Acadia Healthcare Company (ACHC) investor relations material

Strategic actions and operational updates

• Announced a pause on several projects, reducing 2026 CapEx by at least $300 million compared to 2025, with further reductions expected in 2027.

• Added nearly 1,800 beds between 2024 and 2025, with plans for 500-700 more in 2026, focusing on joint ventures with health systems.

• Closed five facilities due to underperformance or lack of strategic fit, concentrating resources on core business lines and favorable geographies.

• Ongoing comprehensive facility-by-facility portfolio review, with additional closures possible as part of operational optimization.

• Real estate value considered in closure decisions, with potential for asset sales to unlock shareholder value.

Financial outlook and growth drivers

• 2025 volumes have been below expectations, mainly due to weaker Medicaid volumes in the Acute line and local facility underperformance.

• No update to full-year 2025 guidance; significant EBITDA and free cash flow improvement expected in 2026 and 2027 from ramping volumes, lower startup costs, and aggressive facility optimization.

• CapEx reduction and focused bed additions in markets with favorable reimbursement expected to accelerate positive free cash flow.

• Rate growth has moderated to low single digits, with some markets offering mid-single-digit opportunities, especially through joint ventures.

• Investments in technology and quality infrastructure are expected to support payer negotiations and reimbursement stability.

Market dynamics and industry trends

• Demand for behavioral health services remains structurally strong, especially for high-acuity patients and in underserved geographies.

• Increased competition from private equity and new entrants, but differentiation achieved through technology, quality, and staff investments.

• Labor market has stabilized, with premium pay declining and employee engagement initiatives supporting retention.

• Ongoing investments in EMRs, patient monitoring, and staff safety devices enhance operational efficiency and care quality.

• Legislative changes, such as the recent bill affecting state-directed payments, are being closely monitored, with most patients expected to be exempt from new Medicaid work requirements.