Premier, Inc. - FORM 8-K - EX-99.1

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TRANSFORMING HEALTHCARE

FROM THE INSIDE

February 2015 Investor Presentation

Exhibit 99.1

Forward-looking statements and Non-GAAP financial measures

PREMIER, INC.

Forward-looking statements—Certain statements included in this presentation,

including, but not limited to, those related to our financial and business outlook, strategy and

growth drivers, member retention rates and revenue visibility, cross and upsell opportunities,

acquisition activities and pipeline, revenue available under contract, and 2015 financial guidance

and related assumptions, are “forward-looking statements” within the meaning of the federal

securities laws. Forward-looking statements may involve known and unknown risks,

uncertainties and other factors that may cause the actual results of Premier to be materially

different from historical results or from any future results or projections expressed or implied by

such forward-looking statements. Accordingly, readers should not place undue reliance on any

forward looking statements. Readers are urged to consider statements in the conditional or

future tenses or that include terms such as “believes,” “belief,” “expects,” “estimates,” “intends,”

“anticipates” or “plans” to be uncertain and forward-looking. Forward-looking statements may

include comments as to Premier’s beliefs and expectations as to future events and trends

affecting its business and are necessarily subject to uncertainties, many of which are outside

Premier’s control. More information on potential risks and other factors that could affect

Premier’s financial results is included, and updated, from time to time, in Premier’s periodic and

current filings with the SEC, including Premier’s most recent Form 10-K for the year ended June

30, 2014. Forward-looking statements speak only as of the date they are made. Premier

undertakes no obligation to publicly update or revise any forward-looking statements.

Non-GAAP financial measures—This presentation includes certain “non-GAAP

financial measures” as defined in Regulation G under the Securities Exchange Act of 1934.

Schedules are attached that reconcile the non-GAAP financial measures included in this

presentation to the most directly comparable financial measures calculated and presented in

accordance with Generally Accepted Accounting Principles in the United States. Our Form 10-Q for

the quarter ended December 31, 2014, to be filed shortly hereafter, provides further explanation and

disclosure regarding our use of non-GAAP financial measures and should be read in conjunction

with this presentation.

Uniquely positioned to address industry challenges

“Data, data, everywhere...

…

and not a drop to drink!”

Premier is a uniquely-aligned healthcare performance

improvement company that provides integrated data-analytics

and business intelligence to comprehensively reduce costs,

improve quality, and drive better patient outcomes.

PREMIER, INC.

Vision and objectives

OUR VISION

Through the collaborative power of the Premier

alliance, we will lead the transformation to

high-quality, cost-effective healthcare

PREMIER, INC.

Make healthcare supply chain efficient and

effective

Deliver continuous improvement in cost

and quality today and enable success in

new healthcare delivery / payment models

Integrate data and knowledge to create

meaningful business intelligence that drives

improvement

Our business at a glance

Alliance of approximately 3,400

hospitals –

68% of U.S. community

hospitals –

and 110,000 alternate

sites of care

74%

owned

health

systems¹

~$41

billion

group

purchasing

volume

Insights

into

out

every

U.S. health system discharges

Integrated clinical, financial and

operational data

Over 500 sales/field and advisory

services employees

that

work

with

and inside our member hospitals

Data as of September 30, 2014.

(1)

Following October 31, 2014 exchange.

Premier’s unique customer alignment and data-driven intelligence

platform allow us to help our health systems manage current

challenges and build for the future…

all at the same time

PREMIER, INC.

Unique business model drives innovation and growth

PREMIER, INC.

INTEGRATED SALES/FIELD FORCE & PLATFORM

Become the data analytics “backbone”

with wrap-around services for cost and

quality improvement over the short term

and population health management

solutions over the long term

Change the game in supply chain,

uncover unmatched savings and value,

and lead the disruption of the industry

Note: Consolidated revenue is presented on a non-GAAP pro forma basis for Supply Chain Services. See reconciliation pages in the appendix.

Group purchasing

Direct sourcing

Specialty pharmacy

Capital planning

SaaS-based informatics products

PremierConnect

Enterprise

Advisory services

Performance improvement

collaboratives

Supply Chain Services

Performance Services

73% of FY’14 consolidated revenue

27% of FY’14 consolidated revenue

Positioned to address industry needs

PREMIER, INC.

Member and

Industry Needs

Premier Strategic

Differentiation

Helping health systems manage challenges, optimize the transition,

and build for the future . . . all at the same time

Total cost reduction

Quality improvement

across the continuum

Evolving delivery and

payment models

Actionable data and

information

Scale

Co-innovation

Intelligence to transform

from the inside

Leadership in population

health

Shared infrastructure

Diversified

growth

engine

Data-driven,

technology

enabled

Compelling

financial

profile

Key investment differentiators

PREMIER, INC.

Unique

customer

alignment

Unique customer

alignment

PREMIER, INC.

Partnership model drives innovation and growth

SCALE

Represent ~68% of U.S. community hospitals

Clinical, financial, operational data integrated on

PremierConnect

platform

Insights into

~1 out of

every 3 U.S. health system

discharges

Approximately $41 billion in supply chain spend

Manage ~1,900 contracts from ~1,100 suppliers

ALIGNMENT

Members

own

~74%

equity

(1)

10 health system board members

Premier field force embedded in member hospitals

COMMITMENT

Member average tenure ~15 years (76% at 10+ years)

Members view Premier as strategic partner or

organizational extension

CO-INNOVATION

Co-develop solutions with members

Committees composed of ~165 member hospitals

~1,100 hospitals in performance improvement

collaboratives

Data Alliance Collaborative

Note: Data as of September 30, 2014.

(1) Following October 31, 2014 exchange.

PREMIER, INC.

SCALE

ALIGNMENT

COMMITMENT

CO-INNOVATION

Data-driven,

technology enabled

PREMIER, INC.

Connecting the data –

Enabling the information driven enterprise

PLATFORM

BILLING

PURCHASING

CLAIMS

CLINICAL

FINANCIAL

ANY

DATA

PREMIER, INC.

Social business

PremierConnect

Enterprise & Data Alliance Collaborative*

Fairview

Health

Services

Baystate

Health

Mercy

Health

Doctors

Hospital at

Renaissance

Baystate

Innovation

Center

University

Hospitals

Bon

Secours

Health

System

IBM

UNCC

Verisk

Health

Phytel

Carilion

Clinic

Texas

Health

Resources

Carolinas

HealthCare

System

Clinical utilization effectiveness

Harm reporting

Community health & equity reporting

Ambulatory quality measures

Claims analytics

Total cost of care

Operational reporting

Predictive model for readmissions

Population health analytics

ACO reporting

Referral analytics

H&V procedural analytics

Readmissions metrics & management

Population health

Throughput analytics

Operations & throughput modeling

Population stratification

Disease modeling

PREMIER, INC.

*PremierConnect

Enterprise

and

Data

Alliance

Collaborative

September

30,

2014.

PCE

Private Warehouse

Partners

Mortality

Patient

Experience

Measurable and scalable impact through collaboratives

PREMIER, INC.

~ 350

U.S. hospital members

~ 160,000

deaths avoided

~ $13.2

billion

saved

~ 55,800

readmissions prevented

~ 21,700

instances of

harm prevented

Approximately 1,100 U.S. hospital members participate in at least one

of our performance improvement collaboratives

Readmissions

Cost of

Care

Evidence-

based Care

Harm

Source: Premier QUEST participant performance data as of fiscal year end 6/30/2014 (Year 6, Q4 2013). Results are cumulative.

Note: Deaths avoided and dollars saved over the first 6 years of the program; instances of harm measured over the past 4

years; readmissions prevented measured over the past 3 years. QUEST: Quality, Efficiency, Safety and Transparency.

Evolving

QUEST

focus

integrated

population

health

management

PREMIER, INC.

Measures and focus areas

have two-fold purpose:

Continue to drive improvement on

inpatient metrics that align with

value-based purchasing and

payment reductions and penalties

Begin and enhance the improvement

on ambulatory and community

health-based metrics that will further

help Premier members move to new

models of care delivery

The latest generation of QUEST began January 1, 2014, with over 365

members focusing on ambulatory and population health based metrics in

addition to inpatient care

Services

Integrated framework for delivering solutions

Collaboratives

Information

Technology

Solutions

QUALITY/SAFETY

IMPROVEMENT

•

Quality and safety

•

Physician performance

improvement

•

Regulatory compliance

•

Harm and readmissions

POPULATION

HEALTH

•

Physician network

management

•

Population analytics

and risk management

•

Population engagement

COST

MANAGEMENT

•

Group purchasing

•

Non-labor

•

Physician preference

•

Capital equipment

•

Labor

•

Total cost

•

Clinical variation

•

Resource utilization

•

Integrated pharmacy

PREMIER, INC.

Diversified growth

engine

PREMIER, INC.

Expanding

supply chain

solutions

Steady acute

GPO growth

“Other”

Upside

Performance Services

Non-acute and

complementary

services

expansion

Top Priority Strategic Initiatives

Expanded cost reduction

Non acute and pharmacy growth

Supply chain technology

Member

penetration

performance

services

New product

development

M&A and

growth

opportunities

Top Priority Strategic Initiatives

Clinical integration/ shared

services

Ambulatory data expansion

Population health capabilities

PREMIER, INC.

Multiple opportunities to drive long-term sustainable growth

Attributes

Desired

expertise/

capabilities

Strong

distribution

channel

Supply Chain Services

Growing from within our member channel

HISTORICAL BUSINESS GROWTH

PREMIER, INC.

Single

offering

Multiple

offerings

several years

GPO

only

“All in”

CURRENT BUSINESS GROWTH

Labor

Safety

PremierConnect

Enterprise

Quality

Supply Chain

Population

Health

Integrated

Solutions

Note: The illustrations above are representative of Premier’s business growth and do not necessarily

depict the specific product or service adoption patterns of the organizations represented here.

Member-driven co-development engine

Organic

Acquisitions

Partnerships

Premier platform enables rapid deployment of new solutions

2006

2007

2010

2015

2013

2014

------------Post-IPO---------------------

2013

2014

PREMIER, INC.

(1) Purchased initial 60% ownership in 2011. Remaining 40% minority interest purchased on February 2, 2015.

CareScience

Strategic acquisitions address member needs

(Closed July 2013)

(Closed October 2013)

(Closed April 2014)

(Closed August 2014)

(Closed September 2014)

Company

Clinical & physician

preference cost reduction

Data acquisition from

multiple technologies

Health system capital

expenditure cost reduction

Supply chain technology

enablement

Quality & safety

improvement

Strategic Need

Direct sourcing

(Closed February 2015

)

(1) Purchased initial 60% ownership in 2011. Remaining 40% minority interest purchased on February 2, 2015.

PREMIER, INC.

Attractive opportunities for further capital deployment

Performance Services

Supply Chain Services

Performance Services

Diverse and growing end markets to drive Premier’s growth

Supply Chain Services

PREMIER, INC.

Physician

preference

item (PPI)

management

Alternate site

expansion

Supply chain

analytics,

workflow

Integrated

pharmacy

Patient

engagement

and social

interaction

Data

acquisition

and

management

Ambulatory

clinical

integration

Shared

services /

standardized

care

Population

health

management

Compelling financial

profile

PREMIER, INC.

MULTIPLE GROWTH

DRIVERS

•

Consolidated double-digit net revenue and adjusted

EBITDA

(1)

growth

•

Diversified revenue opportunities in Supply Chain Services

and Performance Services

•

Multiple emerging growth drivers

HIGH VISIBILITY

•

High retention rates in both business segments

•

5-7 year contracts in Supply Chain Services and 3-5 year

SaaS-based subscription contracts in Performance Services

•

Fiscal 2015 revenue visibility over 90%

ATTRACTIVE

ECONOMIC MODEL

•

Significant cross and upsell opportunities in existing

member base

•

High margins and low marginal cost to support new GPO

members and further penetration of existing GPO members

•

SaaS-based products generate high returns on new wins

EVOLVING

BUSINESS MIX

•

Investments in emerging growth initiatives will impact

adjusted

EBITDA

(1)

margins,

but

enhance

adjusted

EBITDA

(1)

growth

•

Capital investments increase D&A, impacting near-term net

income margins

DISCIPLINED CAPITAL

DEPLOYMENT TRACK

RECORD

•

Strong returns on acquired assets

•

Strategic, financial and execution framework in place for

capital deployment

Demonstrated financial model and performance

PREMIER, INC.

(1) See Adjusted EBITDA reconciliation to GAAP equivalent in Appendix.

Our

multiple

business

and

growth

drivers

PREMIER, INC.

GPO

Specialty

pharmacy

Direct

sourcing

SaaS-based

informatics

products

Performance

improvement

collaboratives

Advisory

services

Data

management/

warehousing

Business

Revenue Drivers

FY’14 Results

Net Revenue

14%

Segment Adjusted

EBITDA

Net Revenue

13%

Segment Adjusted

EBITDA

31%

Net Revenue

14%

Adjusted EBITDA

12%

Adjusted fully

distributed EPS

Consolidated

•

Administrative fees paid

by suppliers

•

Drug reimbursement

•

Fee for service

•

Product sales of contract

manufactured items

•

SaaS-based subscriptions

•

Fee-for-service

•

Fee-for-service

•

SaaS-based subscriptions

•

SaaS-based subscriptions

•

Significant stickiness

•

Strong visibility across

diverse revenue streams

(1)

Results are presented on a non-GAAP pro forma basis. See Adjusted EBITDA, Segment Adjusted EBITDA and fully distributed net income reconciliation to

GAAP equivalent in the Appendix.

Net Revenue

11% -

14%

Adjusted EBITDA

8% -

11%

Adjusted fully

distributed EPS

7% -

11%

Significant Fiscal 2015 revenue visibility: 90+%

PERFORMANCE METRICS

FY 2015

FY 2014

3 Year Average

Revenue available under contract

$898M

---

GPO

retention

rate

---

99%

97%

SaaS

institutional

renewal

rate

---

94%

(1)

As of fiscal year-end June 30, 2014

(2)

The retention rate is calculated based upon the aggregate purchasing volume among all members participating in our GPO for such fiscal year less the annualized GPO purchasing

volume

for

departed

members

for

such

fiscal

year,

divided

the

aggregate

purchasing

volume

among

all

members

participating

our

GPO

for

such

fiscal

year.

(3)

The renewal rate is calculated based upon the total number of members that have SaaS revenue in a given period that also have revenue in the corresponding prior year period

divided

the

total

number

members

that

have

SaaS

revenue

the

same

period

the

prior

year.

PREMIER, INC.

HIGH GPO

RETENTION

AND SAAS

INSTITUTIONAL

RENEWAL RATES

OVER 90%

FY 2015 REVENUE

GUIDANCE RANGE

ALREADY AVAILABLE

UNDER CONTRACT

the

Second-quarter

consolidated

and

segment

highlights

Consolidated

Net revenue (millions)

Supply Chain Services

Net revenue (millions)

Performance Services

Net revenue (millions)

Adjusted EBITDA

(millions)

Adjusted EBITDA (millions)

19%

20%

18%

19%

14%

31%

$17.7

$23.2

Q2'14

Q2'15

$83.4

$98.8

Q2'14

Q2'15

$58.0

$69.8

Q2'14

Q2'15

$85.1

$97.3

Q2'14

Q2'15

$150.9

$179.6

Q2'14

Q2'15

$208.9

$249.4

Q2'14

Q2'15

(1) See non-GAAP Adjusted EBITDA and non-GAAP Segment Adjusted EBITDA reconciliations to GAAP equivalents in Appendix.

PREMIER, INC.

Second-quarter

non-GAAP

adjusted

fully

distributed

net

income

17%

$0.31

$0.36

Non-GAAP earnings per share on fully distributed

net income

(1) See non-GAAP adjusted fully distributed net income and non-GAAP earnings per share on fully distributed

net income reconciliations to GAAP equivalents in Appendix

Calculates income taxes at

40% on pre-tax income,

assuming taxable C corporate

structure

Calculates adjusted fully

distributed earnings per

share, assuming total Class A

and B common shares held

by public

$44.4

$52.1

Q2'14

Q2'15

(in millions, except per share data)

PREMIER, INC.

Cash flow and capital flexibility at December 31, 2014

PREMIER, INC.

Year-to-date cash flow from operations of

$153.7 million

Second-quarter free cash flow

of $67.1

million

Cash, cash equivalents and marketable

securities of $469.5 million

No outstanding borrowings on $750 million

five-year unsecured revolving credit facility

CONSIDERABLE CASH AND

DEBT CAPACITY

AVAILABLE

AMPLE CAPITAL

FLEXIBILITY FOR FUTURE

ACQUISITIONS AND

BUSINESS GROWTH

(1)

Three months ended December 31, 2014. Company defines free cash flow as cash provided by operating activities less distributions to limited partners and purchases

of property and equipment. See non-GAAP free cash flow reconciliation to GAAP equivalent in Appendix.

Fiscal

2015

annual

guidance

PREMIER, INC.

Financial guidance for year ending June 30, 2015:

Supply Chain Services growth driven by:

Guidance

Assumptions:

Performance Services growth driven by:

Updated

Pro Forma

(in millions, except per share data)

FY 2015

% YoY Change

Net Revenue:

Supply Chain Services segment

$706 -

$725

11% -

14%

Performance Services segment

$268 -

$275

15% -

18%

Total Net Revenue

$974 -

$1,000

12% -

15%

Non-GAAP adjusted EBITDA

$382 -

$390

9% -

11%

Non-GAAP adjusted fully distributed EPS

$1.40 -

$1.44

8% -

11%

Continued demand for integrated offerings of SaaS-based

subscription and licensed products, advisory services and

collaboratives

Continuation of high SaaS institutional renewal rates

Reduction in advisory services revenue expectations tied to

Partnership for Patients contract and repositioning of research

business

Moderating net administrative fee revenue growth

Continuation of high GPO retention rates

20% -

30% product growth

Guidance is based on comparisons with prior-year non-GAAP pro forma results, which have been adjusted to reflect the impact of the company’s

reorganization and IPO. The Company does not reconcile guidance for adjusted EBITDA and non-GAAP adjusted fully distributed net income per-share to net

income (loss) or GAAP earnings per share because the Company does not provide guidance for reconciling items between net income (loss) and adjusted

EBITDA and non-GAAP adjusted fully distributed earnings per share. The Company is unable to provide guidance for these reconciling items since certain

items that impact net income (loss) are outside of the Company’s control and cannot be reasonably predicted. Accordingly, a reconciliation to net income

(loss) or GAAP earnings per share is not available without unreasonable effort.

(1)

Exchange update

Approximately 398,800 Class B units initially

indicated for exchange into Class A shares on

February 2, 2015

Following right to retract intention to exchange

and right of first refusal, approximately 257,000

Class B Units were exchanged for Class A

common shares on 1-for-1 basis

Next exchange on April 30

, 2015

PREMIER, INC.

Summary

–

Key

investment

differentiators

UNIQUE CUSTOMER ALIGNMENT

Interests and perspectives are aligned with our customers

Members own ~74% of equity

(1)

and view Premier as strategic partner

Embedded field force co-developing solutions with members

DATA-DRIVEN, TECHNOLOGY ENABLED

Integrated, payer-

and vendor-agnostic data platform

Insights

from

approximately

U.S.

health

system

discharges

Emerging data warehousing capabilities

DIVERSIFIED GROWTH ENGINE

Multiple revenue levers

Attractive acquisition and partnership pipeline

COMPELLING FINANCIAL PROFILE

Double digit revenue and EBITDA

(2)

growth in fiscal 2014

Considerable cash and debt capacity for future growth

PREMIER, INC.

(1)

Following October 31, 2014 exchange.

(2)

See Net revenue and Adjusted EBITDA reconciliations to GAAP equivalents in Appendix; financial information for fiscal year 2014 and fiscal year

2013 have been adjusted on a non-GAAP pro forma basis to reflect the impact of the company’s reorganization and initial public offering.

Appendix

PREMIER, INC.

Our leadership team

Susan DeVore, President and CEO

11 years Premier; 26 years healthcare

Cap Gemini Ernst & Young

PREMIER, INC.

Mike Alkire, COO

10 years Premier; 11 years healthcare

Cap Gemini Ernst & Young

Durral Gilbert, President, Supply Chain Services

8 years Premier; 8 years healthcare

BDS Management, Wachovia Securities

Wes Champion, SVP, Performance Partners

7 years Premier; 23 years healthcare

Cap Gemini Ernst & Young, Accenture

Keith Figlioli, SVP, Informatics

5 years Premier; 11 years HIT

Eclipsys (acquired by Allscripts)

Andy Brailo, SVP, Member Field Services

13 years Premier; 21 years healthcare

Medibuy, Bard

Gary Long, SVP, Chief Sales Officer

2 years Premier; 21 years healthcare

McKesson

Craig McKasson, CFO

17 years Premier; 21 years healthcare

Ernst & Young

Jeff Lemkin, General Counsel

4 years Premier; 41 years healthcare

McDermott Will & Emery

Terry Linn, SVP, Strategy

4 years Premier; 31 years healthcare

Ernst & Young, American Medical International,

Charter Medical

Kelli Price, SVP, People

14 years Premier; 16 years healthcare

Malcolm Baldrige National Quality Award expert

Jeff Petry, SVP, Marketing

17 years Premier; 23 years healthcare

Mezzia, The Advisory Board Company

Blair Childs, SVP, Public Affairs

7 years Premier; 26 years healthcare

AdvaMed

Structure

Structural implications of Premier, Inc.

Structured as “Up-C”

with Premier, Inc. (parent C-Corp above operating partnership and

subsidiaries)

Premier, Inc. formed with two classes of stock

•

Class A shares held by public investors

•

Class B shares allocated to member owners

22% of Limited Partner interests sold to public, 78% retained by

member owners as

Class B units

Class B units eligible to exchange 1/7th per year, over seven-year period

Exchange of Class B units for A-shares (on a 1-for-1 basis) as B-units become eligible

for exchange subject to ROFR by members owners and Premier, Inc.

First

exchange

October

31,

2014,

and

subsequent

company

directed

offering

injected

3.9 million shares of liquidity into the public market, resulting in public ownership of 26%

and member owner interest of 74%

Given Up-C structure and differences between taxes paid by our Class A unit holder

(Premier GP) vs. distributions to our Class B unit holders (members owners), we

calculate

Adjusted

Fully

Distributed

Net

Income

for

comparability

purposes

Reflects taxes and net income as if the Company was a C-Corp for all periods

presented

Class A and Class B shares will be used to calculate fully diluted EPS to eliminate

variability due to member exchanges over time

Impact of IPO and

Exchange Process

Adjusted fully

distributed net

income

Share count

PREMIER, INC.

(1)

See Adjusted EBITDA and Adjusted Fully Distributed Net Income reconciliations to GAAP equivalents in Appendix

Income Statement

Net Revenue

500,000

Cost of Revenue

200,000

Gross Profit

300,000

Operating Expenses

140,000

Operating Income

160,000

Net Income Attributable to NCI in Premier LP

(124,800)

Pre-Tax Income Attributable to Premier Inc.

35,200

160,000

Income Tax Expense

14,080

64,000

Net Income Attributable to Premier, Inc.

21,120

96,000

Income Retained in Business

Net Income Attributable to Premier, Inc.

21,120

96,000

Net Income Attributable to NCI in Premier LP

124,800

Tax Distribution to Premier LP Limited Partners

(49,920)

Net Income Retained in Business

96,000

Adjusted Fully Distributed Net Income

Net Income Attributable to Premier, Inc.

21,120

96,000

Add: Income Tax Expense

14,080

64,000

Add: Net Income Attributable to NCI in Premier

124,800

Fully Distributed Income Before Income Taxes

160,000

Adjusted for income tax expense on fully

distributed net income before income taxes

64,000

Adjusted Fully Distributed Net Income

96,000

Income Taxes/Tax Distributions

Income Tax Expense

14,080

64,000

Tax Distribution to Class B Limited Partners

49,920

Total Tax, including tax distribution to limited

partners

64,000

Member owners allocated

income in operating

partnership based on

percentage ownership

Income tax expense equals

40% of income attributable

to Premier, Inc.

Member owners receive tax

distribution to cover any tax

liability on allocated income

Amount of retained

profitability in business

equal regardless of

ownership structure

Reflects 41% tax rate on

100% of pretax income

(assumes full C-Corp tax

treatment)

Amount paid for taxes equal

regardless of ownership

structure

Illustrative impact of ownership structure

Ownership

(1)

22% Class A /

78% Class B

Ownership

100% Class A

PREMIER, INC.

For

illustrative

purposes

only.

Ownership

percentage

based

structure

the

time

the

October

2013

initial public offering and will change over time.

Fiscal 2014 and fiscal 2013 non-GAAP reconciliations

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

(Unaudited, in thousands)

Adjustments

Amount

% of Net

Revenue

Amount

% of Net

Revenue

Amount

% of Net

Revenue

Amount

% of Net

Revenue

Net revenue:

Net administrative fees

464,837

51%

(41,263)

423,574

49%

519,219

60%

(105,012)

414,207

54%

Other services and support

233,186

26%

233,186

27%

205,685

24%

205,685

27%

Services

698,023

77%

(41,263)

656,760

76%

724,904

84%

(105,012)

619,892

81%

Products

212,526

23%

212,526

24%

144,386

16%

144,386

19%

Net revenue

910,549

100%

(41,263)

869,286

100%

869,290

100%

(105,012)

764,278

100%

Cost of revenue:

Services

115,740

13%

115,740

13%

103,795

12%

103,795

14%

Products

191,885

21%

191,885

22%

133,618

15%

133,618

17%

Cost of revenue

307,625

34%

307,625

35%

237,413

27%

237,413

31%

Gross profit

602,924

66%

(41,263)

561,661

65%

631,877

73%

(105,012)

526,865

69%

Operating expenses:

Selling, general and administrative

294,421

33%

294,421

35%

248,301

29%

248,301

33%

Research and development

3,389

— %

3,389

— %

9,370

Amortization of purchased intangible assets

3,062

— %

3,062

— %

1,539

— %

1,539

— %

Total operating expenses

300,872

33%

300,872

35%

259,210

30%

259,210

34%

Operating income

302,052

33%

(41,263)

260,789

30%

372,667

43%

(105,012)

267,655

35%

Other income, net

58,274

12,145

Income before income taxes

360,326

40%

(41,263)

319,063

37%

384,812

44%

(105,012)

279,800

37%

Income tax expense

27,709

(3,239)

24,470

9,726

22,813

32,539

Net income

332,617

37%

(38,024)

294,593

34%

375,086

43%

(127,825)

247,261

33%

Net (income) loss attributable to noncontrolling interest

in S2S Global

(949)

— %

(949)

— %

1,479

— %

1,479

— %

Net income attributable to noncontrolling interest in

Premier LP

(303,336)

(33)%

57,690

(245,646)

(28)%

(369,189)

(42)%

150,726

(218,463)

(29)%

Net income attributable to noncontrolling interest

(304,285)

(33)%

57,690

(246,595)

(28)%

(367,710)

(42)%

150,726

(216,984)

(29)%

Net income attributable to shareholders

28,332

19,666

47,998

7,376

22,901

30,277

Adjustment of redeemable limited partners' capital to

redemption amount

(2,741,588)

Net income (loss) attributable to shareholders after

adjustment of redeemable partners' capital to

redemption amount

(2,713,256)

19,666

(2,693,590)

7,376

22,901

30,277

Adjusted EBITDA

392,288

43%

(41,263)

351,025

40%

419,025

48%

(105,012)

314,013

41%

Adjusted Fully Distributed Net Income

188,561

22%

172,793

23%

nm - Not meaningful

na - Not applicable

Actual

Non-GAAP Pro Forma

Year Ended June 30,

2014

2013

Non-GAAP Pro Forma

PREMIER, INC.

Fiscal 2014 and fiscal 2013 non-GAAP reconciliations

(Unaudited, in thousands)

Actual

Adjustments

Non-GAAP

Pro Forma

Actual

Adjustments

Non-GAAP

Pro Forma

Reconciliation of Non-GAAP Pro Forma Net Revenue to Net Revenue:

Supply Chain Services

678,141

(41,263)

636,878

664,076

(105,012)

559,064

Performance Services

232,408

205,214

Net Revenue

910,549

(41,263)

869,286

869,290

(105,012)

764,278

Reconciliation of Net Income to Adjusted EBITDA and Reconciliation of

Segment Adjusted EBITDA to Income Before Income Taxes:

Net income

332,617

(38,024)

294,593

375,086

(127,825)

247,261

Interest and investment income, net

(1,019)

(965)

Income tax expense

27,709

(3,239)

24,470

9,726

22,813

32,539

Depreciation and amortization

36,761

27,681

Amortization of purchased intangible assets

3,062

1,539

EBITDA

399,130

(41,263)

357,867

413,067

(105,012)

308,055

Stock-based compensation expense

19,476

Acquisition related expenses

2,014

Strategic and financial restructuring expenses

3,760

5,170

Gain on sale of investment

(38,372)

Adjustment to tax receivable agreement liability

6,215

Other (income) expense, net

788

Adjusted EBITDA

392,288

(41,263)

351,025

419,025

(105,012)

314,013

Segment Adjusted EBITDA:

Supply Chain Services

396,470

(41,263)

355,207

431,628

(105,012)

326,616

Performance Services

73,898

56,456

Corporate

(g)

(78,080)

(69,059)

Adjusted EBITDA

392,288

(41,263)

351,025

419,025

(105,012)

314,013

Depreciation and amortization

(36,761)

(27,681)

Amortization of purchased intangible assets

(3,062)

(1,539)

Stock-based compensation expense

(19,476)

Acquisition related expenses

(2,014)

Strategic and financial restructuring expenses

(3,760)

(5,170)

Adjustment to tax receivable agreement liability

(6,215)

Equity in net income of unconsolidated affiliates

(16,976)

(11,968)

Deferred compensation plan expense

(1,972)

Operating income

302,052

(41,263)

260,789

372,667

(105,012)

267,655

Equity in net income of unconsolidated affiliates

16,976

11,968

Interest and investment income, net

1,019

965

Gain on sale of investment

38,372

Other income (expense), net

1,907

(788)

Income before income taxes

360,326

(41,263)

319,063

384,812

(105,012)

279,800

Year Ended June 30,

2014

2013

PREMIER, INC.

Fiscal 2014 and fiscal 2013 non-GAAP reconciliations

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

(Unaudited, in thousands)

2014

2013

28,332

7,376

(41,263)

(105,012)

27,709

9,726

19,476

—

2,014

—

3,760

5,170

(38,372)

—

6,215

—

3,062

1,539

303,336

369,189

314,269

287,988

125,708

115,195

188,561

172,793

Non-GAAP Pro forma fully distributed income before income taxes

Income tax expense on fully distributed income before income taxes

Non-GAAP Pro Forma Adjusted Fully Distributed Net Income

Acquisition related expenses

Strategic and financial restructuring expenses

Gain on sale of investment

Adjustment to tax receivable agreement liability

Amortization of purchased intangible assets

Net income attributable to noncontrolling interest in Premier LP

Stock-based compensation expense

Year Ended June 30,

Net income attributable to shareholders

Pro forma adjustment for revenue share post-IPO

Income tax expense

PREMIER, INC.

Fiscal 2014 and fiscal 2013 non-GAAP reconciliations

2014

2013

Reconciliation of numerator for GAAP EPS to Non-GAAP EPS on Adjusted Fully Distributed Net Income

Net income (loss) attributable to shareholders after adjustment

of redeemable limited partners' capital to

redemption amount

(2,713,256)

7,376

Adjustment

redeemable

limited

partners'

capital

redemption

amount

2,741,588

Net income (loss) attributable to shareholders

28,332

7,376

Pro forma adjustment for revenue share post-IPO

(41,263)

(105,012)

Income tax expense

27,709

9,726

Stock-based compensation

19,476

—

Gain on sale of investment

(38,372)

—

Acquisition related expenses

2,014

—

Strategic and financial restructuring expenses

3,760

5,170

Adjustment to tax receivable agreement liability

6,215

—

Amortization of purchased intangible assets

3,062

1,539

Net income attributable to noncontrolling interest in Premier LP

303,336

369,189

Non-GAAP pro forma adjusted fully distributed income before income taxes

314,269

287,988

Income tax expense on fully distributed income before income taxes

125,708

115,195

Non-GAAP pro forma adjusted fully distributed net income

188,561

172,793

Reconciliation of denominator for GAAP EPS to Non-GAAP to Adjusted Fully Distributed Net Income

Weighted Average:

Common shares used for basic and diluted earnings per share

25,633

5,858

Potentially dilutive shares

124

Class A common shares outstanding

6,742

26,517

Conversion of Class B common units

112,584

112,608

Weighted average fully distributed shares outstanding -

diluted

145,083

144,983

Reconciliation of GAAP EPS to Adjusted Fully Distributed EPS

GAAP income (loss) per share

$ (105.85)

$ 1.26

Impact of adjustment of redeemable limited partners' capital to redemption amount

$ 106.96

$ -

Impact of additions:

Pro forma adjustment for revenue share post-IPO

$ (1.61)

$ (17.93)

Income tax expense

$ 1.08

$ 1.66

Stock-based compensation

$ 0.76

$ -

Gain on sale of investment

$ (1.50)

$ -

Acquisition related expenses

$ 0.08

$ -

Strategic and financial restructuring expenses

$ 0.15

$ 0.88

Adjustment to tax receivable agreement liability

$ 0.24

$ -

Amortization of purchased intangible assets

$ 0.12

$ 0.26

Net income attributable to noncontrolling interest in Premier LP

$ 11.83

$ 63.02

Impact of corporation taxes

$ (4.90)

$ (19.66)

Impact of increased share count

$ (6.06)

$ (28.31)

Non-GAAP earnings per share on adjusted fully distributed net income

diluted

$ 1.30

$ 1.19

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

(Unaudited)

(In thousands)

Year Ended

June 30,

Supplemental Financial Information - Reporting of Net Income and Earnings Per Share

PREMIER, INC.

Fiscal 2015 and fiscal 2014 non-GAAP reconciliations

PREMIER, INC.

2014*

2013*

2014*

2013

Reconciliation of Pro Forma Net Revenue to Net Revenue:

Pro Forma Net Revenue

249,445

208,909

478,753

408,222

Pro forma adjustment for revenue share post-IPO

—

41,263

Net Revenue

249,445

208,909

478,753

449,485

Net income

65,808

51,477

130,695

164,005

Pro forma adjustment for revenue share post-IPO

—

(41,263)

Interest and investment income, net

(122)

(21)

(313)

(241)

Income tax expense

4,270

14,284

10,081

15,048

Depreciation and amortization

11,262

9,198

21,570

17,556

Amortization of purchased intangible assets

3,141

755

4,044

1,356

EBITDA

84,359

75,693

166,077

156,461

Stock-based compensation

7,405

6,494

13,844

6,819

Acquisition related expenses

2,267

177

3,545

319

Strategic and financial restructuring expenses

1,183

1,041

1,279

2,881

Adjustment to tax receivable agreement liability

—

(1,073)

—

Acquisition

adjustment

deferred

revenue

3,596

—

5,661

—

Other income, net

(2)

—

(7)

Adjusted EBITDA

98,808

83,405

189,326

166,476

Segment Adjusted EBITDA:

Supply Chain Services

97,342

85,119

188,610

210,599

Pro forma adjustment for revenue share post-IPO

—

(41,263)

Supply Chain Services

(including pro forma adjustment)

97,342

85,119

188,610

169,336

Performance Services

23,189

17,731

41,551

34,060

Corporate

(21,723)

(19,445)

(40,835)

(36,920)

Adjusted EBITDA

98,808

83,405

189,326

166,476

Depreciation and amortization

(11,262)

(9,198)

(21,570)

(17,556)

Amortization of purchased intangible assets

(3,141)

(755)

(4,044)

(1,356)

Stock-based compensation

(7,405)

(6,494)

(13,844)

(6,819)

Acquisition related expenses

(2,267)

(177)

(3,545)

(319)

Strategic and financial restructuring expenses

(1,183)

(1,041)

(1,279)

(2,881)

Adjustment to tax receivable agreement liability

—

1,073

—

Acquisition

adjustment

deferred

revenue

(3,596)

—

(5,661)

—

Equity in net income of unconsolidated affiliates

(4,749)

(4,491)

(9,615)

(8,605)

Deferred compensation plan expense

460

—

969

—

65,665

61,249

131,810

128,940

Pro forma adjustment for revenue share post-IPO

—

41,263

Operating income

65,665

61,249

131,810

170,203

Equity in net income of unconsolidated affiliates

4,749

4,491

9,615

8,605

Interest and investment income, net

122

313

241

Other (expense) income, net

(458)

—

(962)

Income before income taxes

70,078

65,761

140,776

179,053

Three Months Ended

December 31,

Six Months Ended

December 31,

(Unaudited)

(In thousands)

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

and Non-GAAP Adjusted Fully Distributed Net Income

Reconciliation of Net Income to Adjusted EBITDA and Reconciliation of Segment Adjusted EBITDA to Income Before Income Taxes:

Supplemental Financial Information - Reporting of Pro Forma Adjusted EBITDA

(4)

Fiscal 2015 and fiscal 2014 non-GAAP reconciliations

PREMIER, INC.

2014*

2013*

2014*

2013

Reconciliation of Non-GAAP Pro Forma Adjusted Fully Distributed Net Income:

Net income attributable to shareholders

9,271

6,404

18,544

5,928

Pro forma adjustment for revenue share post-IPO

—

(41,263)

Income tax expense

4,270

14,284

10,081

15,048

Stock-based compensation

7,405

6,494

13,844

6,819

Acquisition related expenses

2,267

177

3,545

319

Strategic and financial restructuring expenses

1,183

1,041

1,279

2,881

Adjustment to tax receivable agreement liability

—

(1,073)

—

Acquisition

adjustment

deferred

revenue

3,596

—

5,661

—

Amortization of purchased intangible assets

3,141

755

4,044

1,356

Net income attributable to noncontrolling interest in Premier LP

55,751

44,916

110,567

158,130

Non-GAAP pro forma adjusted fully distributed income before income taxes

86,884

74,071

166,492

149,218

Income tax expense on fully distributed income before income taxes

34,754

29,628

66,597

59,687

Non-GAAP Pro Forma Adjusted Fully Distributed Net Income

$ 99,895

* Note

that

pro

forma

adjustments

were

made

for

the

three

and

six

months

ended

December

31,

2014

and

the

three

months

ended

December

31, 2013; as such, actual results are presented for each of these periods.

Three Months Ended

December 31,

Six Months Ended

December 31,

(Unaudited)

(In thousands)

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

and Non-GAAP Adjusted Fully Distributed Net Income

Supplemental Financial Information - Reporting of Pro Forma Adjusted EBITDA

52,130

44,443

89,531

Fiscal 2015 and fiscal 2014 non-GAAP reconciliations

PREMIER, INC.

2014

2013

Reconciliation of Non-GAAP Free Cash Flow to Net Cash Provided by Operating Activities:

Net cash provided by operating activities

107,842

131,726

Purchases of property and equipment

(18,051)

(13,720)

Distributions to limited partners

(22,691)

(72,645)

Non-GAAP free cash flow

67,100

45,361

Supplemental Financial Information - Reporting of Non-GAAP Free Cash Flow

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

(Unaudited)

(In thousands)

Three Months Ended

December 31,

Fiscal 2015 and fiscal 2014 non-GAAP reconciliations

PREMIER, INC.

2014*

2013*

2014*

2013

Reconciliation of numerator for GAAP EPS to Non-GAAP EPS on Adjusted Fully Distributed Net Income

Net loss attributable to shareholders after adjustment of redeemable limited

partners' capital to redemption amount

(32,979)

(3,713,408)

(406,363)

(3,713,884)

Adjustment

redeemable

limited

partners'

capital

redemption

amount

42,250

3,719,812

424,907

3,719,812

Net income attributable to shareholders

9,271

6,404

18,544

5,928

Pro forma adjustment for revenue share post-IPO

—

(41,263)

Income tax expense

4,270

14,284

10,081

15,048

Stock-based compensation

7,405

6,494

13,844

6,819

Acquisition related expenses

2,267

177

3,545

319

Strategic and financial restructuring expenses

1,183

1,041

1,279

2,881

Adjustment to tax receivable agreement liability

—

(1,073)

—

Acquisition

adjustment

deferred

revenue

3,596

—

5,661

—

Amortization of purchased intangible assets

3,141

755

4,044

1,356

Net income attributable to noncontrolling interest in Premier LP

55,751

44,916

110,567

158,130

Non-GAAP pro forma adjusted fully distributed income before income taxes

86,884

74,071

166,492

149,218

Income tax expense on fully distributed income before income taxes

34,754

29,628

66,597

59,687

Non-GAAP pro forma adjusted fully distributed net income

52,130

44,443

99,895

89,531

Reconciliation of denominator for GAAP EPS to Non-GAAP Adjusted Fully Distributed Net Income

Weighted Average:

Common shares used for basic and diluted earnings per share

35,589

32,375

33,965

19,001

Potentially dilutive shares

948

110

785

Class A common shares outstanding

13,374

Conversion of Class B common units

108,674

112,608

110,396

112,608

Weighted

average

fully

distributed

outstanding

diluted

145,211

145,093

145,146

145,041

Reconciliation of GAAP EPS to Adjusted Fully Distributed EPS

GAAP loss per share

$ (0.93)

$ (114.70)

$ (11.96)

$ (195.46)

Impact of adjustment of redeemable limited partners' capital to redemption amount

$ 1.19

$ 114.90

$ 12.51

$ 195.77

Impact of additions:

Pro forma adjustment for revenue share post-IPO

$ -

$ (2.17)

Income tax expense

$ 0.12

$ 0.44

$ 0.30

$ 0.79

Stock-based compensation

$ 0.21

$ 0.20

$ 0.41

$ 0.36

Acquisition related expenses

$ 0.06

$ 0.01

$ 0.10

$ 0.02

Strategic and financial restructuring expenses

$ 0.03

$ 0.04

$ 0.15

Adjustment to tax receivable agreement liability

$ -

$ (0.03)

$ -

Acquisition

adjustment

deferred

revenue

$ 0.10

$ -

$ 0.17

$ -

Amortization of purchased intangible assets

$ 0.09

$ 0.02

$ 0.12

$ 0.07

Net income attributable to noncontrolling interest in Premier LP

$ 1.57

$ 1.39

$ 3.25

$ 8.32

Impact of corporation taxes

$ (0.98)

$ (0.92)

$ (1.96)

$ (3.14)

Impact of increased share count

$ (1.11)

$ (1.07)

$ (2.26)

$ (4.09)

Non-GAAP

earnings

per

adjusted

fully

distributed

net

income

diluted

$ 0.36

$ 0.31

$ 0.69

$ 0.62

* Note

that

pro

forma

adjustments

were

made

for

the

three

and

six

months

ended

December

31,

2014

and

the

three

months

ended

December

31,

2013; as such, actual results are presented for each of these periods.

Three Months Ended

December 31,

Six Months Ended

December 31,

Supplemental Financial Information -

Reporting of Net Income and Earnings Per Share

(Unaudited)

(In thousands, except per share data)

Reconciliation of Selected Non-GAAP Measures to GAAP Measures

Premier, Inc. - FORM 8-K - EX-99.1 - February 11, 2015

Attached files

Premier, Inc. Reports