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PINC Premier

Participants
Jim Storey Investor Relations
Susan DeVore Chief Executive Officer
Mike Alkire President
Craig McKasson Chief Administrative and Financial Officer
Michael Cherny Bank of America
Steven Valiquette Barclays
Lisa Gill JP Morgan
Richard Close Canaccord Genuity
Ryan Daniels William Blair
Charles Rhyee Cowen
Jailendra Singh Crédit Suisse
Stephanie Davis Demko SVP
Eric Percher Nephron Research
Eric Coldwell Baird
Alexander Draper SunTrust
Call transcript
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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Premier Inc. Fiscal Year 2020 Third Quarter Results and Conference Call. At this time all participants lines are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]

to Storey, conference Investor like speaker to now Jim today, Relations. would hand over the your I Thank you. Please go ahead, sir.

Jim Storey

call. Thank to you, conference Premier everyone, Inc.'s fiscal April, XXXX third and welcome, quarter

Executive the speakers update the Officer; McKasson, Our year. and Administrative Officer. review discuss Craig Financial remainder ongoing fiscal Mike and Susan provide the are DeVore, quarter's Chief Mike President; results, of and today the Alkire, Craig and will for Susan, strategies Chief an operations

to are remind investors.premierinc.com. release section want that the we copies slides earnings I Before website get Relations our everyone and accompanying of started, at Investor our of this available supplemental the conference call in

filings remarks to materially today, that to our as the to Management's SEC, results in you of future encourage fiscal discussed forward-looking detailed discussed disclosures. update actual risk quarter, factor our might for file we which third are affect statements and could with from no undertake we them. expect speak contain safe harbor and differ review Factors Form obligation We today XX-Q today. certain and statements, those the results These these soon. forward-looking including

business. of on SEC completion release, in in of appropriate, Please soon. the Form measures non-GAAP and financial financial expect operations Specialty which the today and release refer results to to of appendix to GAAP our financial the will we of June to X-K, business, the exit furnish earnings included supplement Reconciliation this our our earnings measures are slides, measures the reflect our also presentation accompanying with we following in Pharmacy evaluate X, XXXX. sale where continuing presented that note Also, financial non-GAAP

over Now to call Susan the let me DeVore. turn

Susan DeVore

and and your ways the had industry. call. today safe the in everyone, live I acknowledging staying work by start which healthcare these welcome, loved and significant times difficult to in and has on impact and Jim, are the I'd and healthy. to managing especially Thanks, like through ones we you hope our COVID-XX

the U.S. tremendous day first We to providers, grateful their the are to around healthcare pandemic. every and frontline across combat this world workers for responders and efforts

to working treatment We pandemic also to new I'd the from to take our ability to quickly, like put also and we're thank serving continue challenging outcomes new providers Their to vaccine in and their of moment to members health ability through going instrumental adapt systems those to individuals to employees patients. member health has researchers working us improving time. protocols. studying logistics support this Premier ways commitment been to continued to our thank our behind organizations for to this enabling a mobilize

playing COVID-XX healthcare is with everyone, a of helping of Premier spend mind discussing most the of the for this today unprecedented partners and critical today start role top I'll through manage quarter, then is time recap brief my our truly As in crisis.

our management's results, quarter of that strong third Premier delivered terms fiscal In expectations. performance financial exceeded

range. While or guidance believe we COVID-XX-related quarter, current our warrants in changing expect not fourth businesses do we our XXXX fiscal do across the withdrawing pressure the some impact financial

the we've potential to outlook this our healthcare a strength integrated from environment. fiscal and very and Premier Operationally, years various financial capabilities during diversified operate are in in that meantime, flexibility. impacts the of position and recent on serving the platform built discuss are business financial review continuing and providers strategically will we remainder Craig for our his the In XXXX. of well

traditional avenues online platform, direct to changing which our partners includes businesses, to we rapidly for ensure patient chain address sources. care continuity are homes, helping sourcing which sourcing go provides from products complex products reliable needed issues ordering and stocked like beyond of And access quality access sourcing. nursing alternate increasingly site these our that business, population. much This a our to accelerates customers, using Through supply with

safety On for Services solution monitoring inside our the alerts. COVID-specific is hospital paradox surveillance the side, Performance

decision While suspected physician's leveraging an directly waves the also support flagging early COVID-XX. predictive And modeling our warning is office. Stanson for in to technology at COVID-XX point is clinical future EMR cases the of at care create the capability of

I'll now we're Services, response Supply of actions healthcare some turn environment this the executing around that organized to member providers. initiatives. and support In our key specific both lead three to Chain in our we've

is products something provider efforts to day. where we've we providing does much to every time, new actionable be. access accelerating to need are products, find they sources supply But and redoubled that First, get real our needed Premier information of

we step to agreements surging For example, business, purchasing group our highly unusual our to capable the suppliers help demand. all took the in of opening meet

to added suppliers or This in has allocation. process expedited under categories shortage product that are sourcing

million to and products additional also and of serve like most. hand provide expedited addition, million are XX of direct and protective more to aggregated a to month alone transportation We've executed from efficiently the where they purchases are categories of X delivery needed masks certain to In healthcare approximately outbreak. sources PPE with brands shields, our companies to products ensure than face major supplies available equipment business last per series protective to us to as deliver for sanitizer, providers. This personal enabled these increase sourcing and to prior masks quickly or month partnered face of our

to second information other critical to more efforts. share align the initiative stakeholders Our with effectively response is and coordinate

of ventilator For response dedicated sector's major key agencies into supplies that providing coalition to the delivering and example, drugs shortage. the diagnostic regarding role of and critical host formation insights approaching includes are to at or organizing early led needs, healthcare FEMA, in in private data this of HHS and coalition PPE COVID-XX. companies availability, federal Premier's a to we capacity, a surge March, timely other

supply including extensive in-demand the gray market, on analytics supply respirator initiative hand on In advising vetting gray channels, highly on guidance HHS, and is NXX nontraditional The information. latest supply capabilities is our and solicitation advising Premier members the our of to and using our is We're and monitoring FDA, healthcare third market. masks, members the drugs, providing chain and conjunction supply actively gowns members. monitoring Conserving products nontraditional supply, conservation and system. to the also suppliers the in offers with CDC and and sterilization providers' levels assess including

have able a on profound of this patients These the what quality we're efforts accomplish impact and teams of care been that front. on proud so have receive ultimately our to

unique we clinicians combination our technology the easier are and to that on coordinated position business, capabilities On capitalize to care. of Premier's make of for it initiatives informed executing deliver side

now clinical COVID-XX-specific includes our instance, for patient and surveillance alerts and flags analytics. technology For tracking

decision natural learning machine to patient COVID-XX point or suspected using processing care. language clinical our addition, cases is directly EMR technology and the flag In the support of at confirmed in

to is to This critical Among be an predict period be other surges level being general, a helping early normalcy serving and recovery system a this would future for while in as of enhanced we hotspots, a technology achieve component and during developed. providers capabilities, COVID-XX, have vaccine waves warning healthcare economy our able and our higher in of the beyond.

respond adopted future. As are new the and methodologies rapidly in potential health threats to to detect

and that as step member our longer-term they analytics healthier the healthcare cultivate the to tomorrow. sciences agencies with me Premier's unique nexus even are that created our clear more healthcare providers I At believe the underscore partnership this providers, and back, as between to challenges supply around enterprise well companies and integrated as will chain position we together value our the as continuing patients tremendous support. deliver same government that crisis capabilities to technology-enabled safer an and the manufacturers, we time, I performance improvement So it's distributors, built we work our by deeper members life to strategies capabilities. a end-to-end these and and foster bring as

other I save our Premier over partners with provide and employees Mike, to my stepping want handing care and for they reiterate to providers to challenges navigate everywhere it working to healthcare that need. patients to these to lives the Before up unusual gratitude and

turn that, Mike, call President. to With the I'll our over

Mike Alkire

thanks, proud help they Susan's I and and to challenging and are joining healthcare our to our be times. everyone, team everything begin Susan, To during for our these members you, more doing of call. echo provider comments, couldn't Thank

for hard So I all it. very appreciate you to much say want thank I the work.

manage we're chain in want mitigate I ensure impact the resurgence work of help and and to COVID-XX our future. address recovery supply and the to through identify the system to members Today, the to healthcare a doing resilient more

to the the healthcare begins look nation immediate healthcare well health of who working As postpone deliver their needs. had patients thousands as systems have their to beyond to COVID-XX of our as care providers are member crisis, to other tens

become trusted typical while their as members We with four environment: patients procedures a four, with and one, their coronavirus; accomplish partner patients objectives three, resume surge for this are both efficient more same community; major another them procedural for revenue. at the improve ways their help time, find to prepare continuing healthcare our care and build with costs; coronavirus to to confidence two, in for in to working infrastructural

the at our first monitor with enabling confidence quickly practices. and cases, guidance it them detect necessary environment, help of These prioritize critical of members' to to and will and and diseases And rebuilding comes quality to be for just the well. the future of this surge COVID-XX technology medical data, supply predict as disease providing care objective. spread attack is solutions also and interventions sharing consulting infected and implement be improve When deployment our progression in protocols population. look positioned prevent of other patient members ultimately but new the our and to Let's will determine COVID-XX, for success, best to not the solutions ability through to rapid

and created environment, COVID-XX temporal population. also to we rest chain supply There cleaning patient for staffing protective reagents fill supply a this of the testing which the the new apparel, On adjustments and to redesigned personal and the additional infrastructure isolate name needs few. are working sanitation thermometers, include are needs services from patients side, just to supplies, by

will as new for for other supply manufacturing to to support U.S. domestic Objective drugs us quickly surges. in clear potentially U.S. It outbreaks and and surges. for more needs. care wake preparing develop more to two include opportunities chain resources to This that need normal PPE, additional is mitigate we, sufficient domestic supply technology critical the providers and the that disease healthcare new that and this industry, stocks patient requiring waves, nearshore an need healthcare have product detect And critical security. future and their providers pandemic, is and supplies for of with

with workers PPE with overwhelmingly is fact approximately products And there on The similar is this healthcare borders The pandemic overseas, widespread here associated reliance their protect sharp as and nations much pharmaceuticals. shortages XX% prevented geographic across U.S. geographic U.S. and This the products in patients that sourced China supplies. closed and access overreliance from treat triggered came COVID-XX swept the into and coming to are needed focus Asia. a the of Southeast these globe risks needed to

a clear, secure To country manufacturers. all create our when production, needs But of supply also while a consideration to resilient away. manufacturing build more sourcing including Asia more go nearshore domestic risk not geographic of will the infrastructure To be that domestic concentration more diversification robust from giving chain and require geographic we're products. to China more sourcing and advocating a supply both chain,

equipment. In focused a provider on personal group explore protective production opportunities, this expanding has Premier regard, domestic strategic to organized members of of investment

our is Our healthcare to in shortage. approach manufacturers are is proportion insulated needs. of that address very the with ProvideGx of that times similar to in from a are nearing greater pharmaceuticals, which shortages envision here are is I or drugs available partnering to ensure a initiative this in Premier objective that successful help products

and and cost objectives Let efficiencies three four, revenue, improved me address together.

focused has post improving been to cost reduced a at generate healthcare era. While never reduce always been than on have pandemic in need further revenue environment, greater care and their providers costs a

capabilities our their to other and cost improvement and cost system; second, short-term require will utilize focused future overall financial third, a delivery over is impact to approach that longer-term standardization, plans which how adopt to understand focused the term and longer redesigning performance follows: margin business performance; a models efforts. scenarios reposition first, impacting as more anticipate the COVID-XX will members focus revenue to models and clinical on through to and of to support build healthcare care of strategic balanced the initiatives We to our environment consulting the identify technology-enabled project and to optimize

to talked and health we or from Health our three standardizing Contigo Contigo addition, initiative also Contigo increase is progress. with for innovative costs that national announce I Health, working our pleased an am system to and Plus, when generating major improving is of initiative. Health Design last high-value to care direct-to-employer that we employers, quarter. continuing acquired two participants reducing accelerate make In on steady HDP, focused Health have revenue care, is Today,

savings management HDP health partners. employer innovative benefit health administration offers customized employs recognized care and employers, significant multiple a in a of company personalized will of markets provide high-touch approach product is including brands. its maintain its high-quality helped a and specializing of XX employer for it for system Fortune to the many a program Health well-known for has financial development centers company and It nationally expenses multiple employers. care. supporting Contigo solutions while with clients The as excellence in pilots clients services which continue TPA specialized achieve healthcare HDP expands

acquisition welcome excited about at this Premier very and to the team We family. HDP are the

today. time your for you Thank

Financial Administrative call over Craig turn McKasson, Chief and our me Officer. let Now, to the

Craig McKasson

also heartfelt through as expected on Thank working as helping impact feet our through of colleagues results. behind briefly of including again. scenes, fiscal I'll and to results I'd guidance the first like the my on back pandemic year, gratitude and COVID-XX the the healthcare its our country work add our workers you. quarter all Mike. the fourth third remainder walk for Thanks, get to well then review fiscal quarter this

rise kick costs Our begin third across sourcing, drive see freight latter management sheet. board to half quarter, of the as was of on position our and execute financial to the strategies continue start and we from on flow continuing amount remains to also was direct reiterate debt of not value Cash allocations that very strength I long-term creation. we strong, flexibility. strong, want net product quarter performance during we and related exceeding In a to while operate growth we financial did some to operational and in balance are the impact very COVID-XX to and material. continued the our to low have a financial expectations

GAAP increased across site our partly rising XX%. revenue million penetration, suppliers the the contract COVID-XX ago. progress contract administrative from year prior categories compliance of a revenue So ongoing consolidated from impact. and high portfolio both standpoint, and new a to increased revenue X%, net from third quarter segment million alternate backdrop acute This of patient addition driven came let's by businesses. increased primarily our trends continuing Services programs a against Chain and review, XX% $XXX.X of utilization $XXX.X Supply Net of fees

from healthcare year, our growth growth foodservice products commodity relative certain purchases Products generated primarily driven strong to last aggregated prior revenue well for member revenue year. as in COVID-XX due XX% increased and prior by demand PremierPro for product the as to among to categories through providers

significant technology member increase increased and the integrated license The as expected Turning a contract and to of million suite the of technology innovation improvement XX. growth $XX.X disclosed from of associated revenue Services. including engagements, was decision consulting with certain Revenue lower X% driven clinical primarily technology access CMS Performance by year our ago. in technology as license a government a with network This hospital solutions new engagements by as agreement previously enterprise partially offset that March engagements. ended timing was the support on well to

redemption ownership Looking value at million year was partners million decrease of $XXX.X based noncash reflect common of the a the stock income the million with in Class profitability. net decrease for in quarter adjustment GAAP GAAP B positive $XX.X the after to $XX.X required compared price. our limited unit last on

net per the reported share. attributable During of we quarter, to stockholders income third GAAP $X.XX

ago, million driven million EBITDA non-GAAP from net adjusted perspective, products non-GAAP $XXX.X administrative of From EBITDA segment revenue. growth XX% increased and adjusted ago. year fees XX% increased primarily consolidated a a by in Chain Supply $XXX.X quarter from Third year Services a of

Performance increased Health. partially In adjusted $XX.X ongoing support was clinical revenue, the EBITDA non-GAAP Services, The previously by million earlier. in from primarily strategic disclosed in Contigo growth of due and X% investments decision a increased year our technology offset to

perspective, flow net a liquidity for million income year. distributed adjusted last with adjusted per and ago non-GAAP $XX.X X% was increased the earnings to operations million, non-GAAP increased share balance period XX% from for a quarter $XXX.X distributed $X.XX. sheet compared $XXX.X X-month period million Third cash the fully and fully year From of same from

the cash to excluded decrease purchase of of and from the prepaid price addition asset contract of the rebates share prior administrative to The agreed for as Acurity acquisition. which certain from was to agreement Acurity by in flow fee Acurity the was Nexera Premier, $XX.X driven onetime operations into entering primarily million members the with purchase by

to also due in primarily remeasurement prepayments agreement. by due to for the decline tax the offset operating partially receivable related capital commodity We of deployed decreases demand a to products These to COVID-XX. were increased expenses, fund

cash approximately activities, or XX% Non-GAAP net flow same a million $XXX.X for EBITDA, partners XX% $XXX earlier. The the by limited due was offset resulted operating with cash year free the partially to ownership. decrease of distributions non-GAAP reduced X-month period primarily to impacting compared by million provided changing or adjusted from factors

XXXX will to administrative free fourth inflows the timing sourcing in increased cash cash and as cash COVID-XX net address of demand as to implications revenue to quarter fiscal for outflows, our flow products direct fees impacted decision well necessary a use result our products. operating projection of strategic Our to procure flow due be given on member of the

subsequent surge sales. related cash of result made member are routine comparison timing collection cash product may be in payments in purchase products impacted the to Given the COVID-XX when on a demand, flow as to

billion that we $XXX amount. $X million repaid and subsequently our with at million June balance at on quarter We revolving and of credit outstanding of XXXX. with XX, $XXX cash compared million March ended equivalents have $XXX.X an the $XXX.X cash million X-year totaled facility, Our XXXX, XX,

$XXX shares million program, the in environment, more our shares not the A any we under Looking stock do the current authorization. of conduct expect January current but to further in Class during the and purchase originally of common year $XXX at share repurchases completed million did repurchase established given quarter the repurchase not fiscal

first Now fourth performance the the of and year fiscal to Based guidance year through revenue outlook of let's chain EBITDA impact the the ranges. generally finish complete said, our guidance. upon assumptions earnings including could of end we top current to expect COVID-XX, anticipated the months the range, the turn quarter, the below to within That distributed nine fiscal and ranges. current possible that while the adjusted COVID-XX, current visibility it and non-GAAP uncertainty lack share services respective exceed and adjusted fully associated due per is with of our their for slightly supply could

Supply expect we the revenue Chain Services of end million million. current top segment $XXX $XXX range of to at the Specifically,

We expect and protective member our other in personal efforts direct result providers demand securing certain revenue from as high COVID-XX. of ongoing strong sourcing healthcare in gains equipment to assist supplies a

the offset slowdown induced We revenue care-related as softness approximately account pandemic will than hospital utilization expect in and performed procedures fees net increase overall of alternate interruption surgeries lower in and revenue this spending a anticipated of as nonhealth due of for the more elected occupancy the in areas. to typically well administrative X/X which site

range. to expectations technology consolidated of new million. in factors the engagements, net revenue this the providers existing extended at upper the be confluence our to being on This Services on of is delayed and and which to million due pressure revenue for the end current $XXX as of range end the are of focus Performance puts This pandemic. current and healthcare $XXX consulting expected is segment low

profitability. at Looking

could to below the We million. $XXX lower $XXX million related end extent the the to on range. that of near expect it of range depending a dollars non-GAAP impacts, of And finish few million COVID-XX adjusted the be EBITDA

from Chain low-margin a Supply be Services greater derived Specifically, revenue we portion direct of business. sourcing expect our to

group impacts procedures our elected in business, the nonhealthcare-related shutdown While and we purchasing the related negative of expect to higher-margin of deferral entities.

offset While administrative a year expected revenue the demand these to to is in net be growth in other by relative effect fees product ago. are the partially quarter pressure in to net expected areas, spikes

Additionally, Performance discussed I EBITDA we expect Services the pressure earlier. segment on increased for reasons

or adjusted end the low a of $X.XX fully few expected non-GAAP cents per earnings the to to of As distributed share below is a be range current result, $X.XX. near

is All Amid costs place diligently unprecedented managing reducing and over hires, we are and factors, near this travel we deteriorate impact no to with should in control, truly results, have have both our business environment, additional unforeseen expenses, full in and the environment operating greatly further meeting an the appreciably. and positively this conditions further are that understanding that said, costs, managing which could financial over manage plans term. we delaying which new negatively

know, year ends respect results quarter consistent when plan on XXXX XXXX, announce with in June fourth we you fiscal fiscal guidance to currently XX. our With Therefore, we for address prior Premier's as mid-August. to years, financial

guidance. for current our impact the between attempt us gather XXXX time to XXXX. Given fiscal trends and ending the would for plans circumstances, fiscal and additional it assess of data, on in use year today to be the now insights next Management to establishing COVID-XX approach premature June digest to August inform our to and

We'll timing demand be economic Performance Services, procedures, like the elective and reopening as as to recovery assessing resumption the related things. of and key well among the facilities nonhealthcare-related areas impact for other level the the of

over similar guidance extraordinary current into potentially the next we'll we can will to improve that issue So many during on initiate in our this altogether. enable the of to August. or environment is annual which quarterly couple other basis consider, a in state to of guidance the assumption this recovery establish withhold may sight need economic time will to and depending of need Certainly, whether mid-August, Premier months, short-term organizations, on medical guidance, us guidance line hopefully our period,

time your for you Thank today.

turn let back to Susan. over the Now me call

Jim Storey

our pandemics. to close manage remarks our with our our partnering pandemic. virus to and members this keep defeat to enable it detect better system to to working through respond together, plan healthcare to by this ultimately want we providers saying make future while We prepared that U.S. quickly position Thanks, will and Craig. to I closely

diversified strong to supported and by to and value as model, balance members. our we flexible to critical comprehensive our continue grow be flow our our continues cash Premier and resilient sheet, our capabilities business provide forward, Moving

your for locations, may you we Thanks in the all open for different address me, or Craig them and time Mike, Operator, because today. address to questions. questions call your we'll please are accordingly. either And

Operator

with And of Instructions] Cherny question first America. Michael Bank [Operator your is from

Susan DeVore

Michael. Hi,

Michael Cherny

you morning all Hi, for everyone. much and the details. so thank Good

think I this of and a go but lot to anyone question with handling your the is obviously, Mike, please it. in, for you've front for response customers. jump wants center, Mike, been a else

You surgeries – you roughly talked X/X about hospitals electives. the mentioned the dynamic of are electives of in see and you

to they that all and you reopenings your continue As a have from we're starting those how country? from your these states, positioning across are of customers purchasing conversations enrolling themselves reopenings, see for the periods a perspective now stocking have customers with to limited as country perspective, across of varying varying the

Mike Alkire

It's question. a Yes. great

So a things. of couple

back I procedures to First their can trying within elective of get think patients all, these doing all that procedures. the to normal so are and that systems they confidence develop

providers safety PPE, So products, the I only think, are patients comfortable, feeling not they're first, ensure comfortable. looking their that but their – to the feeling are for their

like gowns So kinds think and things. things of face of those isolation and masks

So think that's thing. the I first

procedures. surgical going back out start elective implements the weeks, gowns other be second they've is that required to we've that three right? and been initiative procedures The we make past these for over as come to to the that two of want these got are sort sure the necessary that the then rolling or And products, online, ensuring

And historical a the product back available that online. So initiative of these to back look significant is bring interest sort to been. as we've what to understand go data our have at past all they demands procedures have and taken really

Michael Cherny

Craig. customers? for think EBITDA for What And guidance, the the a the Should low then conditions EBITDA that particular, quick few encompass? just terms to today about the of alluded question as utilization average does in Was range. the to? in a related end, below view volume, the million the you your in of average when you one Craig, come

Craig McKasson

Michael. Thanks, Sure.

and we've from demonstrably about some of seen to has think to that into admissions talk utilization COVID-XX, hospitals seen declines inpatient we've amount I about data in the with in talked seeing. XX% I quarter we a utilization. of healthcare Clearly, fourth the they're to the limited utilization and the the And into outpatient the So were you've in standpoint, – decline seen fallen nonacute. and see prior solution fourth that other and within rising XX% public continuing that

that to the year. the starts the end bit extent about and talking and that, to a before – start to So fiscal things the just the you of recovery were Mike elected little happen some resume of procedures to

facilities, impacting XXXX, fourth some fourth continue into more terms back likely nonhealthcare-related sense the to when fourth that's phasing within the us be the normal. balance That range, reopening through of delays then economy would would help slightly later, in going and into of to is the My that, in quarter, us us resume and within – for stuff is impact we and staying it potentially quarter what see in which if the fiscal be guidance have the the range. but and us there the pushing are would beyond that quarter, potentially is be the below of would of

Michael Cherny

everyone. much so thanks Excellent,

Susan DeVore

Michael. you, Thank

Craig McKasson

Thank you, Michael.

Operator

next Your is with from question Steven Valiquette Barclays.

Susan DeVore

Steve. Hi,

Steven Valiquette

it's I different morning Good procedures and that sure during any way along coming what next the forefront to into the that June electric I'm those during seeing parts there quarter I year? just back might any to But the kind different see fall thanks. back was mean, across I'm come approximate here everybody. the to sure you might you Great, guess, what far not you, far would for returning. as be question any June as I of are lines, Mike. electric quarter? procedures country. rescheduling curious any as But reopening states versus your points this as same is or or going data Susan if more percent of fiscal Is of

Susan DeVore

Yes.

do would think get. what focused really members people demand of selective how every in, surgeries, our quickly been that add treatment, can they on Mike, haven't then, there's and able for I So to you and they need is they can things that say, one pent-up cancer some reopen

And is plans beginning they states, putting had work significant in the need, so those processes put Many revenue procedures. need they place. protective every their and member, being not in and we the able reopening do to in as hits actually equipment to you out all them that the to have know, of for scheduling, the figure

would I all it. So on they're say focused

and It's really they chain gradual do for the we've to it what I months all have. the up. year, guess And of helping We they're I as on the what them the – happen on we likely to the quarter the that think your they're amounts protocols in based supply can they members will as that safely quarter. would rest our do that having we we're with Craig's vary the back for I volume. But bring But all to is that say is next as and about fourth are think three needs And today. state, estimate we're can. to they that reflect as Steve, think with And to to the ramp by and exact be intend fourth will what hard, a in quickly to tried point. conversations know focused reopening all us the going comments over it

Steven Valiquette

great. Okay,

of breakdown in business, your of those of it's cetera. whether versus segment book As ambulatory, other parts far trends as acute the et just the

breaking if way? Just down that it further color curious any there's

Susan DeVore

doing internally broken the by we the – that down we're have product way and it category. is We work

nonacute. So surgical, and think and food, cardiovascular pharmacy, nursing, about think about imaging, acute

done fee the And facilities and way. have our and in revenue arenas so product positive administrative it could the our the that is all PPE that tied in revenue think to nursing we there and in talked We Mike impacts and categories be sourcing basically, about. the certainly products direct arenas, because

We the some imaging, negative impacts potential are of services. some from from purchase think food, there from

space. have we by going space tougher, taking the puts We been nonhealthcare, care takes nonacute we're to care a so think has nonacute of where do of approach And and we we're end category the up. and balanced sort some do think to determine

reflect care back, space to tried nonacute bit more we've a maybe slowly. the coming So little

Mike Alkire

Mike. Steve, Susan, this – is if

two space. a of real if to we've truly that the the space. doing add been of understand needs could nonacute I surveys just quick, Just comments is, nonacute One on just ton

some virus, As you're and these have nonacute this. products hit didn't to the facilities, the they nursing well available really manage like a homes these when virus necessarily aware, pandemic of a

get So to many of products. new trying in were access to them actually operating markets

around So to been utilization on much providing appropriate we've them And kinds and utilization. as also them two possible appropriate of – helping been provide things. then expertise things. as data product terms in of One, those get we've two, trying

for products, opportunity we getting think, to we care – obviously, patients. those also So needed sure but an do a the those to access that the provide entities are have education for bit more make to

Steven Valiquette

the color. appreciate I Thanks. added Okay.

Susan DeVore

you. Thank

Operator

is Morgan. question Lisa with next from Your JP Gill

Susan DeVore

Lisa. Hi,

Lisa Gill

a just couple Thank you very Premier want to this much. little lines bit Mike, time. Good morning front understand things domestic about doing I the you of appreciate you everyone for the difficult that really just better. of I and talked manufacturing. all hospitals this. know a thank on is

a Premier of of is direct area You're in your would model lot domestic Asia. my when from you but get directly about that coming previously first going think a think sourcing, When you things about question. that today Would manufacturing, an involved forward? in you strength be position think this business around

the based focus lot questions, secondly, when few And first then recover. on of a obviously, to start things around

sitting that of As how the at office impacts things sitting from on overall telehealth your of medical don't perspective? the medical and I'm space we healthcare, start and of you about in think you telehealth, think future their how like need the my think nonacute do when doctors to doing and amount utilization about supplies home about impact we the If telehealth same obviously, supplies.

Mike Alkire

Lisa. Thanks,

let So a quick the reminder me first, domestic question. just manufacturing around

would GPO So domestic of our be part offering. manufacturing, both obviously,

sure going So are contract the want that products we where to those point products We're understand those to origin for for. are. make the we of

over coming or Southeast U.S., Asia diversifying the years, we've two, actually China So that's have the have that of number the past if And production few versus from. produced those we so business. Number one. those obviously products been direct sourcing in been where are

lot a a the and India. So production last bolus production happening we've of the China And in most to for of part, been three Asian historic, moving there've countries. over Southeast years, of couple been that other

with it's and the manufacturers really, as we of lines, NXXs. diversification generic expand gowns. like critical doing for thinking Very drugs supply, what to extending domestic manufacturing just PPE. did about that that we In those strategies similar where we're like we've capital of things are this been want production products, those drugs, production is about we're especially and with what thinking ensuring that kinds added isolation cases, employ So to on things where some to those short are domestic working we've ProvideGx

doing So ProvideGx. very what with similar we're to very,

it's And the nonacute, then interesting. in

kinds virtual were those of You medicine and things. and telehealth asking about

obviously, as So they providing ways from more a in going there's in potentially these to analytics a physicians be different technology, are our Services and care think lot side need we have capabilities than the for past. Performance

to that health the they would a of typically bit would not too you anything I'm I their add. Susan, that In think sure had early be. impact access settings, terms products to tell to use if obviously what it's in

Susan DeVore

before. do only being will cost The is at products and in with severity Yes. that up been corresponding the patients the telehealth kind centers COVID low there been a think doctors' I and be per of go the that in will stuff and used cost the that go think would those stuff will that severity of be add our be the some think, in Lisa, will pandemic patient things, we've facilities. is higher the telehealth. we've And of is severity, in while We surgery increase up. with offices, of in the initiatives. the cost sense will versus then this will accelerate And looking, healthcare hospitals, severity thing we be because we can of done But the low-cost telehealth done in

how continue and to going see balances that out. that we're to So monitor

Lisa Gill

you. Thank helpful. That’s

Susan DeVore

you. Thank

Mike Alkire

you, Lisa. Thank

Operator

with Richard comes Close question Canaccord from next Genuity. Your

Susan DeVore

Richard. Hi,

Richard Close

morning. good Yes, Yes. company Thank you this time. the has as during well that for done all

exit I That margin for a and the obviously, number your the major curious, But hit see do exit and And how difficulties becoming health systems. some – you here I'm this, improvement do we Mike, objectives? federal performance three this, health cost revenue wanted on customers although efficient financial coming. how these have more Obviously, we to we as moving of that's funding adoption. tech was objectives. unknown, systems your thoughts forward there's from So on

Mike Alkire

Yes.

A things. question, couple great So Richard. of

question, business the happening, what's to data understand a and impacts model truly have the is impact the costs. we analytics have on Lisa's almost to we the to changing, and on if ability First, the see revenue

our And a implications services our well been So world. weeks, from standpoint. obviously, models as to of help of understand business them over the for building healthcare actually help standpoint them the models to better building post-COVID-XX last an systems few a we've then technology as advisory sort

things understanding of couple be critical. a they're looking that think the do. is surveillance So prevalence to One, a if think, this disease, early of I to think I going that really I of really, there's

facility, quickly. the so the recognize make they've into to that patient system if and got got can sure that very symptoms appropriate the they very, comes it surveillance the we've has So

will working think I with want two, different they're analytics, do and of for facilities that it keep have in so their inform procedures create, they as other can patients a strategic about a thinking of to the as I Number they one. guess, their and for to to number word, areas, surges those kinds cohort they of better those communities the electric that's lack things. So facilities allow care that decisions open

as I from vis-à-vis And standpoint the think huge to think really, acceleration our what's post-COVID. to markets. revenue their then be there's as on critical some surveillance obviously the that Health work happening opportunity, we closely going analytics this and with the the really Cares initiative, So And they it's a with have Contigo focus Act employers cost. obviously, and then is well in where to a more funding opportunities getting access

Richard Close

And acquisition Okay. does you customers announced have that many a on? follow-up. HDP the How

Mike Alkire

in somewhere it's – probably That's the teens.

a of approximately working to they're got, then very, working for from as standpoint, with, other to standpoint. centers they're those systems do large don't which very in with think XX is that a healthcare these employers healthcare systems opportunity they've So as TPA we participate a And I obviously a of centers. know, excellence, our from employers well TPA real number

Richard Close

Okay, you. thank

Susan DeVore

Thanks, Richard.

Mike Alkire

Thank you, Richard.

Operator

from comes Blair. Ryan question next Daniels William with Your

Susan DeVore

Hi, Ryan.

Jared Haase

allocation uncertainty, about, things managing obviously, perspective, that. But Good in a travel, is actually bit good on hi. Jared thanks morning. morning. questions. maybe from expenses it talked capital some like Ryan the this This sounds Craig, for near the morning. you the just Hi, Yes, given like term, the line reducing little for a

value kind in of balancing, given staying maybe cautious where potential bit the little well curious organically I'm and think as product, investing the investing still – So for the uncertainty you versus activity? continued about kind M&A a in how playing defense the as proposition of maybe

Craig McKasson

you. Thank Sure.

we've doing So process. first this of in continue to and all, we are – that our capabilities, will throughout do been and invest

and continue be strength cash we free to the of amount believe the fortunate from have place. in We position a debt we're flow operating to of little that with amount of

offense HDP, Obviously, of with in And employer the provider furthering continue large play the appropriate. just acquisition and that our on. where try to so is working we which we're initiative does us enable that to announced direct strategy

in technology to changing. investments ensuring in make our and the see round decision development opportunities in implications Contigo appropriate the just and investments to of side our being employer continuing we're and We're as fiscally continuing make support we'll through Health of do capabilities continue that look continued have Chain business. investments have responsible to given in implications near with out network, Supply our to we've on will investment And So corporate where active well. to don't for then that technology, that the clinical make pipeline, strategic continue COVID-XX, to it does inorganic an term the the we business

Jared Haase

a from perspective, Great. we then are in trends about of now. obviously, another kind one. Susan, I'm macro talked that macro just of Okay. And number right maybe curious, play maybe, a

seeing to that And other transition about any you're that more to perspective trends things that As more do kind risk-based attractive XXXX make of incrementally the models, macro dependent we become normalize as maybe volume as any they're so positive as look the just thoughts maybe the from start relatively bit? going you think beyond not they a we forward?

Susan DeVore

lot And we're there great we members everyone. pandemic, a Nexus of in of changes that the question. between actually sit lot and way Congress federal and the a think a Because we're working do that learning from. implemented That's been agencies, have members I at of Yes. a because with and temporary

ways example, and And thinking of products so for sort thing. example, reusing of alternative risk-based models and or telemedicine about that for

will there that We ACO of adjustments will And the a pleased So made, once flexibility evaluation performance is of during financial provide were this how I much question that be period of for the were of that an things. stuff think stick over? the lot do this is time.

patients. of and sense is But models be way the the physicians systems will further patients the risk-based those necessity, moved marketplace, end-to-end of serving they attractive models that more to forward care by have, those going health terms patients, for models, our needs just through in – of holistic some and

for and and be And the pandemic. so price we going financial to pay, is around to payments going mention ACOs bundled the to think around around our a collaboration forward, not obviously, there that models

I cost we on on economy need the and will it play it the so get to back, where pressure into be, think well. we as how And do

it care that that where So by going. think, implemented, then to forward. a back the will been needed methods things the election the we'll desire be little I to in of of complicated be the an combination bit cycle, about changes revenue of all will That delivering cycle that cost there push will the a – have new lot be. pressure, be in And to have been discussions election way to get and

Jared Haase

thanks that Yes, it. for Got color.

Susan DeVore

you. Thank

Operator

is Rhyee with Charles question Cowen. from next Your

Susan DeVore

there? Hi, you Charles. are Charles,

Charles Rhyee

had sorry, my mute yes, Oh, Yes. on.

that, a don't some we the can in coasts? Is south on had are maybe you of of the an sense and us to states reopen. sort interior? you we're sort sense think looks clearly, about think like maybe a geographic of start going And as help Just it before, on question. you've about and be this mix us more of recall it because we When of Midwest. working rough your we can you if recovery there. the sort concentrated? reopen stages. Is Maybe I geographically coming And forward, the numbers you a maybe where in to can It obviously, if give customers, given more give we us

Susan DeVore

of looked if at you X,XXX we our the have map So members. members,

So sites. we have hospitals, health systems alternate and XXX,XXX

country. the literally So we all are over

We have concentration. very Coast East a significant

We Coast significant have West a and central. also

essentially that to largest the are our the share markets, one is elective come market we have getting you gradually all opened and we're the of IDNs the big So hospitals everywhere. of that do will I and of back probably in up. first things And think on multistate. states I to in tell focus access back that back come procedures those

And elective of of them June, now are across a The what by back we're the We health would members actually, survey, of question of did every June. and their your think asked question them running I all and get our almost planning in in literally in guess you say percentage of the the just up for is surgeries planning. volume our will country. the their in end I right prior to and to be that such market. doing of systems July. do levels to May, normal try And So

intent. whether it Now think make the don't know, but they'll or I not, we that's

it. about thinking we're how that's So

Charles Rhyee

would point, the ahead in supplies your like get it it. be some a not. and Is of terms think that. appreciate pace I whether hospitals of And if But purchasing we of can to just, lot got about there And I that you or going? recovery procedure we volumes there figured conversion? not they before starts that would going? until Or orders, something that but is something where see the make really maybe – the procedures in is is after necessarily would activity result that making really something

Susan DeVore

So think it's I both.

up while they that be will the are that a for elective think surgeries. up COVID back And on lost actually PPE additional and with bigger ramp for try pressure have catch what the So to surgery. is patients such comes ramping I to say there continuing they planning also would as they

our sourcing in see through direct might the So think of that, that happen that of some and anticipation forward buys, you'll that. I company

on fees for because to along administrative fees the demand, understand. a planning particularly that and more of systems, with and models electric think a a of will procedures. the of for ramp going-forward up these surges a think with from procedures, be away little estimating go electric basis, the and more I the where administrative of will they're that advanced inventory just-in-time I expecting accrual do take health I think are there all model up of time COVID, additional bit the they that ramp movement

Charles Rhyee

at helpful. away just just-in-time That's built they're there, hand that follow-up Okay. just pattern? if just from still on you right Was is Maybe purchasing more some model you Or but to is maybe that Susan, does all? purchasing, affect inventory? move really to have your a have going said what it inventory supply regular excess

Susan DeVore

Yes.

cost inventory is of days on hand. at to I They think the don't in. time, want pressure, it'll – in the need they're our put assessment they've they'll have been numbers going to be that have situation back same bigger to

more will think will – there and take And time. will be there gradually so be it over stockpiling done I

or that – be epidemic – will increased pandemic. gloves, of will needed those sense in particularly increased products PPE, kind actually our kind any gowns, there of almost is so need the be for, And basic any commodity masks,

ramp be our normal more patterns buying there. And patterns of on of it and some that do go there then that. to and level so will up they from hand, then And they the sense hands that may will benefit on replenishment as is – inventory

Charles Rhyee

so you I it. Thank appreciate much. Great.

Susan DeVore

Thanks. Thank you.

Operator

Your Jailendra next Crédit with question Singh Suisse. is from

Jailendra Singh

everyone. thanks Hi,

is this Mike. for So just one

GPO increased the details member do and come these compliance some guys In participation as interest around you to and COVID-XX? compliance, see ASCEND of expect can provide the participation? in And programs of out terms we you in terms of programs SURPASS

Mike Alkire

Yes.

$X.X chain reminder, billion representing has in purchasing. XXX,XXX members, supply XX X,XXX $XX billion and it core in about beds hospitals, SURPASS about ASCEND a as about Just represents spend. annual about about has and

there to sort But Or We obviously, category, your these XX% are SURPASS. for do, the we committed answer do the join? and and the people But XX% most those, for the see either evolution compliance question, in about think an of programs? groups talked it part, for having past, by committed more think you ASCEND we as varies. compliance of about we've So actually. other through

obviously, so of probably also of folks for I that ramp pretty to given I take pressures to there's to the of And going of up, opportunities that think as be savings. cost continue groups some there's other you're interesting see that significant evolved. advantage going sort think do sort to sort

sort my opening number behalf got our systems comments, of healthcare ensure this As of we've interest of diversified of on there's spoke a I to a lot chain. supply that think in about I

would to with domestic that there'll coming systems ProvideGx a be I ensure of PPE So similar production to for what we've these drugs. generic guess that working very out that would there's together of us products, built the number

Jailendra Singh

changes of down business? And Last client in and you HDP in outlook this But beyond to quarter. you the employer one with out see acquisition. I'm my that, opportunity did going called more slower-than-expected I you this in pre-COVID. assuming business? was have then on quarter, investment on help. And slow mean follow-up Health. I Okay. you ramp some know around in that you business, situation this Contigo that added that your been have the current or your announced pace concerns not there any

Mike Alkire

Yes. a summary, quick do jump in. I'll then Craig certainly and

to parallel growth. ramp of and different up business, investments that like our parts obviously, the going all cost, revenue just we're So the ensure the and the

to need appropriate supportive the we not we're to push driving make where we models growth revenue either is place. the hiring if so in that And have We're back going of ensure that investments the fewer or margins.

is of have is, of that employees. think We this that Contigo centers going employers game. to a obviously to it going Health be in for really all and we us positions significant that's terms big of care provided though, of their think gist it the to are how evolution HDP opportunity So as the excellence

Craig McKasson

previously, add would short-term is we've I color expected only We have discussed and of never strategy. The Craig. it long-term is, accretion is revenue to as Contigo kind benefits. this immediate Mike, Health a Yes,

to in we're have have we're terms So to investments the we continued cautious the capability. of invest we right, and build that Mike's – continuing. in how But making

as they've pilot Clearly that on. Premier on doing some conversations Contigo management those a in bit little team and Health – things employers initial short of within we've the had other continuing term, the had very we've see have things strategy been acute large move to to don't continue before, time to to this said that see talking focus period of of benefit. that, really that is of But and to we would forward, a actually And is when a from linkage departure direct-to-employer the XXXX in from we'll we standpoint. expect away start kind XXXX, kind

Jailendra Singh

Thanks great. lot. Okay, a

Susan DeVore

Thank you.

Operator

Your with next Demko SVP. question is Stephanie from Davis

Susan DeVore

Hi, Stephanie.

Stephanie Davis Demko

Susan. all Hi, taking echo now. system I and else's for for you're health everyone you doing sentiment Thank about right the questions my

for would a on call guys first a time in heard out the performances So while, decision lot you clinical I be, support.

gaining first Stanson my the the is that, for traction? read-through is finally So question asset

Susan DeVore

can then start, in. Mike, and you add Yes. Yes. I'll

offices. learning vendors of sits physician because Stanson machine sits language think major AI. in top because and I processing, the because it EHR and it – natural Stanson does on And

about be text and is COVID-XX. did almost symptoms get clinical read condition, other out free really capabilities ability quickly the those build to think you or seven and So think days a and really, But figure and that with help any not upstream might happening only read them important. about capabilities with to we with you to what resurgence when

focus traction our our whole the and in very IT Stanson a somewhat consulting will and on you of Stanson, And gradual them about delayed I we We we with surges, – with and be about how before feeling – be able of pressure to significant to to COVID. and we analytics, question, on revenue up. has help financially, will thinking ton travel consulting having that and think manage we're well. answer a how cost things. surveillance sort of ramp health think more TheraDoc And had were We when products, continued. potential and have doing think We recovery the has growth health inability the been services the really systems additional continue. Stanson might services enterprise yes, our from the the good the rates But and been a start will other systems, your

Mike Alkire

is Stephanie, – is this Stephanie, Mike. this And

question. So opened you a up

So surveillance describing. that was here's the the big have the the pitch, governments, need the governments, Susan right? capabilities government, We that local federal they to think communities, the state

really data medical surveillance the read where from unstructured it's by when economy the the shelter like So surges do informed that and updates kinds Stanson's of And ZIP health in occurring. provides believe the the by electronic to records, of our safety ability of real-time to should to officials in additional to code those look things. order when data tied be place and potentially sort we capability or with at product, are open

have only these thing entire So a I'd opportunity this control we other we significant The do think data that focus. that's add provide to tower's health like to – is the to appropriate officials.

tower. of understand And that surges, a about only it helps talk severity. control us we way is the COVID-XX sort So but not

our So we and quality whether are admitted on then then being and to hospital at can respirators. whether look patients data further pull the being they're these put in COVID

have So practices. finally, analytics end-to-end for us share sort technology this that we utilized just a capability of And standpoint. be allows can from then our tire control to whole best

the quickly as data, real-time our If the leveraging best provide out analytics you what's of about as and of think all get the that hands we information that about most sort treatments, providers working you can, around for drugs, think if possible. of part,

Stephanie Davis Demko

just assume on, of few two the reenergized So importance is over next business bit safe a reading given solutions? going that's it quarters, the the get the may everything that those through answers, to little from PS

Mike Alkire

that and investments We're last of in really, solution eight months safety making our very, our team all And over scientists weeks. really excited build the bringing to data to models. specifically these been ford about the last has the the these couple very out and

stack out the the been post-COVID. help capability. improvements. said, advisory a us about help model system of And Obviously, opportunities excited our I our to – And there's and we've healthcare incredibly building to tech our then we're like tower drive obviously, lot control on there's So services. for them

Stephanie Davis Demko

business. the the quick of Good. GPO side And one on follow-up

seeing towards the on pandemic, systems past scale. are on these you in-housing the experts? early saying Over leave years, as partial this certain With we trend the during clients going let's health have calling for of the GPO indications everything at business any just and initiatives to

Mike Alkire

You go ahead, Susan.

Susan DeVore

to make we on think, are Well, ongoing and them them I on the comprehensive pressure performance to pressure the financial to systems. in continuing, normal. open the more space health had to We'll that back help that get of engagements were ways cost continue

in forward I comments, as continuing, enterprise supply with we're So chain and move management my to said end-to-end analytics. end-to-end the

Stephanie Davis Demko

Thank you guys.

Susan DeVore

you. Thank

Mike Alkire

Stephanie. you, Thank

Operator

with is Your Eric Percher Nephron next Research. from question

Susan DeVore

Eric. Hi,

Eric Percher

for Mike, Good you. Thank you your question and efforts. thanks morning. for a

situation or You've I supply quite to extend And we add time. years. come chain of a the I this And over may efforts. dependency talked that be imagine through changes today, know we're XX-year could effort. have that going really want X- about short-term the But some if covered we've even resiliency, from for the to some of some

the need to operational And Is to about efforts and or So my between trade-off on this it to be pressure lead in does question has is, it input cost? be to resilience term? that is cost upward implemented right that terms of longer expected? really there over think a

Mike Alkire

Yes.

this me sort that me describing national X.X the this, from of way – build-out infrastructure we've heard economy say let but is So you've a just been Eric, standpoint.

out So of right? the This the about a X.X was ago. notion of sort How are of infrastructure of domestically? X.X. out think if think working the building pharmaceuticals, And manufacturing just number you this years get economy roads to it, you and building whole back infrastructure is

longer erythromycin longer month those things supplements this. ago they the we they vitamin what and India, about of of middle a in going basically you – were and saw incredibly important So no in and said no were to some ship kinds

Point also we've pharmaceutical that outside other weeks, finished last into sort of really or only a we, is, lot ingredients six of and country U.S., sparked rightfully a products. all it have think so, five product. for over I of manufacturing that active of understanding been concerns, dependence, goods of on the but this really lot that the of ingredients not origin these incredible these go critical got the finished

those are short produced there's some overseas. future going that either in needed that products either epidemics, in or domestically some highlighting Those products ensuring we're cases to be resiliency in where nearshore supply or the can chain that and be are supply in

So for significant materials manufactured, is product see for push, I term finished as obviously, same to PPE, long the the and a well. being just think you're regard where the going not that. but short, both middle raw In

we're materials was, in things most the for raw of for major manufacturing part, is out obviously, One Southeast facilities five in finding ISO the the concentrated gowns Asia.

here, the There but domestically, was some system. the needs of enough meet not obviously, to

it's So as well. going more answer system. redundancy, to To that you're more are and add, raw around system, think produced those to you identifying obviously, being your where materials cost, I as with any add resiliency question costs

we're going And it's so to have do we're to – not efficiently. – these but quite things frankly,

as thinking we're doing have obviously is that think production leverages out, we creating what a be needs more model nearshore products about well. going So that of to built to the are domestic

maybe in we options have low-cost my lower that rate. markets still So have leverage prepared cost that here then are as a obviously, some nearshore. leveraging And that remarks, on so we'll said I blended countries

moving but I it's from of one domestic, cost talked it's across total about. to obviously, Southeast areas, Asia So not, those spread really structure three just

Eric Percher

That’s you. helpful. Thank

Mike Alkire

you. Thank

Operator

Baird. question next is Coldwell Your from with Eric

Susan DeVore

Hi, Eric.

Eric Coldwell

Hi. have Thanks morning. questions. two I Good guys. Thanks. Hi.

First for should Craig. this be one Susan, easy. for second Susan,

Act or I a the no regulatory or that Premier? directly in answer but other anything think largely impacts there either or Cares stimulus is a change is the no,

Susan DeVore

know Craig, additional There's Premier. to give a I directly Eric, that from don't impacts highlights. perspective not much, financial you if want any

Craig McKasson

operating net of that we've being incorporated. the subsidiaries that from result able relative But get, certain loss to take to standpoint income Eric, were reviewed will nothing carry tax a advantage mean provisions. stimulus as of are a Premier. There benefits the that's I Yes. provisions some back and

Susan DeVore

Right.

Eric Coldwell

That's I thought. what

Okay. just And my Craig, directly. then, you. follow-up I'll ask for

obviously, you're remind you you quarter business, admin fees. revenue? is aggregated the us perhaps margin over couple sourcing how matter. a of parse us both if see trended, a finally, Could could for especially to has in on then And that But the last could us you you're light gross buys in sense has moment, operating volume shining fourth versus the And remind business direct what or out sourcing. how at modeling slowdown, Your trended margin give given – doesn't if quarters? going either

Craig McKasson

Yes. Yes.

aggregated forward it's for of would to the hard like you me given on QX dependent buys. these an unfortunately, uncertainty, give So somewhat some really accurate ask it because projection is

and provide the sort And exceed, end much we and we in We'll we how of the that of see but fourth in of did demand some why range on the could upper what depend some. actually uptake be see balance that's of PPE quarter. it so the will through

So sourcing the a does ramp. ongoing of majority aggregated seen products, commodity business use purchases, have PremierPro we of direct these but continue to our be not the

that did we to the is you $XX million. third advanced of been We quarter. another in tell can I What $XX deployed has deploy about through million product pushing fourth capital the that in quarter, by

a million really a tremendous From that the we had look have on opportunities, success and continue put out moving been year about of the improvements in give those over with past more forward, to needed in actually, $XX we'll get about to specific having margins, operational of couple that. order So put can't in but product QX be capital of that. some that business, to of projection quarters, for about talked we ago standpoint place

sourcing business. continuing direct in And to so actually had the improve seen margins

seen compression result primarily of I about impact a to the here. think as think little margins we'll decision in this the over in I QX, remarks. to a prepared talked my of see due transportation I bit our do COVID-XX, expedite in product we've

I not which transportation It normal margins liner, our stuff to So course, an the do get a vehicles that do. other expensive. ocean QX as permanent used it think to were right is opposed expedited from lower we more business. there was will putting long-term but kind direct more sourcing thing to That's of here see on quickly, solution, in the

Eric Coldwell

helpful. Thanks much. extremely That’s very

Susan DeVore

Thanks, Eric.

Operator

Draper from is Draper Alexander Your (sic) SunTrust. Susan question next with

Susan DeVore

Sandy. Hi,

Alexander Draper

Hey, taking your Susan, on I'm name, sounds like. it

I not when brief. you Susan try and over at for ball, they I you, CapEx to about the appreciate on where you historically. spent, so I'm budgets the guys going thinking this keep be longer will hour. dollars don't to like Maybe historical Mike, know the and/or hospitals, just staying allocated looking if So I But term, have but where even numbers. – they what's crystal for

of think allocate and do a XX event it their their capital changes in the than how slices pie, to the and bricks you this lot you will different but size facilities. mortar the terms I change – the maybe the of hospitals it past and start change see was they to XX, Do pie, going towards forward have differently think the of people may allocation – capital about think over of start years? other

Susan DeVore

really It's do accelerate underway. that that what somewhere, will were said already Sandy, funny. that somebody trends is I COVID-XX saw

the visibility a efficiently the globally inpatient bricks ambulatory having trend having mortar, the trend analytics, in and trend enterprise makes population managing and declining supply processing. to the natural mortar, And think so trend more that the bricks to telehealth, for settings, for the demand, me and for and technology, language

while those that sort you'll to the these of mortar. conditions. And Those then and will patients of of severity populations. the things continue of only kinds ambulatory manage IT are investments capabilities that sort I and and infrastructure enterprise and the pandemics So see. to is clinical think of investments investments, I bricks piece to think accelerate and the The potentially, mitigating some with

we're time. And think at already looking the do at sort that the I will But trends accelerate sides – underway. so same both we're it of were

Alexander Draper

thanks so much. Great,

Susan DeVore

you. Thank

Susan DeVore

Okay.

I think that caller. was our last

us bit the and and Thank look safe and a with for all joining months, We longer. little everybody, on talking you healthy. of weeks coming to thanks, and So in you. stay staying forward

Operator

for Thank participating. this today's you call. conference gentlemen, concludes and Ladies

disconnect. You may now