18.

Financial Information for the Company and Its Subsidiaries

The Company conducts substantially all of its business through its subsidiaries. The 6.125% Senior Notes, 5.125% Senior Notes, 5.625% Senior Notes and 6.500% Senior Notes are jointly and severally guaranteed on an unsecured senior basis by all of the Company’s subsidiaries that guarantee the Company’s obligations under the Amended and Restated Senior Credit Facility. Presented below is condensed consolidating financial information for the Company and its subsidiaries at March 31, 2018 and December 31, 2017, and for the three months ended March 31, 2018 and 2017. The information segregates the parent company (Acadia Healthcare Company, Inc.), the combined wholly-owned subsidiary guarantors, the combined non-guarantor subsidiaries and eliminations.

Acadia Healthcare Company, Inc.

Condensed Consolidating Balance Sheets

March 31, 2018

(In thousands)


	Parent		Combined Subsidiary Guarantors		Combined Non- Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Current assets:
Cash and cash equivalents	$	—	$	25,212	$	32,596	$	—		$	57,808
Accounts receivable, net		—		251,938		73,210		—			325,148
Other current assets		—		93,378		27,559		—			120,937

Total current assets		—		370,528		133,365		—			503,893
Property and equipment, net		—		1,113,401		2,038,128		—			3,151,529
Goodwill		—		1,936,057		843,344		—			2,779,401
Intangible assets, net		—		58,285		32,751		—			91,036
Deferred tax assets		1,427		—		3,698		(1,427	)		3,698
Investment in subsidiaries		5,590,670		—		—		(5,590,670	)		—
Other assets		355,984		44,507		7,453		(352,772	)		55,172

Total assets	$	5,948,081	$	3,522,778	$	3,058,739	$	(5,944,869	)	$	6,584,729

Current liabilities:
Current portion of long-term debt	$	33,550	$	—	$	280	$	—		$	33,830
Accounts payable		—		78,622		43,808		—			122,430
Accrued salaries and benefits		—		74,265		30,643		—			104,908
Other accrued liabilities		11,572		29,302		87,599		—			128,473

Total current liabilities		45,122		182,189		162,330		—			389,641
Long-term debt		3,186,180		—		374,680		(352,772	)		3,208,088
Deferred tax liabilities		—		21,772		56,585		(1,427	)		76,930
Derivative instrument liabilities		15,160		—		—		—			15,160
Other liabilities		—		103,280		65,353		—			168,633

Total liabilities		3,246,462		307,241		658,948		(354,199	)		3,858,452

Redeemable noncontrolling interests		—		—		24,658		—			24,658

Total equity		2,701,619		3,215,537		2,375,133		(5,590,670	)		2,701,619

Total liabilities and equity	$	5,948,081	$	3,522,778	$	3,058,739	$	(5,944,869	)	$	6,584,729

Acadia Healthcare Company, Inc.

Condensed Consolidating Balance Sheets

December 31, 2017

(In thousands)


	Parent		Combined Subsidiary Guarantors		Combined Non- Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Current assets:
Cash and cash equivalents	$	—	$	46,860	$	20,430	$	—		$	67,290
Accounts receivable, net		—		230,890		66,035		—			296,925
Other current assets		—		85,746		21,589		—			107,335

Total current assets		—		363,496		108,054		—			471,550
Property and equipment, net		—		1,086,802		1,961,328		—			3,048,130
Goodwill		—		1,936,057		815,117		—			2,751,174
Intangible assets, net		—		57,628		29,720		—			87,348
Deferred tax assets		2,370		—		3,731		(2,370	)		3,731
Derivative instruments assets		12,997		—		—		—			12,997
Investment in subsidiaries		5,429,386		—		—		(5,429,386	)		—
Other assets		381,913		38,860		7,807		(379,008	)		49,572

Total assets	$	5,826,666	$	3,482,843	$	2,925,757	$	(5,810,764	)	$	6,424,502

Current liabilities:
Current portion of long-term debt	$	34,550	$	—	$	280	$	—		$	34,830
Accounts payable		—		70,767		31,532		—			102,299
Accrued salaries and benefits		—		69,057		29,990		—			99,047
Other accrued liabilities		36,196		27,676		77,341		—			141,213

Total current liabilities		70,746		167,500		139,143		—			377,389
Long-term debt		3,183,049		—		401,017		(379,008	)		3,205,058
Deferred tax liabilities		—		27,975		54,728		(2,370	)		80,333
Other liabilities		—		103,112		63,322		—			166,434

Total liabilities		3,253,795		298,587		658,210		(381,378	)		3,829,214

Redeemable noncontrolling interests		—		—		22,417		—			22,417

Total equity		2,572,871		3,184,256		2,245,130		(5,429,386	)		2,572,871

Total liabilities and equity	$	5,826,666	$	3,482,843	$	2,925,757	$	(5,810,764	)	$	6,424,502

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

Three Months Ended March 31, 2018

(In thousands)


	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Revenue	$	—		$	435,625		$	306,616		$	—		$	742,241

Salaries, wages and benefits		6,919			239,052			165,557			—			411,528
Professional fees		—			24,271			29,747			—			54,018
Supplies		—			18,712			10,652			—			29,364
Rents and leases		—			8,239			12,049			—			20,288
Other operating expenses		—			56,170			32,061			—			88,231
Depreciation and amortization		—			18,172			21,601			—			39,773
Interest expense, net		14,617			23,584			7,042			—			45,243
Debt extinguishment costs		940			—			—			—			940
Transaction-related expenses		—			4,009			759			—			4,768

Total expenses		22,476			392,209			279,468			—			694,153
(Loss) income before income taxes		(22,476	)		43,416			27,148			—			48,088
Equity in earnings of subsidiaries		67,598			—			—			(67,598	)		—
(Benefit from) provision for income taxes		(5,752	)		(123	)		3,089			—			(2,786	)

Net income (loss)		50,874			43,539			24,059			(67,598	)		50,874
Net gain attributable to noncontrolling interests		—			—			(55	)		—			(55	)

Net income (loss) attributable to Acadia Healthcare Company, Inc.	$	50,874		$	43,539		$	24,004		$	(67,598	)	$	50,819

Other comprehensive (loss) income:
Foreign currency translation gain		—			—			92,780			—			92,780
Loss on derivative instruments		(20,053	)		—			—			—			(20,053	)

Other comprehensive (loss) income		(20,053	)		—			92,780			—			72,727

Comprehensive income (loss)	$	30,821		$	43,539		$	116,784		$	(67,598	)	$	123,546

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

Three Months Ended March 31, 2017

(In thousands)


	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Revenue before provision for doubtful accounts	$	—		$	426,796		$	262,545		$	—		$	689,341
Provision for doubtful accounts		—			(9,214	)		(933	)		—			(10,147	)

Revenue		—			417,582			261,612			—			679,194
Salaries, wages and benefits		7,396			224,430			144,595			—			376,421
Professional fees		—			22,074			21,335			—			43,409
Supplies		—			18,609			9,100			—			27,709
Rents and leases		—			8,511			10,460			—			18,971
Other operating expenses		—			55,031			28,680			—			83,711
Depreciation and amortization		—			15,551			18,062			—			33,613
Interest expense, net		15,368			18,485			8,904			—			42,757
Transaction-related expenses		—			1,438			2,681			—			4,119

Total expenses		22,764			364,129			243,817			—			630,710
(Loss) income before income taxes		(22,764	)		53,453			17,795			—			48,484
Equity in earnings of subsidiaries		46,553			—			—			(46,553	)		—
(Benefit from) provision for income taxes		(10,984	)		21,070			3,625			—			13,711

Net income (loss)		34,773			32,383			14,170			(46,553	)		34,773
Net loss attributable to noncontrolling interests		—			—			185			—			185

Net income (loss) attributable to Acadia Healthcare Company, Inc.	$	34,773		$	32,383		$	14,355		$	(46,553	)	$	34,958

Other comprehensive (loss) income:
Foreign currency translation gain		—			—			27,046			—			27,046
Loss on derivative instruments		(5,868	)		—			—			—			(5,868	)

Other comprehensive (loss) income		(5,868	)		—			27,046			—			21,178

Comprehensive income (loss)	$	28,905		$	32,383		$	41,401		$	(46,553	)	$	56,136

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2018

(In thousands)


	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Operating activities:
Net income (loss)	$	50,874		$	43,539		$	24,059		$	(67,598	)	$	50,874
Adjustments to reconcile net income (loss) to net cash (used in) provided by continuing operating activities:
Equity in earnings of subsidiaries		(67,598	)		—			—			67,598			—
Depreciation and amortization		—			18,172			21,601			—			39,773
Amortization of debt issuance costs		2,626			—			(101	)		—			2,525
Equity-based compensation expense		6,919			—			—			—			6,919
Deferred income tax (benefit) expense		942			1,104			(149	)		—			1,897
Debt extinguishment costs		940			—			—			—			940
Other		794			315			(66	)		—			1,043
Change in operating assets and liabilities:
Accounts receivable, net		—			(21,049	)		2,256			—			(18,793	)
Other current assets		—			(7,980	)		(5,236	)		—			(13,216	)
Other assets		4,432			(1,305	)		37			(4,432	)		(1,268	)
Accounts payable and other accrued liabilities		—			(11,417	)		8,049			—			(3,368	)
Accrued salaries and benefits		—			5,208			(406	)		—			4,802
Other liabilities		—			1,204			(695	)		—			509

Net cash (used in) provided by continuing operating activities		(71	)		27,791			49,349			(4,432	)		72,637
Net cash used in discontinued operating activities		—			(287	)		—			—			(287	)

Net cash (used in) provided by operating activities		(71	)		27,504			49,349			(4,432	)		72,350
Investing activities:
Cash paid for capital expenditures		—			(40,879	)		(29,448	)		—			(70,327	)
Cash paid for real estate acquisitions		—			(4,293	)		—			—			(4,293	)
Other		—			(4,799	)		733			—			(4,066	)

Net cash used in investing activities		—			(49,971	)		(28,715	)		—			(78,686	)
Financing activities:
Principal payments on long-term debt		—			(169	)		(4,263	)		4,432			—
Common stock withheld for minimum statutory taxes, net		(2,030	)		—			—			—			(2,030	)
Other		(1,742	)		(962	)		—			—			(2,704	)
Cash provided by (used in) intercompany activity		3,843			1,950			(5,793	)		—			—

Net provided by (used in) in financing activities		71			819			(10,056	)		4,432			(4,734	)

Effect of exchange rate changes on cash		—			—			1,588			—			1,588

Net (decrease) increase in cash and cash equivalents		—			(21,648	)		12,166			—			(9,482	)
Cash and cash equivalents at beginning of the period		—			46,860			20,430			—			67,290

Cash and cash equivalents at end of the period	$	—		$	25,212		$	32,596		$	—		$	57,808

Acadia Healthcare Company, Inc.

Condensed Consolidating Statement of Cash Flows

Three Months Ended March 31, 2017

(In thousands)


	Parent			Combined Subsidiary Guarantors			Combined Non- Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Operating activities:
Net income (loss)	$	34,773		$	32,383		$	14,170		$	(46,553	)	$	34,773
Adjustments to reconcile net income (loss) to net cash provided by (used in) continuing operating activities:
Equity in earnings of subsidiaries		(46,553	)		—			—			46,553			—
Depreciation and amortization		—			15,551			18,062			—			33,613
Amortization of debt issuance costs		2,500			—			(104	)		—			2,396
Equity-based compensation expense		7,396			—			—			—			7,396
Deferred income tax (benefit) expense		(171	)		2,754			(576	)		—			2,007
Other		2,732			506			587			—			3,825
Change in operating assets and liabilities:
Accounts receivable, net		—			(10,412	)		(2,047	)		—			(12,459	)
Other current assets		—			5,097			789			—			5,886
Other assets		2,927			(1,778	)		68			(2,927	)		(1,710	)
Accounts payable and other accrued liabilities		—			(9,224	)		(7,769	)		—			(16,993	)
Accrued salaries and benefits		—			(1,961	)		(1,476	)		—			(3,437	)
Other liabilities		—			(304	)		2,446			—			2,142

Net cash provided by (used in) continuing operating activities		3,604			32,612			24,150			(2,927	)		57,439
Net cash used in discontinued operating activities		—			(425	)		—			—			(425	)

Net cash provided by (used in) operating activities		3,604			32,187			24,150			(2,927	)		57,014
Investing activities:
Cash paid for capital expenditures		—			(30,018	)		(20,531	)		—			(50,549	)
Cash paid for real estate acquisitions		—			(2,495	)		—			—			(2,495	)
Other		—			(6,531	)		1,480			—			(5,051	)

Net cash used in investing activities		—			(39,044	)		(19,051	)		—			(58,095	)
Financing activities:
Principal payments on long-term debt		(8,638	)		—			(2,927	)		2,927			(8,638	)
Common stock withheld for minimum statutory taxes, net		(4,234	)		—			—			—			(4,234	)
Other		—			(865	)		—			—			(865	)
Cash provided by (used in) intercompany activity		9,268			(5,030	)		(4,238	)		—			—

Net (used in) provided by in financing activities		(3,604	)		(5,895	)		(7,165	)		2,927			(13,737	)

Effect of exchange rate changes on cash		—			—			842			—			842

Net decrease in cash and cash equivalents		—			(12,752	)		(1,224	)		—			(13,976	)
Cash and cash equivalents at beginning of the period		—			15,681			41,382			—			57,063

Cash and cash equivalents at end of the period	$	—		$	2,929		$	40,158		$	—		$	43,087