AMN 2017 Annual Report

21 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation s You should read the following discussion in conjunction with our consolidated financial statements and the notes thereto and other financial information included elsewhere in this Annual Report on Form 10-K. Certain statements in this “Management’s Discussion and Analysis (“MD&A”) of Financial Condition and Results of Operations” are “forward-looking statements.” See “Special Note Regarding Forward-Looking Statements” under Item 1, “Business.” We intend this MD&A section to provide you with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. The following sections comprise this MD&A: • Overview of Our Business • Recent Trends • Results of Operations • Liquidity and Capital Resources • Off-Balance Sheet and Other Financing Arrangements • Contractual Obligations • Critical Accounting Policies and Estimates • Recent Accounting Pronouncements Overview of Our Business We provide healthcare workforce solutions and staffing services to healthcare facilities across the nation. As an innovative workforce solutions partner, our managed services programs, or “MSP,” vendor management systems, or “VMS,” recruitment process outsourcing, or “RPO,” workforce consulting services, predictive modeling, staff scheduling, remote medical coding, case management and the placement of physicians, nurses, allied healthcare professionals and healthcare executives into temporary and permanent positions enable our clients to successfully reduce staffing complexity, increase efficiency and lead their organizations within the rapidly evolving healthcare environment. For the year ended December 31, 2017, we recorded revenue of $1,988.5 million, as compared to $1,902.2 million for 2016. We recorded net income of $132.6 million for 2017, as compared to $105.8 million for 2016. Nurse and allied solutions segment revenue comprised 62% of total consolidated revenue for the years ended December 31, 2017 and 2016. Locum tenens solutions segment revenue comprised 22% of total consolidated revenue for the years ended December 31, 2017 and 2016. Other workforce solutions segment revenue comprised 16% of total consolidated revenue for the years ended December 31, 2017 and 2016. For a description of the services we provide under each of our business segments, please see, “Item 1. Business —Our Services.” We believe we have become recognized as the market-leading innovator in providing healthcare workforce solutions and staffing services in the United States. We seek to advance our market-leading position through a number of strategies that focus on market growth, increasing operational efficiency and scalability and increasing our supply of qualified healthcare professionals. Our market growth strategy continues to focus on broadening and investing, both organically and through strategic acquisitions, in service offerings beyond our traditional temporary staffing and permanent placement services, to include more strategic and recurring revenue sources from innovative workforce solutions offerings such as MSP, VMS, RPO and workforce optimization services, which generally operate at higher margins than our traditional healthcare staffing businesses. We also seek strategic opportunities to expand into complementary service offerings to our staffing businesses that leverage our core capabilities of recruiting and credentialing healthcare professionals. Along those lines, we acquired Peak during 2016, which provides remote medical coding, case management and related auditing and consulting services. Operationally, our strategic initiatives focus on investing in and further developing our processes and systems to achieve market leading efficiency and scalability, which we believe will provide operating leverage as our revenue grows. From a healthcare professional supply perspective, we continue to invest in new candidate recruitment initiatives and technologies to access and effectively utilize our network of qualified healthcare professionals to capitalize on the demand growth we are experiencing, which we expect to continue in the future due to the combined effects of healthcare reform, the aging population and labor shortages within certain regions and disciplines. Over the last several years, we have worked to execute on our management strategies and intend to continue to do so in the future. Over the past five years, we have grown our business both organically and as a result of a number of acquisitions.