AMN Healthcare Services Inc Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Jasper Bibb - Truist Securities Inc - Analyst : It's Jasper Bibb on for Tobey. I wanted to ask about gross margins in Nurse and Allied. How are you thinking about the segment gross margins there in the first quarter, and could you maybe extrapolate for us like how the labor structural revenue might influence that margin versus what otherwise might be comparable to a year ago.

Question: Jasper Bibb - Truist Securities Inc - Analyst : And then you mentioned, obviously, the normalization of [domain] conditions. In the prepared remarks, bill rate's up a little bit [in] the first quarter. What do you think you need to see in the market to start growing the Nurse and Allied volume sequentially this year?

Question: Albert Rice - UBS Group AG - Analyst : Just wondering if -- we've got the strike revenue. We've got other things going on in the fourth and first quarter, and then there's seasonality. I'm trying to understand how do you -- do you feel like you're seeing a normal pattern here that was similar to what you would have seen pre-pandemic? Do you feel like there's still some softness. And any early thoughts about how the trajectory of the rest of the year for '25 might play out? What are you looking for in terms of revenue trends as we progress through the rest of the year?

Question: Albert Rice - UBS Group AG - Analyst : Okay. That's great. Maybe a follow-up, I'll ask. In the prepared remarks, you mentioned and you mentioned a couple of times in answering the international headwind. Do you have a sense of what the international revenue or impact would be EBITDA impact of '24 versus '25 million overall, I'm sure it varies a little bit depending on how demand looks, but I'm just curious if they got a figure there. And then the other comment was made in the prepared remarks was about large client seemingly stepping back a little bit. Was that because they're doing it themselves, they've changed vendor? Are they having volume issues? What -- maybe flush that out a little more?

Question: Jeffrey Silber - BMO Capital Markets - Analyst : Welcome back, Brian. And actually, let me start with a question for you. I know it's been a few years since you left the company, and I know things have changed a lot in the industry. But from your perspective, what do you think you can do to help the company get back on track?

Question: Jeffrey Silber - BMO Capital Markets - Analyst : All right. That's great to hear. Maybe I could just step back and ask a broader question in terms of the overall marketplace. Are you still seeing hospitals trying to reduce their contract labor? I know [Census] is up, and I know they're focused on full-time employment. But I'm just wondering if you're still seeing pressure on that side of the house.

Question: Joanna Gajuk - Bank of America - Analyst : So I guess maybe a little bit on the last comment. And I remember on the call, on the third quarter call, you were talking about you seeing some hospitals actually coming back and like offering higher rate to be able to fill some of [staff], have you seen more of it, less of it or the same? Or how is that dynamic going on?

Question: Joanna Gajuk - Bank of America - Analyst : Okay. Another follow-up on the comment about the Q1 versus Q2, like the moving pieces, and I appreciate the strike revenue and such. But then when we think about -- and there's obviously seasonality, [that's what I'm headed] with this EBITDA margin for Q1 guidance, because I guess, last quarter, you were kind of talking about maybe like 8.5% EBITDA margin in Q1 and grow from there. So now I guess you're guiding to a lower margin despite the fact that there is some strike revenue in there, in EBITDA. So is that sort of 8% a better starting point [in] how we should think about kind of as the year goes on how this EBITDA margin should be moving, assuming there's just normal seasonality?

Question: Joanna Gajuk - Bank of America - Analyst : So that's another question, if I may, on the international business because I appreciate your comments around your expectations in first half and then second half. But is there any risk to this? I mean, is it sort of like things going to change come June 30 and then you can kind of be back to growing international business?

Question: Mark Marcon - Robert W. Baird & Co - Analyst : Welcome back, Brian. Great to have you on the call. Wondering if you can talk a little bit on Technology and Workforce Solutions, what are you assuming in terms of VMS revenue for the first quarter? So it sounds like language is doing well. So I'm just trying to figure that part out.

Question: Mark Marcon - Robert W. Baird & Co - Analyst : Okay. And just in general, aside from the ShiftWise transition, just in terms of just what you're seeing in terms of overall volumes across the MSP as well as the elements that you're not filling, how is that trending?

Question: Mark Marcon - Robert W. Baird & Co - Analyst : Great. And then kind of a broader industry question. There's been some obvious signs of consolidation in terms of [ECRN and AIA]. There's also been reports of some other companies in the space that might be looking for partners and seems like it would be natural to see a little bit of a shakeout and a little bit of consolidation, just given what's happened to the overall demand level since 2020. And I was wondering if you could provide any commentary on what -- in terms of what you're seeing from a competitive dynamic perspective, both in terms of demand from hospitals and your competitive position and how that translates to pricing. But also in terms of are the clinicians appreciating your relative strength? And what are you seeing from that perspective?

Question: Mark Marcon - Robert W. Baird & Co - Analyst : Great. Cary, just to follow-on on that. I mean, given the consolidation, it sounds like it sounds like the competition is still tough. Or are you saying that there has been a little bit of a reduction in capacity and that your competitive position is appreciably better because of that -- because of some of the exits that have occurred.

Question: Jack Slevin - Jefferies Group LLC - Analyst : A lot of [mine] have been asked already, so maybe a pretty quick one. You gave some color around the margin impacts from the labor disruption revenue when you guided 4Q. Apologies if I missed it, but could you just help me see if we can frame that out in terms of gross margin and adjusted EBITDA in the 1Q guide?

Question: Jack Slevin - Jefferies Group LLC - Analyst : That's right. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 20, 2025 / 10:00PM, AMN.N - Q4 2024 AMN Healthcare Services Inc Earnings Call

Question: Jack Slevin - Jefferies Group LLC - Analyst : Okay. Got it. Really appreciate it. That's helpful. One quick follow-up. I guess just taking the business at face value where you sit in the first quarter. I was hoping you could give a little color maybe on how you're thinking about free cash flow conversion for free cash generation. I guess I'm just trying to square, you had some of the benefit in Q4 that probably reverses, but on a normalized basis, sort of how we should think about converting cash going forward?

Question: Jack Slevin - Jefferies Group LLC - Analyst : That's great. Yes.

Question: Trevor Romeo - William Blair & Co LLC - Analyst : Welcome back to Brian. Really good to have you back on these calls. Just a couple of quick ones left for me. I think, one, we talked about order volumes already a bit, but I was wondering if you could talk about your traveler on assignment volumes and maybe how they trended on a monthly basis. I think last quarter, you had some positive momentum maybe in September. So just wondering how maybe the last 4 months have gone from a TOA perspective? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 20, 2025 / 10:00PM, AMN.N - Q4 2024 AMN Healthcare Services Inc Earnings Call

Question: Trevor Romeo - William Blair & Co LLC - Analyst : Got it. That's helpful. And then just one other quick one. I was wondering what kind of demand you're seeing in your school staffing business. I think that's an area we've kind of heard some positive trends from others recently I think there's been a couple of acquisitions in that area lately. So just wondering if you could give a bit more color on what you're seeing there.