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Section 1: 8-K (8-K)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________
FORM 8-K
_________________________

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

August 7, 2018
Date of Report (Date of earliest event reported)   

Evolent Health, Inc.
(Exact name of registrant as specified in its charter)
_________________________


Delaware 
001-37415
32-0454912
(State or other jurisdiction of
incorporation or organization)
Commission File Number: 
(IRS Employer
Identification No.)
 
800 N. Glebe Road, Suite 500, Arlington, Virginia 22203
 
 
(Address of principal executive offices)(zip code)
 
  
(571) 389-6000
(Registrant’s telephone number, including area code)
 
Not Applicable
(Former name, former address and former fiscal year, if changed since last report.)
_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐






Item 2.02.  Results of Operations and Financial Condition
 
On August 7, 2018, Evolent Health, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2018, a copy of which is furnished herewith as Exhibit 99.1.
   
Item 9.01.  Financial Statements and Exhibits

(d) Exhibits

The following exhibits are being furnished with this Form 8-K
 
Exhibit


Number

Description








SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EVOLENT HEALTH, INC.
 
 
By:
 /s/ Lydia Stone
Name:
Lydia Stone
Title:
Chief Accounting Officer
 
and Corporate Controller
 
 
By:
 /s/ Jonathan Weinberg
Name:
Jonathan Weinberg
Title:
General Counsel and Secretary


Dated: August 7, 2018





EXHIBIT INDEX

Exhibit
 
 
Number
 
Description
 
 
 



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
Exhibit 99.1

 
394550277_evhlogoa02.jpg

 
 

Evolent Health Announces Second Quarter 2018 Results
WASHINGTON, D.C., August 7, 2018Evolent Health, Inc. (NYSE: EVH), a company providing an integrated value-based care platform to the nation’s leading health systems and physician organizations, today announced financial results for the quarter ended June 30, 2018.

Highlights from the second quarter of 2018 announcement include (all comparisons are to the quarter ended June 30, 2017):

GAAP revenue of $144.3 million, an increase of 34.8%; Adjusted Revenue of $144.5 million, an increase of 34.7%
Net income (loss) attributable to Evolent Health, Inc. of $(9.9) million, Adjusted EBITDA of $4.9 million
Lives on platform of approximately 3.1 million, an increase of 10.9%
New partnership agreement with Torrance Health IPA (THIPA) and Torrance Memorial Integrated Physicians (TMIP) in California. Evolent is providing Torrance with its IdentifiSM population health performance management platform and Risk Adjustment solution to help enhance performance across Torrance’s provider network of 500 providers in the Los Angeles metro area. THIPA and TMIP collectively manage more than 20,000 Medicare Advantage and Next Generation ACO lives.
In June, Evolent announced Medicaid partnerships with Baptist Health Care and Nicklaus Children’s Health System in Florida. The Florida Agency for Health Care Administration (AHCA) notified Baptist Health Care and Nicklaus Children’s Health System of its intent to award their affiliates with contracts to provide physical and behavioral health care services through Florida’s Statewide Medicaid Managed Care (SMMC) program. Including Lee Health, Evolent is now collaborating with three health systems to launch and operate Medicaid plans in five regions of Florida that cover more than 1 million eligible beneficiaries.

Frank Williams, Chief Executive Officer of Evolent Health, Inc., commented, “We are quite pleased with our second quarter results as we achieved our key strategic, operational and financial objectives. We continue to see considerable interest from provider organizations looking to move substantially into value-based care as well as existing risk-bearing organizations focused on improving performance.”

Mr. Williams commented, "We also continue to see considerable wins and momentum in the Medicaid market. Establishing a major presence in key markets such as Miami-Dade, Palm Beach, Fort Myers, Pensacola and Tallahassee creates a strong, long-term growth opportunity for Evolent in Florida and beyond."

Mr. Williams added, “We are excited to announce our partnership with Torrance Health IPA and Torrance Memorial Integrated Physicians in California. Torrance has a strong reputation and highly engaged physicians across its network, and we look forward to elevating the performance of its Medicare risk business.”

Mr. Williams concluded, "Lastly, we are pleased to report that our 2018 Next Generation ACO cohort is operational and continues to perform well from both a cost and clinical quality standpoint. Our continued ability to identify and codify best practices across the network is driving meaningful improvements in health outcomes for patients across multiple regions and serves as a model for our Medicare Center of Excellence.”

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Financial Results of Evolent Health, Inc.

In our earnings releases, prepared remarks, conference calls, slide presentations and webcasts, we may use or discuss non-GAAP financial measures. We are not providing forward looking guidance for GAAP reported financial measures in the “Business Outlook” section below. A reconciliation of forward looking non-GAAP financial measures to the most comparable GAAP financial measure is provided in the “Guidance Reconciliation” table below. Definitions of the non-GAAP financial measures, as well as reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in this earnings release. See “Financial Statement Presentation” and “Non-GAAP Financial Measures” for more information.

Reported Results

Evolent Health, Inc. reported the following United States of America generally accepted accounting principles (“GAAP”) results:

Total revenue of $144.3 million and $107.1 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 34.8%;
Services revenue of $125.2 million for the three months ended June 30, 2018, before intersegment eliminations of $3.6 million; and
True Health premiums revenue of $22.9 million before intersegment eliminations of $0.2 million.
Cost of revenue of $69.0 million and $68.0 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 1.5%;
Claims expenses of $18.4 million for the three months ended June 30, 2018;
Selling, general and administrative expenses of $57.4 million and $51.1 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 12.4%;
Net income (loss) attributable to Evolent Health, Inc. of $(9.9) million and $(16.9) million for the three months ended June 30, 2018 and 2017, respectively;
Earnings (loss) available to common shareholders, basic and diluted, of $(9.9) million and $(16.9) million for the three months ended June 30, 2018 and 2017, respectively; and
Earnings (loss) available to common shareholders, per basic and diluted share, of $(0.13) and $(0.28) for the three months ended June 30, 2018 and 2017, respectively.

Total cash and cash equivalents as of June 30, 2018, were $198.0 million.

Adjusted Results

Adjusted Revenue of $144.5 million and $107.3 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 34.7%;
Adjusted Services Revenue of $125.4 million for the three months ended June 30, 2018, before intersegment eliminations of $3.6 million; and
True Health premiums revenue of $22.9 million for the three months ended June 30, 2018, before intersegment eliminations of $0.2 million.
Adjusted Cost of Revenue of $68.2 million and $66.2 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 3.1%;
Claims expenses of $18.4 million for the three months ended June 30, 2018;
Adjusted Selling, General and Administrative Expenses of $53.0 million and $44.7 million for the three months ended June 30, 2018 and 2017, respectively, an increase of 18.5%;
Adjusted EBITDA of $4.9 million and $(3.6) million for the three months ended June 30, 2018 and 2017, respectively;
Services Adjusted EBITDA of $5.6 million for three months ended June 30, 2018; and
True Health Adjusted EBITDA of $(0.8) million for the three months ended June 30, 2018.
Adjusted Earnings (Loss) Available for Class A and Class B Shareholders of $(2.3) million and $(8.8) million for the three months ended June 30, 2018 and 2017, respectively; and

2



Adjusted Earnings (Loss) per Share Available for Class A and Class B Shareholders of $(0.03) and $(0.13) for the three months ended June 30, 2018 and 2017, respectively.

Business Outlook

For the full year 2018, Adjusted Revenue is expected to be in the range of approximately $570.0 million to $585.0 million. We are making two small adjustments to full year guidance: reducing the high end of the range in the Services business by $5.0 million and adjusting the intersegment eliminations to $15.0 million from $20.0 million. The components of Adjusted Revenue include Adjusted Services Revenue, which is forecasted to be approximately $495.0 million to $505.0 million, and True Health premiums revenue, which is forecasted to be approximately $90.0 million to $95.0 million; intersegment eliminations are forecasted to be approximately $(15.0) million for the full year. Adjusted EBITDA is expected to be in the range of approximately $18.0 million to $23.0 million.

For the three months ended June 30, 2018, Adjusted Revenue is expected to be in the range of approximately $140.0 million to $144.0 million. The components of Adjusted Revenue include Adjusted Services Revenue, which is forecasted to be approximately $122.0 million to $124.0 million, and True Health premiums revenue, which is forecasted to be approximately $22.0 million to $24.0 million; intersegment eliminations are forecasted to be approximately $(4.0) million for the quarter. Adjusted EBITDA is expected to be in the range of approximately $3.0 million to $5.0 million.

This “Business Outlook” section contains forward-looking statements, and actual results may differ materially. Factors that may cause actual results to differ materially from our current expectations are set forth in “Forward Looking Statements - Cautionary Language” and Evolent Health, Inc.’s filings with the Securities and Exchange Commission (“SEC”).

Web and Conference Call Information
As previously announced, Evolent Health, Inc. will hold a conference call to discuss its second quarter performance this evening, August 7, 2018, at 5:00 p.m., Eastern Time. The conference call will be available via live webcast on the Company’s Investor Relations website at http://ir.evolenthealth.com. To participate by telephone, dial 855.940.9467 or 412.317.6034 for international callers, and ask to join the Evolent Health call. Participants are advised to dial in at least fifteen minutes prior to the call to register. The call will be archived on the company’s website for one week and will be available beginning later this evening. Evolent Health invites all interested parties to attend the conference call.
###
About Evolent Health, Inc.
Evolent Health, Inc.’s Services segment focuses on partnering with leading provider organizations to achieve superior clinical and financial results in value-based care. With a provider heritage and over 20 years of health plan administration experience, Evolent operates in more than 30 U.S. health care markets, actively managing care across Medicare, Medicaid, commercial and self-funded adult and pediatric populations. With the experience to drive change, Evolent confidently stands by a commitment to achieve results. Our True Health segment consists of a commercial health plan we operate in New Mexico that focuses on small and large businesses. For more information, visit www.evolenthealth.com.

Contacts:

Bob East
Robin Glass
443.213.0500
571.389.6005
Investor Relations
Media Relations
InvestorRelations@evolenthealth.com
RGlass@evolenthealth.com

3



Financial Statement Presentation
Evolent Health, Inc. is a holding company and its principal asset is all of the Class A common units in its operating subsidiary, Evolent Health LLC, which has owned all of our operating assets and substantially all of our business since inception. The financial results of Evolent Health LLC are consolidated in the financial statements of Evolent Health, Inc.
Non-GAAP Financial Measures
In addition to disclosing financial results that are determined in accordance with GAAP, we present and discuss Adjusted Revenue, Adjusted Services Revenue, Adjusted Transformation Services Revenue, Adjusted Platform and Operations Services Revenue, Adjusted Cost of Revenue, Adjusted Selling, General and Administrative Expenses, Adjusted Depreciation and Amortization Expenses, Adjusted Operating Income (Loss), Adjusted EBITDA, Adjusted Earnings (Loss) Available to Class A and Class B Shareholders, Adjusted Earnings (Loss) per Share Available to Class A and Class B Shareholders and Adjusted Weighted-Average Class A and Class B Shares, which are all non-GAAP financial measures, as supplemental measures to help investors evaluate our fundamental operational performance.

Adjusted Transformation Services Revenue and Adjusted Platform and Operations Services Revenue are defined as transformation services revenue and platform and operations services revenue, respectively, before the effect of intersegment eliminations and adjusted to exclude the impact of purchase accounting adjustments. In addition, the company’s Adjusted Transformation Services Revenue and Adjusted Platform and Operations Services Revenue for the six months ended June 30, 2018, include a $4.5 million adjustment related to revenue that was contracted for prior to 2018 and that was properly excluded from revenue in our 2017 results under the revenue recognition rules then in effect under Accounting Standards Codification (“ASC”) 605. On January 1, 2018, we adopted the new revenue recognition rules under ASC 606 using the modified retrospective method, which required us to include this $4.5 million as part of the cumulative transition adjustment to beginning retained earnings as of January 1, 2018. Under ASC 605, and based on proportionate performance revenue recognition, we would have recognized an additional $4.5 million in revenue during 2018, primarily within our Adjusted Transformation Services Revenue. The company has therefore included this revenue, and related profit, in its adjusted results for the six months ended June 30, 2018, as they had not been previously reported prior to 2018 and the contracts are expected to be completed within 2018. This is a one-time adjustment and it will not reoccur in future periods.

Adjusted Services Revenue is defined as the sum of Adjusted Transformation Revenue and Adjusted Platform and Operations Revenue. Adjusted Revenue is defined as the sum of Adjusted Services Revenue and True Health premiums revenue, less relevant intersegment eliminations. Management uses Adjusted Revenue, Adjusted Services Revenue, Adjusted Transformation Services Revenue and Adjusted Platform and Operations Services Revenue as supplemental performance measures because they reflect a complete view of the operational results. The measures are also useful to investors because they reflect the full view of our operational performance in line with how we generate our long term forecasts.

Adjusted Cost of Revenue and Adjusted Selling, General and Administrative Expenses are defined as cost of revenue and selling, general and administrative expenses, respectively, adjusted to exclude the impact of stock-based compensation expenses, severance costs, amortization of contract cost assets recorded as a result of a one-time ASC 606 transition adjustment, transaction costs related to acquisitions and business combinations, securities offerings and other one-time adjustments. Management uses Adjusted Cost of Revenue and Adjusted Selling, General and Administrative Expenses as supplemental performance measures, which are also useful to investors, because they facilitate an understanding of our long term operational costs while removing the effect of costs that are one-time (e.g. transaction costs) and non-cash (e.g. stock-based compensation expenses) in nature. Additionally, these supplemental performance measures facilitate understanding a breakdown of our Adjusted Total Operating Expenses.


4



Adjusted Depreciation and Amortization Expenses is defined as depreciation and amortization expenses adjusted to exclude the impact of amortization expenses related to intangible assets acquired through acquisitions and business combinations. Management uses Adjusted Depreciation and Amortization Expenses as a supplemental performance measure because it reflects a complete view of the operational results. The measure is also useful to investors because it facilitates understanding a breakdown of our Adjusted Total Operating Expenses.

Adjusted Total Operating Expenses is defined as the sum of Adjusted Cost of Revenue, Adjusted Selling, General and Administrative Expenses and Adjusted Depreciation and Amortization Expenses, and reflects the adjustments made in those non-GAAP measures. Adjusted Total Operating Expenses is adjusted to exclude the impact of one-time adjustments, such as goodwill impairment, severance costs, and items arising from acquisitions and business combinations, such as changes in fair value of contingent consideration and indemnification assets.

Adjusted Operating Income (Loss) is defined as Adjusted Revenue less Adjusted Total Operating Expenses, and reflects the adjustments made in those non-GAAP measures.

Adjusted EBITDA is the sum of Services Adjusted EBITDA and True Health Adjusted EBITDA and is defined as EBITDA (net income (loss) attributable to Evolent Health, Inc. before interest income, interest expense, (provision) benefit for income taxes, depreciation and amortization expenses), adjusted to exclude, changes in fair value of contingent consideration and indemnification assets, income (loss) from equity affiliates, other income (expense), net, net (income) loss attributable to non-controlling interests, purchase accounting adjustments, stock-based compensation expenses, severance costs, amortization of contract cost assets recorded as a result of a one-time ASC 606 transition adjustment, transaction costs related to acquisitions and business combinations and other one-time adjustments (which for the six months ended June 30, 2018, includes the ASC 606 transition adjustment described above). Management uses Adjusted EBITDA as a supplemental performance measure because the removal of transaction costs, one-time or non-cash items (e.g. depreciation, amortization and stock-based compensation expenses) allows us to focus on operational performance. We believe that this measure is also useful to investors because it allows further insight into the period over period operational performance in a manner that is comparable to other organizations in our industry and in the market in general.

Adjusted Earnings (Loss) Available to Class A and Class B Shareholders is defined as earnings (loss) available to common shareholders adjusted to exclude, income (loss) from equity affiliates, (provision) benefit for income taxes, changes in fair value of contingent consideration and indemnification assets, net (income) loss attributable to non-controlling interests, purchase accounting adjustments, stock-based compensation expenses, severance costs, amortization of contract cost assets recorded as a result of a one-time ASC 606 transition adjustment, transaction costs related to acquisitions and business combinations and other one-time adjustments (which for the six months ended June 30, 2018, includes the ASC transition adjustment described above).

Adjusted Weighted-Average Class A and Class B Shares is defined as weighted average common shares (diluted) adjusted to include, in periods of net loss, the dilutive or potentially dilutive effect of the assumed conversion of Class B common shares to Class A common shares.

Adjusted Earnings (Loss) per Share Available to Class A and Class B Shareholders is defined as Adjusted Earnings (Loss) Available to Class A and Class B Shareholders divided by Adjusted Weighted-Average Class A and Class B Shares, and reflects the adjustments made in those non-GAAP measures.
 
Management uses Adjusted Earnings (Loss) Available to Class A and Class B Shareholders, Adjusted Weighted-Average Class A and Class B Shares and Adjusted Earnings (Loss) per Share Available to Class A and Class B Shareholders because these performance measures represent our core operating performance distributed amongst all of our investors which is not represented by the GAAP results across

5



time due to our complex equity structure. We believe that these measures are also useful to investors for the same reason.

These adjusted measures do not represent and should not be considered as alternatives to GAAP measurements, and our calculations thereof may not be comparable to similarly entitled measures reported by other companies. A reconciliation of these adjusted measures to their most comparable GAAP financial measures is presented in the tables below. We believe these measures are useful across time in evaluating our fundamental core operating performance.


6




Evolent Health, Inc.
Consolidated Statements of Operations and Comprehensive Income (Loss)
(unaudited)
(in thousands, except per share data)
For the Three
 
For the Six
 
Months Ended
 
Months Ended
 
June 30,
 
June 30,
 
2018
 
2017
 
2018
 
2017
Revenue
 
 
 
 
 
 
 
Transformation services
$
8,215

 
$
5,361

 
$
14,720

 
$
15,596

Platform and operations services
113,346

 
101,710

 
223,164

 
197,714

Premiums
22,737

 

 
46,128

 

Total revenue
144,298

 
107,071

 
284,012

 
213,310

 
 
 
 
 
 
 
 
Expenses
 
 
 
 
 
 
 
Cost of revenue (exclusive of depreciation and amortization
 
 
 
 
 
 
 
expenses presented separately below)
69,003

 
67,994

 
140,978

 
135,523

Claims expenses
18,428

 

 
35,177

 

Selling, general and administrative expenses
57,403

 
51,090

 
112,929

 
104,641

Depreciation and amortization expenses
10,034

 
6,904

 
19,530

 
13,519

Change in fair value of contingent consideration and indemnification asset
(1,604
)
 
200

 
(1,504
)
 
200

Total operating expenses
153,264

 
126,188

 
307,110

 
253,883

Operating income (loss)
(8,966
)
 
(19,117
)
 
(23,098
)
 
(40,573
)
Interest income
878

 
218

 
1,950

 
403

Interest expense
(855
)
 
(947
)
 
(1,708
)
 
(1,901
)
Income (loss) from equity affiliates
(1,275
)
 
(555
)
 
(1,406
)
 
(1,077
)
Other Income (expense), net
78

 
3

 
60

 
5

Income (loss) before income taxes and
 
 
 
 
 
 
 
non-controlling interests
(10,140
)
 
(20,398
)
 
(24,202
)
 
(43,143
)
Provision (benefit) for income taxes
(109
)
 
(700
)
 
(106
)
 
(295
)
Net income (loss)
(10,031
)
 
(19,698
)
 
(24,096
)
 
(42,848
)
Net income (loss) attributable to non-controlling interests
(115
)
 
(2,793
)
 
(554
)
 
(7,930
)
Net income (loss) attributable to Evolent Health, Inc.
$
(9,916
)
 
$
(16,905
)
 
$
(23,542
)
 
$
(34,918
)
 
 
 
 
 
 
 
 
Earnings (Loss) Available to Common Shareholders
 
 
 
 
 
 
 
Basic
$
(9,916
)
 
$
(16,905
)
 
$
(23,542
)
 
$
(34,918
)
Diluted
(9,916
)
 
(16,905
)
 
(23,542
)
 
(34,918
)
 
 
 
 
 
 
 
 
Earnings (Loss) per Common Share
 
 
 
 
 
 
 
Basic
$
(0.13
)
 
$
(0.28
)
 
$
(0.31
)
 
$
(0.62
)
Diluted
(0.13
)
 
(0.28
)
 
(0.31
)
 
(0.62
)
 
 
 
 
 
 
 
 
Weighted-Average Common Shares Outstanding
 
 
 
 
 
 
 
Basic
77,209

 
59,478

 
76,297

 
56,057

Diluted
77,209

 
59,478

 
76,297

 
56,057

 
 
 
 
 
 
 
 
Comprehensive income (loss)
 
 
 
 
 
 
 
Net income (loss)
$
(10,031
)
 
$
(19,698
)
 
$
(24,096
)
 
$
(42,848
)
Other comprehensive income (loss), net of taxes, related to:
 
 
 
 
 
 
 
Foreign currency translation adjustment
(148
)
 

 
(148
)
 

Total comprehensive income (loss)
(10,179
)
 
(19,698
)
 
(24,244
)
 
(42,848
)
Total comprehensive income (loss) attributable to
 
 
 
 
 
 
 
non-controlling interests
(115
)
 
(2,793
)
 
(554
)
 
(7,930
)
Total comprehensive income (loss) attributable to
 
 
 
 
 
 
 
Evolent Health, Inc.
$
(10,064
)
 
$
(16,905
)
 
$
(23,690
)
 
$
(34,918
)

7



Evolent Health, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
 
(in thousands)
 
As of
 
 
As of
 
 
June 30,
December 31,
 
 
2018
 
 
2017
 
Cash and cash equivalents
 
$
197,983

 
 
$
238,433

 
Restricted cash
 
56,342

 
 
56,930

 
Restricted investments
 
712

 
 
8,755

 
Note receivable
 
12,000

 
 
20,000

 
Total current assets
 
353,254

 
 
378,182

 
Intangible assets, net
 
236,819

 
 
241,261

 
Goodwill
 
635,282

 
 
628,186

 
Total assets
 
1,321,620

 
 
1,312,697

 
 
 
 
 
 
 
 
Long-term debt, net of discount
 
121,853

 
 
121,394

 
Total liabilities
 
270,239

 
 
266,391

 
Total shareholders' equity (deficit) attributable to
 
 
 
 
 
 
Evolent Health, Inc.
 
1,041,233

 
 
1,010,879

 
Non-controlling interests
 
10,148

 
 
35,427

 
Total liabilities and shareholders' equity (deficit)
 
1,321,620

 
 
1,312,697

 


8



Evolent Health, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
 
(in thousands)
For the Six
 
Months Ended
 
June 30,
 
2018
 
2017
Net cash and restricted cash provided by (used in) operating activities
$
(18,004
)
 
$
(37,812
)
Net cash and restricted cash provided by (used in) investing activities
(19,376
)
 
1,339

Net cash and restricted cash provided by (used in) financing activities
(3,665
)
 
(19,612
)
Effect of exchange rate on cash and cash equivalents and restricted cash
7

 

 
 
 
 
Net increase (decrease) in cash and cash equivalents and restricted cash
(41,038
)
 
(56,085
)
Cash and cash equivalents and restricted cash as of beginning-of-period
295,363

 
170,029

Cash and cash equivalents and restricted cash as of end-of-period
$
254,325

 
$
113,944



9



Evolent Health, Inc.
Adjusted Results of Operations
(unaudited)
(in thousands)
For the Three Months Ended June 30, 2018
 
 
For the Three Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Evolent Health, Inc.
 
Evolent Health, Inc.
 
Evolent
 
 
 
Evolent
 
 
Evolent
 
 
 
Evolent
 
as Reported
 
as Adjusted
 
Health, Inc.
 
 
 
Health, Inc.
 
 
Health, Inc.
 
 
 
Health, Inc.
 
Change Over Prior Period
 
Change Over Prior Period
 
as Reported
 
Adjustments
 
as Adjusted
 
 
as Reported
 
Adjustments
 
as Adjusted
 
$
 
%
 
$
 
%
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Transformation services (1)
$
8,215

 
$

 
$
8,215

 
 
$
5,361

 
$

 
$
5,361

 
$
2,854

 
53.2
 %
 
$
2,854

 
53.2
%
Platform and operations services (1)
113,346

 
216

 
113,562

 
 
101,710

 
244

 
101,954

 
11,636

 
11.4
 %
 
11,608

 
11.4
%
Premiums
22,737

 

 
22,737

 
 

 

 

 
22,737

 
 %
 
22,737

 
%
Total revenue
144,298

 
216

 
144,514

 
 
107,071

 
244

 
107,315

 
37,227

 
34.8
 %
 
37,199

 
34.7
%
Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue (exclusive of
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
expenses presented
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
separately below) (2)
69,003

 
(815
)
 
68,188

 
 
67,994

 
(1,837
)
 
66,157

 
1,009

 
1.5
 %
 
2,031

 
3.1
%
Claims expenses
18,428

 

 
18,428

 
 

 

 

 
18,428

 
 %
 
18,428

 
%
Selling, general and
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
administrative expenses (3)
57,403

 
(4,390
)
 
53,013

 
 
51,090

 
(6,370
)
 
44,720

 
6,313

 
12.4
 %
 
8,293

 
18.5
%
Depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
expenses (4)
10,034

 
(2,769
)
 
7,265

 
 
6,904

 
(2,383
)
 
4,521

 
3,130

 
45.3
 %
 
2,744

 
60.7
%
Change in fair value of contingent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
consideration and indemnification asset (5)
(1,604
)
 
1,604

 

 
 
200

 
(200
)
 

 
(1,804
)
 
(902.0
)%
 

 
%
Total operating expenses
153,264

 
(6,370
)
 
146,894

 
 
126,188


(10,790
)

115,398

 
27,076

 
21.5
 %
 
31,496

 
27.3
%
Operating income (loss)
$
(8,966
)
 
$
6,586

 
$
(2,380
)
 
 
$
(19,117
)
 
$
11,034

 
$
(8,083
)
 
$
10,151

 
53.1
 %
 
$
5,703

 
70.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total operating expenses as a


 
 
 


 
 


 
 
 


 
 
 
 
 
 
 
 
percentage of total revenue
106.2
%
 
 
 
101.6
%
 
 
117.9
%
 
 
 
107.5
%
 
 
 
 
 
 
 
 

(1) 
Adjustments to platform and operations services revenue include deferred revenue purchase accounting adjustments of approximately $0.2 million for the three months ended June 30, 2018 and 2017, respectively, resulting from our acquisitions and business combinations.
(2) 
Adjustments to cost of revenue include approximately $0.4 million in stock-based compensation expense for the three months ended June 30, 2018 and 2017, respectively. The adjustments also include approximately $0.5 million related to the amortization of contract cost assets recorded as a result of the one-time ASC 606 transition adjustment for the three months ended June 30, 2018. Adjustments also include transaction costs of approximately $1.4 million for the three months ended June 30, 2017, resulting from acquisitions and business combinations.
(3) 
Adjustments to selling, general and administrative expenses include $4.3 million and $5.0 million in stock-based compensation expense for the three months ended June 30, 2018 and 2017, respectively. Adjustments also include transaction costs of $0.1 million and $1.4 million for the three months ended June 30, 2018 and 2017, respectively, resulting from acquisitions and business combinations and costs relating to our securities offerings. The adjustments also include less than $0.1 million related to the amortization of contract cost assets recorded as a result of the one time ASC 606 transition adjustment and $0.1 million of one-time severance costs for the three months ended June 30, 2018.
(4) 
Adjustments to depreciation and amortization expenses of approximately $2.8 million and $2.4 million for the three months ended June 30, 2018 and 2017, respectively, relate to amortization of intangible assets acquired via asset acquisition and business combinations.
(5) 
The adjustment reverses the impact of changes in fair value of our contingent consideration and indemnification asset that were acquired through business combinations during 2016.

10



Evolent Health, Inc.
Adjusted Results of Operations
(unaudited)
(in thousands)
For the Six Months Ended June 30, 2018
 
 
For the Six Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Evolent Health, Inc.
 
Evolent Health, Inc.
 
Evolent
 
 
 
Evolent
 
 
Evolent
 
 
 
Evolent
 
as Reported
 
as Adjusted
 
Health, Inc.
 
 
 
Health, Inc.
 
 
Health, Inc.
 
 
 
Health, Inc.
 
Change Over Prior Period
 
Change Over Prior Period
 
as Reported
 
Adjustments
 
as Adjusted
 
 
as Reported
 
Adjustments
 
as Adjusted
 
$
 
%
 
$
 
%
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Transformation services (1)
$
14,720

 
$
3,655

 
$
18,375

 
 
$
15,596

 
$

 
$
15,596

 
$
(876
)
 
(5.6
)%
 
$
2,779

 
17.8
%
Platform and operations services (1)
223,164

 
1,276

 
224,440

 
 
197,714

 
775

 
198,489

 
25,450

 
12.9
 %
 
25,951

 
13.1
%
Premiums
46,128

 

 
46,128

 
 

 

 

 
46,128

 
 %
 
46,128

 
%
Total revenue
284,012

 
4,931

 
288,943

 
 
213,310

 
775

 
214,085

 
70,702

 
33.1
 %
 
74,858

 
35.0
%
Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue (exclusive of
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
expenses presented
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
separately below) (2)
140,978

 
(2,451
)
 
138,527

 
 
135,523

 
(2,860
)
 
132,663

 
5,455

 
4.0
 %
 
5,864

 
4.4
%
Claims expenses
35,177

 

 
35,177

 
 

 

 

 
35,177

 
 %
 
35,177

 
%
Selling, general and
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
administrative expenses (3)
112,929

 
(10,488
)
 
102,441

 
 
104,641

 
(14,882
)
 
89,759

 
8,288

 
7.9
 %
 
12,682

 
14.1
%
Depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
expenses (4)
19,530

 
(5,405
)
 
14,125

 
 
13,519

 
(4,708
)
 
8,811

 
6,011

 
44.5
 %
 
5,314

 
60.3
%
Change in fair value of contingent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
consideration and indemnification asset (5)
(1,504
)
 
1,504

 

 
 
200

 
(200
)
 

 
(1,704
)
 
(852.0
)%
 

 
%
Total operating expenses
307,110

 
(16,840
)
 
290,270

 
 
253,883

 
(22,650
)
 
231,233

 
53,227

 
21.0
 %
 
59,037

 
25.5
%
Operating income (loss)
$
(23,098
)
 
$
21,771

 
$
(1,327
)
 
 
$
(40,573
)
 
$
23,425

 
$
(17,148
)
 
$
17,475

 
43.1
 %
 
$
15,821

 
92.3
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total operating expenses as a
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
percentage of total revenue
108.1
%
 
 
 
100.5
%
 
 
119.0
%
 
 
 
108.0
%
 
 
 
 
 
 
 
 

(1) 
Adjustments to transformation services revenue and platform and operations services revenue for the six months ended June 30, 2018, include approximately $3.7 million and $0.8 million, respectively, resulting from our transition adjustments related to the implementation of ASC 606. Adjustments to platform and operations services revenue also include deferred revenue purchase accounting adjustments of approximately $0.4 million and $0.8 million for the six months ended June 30, 2018 and 2017, respectively, resulting from our acquisitions and business combinations.
(2) 
Adjustments to cost of revenue include $0.8 million and $0.7 million in stock-based compensation expense for the six months ended June 30, 2018 and 2017, respectively. The adjustments also include $1.0 million related to the amortization of contract cost assets recorded as a result of the one-time ASC 606 transition adjustment and $0.7 million of one-time severance costs for the six months ended June 30, 2018. Adjustments also include transaction costs of approximately $2.1 million for the six months ended June 30, 2017, resulting from acquisitions and business combinations.
(3) 
Adjustments to selling, general and administrative expenses include $7.8 million and $9.7 million in stock-based compensation expense for the six months ended June 30, 2018 and 2017, respectively. Adjustments also include transaction costs of $1.8 million and $5.2 million for the six months ended June 30, 2018 and 2017, respectively, resulting from acquisitions and business combinations and costs relating to our securities offerings. The adjustments also include $0.1 million related to the amortization of contract cost assets recorded as a result of the one time ASC 606 transition adjustment and $0.8 million of one-time severance costs for the six months ended June 30, 2018.
(4) 
Adjustments to depreciation and amortization expenses of approximately $5.4 million and $4.7 million for the six months ended June 30, 2018 and 2017, respectively, relate to amortization of intangible assets acquired via asset acquisition and business combinations.
(5) 
The adjustment reverses the impact of changes in fair value of our contingent consideration and indemnification asset that were acquired through business combinations during 2016.

11



Evolent Health, Inc.
Segment Results
(unaudited)

 
 
 
 
 
 
 
Intersegment
 
 
 
 
 
Services
 
True Health (1)
Eliminations
Consolidated
Adjusted Revenue
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Services:
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Transformation Services
 
$
8,215

 
 
$

 
 
$

 
 
$
8,215

 
Adjusted Platform and Operations Services
 
117,177

 
 

 
 
(3,615
)
 
 
113,562

 
Adjusted Services Revenue
 
125,392

 
 

 
 
(3,615
)
 
 
121,777

 
True Health:
 
 
 
 
 
 
 
 
 
 
 
 
Premiums
 

 
 
22,939

 
 
(202
)
 
 
22,737

 
Adjusted Revenue
 
125,392

 
 
22,939

 
 
(3,817
)
 
 
144,514

 
Purchase accounting adjustments (2)
 
(216
)
 
 

 
 

 
 
(216
)
 
Total revenue
 
$
125,176

 
 
$
22,939

 
 
$
(3,817
)
 
 
$
144,298

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
Services:
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Transformation Services
 
$
5,361

 
 
$

 
 
$

 
 
$
5,361

 
Adjusted Platform and Operations Services
 
101,954

 
 

 
 

 
 
101,954

 
Adjusted Services Revenue
 
107,315

 
 

 
 

 
 
107,315

 
Adjusted Revenue
 
107,315

 
 

 
 

 
 
107,315

 
Purchase accounting adjustments (2)
 
(244
)
 
 

 
 

 
 
(244
)
 
Total revenue
 
$
107,071

 
 
$

 
 
$

 
 
$
107,071

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segments
 
 
 
 
 
 
Services
 
True Health (1)
Total
 
Three Months Ended June 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA
 
$
5,642

 
 
$
(758
)
 
 
4,884

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA
 
(3,562
)
 
 

 
 
(3,562
)
 
 
 
 

(1) 
The True Health segment was created in January 2018.
(2) 
Purchase accounting adjustments pertain to Adjusted Platform and Operations Services Revenue. There were no purchase accounting adjustments in relation to Adjusted Transformation Services Revenue or True Health premiums revenue.

12



Evolent Health, Inc.
Segment Results
(unaudited)

 
 
 
 
 
 
 
Intersegment
 
 
 
 
 
Services
 
True Health (1)
Eliminations
Consolidated
Adjusted Revenue
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Services:
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Transformation Services
 
$
18,375

 
 
$

 
 
$

 
 
$
18,375

 
Adjusted Platform and Operations Services
 
231,852

 
 

 
 
(7,412
)
 
 
224,440

 
Adjusted Services Revenue
 
250,227

 
 

 
 
(7,412
)
 
 
242,815

 
True Health:
 
 
 
 
 
 
 
 
 
 
 
 
Premiums
 

 
 
46,524

 
 
(396
)
 
 
46,128

 
Adjusted Revenue
 
250,227

 
 
46,524

 
 
(7,808
)
 
 
288,943

 
ASC 606 transition adjustment (2)
 
(4,498
)
 
 

 
 

 
 
(4,498
)
 
Purchase accounting adjustments (3)
 
(433
)
 
 

 
 

 
 
(433
)
 
Total revenue
 
$
245,296

 
 
$
46,524

 
 
$
(7,808
)
 
 
$
284,012

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
Services:
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Transformation Services
 
$
15,596

 
 
$

 
 
$

 
 
$
15,596

 
Adjusted Platform and Operations Services
 
198,489

 
 

 
 

 
 
198,489

 
Adjusted Services Revenue
 
214,085

 
 

 
 

 
 
214,085

 
Adjusted Revenue
 
214,085

 
 

 
 

 
 
214,085

 
Purchase accounting adjustments (3)
 
(775
)
 
 

 
 

 
 
(775
)
 
Total revenue
 
$
213,310

 
 
$

 
 
$

 
 
$
213,310

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segments
 
 
 
 
 
 
Services
 
True Health (1)
Total
 
Six Months Ended June 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA
 
$
12,608

 
 
$
189

 
 
12,797

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA
 
(8,337
)
 
 

 
 
(8,337
)
 
 
 
 

(1) 
The True Health segment was created in January 2018.
(2) 
Adjustment to Adjusted Transformation Services Revenue was approximately $3.7 million and the adjustment to Adjusted Platform and Operations Services Revenue was approximately $0.8 million. See “Non-GAAP Financial Measures” above for more information on adjustments pertaining to the implementation of ASC 606.
(3) 
Purchase accounting adjustments pertain to Adjusted Platform and Operations Services Revenue. There were no purchase accounting adjustments in relation to Adjusted Transformation Services Revenue or True Health premiums revenue.


13




Evolent Health, Inc.
Reconciliation of Adjusted EBITDA to Net Income (Loss)
Attributable to Evolent Health, Inc.
(unaudited)
 
(in thousands)
For the Three
 
For the Six
 
Months Ended
 
Months Ended
 
June 30,
 
June 30,
 
2018
 
2017
 
2018
 
2017
Net Income (Loss) Attributable to
 
 
 
 
 
 
 
Evolent Health, Inc.
$
(9,916
)
 
$
(16,905
)
 
$
(23,542
)
 
$
(34,918
)
Less:
 
 
 
 
 
 
 
Interest income
878

 
218

 
1,950

 
403

Interest expense
(855
)
 
(947
)
 
(1,708
)
 
(1,901
)
(Provision) benefit for income taxes
109

 
700

 
106

 
295

Depreciation and amortization expenses
(10,034
)
 
(6,904
)
 
(19,530
)
 
(13,519
)
EBITDA
(14
)
 
(9,972
)
 
(4,360
)
 
(20,196
)
Less:
 
 
 
 
 
 
 
Income (loss) from equity affiliates
(1,275
)
 
(555
)
 
(1,406
)
 
(1,077
)
Change in fair value of contingent
 
 
 
 
 
 
 
consideration and indemnification asset
1,604

 
(200
)
 
1,504

 
(200
)
Other income (expense), net
78

 
3

 
60

 
5

Net (income) loss attributable to
 
 
 
 
 
 
 
non-controlling interests
115

 
2,793

 
554

 
7,930

ASC 606 transition adjustments

 

 
(4,498
)
 

Purchase accounting adjustments
(216
)
 
(244
)
 
(433
)
 
(775
)
Stock-based compensation expense
(4,718
)
 
(5,360
)
 
(8,513
)
 
(10,464
)
Severance costs
105

 

 
(1,489
)
 

Amortization of contract cost assets
(578
)
 

 
(1,139
)
 

Transaction costs
(14
)
 
(2,847
)
 
(1,798
)
 
(7,278
)
Adjusted EBITDA
$
4,885

 
$
(3,562
)
 
$
12,798

 
$
(8,337
)


14



Evolent Health, Inc.
Reconciliation of Adjusted Earnings (Loss) Available to Class A and Class B
Shareholders to Earnings (Loss) Available to Common Shareholders
(unaudited)
 
(in thousands, except per share data)
For the Three
 
For the Six
 
Months Ended
 
Months Ended
 
June 30,
 
June 30,
 
2018
 
2017
 
2018
 
2017
Earnings (Loss) Available to
 
 
 
 
 
 
 
Common Shareholders - Basic and Diluted (a)
$
(9,916
)
 
$
(16,905
)
 
$
(23,542
)
 
$
(34,918
)
Less:
 
 
 
 
 
 
 
Income (loss) from equity affiliates
(1,275
)
 
(555
)
 
(1,406
)
 
(1,077
)
(Provision) benefit for income taxes
129

 
700

 
136

 
280

Change in fair value of contingent consideration
 
 
 
 
 
 
 
and indemnification asset
1,604

 
(200
)
 
1,504

 
(200
)
Net (income) loss attributable to
 
 
 
 
 
 
 
non-controlling interests
115

 
2,793

 
554

 
7,930

ASC 606 Transition Adjustment

 

 
(4,498
)
 

Purchase accounting adjustments
(2,985
)
 
(2,669
)
 
(5,838
)
 
(5,569
)
Stock-based compensation expense
(4,718
)
 
(5,360
)
 
(8,513
)
 
(10,464
)
Severance costs
105

 

 
(1,489
)
 

Amortization of contract cost assets
(578
)
 

 
(1,139
)
 

Transaction costs
(14
)
 
(2,847
)
 
(1,798
)
 
(7,278
)
Adjusted Earnings (Loss) Available
 
 
 
 
 
 
 
to Class A and Class B Shareholders (b)
$
(2,299
)
 
$
(8,767
)
 
$
(1,055
)
 
$
(18,540
)
 
 
 
 
 
 
 
 
Earnings (Loss) per Share Available to
 
 
 
 
 
 
 
Common Shareholders - Basic and Diluted (a) (1)
$
(0.13
)
 
$
(0.28
)
 
$
(0.31
)
 
$
(0.62
)
 
 
 
 
 
 
 
 
Adjusted Earnings (Loss) per Share Available
 
 
 
 
 
 
 
to Class A and Class B Shareholders (b) (2)
$
(0.03
)
 
$
(0.13
)
 
$
(0.01
)
 
$
(0.27
)
 
 
 
 
 
 
 
 
Weighted-average common shares - basic
77,209

 
59,478

 
76,297

 
56,057

Weighted-average common shares - diluted
77,209

 
59,478

 
76,297

 
56,057

Adjusted Weighted-Average Class A
 
 
 
 
 
 
 
and Class B Shares (3)
78,071

 
68,155

 
77,795

 
68,051


(1) 
For periods of net loss, shares used in both the basic and diluted earnings per share calculation represent basic shares as using diluted shares would be anti-dilutive.
(2) 
Represents Adjusted Earnings (Loss) Available to Class A and Class B Shareholders divided by Adjusted Weighted-Average Class A and Class B Shares as described in footnote 3 below.
(3) 
Represents the weighted-average common shares (diluted) adjusted to include, in periods of net loss, the dilutive or potentially dilutive effect of the assumed conversion of Class B common shares to Class A common shares. See the reconciliation of Adjusted Weighted-Average Class A and Class B Shares to diluted weighted-average common shares on the following page.

15



Evolent Health, Inc.
Reconciliation of Adjusted Weighted-Average Class A and Class B
Shares to Diluted Weighted-Average Common Shares
(unaudited)
 
(in thousands)
For the Three
 
For the Six
 
Months Ended
 
Months Ended
 
June 30,
 
June 30,
 
2018
 
2017
 
2018
 
2017
Weighted-average common shares - diluted
77,209

 
59,478

 
76,297

 
56,057

Assumed conversion of Class B common
 
 
 
 
 
 
 
shares to Class A common shares
862

 
8,677

 
1,498

 
11,994

Adjusted Weighted-Average Class A and Class B Shares
78,071

 
68,155

 
77,795

 
68,051



16



Evolent Health, Inc.
Guidance Reconciliation
(unaudited)
(in thousands)
For the Three
For the Twelve
 
Months Ended
Months Ended
 
September 30,
December 31,
 
 
2018
 
 
2018
 
Services revenue
 
$
122,800

 
 
$
494,700

 
Purchase accounting adjustments
 
200

 
 
800

 
ASC 606 transition adjustments
 

 
 
4,500

 
Adjusted Services Revenue
 
123,000

 
 
500,000

 
True Health premiums revenue
 
23,000

 
 
92,500

 
Intersegment eliminations
 
(4,000
)
 
 
(15,000
)
 
Adjusted Revenue
 
$
142,000

 
 
$
577,500

 
 
 
 
 
 
 
 
Net Income (Loss) Attributable to
 
 
 
 
 
 
Evolent Health, Inc.
 
$
(12,800
)
 
 
$
(53,000
)
 
Less:
 
 
 
 
 
 
Interest income
 
900

 
 
3,500

 
Interest expense
 
(900
)
 
 
(4,000
)
 
Depreciation and amortization expenses
 
(10,000
)
 
 
(40,000
)
 
EBITDA
 
(2,800
)
 
 
(12,500
)
 
Less: