Tivity Health, Inc. (TVTY) Tops Q3 EPS by 10c, Slight Miss on Revenues; Boosts FY17 Guidance

Tivity Health, Inc. (NASDAQ: TVTY) reported Q3 EPS of $0.46, $0.10 better than the analyst estimate of $0.36. Revenue for the quarter came in at $137.37 million versus the consensus estimate of $137.95 million.

2017 Financial Guidance

Tivity Health announced today that, based on results for the first nine months of the year and the Company’s outlook for the remainder of 2017, it has raised its financial guidance for 2017, as follows:

• revenues in a range of $555 million to $557 million, compared with the previous range of $550 million to $558 million;
• adjusted EBITDA in a range of $126 million to $128 million, compared with the previous range of $119 million to $123 million; and
• adjusted earnings per diluted share in a range of $1.58 to $1.61, compared with the previous range of $1.50 to $1.58.

Third-Quarter 2017 Financial Highlights

• Revenues increased by 10.1% to $137.7 million driven by growth in all three of the Company’s product lines. This compares to revenues of $125.0 million for the third quarter of 2016.
• Net income from continuing operations was $19.9 million, or $0.46 per diluted share, compared with $4.8 million, or $0.12 per diluted share, for the third quarter of 2016. Results for the third quarter of 2017 include an effective income tax rate of 34.3%. Adjusted net income from continuing operations for the third quarter of 2016 was $11.9 million, or $0.31 per diluted share, which excludes income tax expense related to the first half of 2016, restructuring charges, business separation costs and income attributable to the reversal of deferred tax asset valuation allowance. See pages 9-12 for a reconciliation of non-GAAP financial measures.
• Weighted average diluted shares outstanding increased 13.3% to 43.5 million compared with the third quarter of 2016. The most significant factor driving the diluted share count increase was the 76% increase in the Company’s weighted average stock price for the third quarter of 2017 compared with the third quarter of 2016.
• EBITDA was $35.3 million or 25.7% of revenue. EBITDA for the third quarter of 2016 was $24.4 million, and adjusted EBITDA was $26.2 million, or 21.0% of revenue, which excluded restructuring costs and business separation costs.
• Cash flow from operations was $33.6 million, and free cash flow totaled $31.8 million. Net funded debt was $151.3 million and the ratio of total debt to trailing 12 months EBITDA, as calculated under the Company’s credit facility, improved to 1.2, compared with 1.9 at the end of 2016. At September 30, 2017, the Company had cash and cash equivalents of $4.9 million.

For earnings history and earnings-related data on Tivity Health, Inc. (TVTY) click here.

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