Acadia Healthcare Company (ACHC) BofA Securities 2025 Healthcare Conference summary

Financial performance and outlook

• Revenue, EBITDA, volume, and margins were in line with guidance, with EBITDA at the high end of the range for the quarter.

• 2025 full-year financial guidance for revenue and adjusted EBITDA was reaffirmed.

• Revenue is expected to grow 6% in 2025, but EBITDA will decline due to lower supplemental payments and PLGL expenses.

• Supplemental payments are expected to be down $10–$15 million year-over-year, with PLGL expense at $10 million for 2025.

• Labor trends and startup costs outperformed expectations in Q1, providing some tailwinds.

Growth strategy and capacity expansion

• Added 378 newly licensed beds and seven new Comprehensive Treatment Centers (CTCs) in Q1.

• Currently in a period of record growth, with 1,600–1,800 beds added over 2023–2024 and plans for 800–1,000 more in 2025.

• Bed additions are expected to moderate to 600–800 per year from 2026 to 2028, supporting sustainable free cash flow by 2026.

• De novo facility construction takes 18–24 months, with break-even in 12–13 months and target margins of 30% by year five.

• Joint venture partnerships remain strong, with multiple new facilities planned with existing partners.

Demand trends and service lines

• Consistent demand across all four business lines, with behavioral health identified as a major public health crisis.

• The industry is underbedded by an estimated 75,000 beds, and 30 million Americans with mental illness receive no care.

• CTCs, now 17% of the business, saw mid-teens to low 20% growth in 2023–2024 and are expected to grow mid-single digits going forward.

• High acuity in opioid use disorder patients is driving complexity and demand for CTC services.

• Tuck-in M&A is accelerating CTC growth, with four acquisitions in Q1.