PINC Premier

Angie McCabe Vice President, Investor Relations
Susan DeVore Chief Executive Officer
Mike Alkire President
Craig McKasson Chief Financial Officer and Chief Administrative Officer
Eric Percher Nephron Research
Lisa Gill JP Morgan
Donald Hooker KeyBanc
Jermaine Brown Credit Suisse
Jonathan Yong Barclays
Ryan Daniels William Blair
John Ransom Raymond James
Evan Stover Baird
Stephanie Davis SVB Leerink
Richard Close Canaccord Genuity
Call transcript
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Good afternoon, ladies and gentlemen. Welcome to the Premier Incorporated Fiscal 2021 Conference Call. At this time all participant lines are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] I would now like to turn the conference over to your host, Ms. of President Vice McCabe, Investor Relations. Angie

Angie McCabe

Christian. conference call. you, Welcome to quarter first XXXX fiscal Premier's Thank

Our afternoon Chief Mike Alkire, Officer. speakers Executive President Chief this and are Susan Craig McKasson, Administrative Financial Premier's and DeVore, Officer;

which over first the detailed actual Management's we as adjusted today reflect the measures forward-looking X-K, statements might forward-looking factor turn the of financial file to today safe Relations X, These Form of earnings now accompanying financial of DeVore. could Reconciliations discussed no where for this section to website will copies presented the SEC results our conference of following on today. Before supplemental everyone completion encourage the are the and quarter, Pharmacy release appendix our soon. measures Susan statements available financial operations undertake Susan. evaluate sale We slides measures to results financial our business soon. GAAP the earnings slides our fiscal are to obligation future to update appropriate, started, disclosures. earnings our speak to note will this in to non-GAAP which expect of the that included that release in call furnish business. I of Also, I from remind Specialty Factors harbor in remarks our get we including materially review and in refer we with presentation June to in Please certain exit continuing that or those results supplemental of call also non-GAAP XXXX. and these and and to we risk our and today filings XX-Q SEC, them. expect accompanying contain we you want the our are to Form differ at affect Investor the discussed

Susan DeVore

for with potential on believe value you Premier afternoon with and execute fiscal good Presidential quarter perspectives solid on our the members. challenging and the in revenue. Angie navigate review we XX% providers deliver to we stockholders. our of segment and prior first supply positioned Compared period, everyone the execution discuss key very joining value XXXX healthcare services the we'll We're that our strategy, This to we delivering net impact us performance our continue We're play differentiated role services we XX% Thanks, our the results thank afternoon ongoing and services in the and well segment provide first and products election and pandemic. our believe today. and net deliver helping produced our our growth growth share to our year a a to COVID-XX revenue, XX% quarter members these growth results consolidated pleased revenue in reasons environment chain we superior our reflect net in which to we're results, in

our EBITDA separate restructuring year-over-year communicated, and sequential remarks. the pressure of impact the and impact improvement GPO fourth provide the more ongoing COVID-XX The Craig ongoing some given of economy. the But in these effect is on the continuing adjusted parts various extension the on As country topics member-owner his and experienced business. when profitability. Adjusted and quarter XXXX we to details will expected pandemic's We on per related compared our previously impacting year-over-year. our and fiscal our agreement. expect pandemic our we declined also earnings share discussed COVID-XX amendment of with of pandemic

will it of much remains effective exactly us and what we of approval, distribution vaccine, the surrounding an to adoption uncertainty how duration the for affected. be predict time and patterns surge for current difficult Given and by continue

to XXXX us year for at providing possible business fiscal not financial it's as not this this for and of the accurately fiscal we're on result, full guidance the such forecast a our time. remainder impact As

healthcare importantly, vaccine We consumer trends, the in and reopening will and continue also resurgence and geography, and Most navigate to future. maybe other states. adoption distribution diligently businesses organizations preparing case monitor assisting various health future the phased COVID-XX current approval leadership behavior more continue we challenging to in and closures our care a create take a COVID-XX the current Helping continuing monitoring utilization implications, for or and environment, this of by resurgence and patterns, members supply will resilient, as chain role. renewed helping in hotspots them

And focus based the solutions other than and providers will payment COVID-XX intensified is financial will pressures and resulting we've several the validated budget election. these further enterprise pandemic's spending belief state irrespective contend our will seek of positioned healthcare Trust and paid end-to-end of and healthcare outcome of risk problems faster chain with of analytics supply we the cost, and of the for months, over need quality from primarily provider delivery Medicare services. As will Employers strategies. safety well the Regardless also improvement continue to the the for technology-enabled as and of reinforced across result This many both and employer impact our has on Moreover, performance a Premier movement healthcare subsidies. to impact have the believe fuel cost Fund providers. the which models communicated of on past of the release increasing members pandemic of parties the on spending underlying challenges the patient-centric and facing healthcare. In healthcare respects politics efficient to problems benefits. some remain growing is our

strategy providers challenges preventing health pursuing partnership diversified repeat that recent need products capabilities, the for robust in products Finally, of which a we our expansion focused at including domestic are a manufacturing member in Healthcare an that critical resulted been learned both of few pandemic countries. sources area from with we've have the forefront, system. from parties chain critical supply equally an the from on overdependence a on coming

expect will that believe We benefit election. the Congress of and made. be investments by prioritized outcome matter the issue Which administration the this we will next tomorrow's no we've

we're solid a XXXX and near- in start goal. our focused strategy our So longer-term achieve to fiscal executing to and on off

As the subject XXXX COVID-XX pandemic. we've previously and fiscal said to beginning in

target We annual multi-year a single well the in to been expect growth doing continue do will long-term. rate the to we've compound believe for work the We positions us mid-to-high and digits.

the call our Mike I'll President. Now turn to over Alkire,

Mike Alkire

afternoon This strategies. to performance supply I'm our on the improvement making progress analytics in Thank end-to-end focus you, and Susan. and enterprise technology-enabled executing we're going chain

for currently capture our services we approximately member growth. further we sustainable position billion spend. of long-term $XX chain As Premier our existing In supply segment,

Our supply supply spend longer-term solidifying that leading the our technology we to chain position portion us of healthcare continue goal enable expand will is to a systems services alongside and outcomes. provider chain to manage total our of health as member members capture,

near areas; coverage areas progress the in we're in portfolio following particularly deepening and by clinical the with making categories our products. preference and to are compliance executing and purchasing supply in chain. our resiliency co-investing including create to by more purchased We services in GPO engagement first, member healthcare additional expanding physician our portfolio expanding Continuing programs in onshore the expand in manufacturing high members shore our and

to how example I'm making creating Ameritech share Prestige good more it progress. the is supply is chain in resiliency we're that healthcare of one in co-investment pleased Our and

up have ramped supplying spend months. and the fully now is participating of members with XXX% been last our for our stage committed several they members committed Our

healthcare strengthen well opportunities We we as also providers. to critical believe are additional maintain pursuing as member, which other this goal categories exemplifies long-term in we and product the actively co-invest relationships to our advance with deep

continue e-invoicing supply provide enabling technology paperless automated, and platform all payables to end to chain. an invoice payment our seamless we on Second, into and aspects stocked the of e-commerce focus technology Through procurement, and expansion front experience. our planned and healthcare

the analytics member In addition, drive enhancing and or products conduct intelligence-enabled clinical third, analysis clinical artificial chain be we're will co-managing resource workflow the help in supply value appropriate and outcomes determine of efficiencies that providers savings. co-owning and therapies further utilization. And in to developing and effectiveness to integrated

quality there real believe and our wrap-around Turning segment, data to with opportunity improve need insights reduce cost. to for is and implementation and services driven AI Services Performance technology, we total

payment continue providers risk-based to addition, help healthcare In transition to we models.

are expanding addressed the and standardization life fully to sciences employer, our coordinate more in payer markets. care capabilities improvement and and We also

provider focused on we're Specifically, performance utilization, financial advisory following healthcare, services. integrated ways; members, this our analytics, clinical, advancing operational and improving service, business and in the technology-enabled technology workflow,

in payment models. All of healthcare which and transitions work quality, to new system to reduce improve advance together cost the

are we US on recently rate. pregnancy as maternal differentiated their the demonstrates data Office the advisory two-year the the a at as and analytics and wrap-around health is dying of US result national or Women's with provide. Services crisis capabilities lifelong Human partnership in women increasing Congress Department of Our an experiencing announced Health technology, focusing complications, growing services Health of

data. and these because our impact Importantly, studies In and nation that health is HHS provide provided capabilities. We to this performance source and to find analyze deaths with across contract unique is response, that analysis science-based the Premier harm to forward goal scale to understand sole improvement of improvement XXX Health data populations. inequities, look to The the of approach measures Office solutions most partnering that identified proven by are of to the of that and drivers a timely initiative Women's reliable, at measurement, performance of outcomes implement partnering least key analytics and are driven the hospitals vast data, vulnerable the treating majority preventable. with conduct a

the have the a help solutions We bring and in are honored baby. to place excited necessary to expertise, and world to America safest the capabilities

companies the platform, Second, expending our our with providers sciences along we're processing evidence learning and in advancements life and natural machine and capabilities, connect data to of patient world real better further to backed and language with clinical trials. technology used leading for discovery data research cases

companies. working records to electronic drug health For EHRs our research utilize are leveraging existing example, with collaborative trial science a we create network to life or

excellence include expanding high we're expansion of Third, wrap-around further as expansion. additional growth to platform, programs as authorization the capabilities Health, well through of prior and network network providers, centers our Contigo value direct-to-employer

positioned and to to believe Chief our call strategies our turn we are achieve I well initiatives now will the in Administrative our McKasson, Financial make over to further Craig these longer-term Officer. strategic advancing and underway, With progress we goals.

Craig McKasson

and term. to continue close first results thoughts impact and some the of Mike. near to begin brief how businesses outlook with year general may fiscal with of remainder in related this Thanks I'll our for COVID-XX XXXX our today the discussion a quarter our

to prior For chain the segment increased ago. of year XX% million first services revenue Supply of a due the services quarter revenue compared with consolidated primarily with the quarter XX% chain revenue decreased year XX% net revenue quarter. increased three from administrative XXXX, and year with net compared $XXX.X prior In factors. fees performance $XXX.X of million segment million supply prior of compared increased $XX.X services, year

agreements net and these our quarter. First, $XX implementation X, amended extended the million expected revenue by agreements with ago year XXXX GPO administrative the fees effective quarter July reduced first in approximately of as compared which the first we were

of ability technology spending of on $XXX.X With the Acurity in respect significant million a X, a increased million net an member to and amount from in in of for quarter efforts acquisition to a first the record healthcare revenue of in of our increase share. $XX redemption value income related required fees million members million ownership. per as $XX.X a Plus. And $X overall Design fiscal benefit quarter high non-healthcare secure an was of benefit to decrease release to and GAAP revenue $X utilization $XX.X stockholders the critically which primarily the increase July million a new segment, COVID-XX our our XXXX COVID-XX by for as Directors categories in of including the is to income approximately from adjustment July and was deferred a of a acquisition comprised ongoing disclosed B result of last was slowdown quarter XX, negatively the in million GAAP a million the demand SaaS-based volume Products resulting areas. to former allowance limited growth related result the result adjustment million to After is unit year. result in Second, in income from non-cash Class is by revenue of from services net prepaid the $XXX agreement a to needed third, amortization Nexera. which million and and of estimated fourth from tax approximately fiscal a of restructure net with of performance $X.XX XXXX In pandemic. million approximately revenue XXXX agreements July in of quarter year as impact negative other incremental million related XXX% of the driven assets being procedures of PPE Directors of impact contract losses. non-cash $XX the incremental supplies the including result common deferred $XX to a on attributable license period previously operating for negative to required driven decline administrative $XXX pandemic, attributable majority the profitability, The certain our The utilization XXXX as reflect comprised the first Independent as Board XX. continue attributable purchasing additional in of compared elective $XX prior a through and tax a result evaluation of Net as partners Health a

longer Premier in quarter from future. in make million EBITDA decreased to the As XX% ago. adjustment this required Consolidated year no of a the result, adjusted be $XXX.X a will first

result quarter-over-quarter to primarily adjusted $XX.X year the performance We prior expenses increased and revenue. quarter-over-quarter as per administrative primarily as year COVID-XX and meeting XX% of expected on by $XX.X to impacts well the million net services fees adjusted net decreased services Nexera a million of administrative and a chain a the adjusted this decreased XX% in driven ago XX% Supply the decline as pandemic. income travel EBITDA the a as growth amended of revenue Adjusted of segment share SG&A revenue XX% decreased agreements, result GPO EBITDA expenses decreased million acquisition from of and from COVID-XX related decline quarter due to $X.XX. of the Acurity and earnings fees $XXX.X pandemic decline in net the primarily

inventory cash the our evaluation decrease fiscal was as remainder through for as year XXXX. XXXX aggregated help at record lower historical approximately and driven million of agreement The Our with per liquidity for $XX.X at of as capital On with of inventory cash release of Premier equivalents was we limited pandemic. of the a stockholders including year. primarily Cash flow in the Board payments cash the associated XX% the quarter of $XX.X free cash the to is and was current from from well for net quarter result of as million flow million now increase lowest operating incentives lower in fee administrative a certain PPE the compared operations on anticipated PPE a with free $XX.X operations quarter. the ends driven totaled the tax June assets $XXX.X and well cash flow for rate COVID-XX fees $X.XX million of given revenue allowance receivable working The annual $XX flow primarily declared funding the dividend that XX, pandemic effective first Directors $XX.X was to XXXX quarter share the an decrease the payment revenue XXXX. partners which of to deferred by perspective, the compared in million cash tax our factors XXXX expenses same initially purchases fiscal first tax that for occur was of XX, sheet XX, of expect million in utilization prior primarily the result as first timing of year December XXXX on slightly compared and including quarterly net payable the year in negative Free December of in of ago. GPO of From than impact October on members cash administrative XX, losses. net for period of $XX.X flow made X, amendments the million a by Premier's that manage September with Historically, the and former same first as June was LP. balance affected purchasing

million subsequently facility $XX billion and October. that $XXX repaid balance $X credit had XXXX balance five-year an September of Our of we've XX, of revolving as outstanding million in

As our guidance the Susan fiscal the pandemic uncertainty pandemic estimate this currently the XXXX. earlier, discussed to we're not on Therefore fiscal providing performance the for we're unable at the related of to time. XXXX of remainder COVID-XX accurately given impact annual

We continue will to throughout our to so assess do move the ability as year. forward we

we to pandemic However on that, I our the expect compared of would business Broadly to we short impact progress currently to fiscal of term. the provide like COVID-XX commentary the XXXX. some while directional one; the lessens fourth negative how quarter expect in

which our elective EBITDA certain result in to pandemic. slowdown that net be the pressured healthcare utilization, We as overall the expect related non-healthcare continue and of to purchasing revenues deferral continue GPO by in continued ongoing significant will potential lower a fees areas administrative generates procedures the of COVID-XX

during product's pandemic. our did the making will needed growth a sourcing some regarding and quarters experience performance timing quarter revenue in as fiscal and for our and direct down approximately quarter related ongoing completion improvement fiscal in to for a lower which potential of in of in optimistic while from to direct in critically first our margins services we businesses than demand performance the quarter Fourth; XXXX view sourcing our Based result generally depending of the back expect it our delayed taking of having third engagements product year ago. on We XXXX decision significant adjusted incremental our efforts in continue revenue expect the our more the for Second; direct benefit sequential technology second with could experienced pandemic delays as of the of increase members. PPE on GPO increasing full engagements fiscal result to the a new performance in and may sequential result product of supplies consulting meaningful year. step $XX earnings performance Three; to significant expect benefit incremental to as low sourcing. margin which likely business services, million result of title after direct EBITDA this sourcing. we current and We in respect profitability as revenue fiscal a a to revenue cost a other our and than generates high adjusted not do per we existing visibility, and the share XXXX secure fourth

a the to will while in As resources that managing position environment always, in balanced appropriate place approach future we diligently take growth ensuring to between continue company for also expenses have a environment. in current we the post-COVID the

fiscal highlighted our to consolidated COVID-XX impact are the Susan longer-term deliver rate targets per mid-to-high as revenue, net XXXX. Thank multi-year the Finally, compound growth growth the in you subject beginning adjusted adjusted to in and today. your time digits a ongoing earnings of single for EBITDA share for pandemic annual

over me the Susan. let back call turn Now to

Susan DeVore

our Thanks questions different will Operator, you Please because call appreciate address today may locations. we all Craig. call accordingly. We your Craig everyone's address to them for questions. in we and me or participation in Mike, and are open the


your [Operator is Nephron from Instructions] Research. Percher Eric first from question

Eric Percher

A for question Craig.

I but glanced off directional didn't address think cash commentary it directly. flow, your

year is expectation we $XX cash as we at versus one-time million potentially Let year? XXXX the the most to last you some comparable about thinking of look end year flow. fiscal look me full Should element and maybe another year by be working as items reverses ask capital your In of this the more elevated. toward QX,

Craig McKasson

indicated yes, of back directional in a basis subject stockpiling lower a cash see I free the pandemic back a be do Relative of, to Eric. in XX% and cash the back and excess of in result amended opposed as expect year conversion at Would question. in the likely we that step see prior we percentage the half demand improve the the where half of my year. would more it only to and put in should commentary, as Sure, as extended been would would to XXXX the you of have if expect fiscal that we fiscal flow of free as as in That's a place? adjusted agreements. the range we commentary forward to to some down on the your in to that go normalizes, a the amended then and a I stabilized extended great remind GPO that GPO XXXX the flow restructuring agreements EBITDA thing We look

Eric Percher

of and was that the Thank you There for some last as element acquisition PPE I that guess related other part year. rebate. well as the

Craig McKasson

purchasing we're the million that's to second then PPE quarter of out correct. again levels normalized fiscal was fiscal historic in million to the turn XXXX in indicated pandemics type million first a return here We winter whether about top will we that In or of the levels the elevated $XX another of $XX had then incremental how I back of fourth here that incremental dictate perspective, quarter. that in quarter XXXX, down subject from see about that and more $XX on overtime. expecting and months continue to see

Eric Percher

Thank you. Perfect.


Thank you.

question next Gill JP from is Your from Morgan. Lisa

Lisa Gill

women's growth you that to that size mentioned there for with for meaningful quarter a way Mike, the you was initiative performance services? in HHS. that can and that the Is us health the

Mike Alkire

answer let very talk just me let financial so broadly Craig and I'll then the Yes questions.

we a it's that won. just So contract

and answer, a we're it's help them important data from the not health. of after technology to to seeing obviously our so question. bring services HHS the revenue us Craig, an to women's it for obviously can all that you the improving of opportunity financial really is provides reason And So capabilities standpoint and us, any with get to

Craig McKasson

Lisa. thanks Sure,

approximately So over two-year the contract government itself million $X a contract period. is an

are it country think needs pressing can the analytics well. social that our and the affecting that across data incredibly I Premier with population significant overly important to have not the impact is highlight healthcare well but as meaningful So on

Lisa Gill

that we contract services about giving area? comments also But contributes around Mike's on risk about a guidance we'll obviously difficult performance there If I'm bearing things curious anticipate to talked I the anything about performance it's maybe know know is just move think you're you're specific in talk quarter just entities. seeing that. he these on going call you we the performance Is side? I to this there and know out? call not services performance you strong would quarters side. the the Can what several as that services. around more through next are forward. much see on things the you trends But supply that the chain I in especially

Mike Alkire

drove three first I So things quarter growth. think

First had of several all and we enterprise data analytics license deal.

had had So that with impact. we technology strong a acquisition, had Design across decision Lisa. some really our contributions from Health clinical obviously our so that Plus technology, financial including system, incremental that We business our strong safety growth SaaS nice [indiscernible] and and growth then revenue support so that's had quality

Lisa Gill

helpful. Thanks. Okay, that's


question Donald from KeyBanc. is from next The Hooker

Donald Hooker

out in of Yes, spend sort there. remind what is? a Can me non-healthcare that of you the business that you areas called you GPO percent as the spend have

Craig McKasson

Donald. Craig. is this Sure,

Donald Hooker


Craig McKasson

understand. Yes,

primarily sense Hospitality things of, healthcare where about in Group component non-healthcare of is providers the type things have our of to colleges of other nature universities, available like actually that such organizations comprised what of also environment. that non-healthcare that organization and portfolio to types Purchasing that's our that. take those we chains we make all schools and catered our our So is GPO, X% total as

to fully to XX% below those back virtual continues what little that environment a with a be So levels lot that given the has and decline in did historical that substantial colleges of bit schools a and last while continue and very, of the up in that - opened have of you a the not see areas almost in maybe economy that's to things shutdown come and tune in nature. business universities quarter, economy very we and was the a

Donald Hooker

and whoever. maybe optimistic guys you out. had a that's Okay, performance then Well Susan some to helpful I seemed a or services you Craig data good more follow-up know base. on or

getting good a ago of month population they number ACOs do some to management seemed were think a and health results It working as guys. when were with they like every collaborative. with you year I your you seem

heating that a area? driver guys As more about the collaborative effort up to that optimism detail particular wanted in over hear of that you kind those start that programs is just for again, I that maybe and segment. for maybe

Susan DeVore

Don. Yes thanks

our the we success ACO bundled have systems have health national So great those with than member averages collaboratives had in performed and payment and better both.

side been and and house in as by really of employer, applied services, direct-to-employer we pivots driven Craig Contigo we're and performance sciences programs provider say, this speed would do on what said movement applied Mike our some those also consistent based the the the that's seeing been well. And after in in programs most growth the participation technology to is towards good and it's recall elections, picks you'll as depending did not whether so through at level of really in relationships Health in of growth up of point, I value an back as factored sciences

from And us a business the for not would be so business than really came where but continues population growth in steady the quarter. to health more I good a say of first

Donald Hooker

much. very you thank Okay,


question is next Credit Your from Suisse. Jailendra from Singh

Jermaine Brown

This in actually Brown filling Jermaine for Jailendra. is

results this products the just maybe rate run I'm within Susan that of in going forward. to trying sustainability better understand for Strong you. the is business the So

cases So on you supply can you we the if as hospitalization can maybe in provide that season. general the - of into resurgence potential given the head color chain state winter particularly some the the you've rates seen,

Susan DeVore

an in the varies Mike give volumes. inpatient XX% the in and role and slower like what volumes XX%, XX% geography healthcare range yet gradual. hospital. you But at it more the back that members by sure of range. you data inpatient some for tell of this the think on they also ER what them they're with and direct know for we time side patients back XX% range the see sourcing non-acute on [ph] Craig then the The terms they of geography. non-healthcare in as seeing in they are to and But the they're you Again additional can like our need systems to to some severity know supplies by is business from and stuff impact some that all They're plus sort members need, and varies are slowly. referred then help I going more the Yes, our our the more more inpatient and in their range. to bit little and potentially think same about come our to back that to to can I of commentary XX% our our from generally that's they business and make Outpatient and working we commitment We're direct it coming at sourcing. generally the outpatient that XX% Craig increase been in the have need of have the get supplies they're use they the a and vehicle

end business. is, more direct or as Purchasing shutdown slow down going well to I if uncertainty think geographies businesses the affect Group as we stop again elective sourcing have having significantly. economies or up procedures that's our both or health if systems to Obviously,

and Craig you want will So you anything Mike, any components to it for turn I exponential to add?

Craig McKasson

is a in this had. I and products that addressed color remarks direct the revenue additional I which only our But sourcing think provide the would business. standpoint I I've from already Yes,

talked have quarter. about first seen needs. million the $XX We uptick dramatic in incremental PPE We that in

beyond second We further negative the the same go see their in my of we QX. expect in they're indicated in further not in incremental that really as been were business. anticipate products an have current and back on up the were performance more we upon step the $XX But of million above that that is that be building seeing to sourcing down could would that question pandemic. we I part in that the back visibility, our even The with to direct What so that in the But of things demand and in to inventory it people to is step quarter. sustained dependent they terms stockpiles based likely approximately over remarks spring. situation in QX extent would up

Mike Alkire

additional of couple a just Craig, facts.

it a relates last to said areas. just gowns. had think that you that potential survey shared in they XX% NXX all testing PPE responded some and did of think I had survey we we Of where and said, shortages XX% XX% have those gloves, So know around members as they they our shortage week. they said, exposure swabs the XX% regularly this

what to ways PPE us at care is, that to So creative to ensure have or be another means do going to appropriate their patients. forward looking the either create to buys we're healthcare systems that for our mechanisms

Jermaine Brown

the year within it is that performance very expenses with the do sustainable margins. leading and not the materialize? and associated travel more [ph] if the then are remainder Got business, person in what assuming strong not, for offsets services of that one How

Craig McKasson

Sure, this address is Craig. I'll be happy that. to

to in that would your back to expect independent through slightly advisory do in seeing balance we year And nature that we to So as first EBITDA has. labor lower range in that services services the what range that than of bit our it in adjusted to about it was be fiscal mid-XX's going obvious was well. anticipate services contributed first in part attributable growth the we mid-XX% of component little margin our is margins XXXX improved that's higher performance at point, of we growth piece it the the will sort that quarter. in quarter, and that be we the strong advisory generate the it's performance generally higher the to fiscal But growth revenue the in because have services a fiscal that XXXX. But of talked doesn't the technology segment bit typically was

that anticipate we adjusted year. that margin business EBITDA traditionally mid-XX% the full in over generated we So that

Jermaine Brown

you. Thank Perfect.


question next Jonathan Barclays. from from Yong is The

Jonathan Yong

turning the members stockpiling. that, one call have is just two, versus guess and again. case where holding they it is that about this many weeks do your stockpiling the just maybe comment to And the I'm I in that side they're Just quarter? they on product inventories curious juncture how of back were at second inventory.

Mike Alkire

Susan, I first can this. a take crack at

on So it health system. the depends

days to trying get XX depending PPE inventory is. many guidance the So health our of of on of have systems category what

him need try stockpiles. was level a today. to the to an on to to Vice to in six He months to So take system Officer to They that XXX it's literally stockpile. very days Chief sort want large Florida thinking of attain. stockpiles those that with get they're are of Operating the they thinks of - going President, I Executive nine get

around underpins the and the we couple revenue products think I about in growth of comments Craig sort next all that So Susan's with think associated how of quarters.

Susan DeVore

and get systems the to Yes systems vaccine requirements try vaccinated several a different get would build out I could different we is, states, only add thinks that as have stockpiles. the thing I on for everybody to generally and and continue think more health our healthcare months this

requirements. make They're with they So or of they're another to supplies need. the want anticipating also six and more their months this complying they have that state sure

Jonathan Yong

side. seems see on going been heard issue prominent comments just that kind kind how bit and on peer yours this you shortage that well. shortage. you're back I some this glove of it of and more great recently like seeing as long of mentioned of that We gloves Okay, more guess Has to also in are Thanks. do today the now another persisting? the

Mike Alkire

so, been has building last in months glove number of itself market terms demand. Yes, the of slowly over the

for product. utilization part know a been most prior in of in glove think now is be historically market the We utilize was that they're even to countries that about non-acute that the here. have lot So buying the the other to gloves, domestically settings There more you if pandemic. and

are mid-term the produce building those But the it that of we've overtime factories seen of happening additional in thing a of that going the is a of over it coming pressure and a from and we then and supply. been it to has exceeding of we've quarters. are what's know couple describe short lot part given demand we There certain this price and course way that, been that the number side. factories is there supply obviously be are online obviously next There So is we gloves. demand

Jonathan Yong

you. Great, thank


next Blair. is from Ryan The Daniels question William from

Ryan Daniels

strategic little discussing detail that? have performance-based In supply if savings. co-managing the Thanks. drivers chain some you. of are further or for there's growth risk co-owning one a with actually I that co-manage what you and outcomes to means drive the in supply go the Mike, for chain included co-owner, bit any on supply fees mentioned that about Can business, chain that the more organization, you

Mike Alkire

you, I appreciate Thank the question.

our supply to what is things, our bringing it Purchasing all that means function outcome. account owning us, that technology, chain the to of couple services So we're really and and our Group

getting And is, to systems platform platform ecommerce on healthcare upfront so ordering really what our pricing services. their out extend extend out means non-acute the building the help catalogues into acquired a the in or on Medpricer obviously then obviously technology. we've that working so been last the and that settings We non-acute really building focus setting, after purchase year that we was

in and So And item. service purchase technology analytics we're bringing clinical creating benchmarks arena. contracts and obviously additional to after GPO and the preference then get physician

efficiency of just whole beginning and So all spoke our very, also have all an invoicing on e-invoicing the help invoicing, really manage to play they to more cash them capabilities centralized the about unique large rule to opportunity obviously one manage a very all and fell bit the It goal brings in given these invoices. function. in payables we're efficiently area a payables. invoicing sort [ph] got how we've to effectively IDNs really and centralized bringing get the is, it's really an solution pretty more that complex one little and technology across that after We we're that spend. I our and out believe

services, possible. it's the will health most technology capability So that to ensure risk cases, results we're go we driving wrap-around of - obviously what's with at risk outcome. systems - that care it's some deals In create to of our some the performance and amount of some the it's

Craig McKasson

that, would is add this Mike, Craig. I The Ryan. to only thing

generally intention always at risk. more certain risk savings engagement around think where for a of to more sharing as performance-based be that return. anything guaranteeing achieved But is to but in sharing below change, savings of above it's where as and we're think a we'd that type opposed we're change then I truly are could opposed steer the the to subject But I or in the much risk at the that. is pure - it's As outcome

Mike Alkire

Craig. you, Thank

Ryan Daniels

Contigo sense. Thanks. employers for more pipeline really there? makes time more to for Health. just talk network be to It other One around that looking at like point Great, on there centers engage more capabilities pushing employer providers a out the something seems that the you're this workforces. value excellence, in like high or any their interesting an little wrapping about you of the and follow-up data can interest bit

Mike Alkire

high is so to centers really working employers solid The additional as in and of a with is conversations network those those the Initially, and those so we're support from focus team expand requirements excellence and systems capabilities in centers healthcare of standpoint of in Yes of delivery employers employees out conversation basis. with. that participating well to of pipeline so clinical alike. various building excellence quality with the terms out value that building

and as the come pipeline strong continues to evolve. more So strategy to

Susan DeVore

maternal the with managing cost practices those And and higher doing delivery and Mike, initiative we're actually and Ryan. for also for in employees the employer because best cost. XX% in complications add, work morbidity think and complications just setting one care high the We is blueprint a comes

from can our and of data Contigo So insights the activities. learnings all we technology, leverage actually think through we maternal

Mike Alkire

Contigo Ryan. evolve all thing, more continued of One attribute other we're prior One around authorization. as to

So lot data. employers our on you interest of capabilities underpinning of so the at the that and a seems the prior lot getting to the authorization behalf employees the point our from the approving employers. are obviously and quality and really therapies clinical our going analytics procedures of sort capability [indiscernible] ensuring are meet of A to are of if will be clinical again of and that that

Ryan Daniels

Thank Okay, perfect. appreciate I you. the all color.


The Raymond James. John question is from from next Ransom

John Ransom

just wanted a the to I ask question guidance. about long-term

in you core us revenue bridge pace your targets? could Just in that EPS business, and help given EBITDA of spend your gap between the the

Craig McKasson

this Sure, to achieve happy plan talk is about growth the mid-to-high Craig beginning our in single-digit be longer to XXXX. term I'll

so achieving in the today that into extended business we're during experiencing if in across XX% anticipate further selectively will penetration pandemic to our sense. subsided type is portfolio individual the and into do lot have adoption which supply business that that the of of billion agreements able normal help incur portfolio our with our was that pressures supply and we do shore adoption expanding we into pull appropriate it's GPO. get XXXX, will the there aware. Mike way time co-manage would or spend period and there, of side you're allows chain compliance to chain, face co-investing it will and we're will in there's opportunity expect fiscal achieving other in being to And and categories pandemic our through well drive on as So well on spend is then Mike plan to across shore back growing during about, that cost more business that the ability the growth there. Further of being participation of that have low-to-mid single-digit single-digit us our We actually and membership and it sort that in growth we're which where the purchasing and beginning our The supply the not that to has pandemic amended GPO more agreements the talked expand the about. we and new business back through the manufacturing not outsized this technology we then growth. and categories. chain that come GPO beyond this experiencing through capturing be prior with mentioned systems to Mike the identify we're but Clearly comprised demand healthcare healthcare sourcing we But co-own the reset as captured team then once managing growth that to makes of we the capture The through return direct and further been single-digit low some that categories, we to near we'll are XXXX. high and continuing more then would as have low-to-mid as substantially anticipate talked GPO also talked GPO usage $XX currently spend of of through think our providers programs and an spend a enhancements with our down and about our and of fiscal

how single-digit the the So chain side. mid-to-high to on supply get that's we'll

extend that's sciences margin be to really a network mid-high bit significantly On when and to to leverage operation get that we about we've life value to business the quite employers The But that growing payers authorization, continuing through expansion provider also profiles growth Electronic provide will growth performance EBITDA we and partnership and single with type us earnings growth anticipated those per have with revenue in trajectory that growth and that high talked our that Mike and our adjusted adjusted mid-to-high digits and share. direct-to-employer provide prior in Those yield the of the single-digit network, all part mid-to-high clinical that in just we support about. will are and areas achieve the through integrated clinical financial the performance opportunities Record our is continue into is think going a services side, big into and Health to single-digit our analytics. then to ability addressing in spots decision talked platform suite that needs. workflow

John Ransom

Great just couple a follow-ups. and of

the the Why all leverage actually like some kind move your some [indiscernible]. Thanks. as you increasing rate, top operating they're isn't levels seems business. than which income of EPS thinking you were might faster in grow at There grow growth and of be to line? a that your look long-term of back On that be guide. of or in just we out were the three question, really movement any then And variety happen second is to going significant supplies there just sourcing the if perhaps onshoring made side, the two not but down kind It there same as going some reasons. years, operating for will overseas the or

Mike Alkire

Go ahead, Craig.

Craig McKasson

Yes, Mike.

to Let terms me over manufacturing. you then comment real just quick leverage hit of in domestic I'll turn operating the and it

we'll albeit us of share performance anticipate growth level. shareholder EBITDA the at other EPS the that to otherwise potential of at I We repurchases that to higher more margin business, from most the think vehicles EBITDA which see segment look in you of we'll it mix so continue low-to-mid highest get But in get the will look could the or the margins John return I does single-digit driver have standpoint, business earlier is business we challenging operating and the the to that you have the range. make GPO overall when growth an the it there. is mid-XX% of significantly big the future So services as mentioned overall when mix rate in obviously

get the to by of services technology, get technology where continue drive offset have advisory wrap-around leverage margins services higher we leverage implementation We the that some could to of the will implementation somewhat we not the augment the in of so all will be and the retention operating is value why combination and and GPO a the they're leverage given a high and lot for then nature additional of model and there. the rates ensure the And there that's part. that so comparable renewal most

Mike Alkire

be that they other additional on We or just guess I'll that. would other I investment there NXX well face mask Obviously, do standpoint, I domestic PPE. longer to in made domestically a term projects do produced be focused you're shore. that aware and of a near in got either Texas. believe probability here producer highly we are say are automated that is We've But the high manufacturing couple from a brief. even products to way believe those better

and and the into are well raw our that active excipients exposed to as incredibly the it as generic believe country materials finished ingredients go going pharmaceutical active We the goods. pharmaceutical the be also as is relates ingredients to drugs

those partnerships believe to So we capital have right decisions and processes, of to just those are are of, bring and it's onshore. to to going given a make long-term compete and back right US automated investment levels that that most that highly we of matter of can actually level potentially get production

Susan DeVore

add, thing I only The would Mike.

investments system we invest to health buying, alongside that purchase. advanced they our and of know have have is and to member bring make health so intention Our it, systems with member commitment minority our we're levels committed what

it Premier. foreign this also highly lot [indiscernible] capital-intensive of helps for for countries it not relationship on and it us it's makes the PPE. terribly a lessen a So dependence But strategy

John Ransom

Thank you.


is Your Evan from next question Baird. Stover from

Evan Stover

that margin This one were But historically Craig. sourcing the growth less been quarter on single talked believe and bit is believe about throughout high the challenges know drop for it seeing? for sourcing pandemic and you little of than Can was digits. said quarter help And Product the call. had challenges on the the rest direct year. XQ has guys and after running some what figured little from historical this between last gross they I of early X% you quarters. maybe product really over, the the figure Thank the margin incremental cost to bit get going margin is revenue in spread well the you kind not where to might But there maybe you coming there. the us you're out your I there a talk some Because in you comment of now, a right margins, out you. trend I

Craig McKasson

question. great a it's Evan,

I albeit reason was you did we compression PPE So saw other market. the in glove while of some think see we main mask, in as where some see the components deterioration and such some stabilization etc that did

go wasn't implement up would We price first in about are product the more lot effective the ramping which cost but on we're of to for price covering appropriate at cost there's other with Mike, pressure place don't demand you that really for that see any margin and the increases a our of the a expect significantly we did sourcing margin gross getting we talked business. gloves. margins. into in that As should that beginning if actually in add. the anticipate remainder improve appropriately We go of as I put Mike the so and direct increase price gloves. it quarter, fiscal We ensure is any gouging, know did some manufacturers did color year first quarter doing would now without along now our other

Mike Alkire

Craig. you it. you, Thank Well hit

Evan Stover

PremierConnect. one. dumb think thank But years But the revenue the pattern model organic components lot always But business lot performance my were maybe and three if and best isn't in obviously by little of, different there the we the I'm growth one-time a to. in I that variability was bit out was second less maybe I the business Even some commentary in I question that primarily tech there there impression a services historically that more there tech on take this around coming is thinking a a size-based HDP. licensing type I of there. was you my and upside under and through Okay, used about than mostly is hope

Craig McKasson

a sorry, Go - It's I'm question, Mike. ahead. good so

Mike Alkire

No, you go.

Craig McKasson

Evan, we have XX or we've this don't probably, enterprise about seen talked over I know XX data and the with months past analytics. our

kind approach in revenue accelerated for some there license quarters. growth license is some of to licenses that as saw that under mentioned than of did the our and we've recognition been access individuals in products past members when where recognition for all I our both. get to engaging based and actually SaaS We So purchasing is so have first and the as different revenue now They're we historical have quarter. talking both our are few But about solutions. the that of continue to we agreements

And standard when licenses. so there's kind recognition of data enterprise a sell we SaaS little do more annuity analytics revenue based lumpiness than true those

Mike Alkire

Craig, analytics keen operational of it stance and to the those leverage these of insights off to the is all capabilities all these does because capabilities we license when the enterprise data an capabilities to different do really data those enterprise the systems sort into write wide standpoint show our about and Premier the sets of workflow. part like and facets highlights, want them nice analytics from healthcare I so integrate

do it long-term. for creates quite bit my stickiness like we a implies So these us a it as ideals, of

Evan Stover

Thank you both.


SVB Stephanie from is Davis question Leerink. next The

Stephanie Davis

base some you into and Susan, utilization performance bit earlier and these management like [ph] little small have away a assets? feels a in guys given solutions you look healthtech [ph] this to tools. given start seeing of the [indiscernible] an workflow With divestitures in just that we're move assets supply PS you potential and thought of the segment. if hinted valuations at some for advice But It strategy mind, from of more you prior in question. your value your the

Susan DeVore

Stephanie. Thanks

away life direct-to-employer and through applied adjacent license moving Craig articulating quarter through markets mean growth was was basically sciences, just from didn't Mike growth I the had about. more there. as sciences So We've were in we to and technology that moving the toward the Contigo I that imply that. nice SaaS and just described curve talked

to there's stepping providers that help technology and move much as that imply services from that's think to market We models the data continue that multiple didn't models. so future think combination well. areas. administration part alternative growth to no value movement possible We across that. wanted We accelerates diversified to that did direction if Democratic the either entirely will believe well. I to will because in have It's Republican payment really drivers it's of the as and move to we mean very back revenue with I or payments based of the streams

Stephanie Davis

are flipside are you the looking strategy bit? question evolve then on then your there understood add a guess Okay, assets I does that on that tech to any as

Susan DeVore

area I analytics, ambulatory analytics, capabilities Well in the or which in life do around prior well capabilities, services be performance sciences analytics our capital the authorization population, space continue direct-to-employer to kind that will analytics about. Mike deployment of think claims health as as talked

services organic continue we cost organic link we supply this targeted that have for quality chain areas and and you in data investment financial operational, our and to sort if have in view performance both So of elements. Stephanie

sciences them and take some insights those or with sweet and can help spots common help problems. models to you assume companies and or can really these risk improve, providers can new life You to also you payers employers work on in

take basically how all and for couple and built of use strategy, we purposes. do the data and that's these them we've insights So have infrastructure a different

Stephanie Davis

All right, guys. you, that's helpful. Thank


next Close Close Genuity. Richard your line from from Canaccord Your question open. is Richard is

Richard Close

I'll quick keep here. it

demand that this future the year? about area the throughout talked services I quarters in there on advisory increased see any advisory year. services specific coming mean You the you revenue. fiscal the of growing Is

Mike Alkire

all that relates really and back to delaying performance out helping COVID. to systems centers normalcy get around improvement healthcare as primarily It they're with

for part the it's improvement. most So performance all

Susan DeVore

of big Well They cost imperatives and have the many variation and because space COVID. very the in much of space. all clinical it's cost of management the challenges

large-scale and space So cost performance management point. kind of Mike's to improvement

Richard Close

thanks. Okay,


America. Your from from Cherny is Bank Michael last question of

Unidentified Participant

is pricing potential Craig you or This any Mike. there for Allen a then deeper stockpiling where way guess the needle move in I scenario could the dig the pricing for other? or little Mike, materially with of and trends PPE. Can one the is on

Mike Alkire

you if can just you into couple Craig, like. I'll a comments take some macro then would detail, get

doubled cost don't that basically is China ago. we're XX now what know of in obviously [ph] I right gloves experiencing So weeks gloves. the announced

go So of gloves obviously the and market exacerbated continuing price of that are to up. and sort just that's

the pretty would I a that say too taking sense not a organizations eye categories demand obviously the are point, have we're because hypodermic reason and that, tell areas is keeping countries We're but know I the keeping alcohol if to tell potential there's virus those you significant Susan's we other vaccine on of? have increase Craig about and I'm think prices. supply kinds and part for So advantage that most an again things and of there a don't to sure an Are in early that things. balance those cold there swabs it's be to just anything are kinds of enough we that. and are the add. for Susan, else going But of eye supporting of storage that those needles would things. on you disruption, might there To

Craig McKasson

think would on earlier. This only is I Susan Craig, touched this I and really add the color

we that amount not kind of really as providers the systems. on intent procure that product product and healthcare ever as commitment having the the across their aggregate of and really need manage are to I the to earlier folks helps the to and any for cost trying our perspective we down going us and deliver just then our and pass of that opposed so cost perspective out therefore a in at source healthcare of The and care try that our and actually margin members to is keeping price key Our in trying way working is excess and behalf terms on to procure expense from demand, to mentioned country. can with this to is us

raising business make So margin of we'll at the extent but pricing. on our not

past what we'll as [ph] us higher will Mike quarters. plays normalized happened over for and some elevated about, back that overtime going see just demand I from time period to So there's a we'll I that's think levels. out. It's think that is see of size the given we product to But you'll have cost think prices come if time take talked few how down

Unidentified Participant

Thank you.


our gentlemen, that for a Ladies Thank wonderful day. your and for conference call participation and concludes you have today.

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