Alignment Healthcare Reports Fourth Quarter and Full-Year 2024 Results; Provides Full-Year 2025 Financial Guidance

Reports 189,100 health plan members as of Dec. 31, 2024, up 58.6% year-over-year, beating year-end expectationsAchieves first full year of positive adjusted EBITDA as a public company, driven by operating leverage and strong medical benefits ratio performanceRaises midpoint of 2025 health plan membership guidance by 2,000 to reflect strong open enrollment period momentumIntroduces 2025 revenue guidance of $3.72 billion to $3.78 billion, representing 37.6%-39.6% growth year-over-year, and adjusted EBITDA of $35 million to $60 million ORANGE, Calif., Feb. 27, 2025 (GLOBE NEWSWIRE) -- Alignment Healthcare, Inc. (NASDAQ: ALHC), today reported financial results for its fourth quarter and full year ended Dec. 31, 2024. “2024 was a milestone year that proved health plans can win by providing more care, not less,” said John Kao, founder and CEO. “By using our clinical resources and technology to improve outcomes and manage medical expenses, we grew while others pulled back. With strong momentum from the annual enrollment period and industry-leading stars performance, we enter 2025 positioned for success and confident that we are fulfilling our vision for Medicare Advantage done right.” Fourth Quarter 2024 Financial HighlightsAll comparisons, unless otherwise noted, are to the three months ended Dec. 31, 2023. Health plan membership at the end of the quarter was approximately 189,100, up 58.6% year over yearTotal revenue was $701.2 million, up 50.7% year over year. Revenue excluding ACO REACH was $700.7 million, up 61.4% year over yearAdjusted gross profit was $87.9 million and loss from operations was $(22.5) million Adjusted gross profit excludes depreciation and amortization of $6.8 million and selling, general, and administrative expenses of $102.1 million (which includes $14.7 million of equity-based compensation). Adjusted gross profit also excludes an additional $1.5 million of equity-based compensation recorded within medical expensesMedical benefits ratio based on adjusted gross profit was 87.5% Adjusted EBITDA was $1.4 million and net loss was $(31.1) million Full Year 2024 Financial HighlightsAll comparisons, unless otherwise noted, are to the twelve months ended Dec. 31, 2023. Total revenue was $2,703.6 million, up 48.3% year over year. Revenue excluding ACO REACH was $2,702.6 million, up 59.0% year over yearAdjusted gross profit was $302.6 million and loss from operations was $(101.6) million Adjusted gross profit excludes depreciation and amortization of $27.1 million and selling, general, and administrative expenses of $371.4 million (which includes $66.2 million of equity-based compensation). Adjusted gross profit also excludes $0.8 of restructuring costs and an additional $4.9 million of equity-based compensation recorded within medical expensesMedical benefits ratio based on adjusted gross profit was 88.8% Adjusted EBITDA was $1.3 million and net loss was $(128.1) million Adjusted Gross Profit is reconciled as follows: Three Months Ended December 31, Year Ended December 31, 2024 2023 2024 2023 (dollars in thousands) Loss from operations$(22,545) $(41,913) $(101,555) $(127,817)Add back: Equity-based compensation (medical expenses) 1,546 1,517 4,930 7,541 Depreciation (medical expenses) 46 60 190 254 Restructuring costs (medical expenses) (1) — — 796 — Depreciation and amortization (2) 6,762 5,801 26,872 21,414 Selling, general, and administrative expenses 102,128 83,737 371,374 307,433 Total add back 110,482 91,115 404,162 336,642 Adjusted gross profit$87,937 $49,202 $302,607 $208,825 (1) Represents severance and related costs incurred as part of a corporate restructuring, that took place during 2024, designed to streamline our organizational structure and drive operational efficiencies(2) Includes $0.6 million in impairment expense related to intangible assets that were written off during the year Adjusted EBITDA is reconciled as follows: Three Months Ended December 31, Year Ended December 31, 2024 2023 2024 2023 (dollars in thousands) Net loss$(31,064) $(47,231) $(128,071) $(148,173)Less: Net loss attributable to noncontrolling interest (27) 22 36 156 Adjustments: Interest expense 5,492 5,484 23,547 21,231 Depreciation and amortization (1) 6,808 5,861 27,062 21,668 Income tax expense (benefit) 7 (24) 21 (22)Equity-based compensation (2) 16,236 15,652 71,132 66,835 Acquisition expenses (3) — 216 26 977 Litigation costs (4) 892 348 2,069 2,298 (Gain) loss on ROU assets (5) — — 143 (289)Gain on sale of property and equipment (1) — (9) — Restructuring costs (6) — — 2,363 — Loss on extinguishment of debt 3,020 — 3,020 — Adjusted EBITDA$1,363 $(19,672) $1,339 $(35,319) (1) Includes $0.6 million in impairment expense related to intangible assets that were written off during the year(2) Represents equity-based compensation related to grants made in the applicable year, as well as equity-based compensation related to the timing of the IPO, which includes previously issued stock appreciation rights ("SARs") liability awards, modifications related to transaction vesting units, and grants made in conjunction with the IPO(3) Represents acquisition-related fees, such as legal and advisory fees, that are non-capitalizable(4) Represents certain litigation costs considered outside of the ordinary course of business based on the following considerations which we assess regularly: (i) the frequency of similar cases that have been brought to date, or are expected to be brought within two years, (ii) complexity of the case, (iii) nature of the remedies sought, (iv) litigation posture of the Company, (v) counterparty involved, and (vi) the Company's overall litigation strategy(5) Represents gains or losses related to ROU assets that were terminated or subleased in the respective period(6) Represents severance and related costs incurred as part of a corporate restructuring, that took place during 2024, designed to streamline our organizational structure and drive operational efficiencies Outlook for First Quarter and Fiscal Year 2025 Three Months EndingMarch 31, 2025Twelve Months Ending December 31, 2025$ MillionsLowHighLowHighHealth Plan Membership211,000215,000227,000233,000Revenue$880$895$3,720$3,775Adjusted Gross Profit(1)$89$97$415$445Adjusted EBITDA(2)$2$10$35$60 _______________________ Adjusted gross profit is a non-GAAP financial measure that is presented as supplemental disclosure, that we define as loss from operations before depreciation and amortization, clinical equity-based compensation expense, clinical restructuring costs, and selling, general, and administrative expenses. We cannot reconcile our estimated ranges for adjusted gross profit to loss from operations, the most directly comparable GAAP measure, and cannot provide estimated ranges for loss from operations, without unreasonable efforts because of the uncertainty around certain items that may impact loss from operations, including equity-based compensation expense and depreciation and amortization, that are not within our control or cannot be reasonably predicted.Adjusted EBITDA is a non-GAAP financial measure that is presented as supplemental disclosure, that we define as net loss before interest expense, income taxes, depreciation and amortization expense, acquisition expenses, certain litigation costs, gains or losses on right of use ("ROU") assets, gains or losses on sale of property and equipment, restructuring costs, equity-based compensation expense and loss on extinguishment of debt. We cannot reconcile our estimated ranges for Adjusted EBITDA to net loss, the most directly comparable GAAP measure, and cannot provide estimated ranges for net loss, without unreasonable efforts because of the uncertainty around certain items that may impact net loss, including equity-based compensation expense and depreciation and amortization, that are not within our control or cannot be reasonably predicted. Conference Call DetailsThe company will host a conference call at 5 p.m. EST today to discuss these results and management’s outlook for future financial and operational performance. A live audio webcast will be available online at https://ir.alignmenthealth.com/. At the start of the conference call, participants may access the webcast at the following link: https://edge.media-server.com/mmc/p/oawc6g57. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web links, and will remain available for approximately 12 months. About Alignment HealthAlignment Health is championing a new path in senior care that empowers members to age well and live their most vibrant lives. A consumer brand name of Alignment Healthcare (NASDAQ: ALHC), Alignment Health’s mission-focused team makes high-quality, low-cost care a reality for its Medicare Advantage members every day. Based in California, the company partners with nationally recognized and trusted local providers to deliver coordinated care, powered by its customized care model, 24/7 concierge care team and purpose-built technology, AVA®. As it expands its offerings and grows its national footprint, Alignment upholds its core values of leading with a serving heart and putting the senior first. For more information, visit www.alignmenthealth.com. Forward-Looking StatementsThis release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future growth and our financial outlook for the first quarter ending March 31, 2025 and year ending December 31, 2025. Forward-looking statements are subject to risks and uncertainties and are based on assumptions that may prove to be inaccurate, which could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: our ability to attract new members and enter new markets, including the need for certain governmental approvals; our ability to maintain a high rating for our plans on the Five Star Quality Rating System; our ability to develop and maintain satisfactory relationships with care providers that service our members; risks associated with being a government contractor; changes in laws and regulations applicable to our business model; risks related to our indebtedness; changes in market or industry conditions and receptivity to our technology and services; results of litigation or a security incident; the impact of shortages of qualified personnel and related increases in our labor costs. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our Annual Report on Form 10-K for the year ended December 31, 2024, and the other periodic reports we file with the SEC. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update or revise this information unless required by law. Consolidated Balance Sheets(in thousands, except par value and share amounts) December 31,2024 December 31,2023Assets Current Assets: Cash and cash equivalents$432,859 $202,904 Accounts receivable (less allowance for credit losses of $0 at December 31, 2024 and 2023) 153,904 119,749 Investments - current 37,791 115,914 Prepaid expenses and other current assets 37,084 44,970 Total current assets 661,638 483,537 Property and equipment, net 67,139 51,901 Right of use asset, net 7,818 9,959 Goodwill 34,826 34,826 Intangible Assets, net 4,550 5,252 Other assets 6,092 6,405 Total assets$782,063 $591,880 Liabilities and Stockholders' Equity Current Liabilities: Medical expenses payable$289,788 $205,399 Accounts payable and accrued expenses 22,126 23,511 Accrued compensation 39,931 34,112 Total current liabilities 351,845 263,022 Long-term debt, net of debt issuance costs 321,428 161,813 Long-term portion of lease liabilities 7,835 8,974 Total liabilities 681,108 433,809 Commitments and Contingencies Stockholders' Equity: Preferred stock, $.001 par value; 100,000,000 shares authorized as of December 31, 2024 and 2023, respectively; no shares issued and outstanding as of December 31, 2024 and 2023 — — Common stock, $.001 par value; 1,000,000,000 shares authorized as of December 31, 2024 and December 31, 2023; 191,778,639 and 188,951,643 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively 192 189 Additional paid-in capital 1,107,952 1,037,015 Accumulated deficit (1,008,293) (880,258)Total Alignment Healthcare, Inc. stockholders' equity 99,851 156,946 Noncontrolling interest 1,104 1,125 Total stockholders' equity 100,955 158,071 Total liabilities and stockholders' equity$782,063 $591,880 Consolidated Statements of Operations(in thousands, except per share amounts) Three Months Ended December 31, Year Ended December 31, 2024 2023 2024 2023 Revenues: Earned premiums$691,785 $459,009 $2,671,931 $1,800,933 Other 9,456 6,378 31,630 22,697 Total revenues 701,241 465,387 2,703,561 1,823,630 Expenses: Medical expenses 614,896 417,762 2,406,870 1,622,600 Selling, general, and administrative expenses 102,128 83,737 371,374 307,433 Depreciation and amortization 6,762 5,801 26,872 21,414 Total expenses 723,786 507,300 2,805,116 1,951,447 Loss from operations (22,545) (41,913) (101,555) (127,817)Other expenses: Interest expense 5,492 5,484 23,547 21,231 Other (income) expenses, net — (142) (72) (853)Loss on extinguishment of debt 3,020 — 3,020 — Total other expenses 8,512 5,342 26,495 20,378 Loss before income taxes (31,057) (47,255) (128,050) (148,195)Provision for income tax expense (benefit) 7 (24) 21 (22)Net loss$(31,064) $(47,231) $(128,071) $(148,173)Less: Net loss attributable to noncontrolling interest (27) 22 36 156 Net loss attributable to Alignment Healthcare, Inc.$(31,091) $(47,209) $(128,035) $(148,017)Total weighted-average common shares outstanding - basic and diluted 191,897,164 188,328,517 190,793,552 186,214,784 Net loss per share attributable to Alignment Healthcare, Inc. - basic and diluted$(0.16) $(0.25) $(0.67) $(0.79) Consolidated Statements of Cash Flows (in thousands) Year Ended December 31, 2024 2023 2022 Operating Activities: Net loss$(128,071) $(148,173) $(149,639)Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Provision for credit loss 123 91 150 (Gain) loss on right of use assets 143 (289) 510 Gain on sale of property and equipment (9) — — Depreciation and amortization 27,062 21,668 17,486 Amortization-debt issuance costs 1,293 1,254 1,850 Amortization-investment discount (2,579) (4,917) — Amortization of payment-in-kind interest — — 2,943 Loss on disposal of property and equipment — — 101 Equity-based compensation 71,132 66,835 81,718 Non-cash lease expense 1,764 2,318 2,811 Loss on extinguishment of debt 3,020 — 2,196 Changes in operating assets and liabilities: Accounts receivable (34,278) (26,950) (34,377)Prepaid expenses and other current assets 7,887 (2,863) (14,356)Other assets 60 (142) (86)Medical expenses payable 84,389 35,264 44,250 Accounts payable and accrued expenses (1,460) (6,347) 13,743 Accrued compensation 5,819 6,574 3,609 Lease liabilities (1,525) (3,510) (4,214)Payment-in-kind interest — — (14,122) Net cash provided by (used in) operating activities 34,770 (59,187) (45,427)Investing Activities: Purchase of business, net of cash received — — (4,043)Purchase of investments (82,200) (379,058) (2,825)Sale of property and equipment 14 — — Maturities of investments 162,795 267,790 2,425 Acquisition of property and equipment (41,418) (35,995) (23,774) Net cash provided by (used in) investing activities 39,191 (147,263) (28,217)Financing Activities: Repurchase of noncontrolling interest — — (100)Proceeds from long-term debt 380,000 — 165,000 Debt issuance costs (8,792) — (5,196)Repayment of long-term debt (215,000) — (143,179)Payment of employment taxes related to release of restricted stock (350) — — Proceeds from exercise of stock options 155 — — Contributions from noncontrolling interest holders 15 105 68 Net cash provided by financing activities 156,028 105 16,593 Net increase (decrease) in cash 229,989 (206,345) (57,051)Cash, cash equivalents and restricted cash at beginning of period 204,954 411,299 468,350 Cash, cash equivalents and restricted cash at end of period$434,943 $204,954 $411,299 Supplemental disclosure of cash flow information: Cash paid for interest$22,157 $19,165 $22,447 Supplemental non-cash investing and financing activities: Acquisition of property in accounts payable$70 $59 $47 Purchase of business in accounts payable$— $— $505 Debt issuance costs in accounts payable$512 $— $— The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets to the total above: December 31, 2024 December 31, 2023 December 31, 2022Cash and cash equivalents$432,859 $202,904 $409,549 Restricted cash in other assets 2,084 2,050 1,750 Total$434,943 $204,954 $411,299 Non-GAAP Financial Measures Certain of these financial measures are considered “non-GAAP” financial measures within the meaning of Item 10 of Regulation S-K promulgated by the SEC. We believe that non-GAAP financial measures provide an additional way of viewing aspects of our operations that, when viewed with the GAAP results, provide a more complete understanding of our results of operations and the factors and trends affecting our business. These non-GAAP financial measures are also used by our management to evaluate financial results and to plan and forecast future periods. However, non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Non-GAAP financial measures used by us may differ from the non-GAAP measures used by other companies, including our competitors. To supplement our consolidated financial statements presented on a GAAP basis, we disclose the following non-GAAP measures: Medical Benefits Ratio, Adjusted EBITDA and Adjusted Gross Profit as these are performance measures that our management uses to assess our operating performance. Because these measures facilitate internal comparisons of our historical operating performance on a more consistent basis, we use these measures for business planning purposes and in evaluating acquisition opportunities. Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net loss before interest expense, income taxes, depreciation and amortization expense, acquisition expenses, certain litigation costs, gains or losses on right of use ("ROU") assets, gains or losses on sale of property and equipment, restructuring costs, equity-based compensation expense and loss on extinguishment of debt. Adjusted EBITDA should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of Adjusted EBITDA in lieu of net loss, which is the most directly comparable financial measure calculated in accordance with GAAP. Our use of the term Adjusted EBITDA may vary from the use of similar terms by other companies in our industry and accordingly may not be comparable to similarly titled measures used by other companies. Medical Benefits Ratio (MBR) We calculate our MBR by dividing total medical expenses, excluding depreciation, equity-based compensation and clinical restructuring costs, by total revenues in a given period. Adjusted Gross Profit Adjusted gross profit is a non-GAAP financial measure that we define as loss from operations before depreciation and amortization, clinical equity-based compensation expense, clinical restructuring costs and selling, general, and administrative expenses. Adjusted gross profit should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of adjusted gross profit in lieu of loss from operations, which is the most directly comparable financial measure calculated in accordance with GAAP. Our use of the term adjusted gross profit may vary from the use of similar terms by other companies in our industry and accordingly may not be comparable to similarly titled measures used by other companies. Investor Contact Harrison Zhuohzhuo@ahcusa.com Media Contact Priya ShahmPR, Inc. for Alignment Healthalignment@mpublicrelations.com

Alignment Healthcare Reports Fourth Quarter and Full-Year 2024 Results; Provides Full-Year 2025 Financial Guidance

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