The Innovator in Healthcare Workforce Solutions and Staffing Services Investor Presentation March 2019
Forward-Looking Statements This investor presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company bases these forward-looking statements on its current beliefs, expectations, estimates, forecasts and projections about future events and the industry in which it operates. Forward-looking statements are identified by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “should,” “would,” “project,” “may,” variations of such words and other similar expressions. In addition, statements that refer to performance; plans, objectives and strategies for future operations; and other characterizations of future events or circumstances, are forward-looking statements. The Company’s actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Factors that could cause actual results to differ from those discussed in or implied by the forward-looking statements contained in this presentation are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and its other periodic reports, its current reports and its other filings with the SEC. Developments subsequent to this presentation are likely to cause these statements to become outdated with the passage of time. Non-GAAP Measures This presentation contains certain non-GAAP financial information, which the Company provides as additional information, and not as an alternative, to the Company's condensed consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures include (1) adjusted EBITDA and (2) adjusted EBITDA margin on slides 10 and 27, respectively. Management believes that adjusted EBITDA and adjusted EBITDA margin serve as industry-wide financial measures. These non-GAAP measures should not be used in isolation to evaluate the Company's performance. A reconciliation of the non-GAAP measures identified in this presentation, along with further detail about the use and limitations of certain of these non-GAAP measures, may be found on the Company's website at http://amnhealthcare.investorroom.com/financialreports. 2
Key Investment Highlights Leader in Attractive Market Trusted partner in healthcare staffing services: nurse, allied, locum tenens, physician and executive search, interim leadership, mid-revenue cycle Innovator in Workforce Solutions MSP, VMS, RPO, workforce optimization, scheduling and credentialing solutions Differentiated by Technology Enhances recruiting capabilities and improves efficiency Scalable Operating Model Ability to drive attractive cash flow and earnings growth Strong Cash Flow and Balance Sheet Disciplined management and conservative balance sheet 3
AMN at a Glance Recognized as Diverse Client Base Supply ↔ Demand largest U.S. with over 100 MSP clients, which Age demographic shift creates healthcare includes many leading growth opportunities for AMN staffing firm workforce solutions healthcare systems 2013-18 Nurse and Allied 21% Revenue Growth Solutions $2.1B Locum Tenens 16% 18% Solutions 61% 2018 Revenue CAGR Other Workforce Solutions Innovation leaders 2018 Impact Named largest healthcare staffing HRO Today’s Recruiting Excellence Awards - Top performer in revenue, firm in the US Award and Diversity & Inclusion profits, and stock returns Excellence award 4
Our Mission Every day, we . . . Deliver the best talent and insights to help healthcare organizations optimize their workforce Give healthcare professionals opportunities to do their best work towards quality patient care Create a values-based culture of innovation where our team members can achieve their goals 5
A Recognized Leader 2019 2016 2019 2018 2011- Peer Review Designation Exemplary Corporate Equality Index Best Proxy Statement to AMN MSP (Managed Compensation Gender Equality Index Services Programs) since Discussion & Analysis 2011 (CD&A) Award Winner 2018 2018 2018 2018 2018 Re-Certified through 2020 Healthcare Leader The Top Size of Deal Largest Healthcare Provider Based on Customer First Corporate Staffing Company in Top performer in revenue, Certification for Staffing Satisfaction and Based on Customer the U.S. profits, and stock returns. Quality Services by the Satisfaction and Quality Joint Commission 6
History of AMN Healthcare Strategic Transformation in Workforce Solutions Mid-Revenue Cycle, Nurse, Physician, C-Suite and Interim Physician, Allied, Nurse and VMS, Interim Leadership, Leadership, and Search Expansion Workforce Scheduling Credentialing Solutions Merritt Hawkins, Onward Healthcare, MedPartners, Travel Nurse Staff Care, Locum Leaders, Phillips DiPisa, American Mobile Nurses: MedTravelers, Medefis, The First String, Leaders For Today, A founding company O’Grady Peyton MillicanSolutions, Avantas Silversheet 1980s 2000–08 2014-15 2018-19 1990s 2010-13 2016 Nurse and Allied Workforce Solutions: Interim Leadership and Expansion MSP, RPO and VMS Executive Search, Labor Disruption, Medical Coding Preferred Healthcare, MedFinders, Medical Express, ShiftWise BE Smith, Peak Health, NursesRx HealthSource Global 7
Evolution of AMN: Driving Towards Workforce Solutions AMN has evolved from Staffing and Recruitment traditional healthcare staffing to Workforce Solutions providing comprehensive Leadership workforce solutions Workforce Technologies Workforce Solutions Now Dominate Revenue Mix 2018 2008 4% Workforce Solutions Staffing 63% 8
Revenue Growth with Operating Leverage Revenue Adjusted EBITDA $270 $2,136 $256 $1,988 $1,902 $237 $1,463 $165 $1,036 $1,012 $91 $85 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 ($ Millions) 9
2019 – A Year of Focus and Investment Tailwinds Headwinds Investments • Recent MSP wins and • Locum Tenens • Locum Tenens implementations turnaround enhancements and headcount • Strong MSP pipeline • Lower staffing volume with large client • Candidate and client • Healthy demand across engagement staffing service lines • Tough Q2 comp due to $25M strike revenue • Digital and mobile • Added Silversheet credentialing solution • Margin impact from • Analytics, data Silversheet and management and • Deleveraging and share investments reporting repurchases 10
Industry Overview
Healthcare Staffing: Large, Fragmented Market U.S. Temporary Healthcare Staffing Demand Drivers ($ Billions) $20 $17.4 • Growing economy $16.7 $16.2 $15.2 $15 • Shortage of clinicians & physicians $13.2 • Aging population & medical advances $10 • Adoption of outsourced solutions $5 • New emerging clinical roles $0 Other Addressable Markets: Greater Than $5 Billion (Interim Leadership, Perm/Search, RPO, Mid-Revenue Cycle, Workforce Consulting, VMS, Credentialing) 12 Sources: US Healthcare Staffing Forecast, Staffing Industry Analysts, September 2018; AMN internal estimates of other markets
Why JOLTS Matters Healthcare Hires, Openings and Quits Five-Year CAGRs 7% 14% 6% Job Openings % of Employment 5% 4% 5% 3% Hires 3% 2% Quits 1% 2013 2014 2015 2016 2017 2018 Hires Openings Quits JOLTS = Job Openings and Labor Turnover Survey • Healthcare sector has record-high % of open jobs • Voluntary quits = 66% of hires in Q4 2018 • Hires reached 3% of jobs for first time since 2008 Data source: Job Openings and Labor Turnover Surveys, US Bureau of Labor Statistics 13
Drivers of Healthcare Employment Growth Annual Growth in Healthcare Spend Aging Population and Healthcare Utilization U.S. population aged 65+ in millions 72 5.5% • Over 65 - 3x more hospital days 4.4% 3.9% 40 • Over 75 - 4x more healthcare days 2010 2015 2020 2025 2030 2017 2018 2018–27 Source: U.S. Department of Health and Human Services Aging Healthcare Professionals Projected Healthcare Labor Shortage in 2030 ~ 50% of RNs and physicians are age 50+ 55% of RNs who plan to retire will do so by 2020 Up to 104,900 Regional & specialty ~38% of active physicians are age 56 & older physician shortage nurse shortages Sources: National Council of State Boards of Nursing and The Forum of State Nursing Workforce Centers – 2013 data and Association of American Medical Colleges April 5, 2016; AMN Healthcare survey, November 2017; AMA Physician Master File and 2012 Physicians Foundation Survey conducted by Merritt Hawkins – 2012 data; National Health Expenditure Projections – CMS, February 2019; AMN Healthcare 2013 Clinical Workforce Survey of Hospital Leaders; “The Complexities of Physician Supply and Demand,” Association of American Medical Colleges, March 2018; Future of the Nursing Workforce, Health Resources and Services Administration, December 2014. 15
Business Overview
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