:
|
|
|
|
||||||
Supply Chain Services
|
$
|
535,380
|
|
$
|
493,763
|
|
$
|
439,013
|
|
Performance Services
|
123,429
|
|
121,090
|
|
110,787
|
|
|||
Corporate
|
(115,760
|
)
|
(113,262
|
)
|
(108,825
|
)
|
|||
Adjusted EBITDA
|
$
|
543,049
|
|
$
|
501,591
|
|
$
|
440,975
|
|
(a)
|
Refer to
Note 4 - Investments
for further information.
|
(b)
|
Represents interest expense, net and realized gains and losses on our marketable securities.
|
(c)
|
Represents non-cash employee stock-based compensation expense and stock purchase plan expense of
$0.4 million
during both of
the years ended June 30, 2018 and 2017
.
|
(d)
|
Represents legal, accounting and other expenses directly related to strategic and financial restructuring expenses.
|
(e)
|
Represents adjustments to TRA liabilities for a
14%
decrease in the U.S. federal corporate income tax rate that occurred during
the year ended June 30, 2018
, which is a result of the TCJA that was enacted on December 22, 2017, an increase in income apportioned to California and a
1.5%
decrease in the North Carolina state income tax rate during
the year ended June 30, 2017
, and an adjustment for a
1%
decrease in North Carolina state income tax rate during the year ended June 30, 2016.
|
(f)
|
Represents implementation and other costs associated with the implementation of our enterprise resource planning ("ERP") system.
|
(g)
|
This item includes non-cash adjustments to deferred revenue of acquired entities of
$0.3 million
,
$0.6 million
and
$5.6 million
for
the years ended June 30, 2018, 2017 and 2016
, respectively. Business combination accounting rules require the Company to record a deferred revenue liability at its fair value only if the acquired deferred revenue represents a legal performance obligation assumed by the acquirer. The fair value is based on direct and indirect incremental costs of providing the services plus a normal profit margin. Generally, this results in a reduction to the purchased deferred revenue balance, which was based on upfront software license update fees and product support contracts assumed in connection with acquisitions. Because these support contracts are typically one year in duration, our GAAP revenues for the one-year period subsequent to the acquisition of a business do not reflect the full amount of support revenues on these assumed support contracts that would have otherwise been recorded by the acquired entity. The Non-GAAP adjustment to software license update fees and product support revenues is intended to include, and thus reflect, the full amount of such revenues.
|
(h)
|
Represents realized and unrealized gains and losses and dividend income on deferred compensation plan assets.
|
|
First
|
Second
|
Third
|
Fourth
|
||||||||
|
Quarter
|
Quarter
|
Quarter
|
Quarter
|
||||||||
Fiscal Year 2018
|
|
|
|
|
||||||||
Net revenue
|
$
|
390,564
|
|
$
|
411,398
|
|
$
|
425,338
|
|
$
|
433,956
|
|
Gross profit
|
199,188
|
|
210,871
|
|
221,790
|
|
231,116
|
|
||||
Net income
|
60,616
|
|
19,769
|
|
76,549
|
|
100,636
|
|
||||
Net income attributable to non-controlling interest in Premier LP
|
(44,610
|
)
|
(56,485
|
)
|
(53,047
|
)
|
(70,127
|
)
|
||||
Adjustment of redeemable limited partners' capital to redemption amount
|
320,424
|
|
317,916
|
|
(127,039
|
)
|
(353,720
|
)
|
||||
Net income (loss) attributable to stockholders
|
$
|
336,430
|
|
$
|
281,200
|
|
$
|
(103,537
|
)
|
$
|
(323,211
|
)
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
||||||||
Basic
|
52,909
|
|
55,209
|
|
53,529
|
|
52,412
|
|
||||
Diluted
|
140,046
|
|
139,237
|
|
53,529
|
|
52,412
|
|
||||
|
|
|
|
|
||||||||
Net income (loss) per share attributable to stockholders:
|
|
|
|
|
||||||||
Basic
|
$
|
6.36
|
|
$
|
5.09
|
|
$
|
(1.93
|
)
|
$
|
(6.17
|
)
|
Diluted
|
$
|
0.30
|
|
$
|
0.06
|
|
$
|
(1.93
|
)
|
$
|
(6.17
|
)
|
|
|
|
|
|
||||||||
Fiscal Year 2017
|
|
|
|
|
||||||||
Net revenue
|
$
|
313,272
|
|
$
|
358,500
|
|
$
|
379,803
|
|
$
|
403,098
|
|
Gross profit
|
174,769
|
|
182,486
|
|
202,555
|
|
214,815
|
|
||||
Net income
|
58,095
|
|
246,184
|
|
71,338
|
|
73,860
|
|
||||
Net income attributable to non-controlling interest in Premier LP
|
(49,601
|
)
|
(181,173
|
)
|
(51,433
|
)
|
(53,845
|
)
|
||||
Adjustment of redeemable limited partners' capital to redemption amount
|
61,808
|
|
335,264
|
|
(100,506
|
)
|
(333,742
|
)
|
||||
Net income (loss) attributable to stockholders
|
$
|
70,302
|
|
$
|
400,275
|
|
$
|
(80,601
|
)
|
$
|
(313,727
|
)
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
||||||||
Basic
|
47,214
|
|
49,445
|
|
50,525
|
|
51,470
|
|
||||
Diluted
|
142,962
|
|
141,308
|
|
50,525
|
|
51,470
|
|
||||
|
|
|
|
|
||||||||
Net income (loss) per share attributable to stockholders:
|
|
|
|
|
||||||||
Basic
|
$
|
1.49
|
|
$
|
8.10
|
|
$
|
(1.60
|
)
|
$
|
(6.10
|
)
|
Diluted
|
$
|
0.26
|
|
$
|
1.58
|
|
$
|
(1.60
|
)
|
$
|
(6.10
|
)
|
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)
|
Weighted-average exercise price of outstanding options, warrants and rights (b)
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
|
Equity compensation plans approved by security holders:
|
|
|
|
Amended and Restated Premier, Inc. 2013 Equity Incentive Plan
|
5,423,171
(1)
|
$30.53
(2)
|
3,595,111
(3)
|
Equity compensation plans not approved by security holders
|
n/a
|
n/a
|
n/a
|
Total
|
5,423,171
(1)
|
$30.53
(2)
|
3,595,111
(3)
|
Years Ended June 30, 2018, 2017 and 2016
|
||||||||||
(in thousands)
|
||||||||||
|
Beginning Balance
|
Additions/(Reductions) to Expense or Other Accounts
|
Deductions
|
Ending Balance
|
||||||
Year ended June 30, 2018
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
1,812
|
|
1,148
|
|
1,119
|
|
$
|
1,841
|
|
Deferred tax assets valuation allowance
|
$
|
91,787
|
|
(33,106
|
)
|
—
|
|
$
|
58,681
|
|
|
|
|
|
|
||||||
Year ended June 30, 2017
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
1,981
|
|
781
|
|
950
|
|
$
|
1,812
|
|
Deferred tax assets valuation allowance
|
$
|
64,958
|
|
26,829
|
|
—
|
|
$
|
91,787
|
|
|
|
|
|
|
||||||
Year ended June 30, 2016
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
1,153
|
|
1,655
|
|
827
|
|
$
|
1,981
|
|
Deferred tax assets valuation allowance
|
$
|
28,679
|
|
36,279
|
|
—
|
|
$
|
64,958
|
|
Exhibit
No.
|
|
Description
|
2.1
|
|
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
|
9.1
|
|
|
10.1
|
|
|
10.1.1
|
|
|
10.1.2
|
|
|
10.2
|
|
|
10.3
|
|
|
10.4
|
|
|
10.5
|
|
|
10.6
|
|
|
10.7
|
|
|
10.8
|
|
|
10.9
|
|
|
10.10
|
|
|
10.11
|
|
|
10.12
|
|
|
10.13
|
|
|
10.14
|
|
|
10.15
|
|
Exhibit
No.
|
|
Description
|
10.16
|
|
|
10.17
|
|
|
10.18
|
|
|
10.19
|
|
|
10.20
|
|
|
10.21
|
|
|
10.22
|
|
|
10.23
|
|
|
10.24
|
|
|
10.25
|
|
|
10.25.1
|
|
|
21
|
|
|
23
|
|
|
24
|
|
Power of Attorney (included on the signature page hereof)*
|
31.1
|
|
|
31.2
|
|
|
32.1
|
|
|
32.2
|
|
|
101.INS
|
|
XBRL Instance Document*
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document*
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document*
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document*
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document*
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document*
|
|
PREMIER, INC.
|
|
|
By:
|
/s/ SUSAN D. DEVORE
|
|
Name:
|
Susan D. DeVore
|
|
Title:
|
President, Chief Executive Officer and Director
|
|
Date:
|
August 22, 2018
|
Signature
|
|
Capacity
|
|
Date
|
|
|
|
|
|
/s/ SUSAN D. DEVORE
Susan D. DeVore
|
|
President, Chief Executive Officer and Director (principal executive officer)
|
|
August 22, 2018
|
|
|
|
|
|
/s/ CRAIG S. MCKASSON
Craig S. McKasson
|
|
Chief Financial Officer and Senior Vice President (principal financial and accounting officer)
|
|
August 22, 2018
|
|
|
|
|
|
/s/ BARCLAY E. BERDAN
Barclay E. Berdan
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ ERIC J. BIEBER, MD
Eric J. Bieber, MD
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ STEPHEN R. D'ARCY
Stephen R. D'Arcy |
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ JODY R. DAVIDS
Jody R. Davids
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ WILLIAM B. DOWNEY
William B. Downey
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ PETER S. FINE
Peter S. Fine
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ PHILIP A. INCARNATI
Philip A. Incarnati
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ DAVID LANGSTAFF
David Langstaff |
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ WILLIAM E. MAYER
William E. Mayer |
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ MARC D. MILLER
Marc D. Miller
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ MARVIN R. O'QUINN
Marvin R. O'Quinn
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ SCOTT REINER
Scott Reiner
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ TERRY D. SHAW
Terry D. Shaw
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ RICHARD J. STATUTO
Richard J. Statuto
|
|
Director
|
|
August 22, 2018
|
|
|
|
|
|
/s/ ELLEN C. WOLF
Ellen C. Wolf
|
|
Director
|
|
August 22, 2018
|
Participant
:
|
|
Target Number of
Performance Shares:
Performance Cycle:
July 1, 20
- June 30, 20
|
|
Grant Date:
|
|
Participant
:
|
|
Grant Date
:
|
|
Number of Award Shares
:
|
|
Vesting Date
:
|
The third anniversary of the Grant Date (the “
Vesting Date
”).
|
(a)
|
In the event that a Participant terminates employment due to being a Good Leaver (as defined below), the Participant shall immediately vest in a portion of the Award equal to the number of Award Shares granted times a fraction, the numerator of which is the number of days of active service elapsed since the Grant Date and the denominator of which is 1,095. A Participant is a “Good Leaver” on account of (i) terminating employment with the Premier Group due to death, Disability or an Approved Retirement (as defined in Section 14 below) or (ii) the termination of the Participant’s employment with the Premier Group Without Cause (as defined in Section 14 below) prior to a Change in Control; and
|
(b)
|
In the event a member of the Premier Group (or a successor) terminates the Participant’s employment Without Cause or the Participant terminates his employment for Good Reason (as defined in Section 14 below) within the twelve month period commencing upon a Change in Control (as defined in the Plan), the Award shall vest in full.
|
If:
|
Here’s what happens to Your Award:
|
|
|
||
You
are a Good Leaver (as defined in Section 3(a))
|
|
You shall immediately vest in a pro-rata portion of the Award as described in Section 3(a).
|
|
|
|
We terminate your employment for Just Cause or you leave the Premier Group other than as a Good Leaver prior to a Change in Control
|
|
Both the vested and unvested portions of your Award are immediately cancelled.
|
You take an approved personal leave of absence
|
For the first six (6) months of an approved personal leave, vesting continues. If the approved leave exceeds six (6) months, vesting is suspended until you return to work and remain actively employed for 30 calendar days, after which time vesting will be restored retroactively. If you terminate employment for any reason during the first year of an approved leave, the termination of employment provisions will apply. If the leave exceeds one year, your Award will be cancelled immediately.
|
You are on an approved family and medical leave, military leave, or other statutory leave of absence
|
Your Award will continue to vest on schedule.
|
You are terminated involuntarily other than for Just Cause or you terminate your employment for Good Reason, in either case, within one (1) year following a Change in Control
|
Upon the Termination Date the unvested portion of your Award will vest immediately.
|
|
|
||
While employed and at any time during the Restricted Period, you breach the Agreement not to Compete
|
|
In addition to all rights and remedies available to the Company at law and in equity, you will immediately forfeit any of your outstanding rights under this Award Agreement.
|
Participant
:
|
|
Grant Date
:
|
(the “
Grant Date
”)
|
Number of Award Shares
:
|
|
Vesting Date
:
|
Shall vest in full on the first anniversary of the Grant Date (the “
Vesting Date
”).
|
(a)
|
In the event that a Participant terminates service due to death or Disability, the Participant shall immediately vest in a portion of the Award equal to the number of Award Shares granted times a fraction, the numerator of which is the number of days of active service elapsed since the Grant Date and the denominator of which is 365; and
|
(b)
|
In the event that the Participant is serving as a director on the Board at the time of a Change in Control, the Award shall vest in full.
|
1.1.
|
Amendment and Restatement
. Premier, Inc., a Delaware corporation (the “Company”), hereby amends and restates its annual incentive compensation plan, which is known as the Premier, Inc. Annual Incentive Compensation Plan (the “Plan”), originally established effective July 1, 1996 for selected Employees.
|
1.2.
|
Purpose
. The purpose of the Plan is to maximize the success of the Company and the Premier Group by providing significant financial incentive opportunities to eligible Employees, to assist in attracting and retaining employees of superior abilities, and to further align the interests and objectives of Participants with those of the Company and the Premier Group.
|
2.1.
|
Definitions
. Whenever used herein the following terms shall have their respective meanings as set forth below:
|
(a)
|
“Administrator” means the Employee(s) of the Company designated from time to time by the Committee to perform those duties specified in the Plan.
|
(b)
|
“Award” shall have the meaning set forth in Section 7.2.
|
(c)
|
“Change in Control” shall have the meaning set forth in Section 13.3 (or subsequent applicable sections, if and as later amended) of the Premier, Inc. 2013 Equity Incentive Plan, as it may be established, modified, amended, restated, or replaced from time to time.
|
(d)
|
“Code” shall have the meaning set forth in Section 8.2.
|
(e)
|
“Code Section 409A” shall have the meaning set forth in Section 11.12.
|
(f)
|
“Committee” means the Compensation Committee of the Board of Directors of the Company.
|
(g)
|
“Company” means Premier, Inc.
|
(h)
|
“Disability” means a determination of disability with respect to a Participant under the long-term disability plan maintained by the Participant’s Premier Group employer. If, at any time during the period that this Plan is in operation, the applicable entity of the Premier Group does not maintain a long-term disability plan, “Disability” shall mean a physical or mental condition that, in the judgment of the Administrator, permanently prevents a Participant from performing the essential functions of the Participant’s job duties with the Premier Group or such other position or job that is made available to the Participant within the Premier Group and for which the Participant is qualified by reason of education, training and experience, with or without reasonable accommodation. In making such determination, the Administrator may, but is not required to, rely on advice of a physician competent in the area to which such Disability relates. In addition, the Participant upon request by the Administrator must submit such medical evidence, records and examination data to the Administrator regarding any Disability as is reasonably necessary for the Administrator to evaluate the same, to be treated as confidential as required by law. The Administrator shall make all determinations and resolve any disputes regarding Disability in its sole discretion, and any decision of the Administrator concerning the same will be binding on all parties.
|
(i)
|
“Earnings” for a Participant that is an exempt Employee (as designated by Premier in accordance with applicable law) means a Participant’s annual base salary from the Participant’s Premier Group employer measured as of the last day of the Plan Year (June 30) or, if sooner, the Participant’s last day of eligibility under the Plan during the Plan Year, in each case excluding all other pay elements (including, but not limited to bonus payments, commissions, incentive compensation, deferred compensation payments, stock options, profit sharing, dividends, benefits, severance pay, vacation payout, expense reimbursements, miscellaneous allowances or any other compensation). For a Participant that is an exempt Employee who does not participate in the Plan for the full Plan Year (pursuant to Article 4), Earnings means the Participant’s annual base salary described in the preceding sentence calculated on a pro rata basis based upon the number of days during which the Participant actually participated in the Plan during the Plan Year divided by 365. “Earnings” for a Participant that is an nonexempt Employee (as designated by Premier in accordance with
|
(j)
|
“Employee” shall means any person designated as an employee of the Premier Group on the payroll records thereof, but excluding any person designated by Premier as an intern, temporary worker or contractor.
|
(k)
|
“Exchange Act” means the Securities Exchange Act of 1934 and all regulations issued thereunder and any successors thereto.
|
(l)
|
“Goals and Performance Standards” shall have the meaning set forth in Section 5.1.
|
(m)
|
“Participant” means any individual designated to participate in the Plan pursuant to Article 4.
|
(n)
|
“Performance Standard Achievement” shall have the meaning set forth in Section 7.1.
|
(o)
|
“Plan Year” means the twelve-month period beginning July 1 through June 30.
|
(p)
|
“Premier Group” means the Company and/or those affiliates, subsidiaries or managed entities which the Company permits to participate in the Plan, as designated from time to time by the Committee.
|
(q)
|
“Recoupment Policy” shall have the meaning set forth in Section 8.3.
|
(r)
|
“Retirement” means the Participant’s voluntary resignation from the Premier Group on or after attaining age 59 ½ or age 55 with 5 or more years of service.
|
(s)
|
“Stretch” means the level of achievement in which the highest payout for Goals and Performance Standards will be made.
|
(t)
|
“Target” means 100% achievement of the Goals and Performance Standards.
|
(u)
|
“Target Award Opportunity” shall have the meaning set forth in Section 6.1.
|
(v)
|
“Termination of Employment” means the separation or end of the Participant’s employment with any and all members of the Premier Group for any reason.
|
(w)
|
“Threshold” means the minimum level of achievement that must be attained for Goals and Performance Standards before a Plan Award is potentially earned.
|
3.1.
|
Committee
. The Committee shall have general responsibility for the administration of the Plan according to the terms and provisions of the Plan and shall have all the powers necessary to accomplish these purposes, including, but not by way of limitation, the right, power and authority:
|
(a)
|
To make rules and regulations for the administration of the Plan;
|
(b)
|
To construe all terms, provisions, conditions and limitations of the Plan;
|
(c)
|
To correct any defects, supply any omissions or reconcile any inconsistencies that may appear in the Plan in the manner and to the extent deemed expedient;
|
(d)
|
To determine all controversies relating to the administration of the Plan, including, but not limited to, differences of opinion that may arise among the Premier Group or the Administrator and the Participants;
|
(e)
|
To resolve any questions necessary to promote the uniform administration of the Plan; and
|
(f)
|
To amend the Plan or terminate the Plan pursuant to Article 10.
|
3.2.
|
Administrator
. The Administrator shall have responsibility for the day-to-day operation of the Plan. The Administrator shall make initial determinations regarding administration of the Plan, including, but not limited to, differences of opinion that may arise among the Premier Group and matters relating to Participant eligibility and incentive payments under the Plan. The foregoing notwithstanding, the Administrator also shall have responsibility for those decisions or actions specifically set forth in the provisions of this Plan.
|
3.3.
|
Discretion
. The Committee or the Administrator, in exercising any power or authority granted under this Plan, or in making any determination under this Plan, shall perform or refrain from performing those acts in its sole and absolute discretion and judgment. Any decision made by the Committee, or any refraining to act or any act taken by the Committee, shall be final and binding on all parties.
|
3.4.
|
Liability and Indemnification
. The Committee or the Administrator shall not be liable for any act done or any determination made in good faith. The Company and the Premier Group shall, to the fullest extent permitted by law, indemnify and hold the Committee, its members and the Administrator harmless from any and all claims, causes of action, damages and expenses (including reasonable attorneys’ fees and expenses) incurred by the
|
4.1.
|
Participation
. All Employees of the Premier Group shall participate in the Plan, except that an individual who becomes an Employee of the Premier Group on or after April 1 of the Plan Year shall not begin participating in the Plan until the next Plan Year. An individual who becomes an Employee of the Premier Group after the start of the Plan Year and before April 1 shall enter the Plan immediately and a Target Award Opportunity shall be established and communicated to such Employee as soon as administratively practicable. Notwithstanding the foregoing, anyone employed by a member of the Premier Group who receives an annual cash incentive award opportunity under the Premier, Inc. Equity Incentive Plan (or its successor) for a fiscal year shall not be eligible to earn an annual incentive under the Plan for such fiscal year. Employees must have three full months of participation in the Plan during the Plan Year to participate in the Plan.
|
4.2.
|
Term of Participation
. A Participant’s participation in the Plan shall continue until the earlier to occur of: (a) the Participant’s Termination of Employment, or (b) termination of the Plan as provided in Article 10.
|
5.1.
|
Goals and Performance Standards
. The Chief Executive Officer of the Company or other appropriate senior executives of the Premier Group shall recommend to the Committee: (a) Plan Year goals, and (b) performance standards that will be used to determine the degree to which the goals have been achieved (“Goals and Performance Standards”). Threshold, Target and Stretch Performance Standards shall be established for each Goal. The Goals and Performance Standards shall be measurable as of the conclusion of the Plan Year.
|
5.2.
|
Committee Approval
. The Committee will review, and will approve or modify as it deems appropriate, the recommendations for Goals and Performance Standards as provided by Section 5.1.
|
6.1.
|
Target Award Opportunity
. For each Plan Year, the Chief Executive Officer of the Company or other appropriate senior executives of the Premier Group shall establish a Target award opportunity for each Participant (the “Target Award Opportunity”). The Target Award Opportunity shall be expressed as a percent of a Participant’s Earnings for the Plan Year. Each Target Award Opportunity may consist of several components, including without limitation:
|
•
|
Company Goals
|
•
|
Departmental/Unit Goals
|
•
|
Individual Goals
|
•
|
Goals at the discretion of the Chief Executive Officer or other appropriate senior executives
|
6.2.
|
Participant Notification
. The Administrator shall notify each Participant of the Participant’s Target Award Opportunity for the Plan Year as soon as practicable following the establishment of such Target Award Opportunity.
|
7.1.
|
Performance Review
. Within 90 days of the conclusion of the Plan Year, the Committee shall review and approve the performance of the Premier Group in achieving the Goals and Performance Standards for the Plan. The Administrator shall make a determination of the Award percentage for each Participant based on total, aggregate Goals and Performance Standard achievement approved by the Committee (“Performance Standard Achievement”) utilizing the following:
|
Performance Standard Achievement
|
Award Percentage
|
Below Threshold
|
0%
|
Threshold
|
50%
|
Target
|
100%
|
Stretch
|
150%
|
7.2.
|
Award Calculation
. The Administrator shall calculate a Participant’s award under the Plan (the “Award”) applying the following formula: the Award percentage, as described in Section 7.1 above, multiplied by the Target Award Opportunity, multiplied by the Participant’s Earnings for the Plan Year. For example, if the Award percentage is 110% and a Participant has a Target Award Opportunity of 10% and Plan Year Earnings of $100,000, the Participant’s Award would be $11,000.
|
8.1.
|
Payment and Timing
. Awards shall be paid in cash by the Company on or about the September 15th immediately following the end of the Company's fiscal year in which they were earned, but in no event later than the next following March 15th (or such later date as is permitted under Internal Revenue Service regulations or guidance with respect to qualifying the awards under the short-term deferral exception under Treasury Regulation Section 1.409A-1(b)(4)). No Awards shall be increased with interest due to a delayed payment. A Participant who is employed on the last business day of the Plan Year or who qualifies for a pro rata payment under Section 9.1 of the Plan need not be employed by the Premier Group on the date that
payment
of the Award is actually made.
|
8.2.
|
Deferral of Payment
. Notwithstanding any other provision of the Plan, a Participant’s Award shall not be paid in cash to the extent that the Participant has entered into a deferral agreement, an employment agreement or such other agreement with the Company or another member of the Premier Group which agreement specifically provides for the deferral of an Award otherwise payable under the Plan and which agreement is drafted and operated to meet the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
|
8.3.
|
Recoupment Policy.
A Participant’s eligibility to participate in, receive Awards under, and rights to payment pursuant to this Plan is conditioned upon the Participant’s being subject to any compensation recovery policy that may be adopted from time to time by the Company or any subsidiary of the Company (a “Recoupment Policy”) and all amounts payable pursuant to this Plan shall be subject to the Recoupment Policy.
|
9.1.
|
Termination Due to Death, Disability, Retirement or a Change in Control
. In the event a Participant’s employment with the Premier Group terminates or ends at any point in time before or after the end of the Plan Year as a result of a Participant’s: (a) death, Disability or Retirement, or (b) resignation occurring within two years following a Change in Control, the Participant (or the Participant’s estate in the event of the Participant’s death) shall be entitled to a payment under Article 7 on a pro rata basis as determined by the Administrator.
|
9.2.
|
Other Termination Events
. In the event a Participant’s employment terminates or ends at any point in time before the last business day of the Plan Year for any reason other than the Participant’s: (a) death, Disability or Retirement, or (b) resignation occurring within two years following a Change in Control, the Participant’s participation in the Plan shall immediately terminate, and the Participant shall
forfeit
all rights under the Plan, including the right to receive any Award or any payment of all or a portion of any Award.
|
10.1.
|
Right to Amend, Suspend or Terminate Plan
. The Committee reserves the right at any time to amend, modify, suspend or terminate the Plan for any reason and without the consent of the Administrator, the Participants or any other person.
|
10.2.
|
Notice
. Notice of any amendment, modification, suspension or termination of the Plan shall be given by the Committee to the Administrator and to all Participants.
|
11.1.
|
Limitation of Rights
. The granting of any rights to a Participant under the provisions of the Plan represent only a discretionary, contingent right to receive compensation. Accordingly, nothing in this Plan shall be construed:
|
(a)
|
To limit in any way the right of the Premier Group to terminate a Participant’s employment at any time for any reason;
|
(b)
|
To evidence any agreement or understanding, express or implied, that the Premier Group will employ a Participant in any particular capacity for any particular term or for any particular remuneration; or
|
(c)
|
To grant any right to, or interest in, either express or implied, any equity position or ownership in the Premier Group.
|
11.2.
|
Alienation
. No benefit provided by this Plan shall be transferable by the Participant except on the Participant’s death, as provided in this Plan. No right or benefit under this Plan shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance or charge. Any attempt to anticipate, alienate, sell, assign, pledge, encumber or charge any right or benefit under this Plan shall be void. No right or benefit under this Plan shall, in any manner, be liable for or subject to any debts, contracts, liabilities or torts of the person entitled to the right or benefit. If any Participant becomes bankrupt or attempts to anticipate, alienate, assign, pledge, sell, encumber or charge any right or benefit under this Plan, then the right or benefit shall, in the discretion of the Administrator, cease. In that event, the Company may hold or apply the right or benefit, or any part of the right or benefit, for the benefit of the Participant, his or her spouse, children, or dependents, the beneficiary or any of them, in the manner or in the proportion that the Administrator shall deem proper, in its sole discretion, but it shall not be required to do so.
|
11.3.
|
Tax Withholding
. The Company shall have the power and the right to deduct or withhold, or require a Participant, or beneficiary thereof, to remit to the Company, the minimum statutory amount to satisfy federal, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan prior to making any payments hereunder.
|
11.4.
|
Unfunded Plan
. The Plan shall be unfunded. Premier Group shall not be required to segregate or earmark any cash, or other assets and property in connection with the Plan. The Premier Group, the Committee and the Administrator shall not have any fiduciary responsibility to any Employee or Participant in connection with this Plan. In addition, the Premier Group shall not be deemed to be a trustee of any amounts to be paid to a Participant. Any liability of the Premier Group to pay any Participant with respect to a potential Plan Award shall be based solely upon any obligations created pursuant to the provisions of the Plan; and no such obligation shall be deemed to be secured by any pledge or encumbrance on any property of the Premier Group. However, the Premier Group shall have the discretion at any time to segregate such assets that may be represented by an Award. Such assets will at all times remain the property of the Premier Group. Moreover, any Participants and their beneficiaries shall at all times be merely unsecured creditors of the Company.
|
11.5.
|
Plan Document Governs
. In the event of a conflict between any other written or oral statements and this Plan document, the provisions of this Plan document shall govern.
|
11.6.
|
Governing Law
. The construction and operation of this Plan are governed by the laws, rules, and judicial decisions of the State of Delaware, except as superseded by federal law.
|
11.7.
|
Headings
. All headings in the Plan are for reference only and not to be utilized in construing the Plan.
|
11.8.
|
Gender
. Unless clearly appropriate, all nouns of whatever gender refer indifferently to persons of any gender.
|
11.9.
|
Singular and Plural
. Unless clearly inappropriate, singular terms refer also the plural and vice versa
.
|
11.10.
|
Severability
. Every provision of this Plan is severable from every other provision of this Plan. Thus, if any part of the provisions contained in this Plan document is determined by a court of competent jurisdiction or by any arbitration panel to which a dispute is submitted to be invalid, illegal or incapable of being enforced, then such covenant or provision (with such modification as shall be required in order to render such covenant or provision not invalid, illegal or incapable of being enforced) shall remain in full force and effect, and all other covenants and provisions contained in this Plan document shall, nevertheless, remain in full force and effect to the fullest extent permitted by law, unless the continuance of the Plan in such circumstances is not consistent with its purposes.
|
11.11.
|
Waiver of Breach
. Waiver by the Committee, the Administrator or the Premier Group of any provision of this Plan shall not operate or be construed as a waiver of any other provision of this Plan or any other future breach of the provisions so waived.
|
11.12.
|
Code Section 409A
.
|
(a)
|
The Plan is intended to be exempt from the requirements of Section 409A of the Code and the rules, regulations and other guidance promulgated thereunder (“Code Section 409A”) and shall be construed and interpreted in such a manner consistent with said intent.
|
(b)
|
Notwithstanding the foregoing, in the event any portion of the Plan is determined to involve the deferral of compensation or the payment of “nonqualified deferred compensation” (as such term is described in Code Section 409A), such portion of the Plan shall be interpreted to comply with Code Section 409A, and each provision that conflicts with such requirements shall be neither valid nor enforceable. The Committee may amend any such portion of the Plan determined to be subject to the requirements of Code Section 409A to the extent required to comply with Code Section 409A, as the Committee may determine to be necessary or appropriate.
|
(c)
|
Notwithstanding anything to the contrary in this Section 11.12, in no event whatsoever shall any member of the Premier Group be liable for any additional tax, interest or penalties that may be imposed on a Participant as a result of Section 409A of the Code or any damages for failing to comply with Section 409A of the Code.
|
(d)
|
The following provisions shall apply upon a “separation from service” (as defined by Code Section 409A) on or after the date that any stock of the Company (or its parent) becomes publicly traded on an established securities market or otherwise. If the Participant is deemed on the date of such a separation from service to be a “specified employee” (within the meaning of that term under Code Section 409A(a)(2)(B) and determined using any identification methodology and procedure selected by the Company (or its parent) from time to time, or if none, the default methodology and procedure specified under Code Section 409A), then any amounts that are considered “nonqualified deferred compensation” (within the meaning of that term under Code Section 409A) payable as a result of the Participant’s separation from service shall not be paid prior to the date which is the earlier of (i) the expiration of the six (6) month period measured from the date of such separation from service of the Participant, and (ii) the date of the Participant’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid to the Participant in a lump sum, and any remaining payments due under the Plan shall be paid or provided in accordance with the normal payment dates specified for them herein. In determining whether a Participant is subject to the delay hereinabove described, the transitional rules of Treasury Regulation § 1.409A-1(i)(6) shall be applied.”
|
12.1.
|
Effective Date
. The Plan as amended and restated shall become effective as of June 15, 2018.
|
Name of Subsidiary
|
State/Province of Incorporation
|
Premier Services, LLC (1)
|
Delaware
|
Premier Healthcare Alliance, L.P. (2)
|
California
|
Premier Supply Chain Improvement, Inc. (3)
|
Delaware
|
Premier Healthcare Solutions, Inc. (3)
|
Delaware
|
Premier Marketplace, LLC (3)
|
Delaware
|
NS3Health, LLC (4)
|
Florida
|
SVS LLC (4)
|
North Carolina
|
Commcare Pharmacy - FTL, LLC (5)
|
Florida
|
Commcare Pharmacy - WPB, LLC (5)
|
Florida
|
Commcare Pharmacy - NYC, LLC (5)
|
Florida
|
Premier Specialty Pharmacy Solutions, LLC (5)
|
Florida
|
Acro Pharmaceutical Services LLC (5)
|
Pennsylvania
|
Community Pharmacy Services, LLC (5)
|
Delaware
|
Innovatix, LLC (4)
|
Delaware
|
InnovatixCares, LLC (6)
|
Delaware
|
Innovatix Network, LLC (6)
|
Delaware
|
Essensa Ventures, LLC (4)
|
New York
|
Premier Insurance Management Services, Inc. (7)
|
California
|
Premier Pharmacy Benefit Management, LLC (7)
|
Delaware
|
TheraDoc, Inc. (7)
|
Delaware
|
Healthcare Insights, LLC (7)
|
Illinois
|
CECity.com, Inc. (7)
|
Pennsylvania
|
Premier Research Institute, Inc. (7)
|
Delaware
|
Revolution Q, LLC (8)
|
Pennsylvania
|
Ostonic Quality Systems, LLC (9)
|
Delaware
|
(1)
|
Registration Statement (Form S-8 No. 333-191484) pertaining to the 2013 Equity Incentive Plan of Premier, Inc.,
|
(2)
|
Registration Statement (Form S-3 No. 333-199158) of Premier, Inc.,
|
(3)
|
Registration Statement (Form S-8 No. 333-204628) pertaining to the 2015 Employee Stock Purchase Plan of Premier, Inc.;
|
(4)
|
Registration Statement (Form S-3/ASR No. 333-221426) of Premier, Inc.,
|
1.
|
I have reviewed this annual report on Form 10-K of Premier, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ Susan D. DeVore
|
|
|
Susan D. DeVore
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Premier, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ Craig S. McKasson
|
|
|
Craig S. McKasson
|
|
|
Senior Vice President and Chief Financial Officer
|
|
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of
|
|
2. The information contained in the Report fairly presents, in all material respects, the financial condition and
|
|
|
/s/ Susan D. DeVore
|
|
|
Susan D. DeVore
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
August 22, 2018
|
|
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of
|
|
2. The information contained in the Report fairly presents, in all material respects, the financial condition and
|
|
|
/s/ Craig S. McKasson
|
|
|
Craig S. McKasson
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
|
August 22, 2018
|