Segment Information

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Segment Information

18. Segment Information

The Company operates in one line of business, which is operating acute inpatient psychiatric facilities, specialty treatment facilities, residential treatment centers and facilities providing outpatient behavioral healthcare services. As management reviews the operating results of its U.S. Facilities and its U.K. Facilities separately to assess performance and make decisions, the Company’s operating segments include our U.S. Facilities and U.K. Facilities. At March 31, 2019, the U.S. Facilities segment included 223 behavioral healthcare facilities with approximately 9,300 beds in 40 states and Puerto Rico, and the U.K. Facilities segment included 370 behavioral healthcare facilities with approximately 8,800 beds in the U.K.

The following tables set forth the financial information by operating segment, including a reconciliation of Segment EBITDA to income before income taxes (in thousands):

	Three Months Ended March 31,
	2019			2018
Revenue:
U.S. Facilities	$	487,960		$	462,405
U.K. Facilities		272,657			279,836
Corporate and Other		—			—
	$	760,617		$	742,241
Segment EBITDA (1):
U.S. Facilities	$	119,008		$	117,124
U.K. Facilities		40,056			51,152
Corporate and Other		(23,061	)		(22,545	)
	$	136,003		$	145,731

	Three Months Ended March 31,
	2019			2018
Segment EBITDA (1)	$	136,003		$	145,731
Less:
Equity-based compensation expense		(6,101	)		(6,919	)
Transaction-related expenses		(4,321	)		(4,768	)
Debt extinguishment costs		—			(940	)
Interest expense, net		(48,130	)		(45,243	)
Depreciation and amortization		(40,580	)		(39,773	)
Income before income taxes	$	36,871		$	48,088

	U.S. Facilities		U.K. Facilities		Corporate and Other		Consolidated
Goodwill:
Balance at January 1, 2019	$	2,044,837	$	351,575	$	—	$	2,396,412
Increase from 2019 acquisitions		34,523		—		—		34,523
Increase from contribution of redeemable noncontrolling interests		3,085		—		—		3,085
Foreign currency translation gain		—		7,979		—		7,979
Balance at March 31, 2019	$	2,082,445	$	359,554	$	—	$	2,441,999

	March 31, 2019		December 31, 2018
Assets (2):
U.S. Facilities	$	3,950,684	$	3,779,040
U.K. Facilities		2,633,347		2,175,809
Corporate and Other		201,486		217,655
	$	6,785,517	$	6,172,504

(1) Segment EBITDA is defined as income before provision for income taxes, equity-based compensation expense, transaction-related expenses, debt extinguishment costs, interest expense and depreciation and amortization. The Company uses Segment EBITDA as an analytical indicator to measure the performance of the Company’s segments and to develop strategic objectives and operating plans for those segments. Segment EBITDA is commonly used as an analytical indicator within the health care industry, and also serves as a measure of leverage capacity and debt service ability. Segment EBITDA should not be considered as a measure of financial performance under GAAP, and the items excluded from Segment EBITDA are significant components in understanding and assessing financial performance. Because Segment EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Segment EBITDA, as presented, may not be comparable to other similarly titled measures of other companies.

(2) Assets include property and equipment for the U.S. Facilities of $1.4 billion, U.K. Facilities of $1.7 billion and corporate and other of $42.9 million at March 31, 2019. Assets include property and equipment for the U.S. Facilities of $1.4 billion, U.K. Facilities of $1.7 billion and corporate and other of $44.9 million at December 31, 2018.