Cross Country Healthcare, Inc. (the "Company") (Nasdaq: CCRN) today announced financial results for its fourth quarter and full year ended December 31, 2021.

SELECTED FINANCIAL INFORMATION:

* Refer to accompanying tables and discussion of non-GAAP (Generally Accepted Accounting Principles) financial measures below.

Business Highlights

• Historic fourth quarter and full year financial performance due to solid execution
• Fourth quarter financial performance exceeded all original guidance ranges
• Year-over-year and sequential volume growth across all lines of business
• Adjusted EBITDA margin of 12.6% for the quarter and 9.7% for the year
• Strong double digit growth from Cross Country Workforce Solutions Group
• Two strategic acquisitions consummated in 2021 for home health and education
• Increased borrowing capacity by $75.0 million during the quarter to fund organic growth

"Over the last three years, we have completely transformed the way Cross Country Healthcare does business and it shows in our historic results. Clients and clinicians alike are increasingly seeing the tremendous value proposition of working with this amazing team, and we are on a solid trajectory as we enter 2022 for continued growth amidst a continued environment of robust demand and elevated rates," said Kevin Clark, Co-Founder and CEO of Cross Country Healthcare. He continued, "As its chairman and with John Martins assuming the CEO role in March, I am confident that we can continue to deliver exceptional performance for quarters to come."

Fourth quarter consolidated revenue was $640.7 million, an increase of 197% year-over-year and 71% sequentially. Consolidated gross profit margin was 23.0%, down 220 basis points year-over-year and up 60 basis points sequentially. Net income attributable to common stockholders was $77.6 million compared to $4.6 million in the prior year and $23.4 million in the prior quarter. Diluted earnings per share (EPS) was $2.07 per share compared to $0.13 per share in the prior year and $0.62 per share in the prior quarter. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) was $80.9 million or 12.6% of revenue, as compared with $11.5 million or 5.3% of revenue in the prior year, and $30.1 million or 8.0% of revenue in the prior quarter. Adjusted EPS was $1.40 compared to $0.19 in the prior year and $0.61 in the prior quarter.

For the year ended December 31, 2021, consolidated revenue was $1.7 billion, an increase of 100% year-over-year. Consolidated gross profit margin was 22.4%, down 180 basis points year-over-year. Net income attributable to common stockholders was $132.0 million, or 3.53 per diluted share, compared to a net loss of $13.0 million, or $0.36 per diluted share, in the prior year. Adjusted EBITDA was $162.1 million or 9.7% of revenue, as compared with $36.3 million or 4.3% of revenue in the prior year. Adjusted EPS was $3.06 compared to $0.46 in the prior year.

Quarterly Business Segment Highlights

Nurse and Allied Staffing

Revenue was $620.4 million, a 212% increase year-over-year and 74% sequentially. Contribution income was $92.4 million, compared to $22.8 million in the prior year and $40.6 million in the prior quarter. Average field contract personnel on a full-time equivalent (FTE) basis were 11,520 as compared with 5,798 in the prior year and 9,003 in the prior quarter. Revenue per FTE per day was $582 compared to $368 in the prior year and $425 in the prior quarter. The increase in the average number of FTEs was primarily due to headcount growth in travel nurse and allied which grew by more than double over the prior year, as well as additional headcount resulting from the Cross Country Workforce Solutions Group (WSG) acquisition. In the fourth quarter, average bill rates rose as we continued to experience significant demand for our services, due to the continuing impacts from COVID-19, as well as the overall tight labor supply for clinicians and professionals. Throughout the pandemic, we have acted with the utmost integrity, working collaboratively with clients on adjusting bill rates in order to adapt to the rapidly changing market conditions. Ensuring our clients have the continuing supply of clinicians and professionals has remained our top priority, and as a result, for the year ended December 31, 2021, our consolidated gross profit margin decreased 180 basis points year-over-year.

Physician Staffing

Revenue was $20.2 million, an increase of 23% year-over-year and 8% sequentially. Contribution income was $1.4 million, an increase compared to $0.9 million in both the prior year and the prior quarter. Total days filled were 12,739 as compared with 9,911 in the prior year and 12,187 in the prior quarter. Revenue per day filled was $1,588 as compared with $1,658 in the prior year and $1,540 in the prior quarter. The increase in revenue was primarily due to an increase in volume in several specialties. The increase in contribution income was driven by higher revenue, partially offset by higher direct costs.

Cash Flow and Balance Sheet Highlights

Cash flow used in operations was $73.4 million for the quarter and $85.6 million for the full year. The primary driver of the use of cash for both the quarter and the year has been due to the investment in net working capital associated with the historic growth in our business, with accounts receivable increasing $318.4 million since the start of the year. Our DSO or days' sales outstanding was 58 days as of December 31, 2021, flat year-over-year and down 3 days sequentially.

As previously announced in an 8-K filed December 16, 2021, the Company entered into an asset purchase agreement with Selected on December 16, 2021. The purchase price included $3.5 million in cash and $1.5 million in shares of the Company's common stock. The Company also amended its Term Loan Credit Agreement on November 18, 2021, which provided for an incremental term loan in the amount of $75.0 million.

At December 31, 2021, the Company had $1.0 million in cash and cash equivalents and $174.3 million principal balance on its term loan, with $9.2 million of borrowings drawn under its asset-based loan facility (ABL), and $18.2 million of letters of credit outstanding. Availability under the ABL is subject to a borrowing base, which was $150.0 million as of December 31, 2021, with $122.6 million available for borrowing as of December 31, 2021.

Outlook for First Quarter 2022

The guidance below applies only to management’s expectations for the first quarter of 2022.

* Refer to discussion of non-GAAP financial measures below.

The above estimates are based on current management expectations and, as such, are forward-looking and actual results may differ materially. The above ranges do not include the potential impact of any future divestitures, mergers, acquisitions, or other business combinations, changes in debt structure, or future share repurchases.

For the first quarter of 2022, average bill rates are anticipated to remain elevated at or slightly above the fourth quarter. As we progress throughout 2022, we anticipate that rates will likely decline as COVID-19 hospitalizations decline. However, demand remains robust amidst a backdrop of tight supply for clinicians and professionals, which will likely continue throughout much of 2022. Though we do not give full year guidance, we do believe that the company will continue to see volume growth throughout 2022, as we continue to invest in both added capacity and our technologies. For the coming year, we anticipate expanding our IT projects, more than doubling the level of investments from 2021.

See accompanying non-GAAP financial measures and tables below.

INVITATION TO CONFERENCE CALL

The Company will hold its quarterly conference call on Wednesday, February 23, 2022, at 5:00 P.M. Eastern Time to discuss its fourth quarter and full year 2021 financial results. This call will be webcast live and can be accessed at the Company's website at ir.crosscountryhealthcare.com or by dialing 888-566-1290 from anywhere in the U.S. or by dialing 773-799-3776 from non-U.S. locations - Passcode: Cross Country. A replay of the webcast will be available from February 23rd through March 9th at the Company's website and a replay of the conference call will be available by telephone by calling 800-391-9853 from anywhere in the U.S. or 203-369-3269 from non-U.S. locations - Passcode: 2022.

ABOUT CROSS COUNTRY HEALTHCARE

Cross Country Healthcare, Inc. (CCH) is a market leading workforce solutions tech-enabled staffing, recruitment, and advisory firm that has 35 years of industry experience and insight. We solve complex labor-related challenges for customers while providing high-quality outcomes and exceptional patient care. As a multi-year Best of Staffing^® award winner, we are committed to an exceptionally high level of service to both our clients and our homecare, education, and clinical and non-clinical healthcare professionals. Our Company was the first publicly traded staffing firm to obtain The Joint Commission Certification, which we still hold with a Letter of Distinction. In 2021, we were listed as one of the top four staffing and recruiting employers for women by InHerSights and earned Energage's inaugural 2021 Top Workplaces USA award. We were also Certified™ by Great Place to Work^®. We have a longstanding history of investing in diversity, equality, and inclusion as a key component of the organization’s overall corporate social responsibility program which is closely aligned with its core values to create a better future for its people, communities, the planet, and its shareholders.

Copies of this and other news releases as well as additional information about the Company can be obtained online at ir.crosscountryhealthcare.com. Shareholders and prospective investors can also register to automatically receive the Company's press releases, filings with the Securities and Exchange Commission (SEC), and other notices by e-mail.

NON-GAAP FINANCIAL MEASURES

This press release and the accompanying financial statement tables reference non-GAAP financial measures, such as gross profit margin, adjusted EBITDA, and adjusted EPS. Such non-GAAP financial measures are provided as additional information and should not be considered substitutes for, or superior to, financial measures calculated in accordance with U.S. GAAP. Such non-GAAP financial measures are provided for consistency and comparability to prior year results; furthermore, management believes they are useful to investors when evaluating the Company's performance as they exclude certain items that management believes are not indicative of the Company's future operating performance. Pro forma measures, if applicable, are adjusted to include the results of our acquisitions, and exclude the results of divestments, as if the transactions occurred in the beginning of the periods mentioned. Such non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. The financial statement tables that accompany this press release include a reconciliation of each non-GAAP financial measure to the most directly comparable U.S. GAAP financial measure and a more detailed discussion of each financial measure; as such, the financial statement tables should be read in conjunction with the presentation of these non-GAAP financial measures.

FORWARD LOOKING STATEMENTS

In addition to historical information, this press release contains statements relating to our future results (including certain projections and business trends) that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Private Securities Litigation Reform Act, and are subject to the "safe harbor" created by those sections. Forward-looking statements consist of statements that are predictive in nature, depend upon or refer to future events. Words such as "expects", "anticipates", "intends", "plans", "believes", "estimates", "suggests", "appears", "seeks", "will", "could", and variations of such words and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. These factors include, but are not limited to, the following: the potential impacts of the COVID-19 pandemic on our business, financial condition, and results of operations, our ability to attract and retain qualified nurses, physicians and other healthcare personnel, costs and availability of short-term housing for our travel healthcare professionals, demand for the healthcare services we provide, both nationally and in the regions in which we operate, the functioning of our information systems, the effect of cyber security risks and cyber incidents on our business, the effect of existing or future government regulation and federal and state legislative and enforcement initiatives on our business, our clients' ability to pay us for our services, our ability to successfully implement our acquisition and development strategies, including our ability to successfully integrate acquired businesses and realize synergies from such acquisitions, the effect of potential liabilities, loses, or other exposures in connection with the WSG acquisition, the effect of liabilities and other claims asserted against us, the effect of competition in the markets we serve, our ability to successfully defend the Company, its subsidiaries, and its officers and directors on the merits of any lawsuit or determine its potential liability, if any, and other factors set forth in Item 1A. "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2020, and in our other filings with the SEC. You should consult any further disclosures the Company makes on related subjects in its filings with the SEC.

Although we believe that these statements are based upon reasonable assumptions, we cannot guarantee future results and readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this press release. There can be no assurance that (i) we have correctly measured or identified all of the factors affecting our business or the extent of these factors' likely impact, (ii) the available information with respect to these factors on which such analysis is based is complete or accurate, (iii) such analysis is correct and/or (iv) our strategy, which is based in part on this analysis, will be successful. The Company undertakes no obligation to update or revise forward-looking statements. All references to "we", "us", "our", or "Cross Country" in this press release mean Cross Country Healthcare, Inc. and its subsidiaries.