agl-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________

FORM 10-Q

_______________________________________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2023


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-40332

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agilon health, inc.

(Exact name of registrant as specified in its charter)


Delaware			37-1915147
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

6210 E Hwy 290, Suite 450

Austin, TX 78723

(Address of principal executive offices)

(562) 256-3800

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, $0.01 par value	AGL	New York Stock Exchange

_______________________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x NO o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated Filer

Non-accelerated Filer

Smaller Reporting Company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) YES o NO x

At October 27, 2023, there were 406,040,924 shares of the registrant’s $0.01 par value common stock outstanding.

Table of Contents

agilon health, inc.

INDEX


PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements:

	Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022	3

	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2023 and 2022	4

	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2023 and 2022	5

	Condensed Consolidated Statements of Stockholders’ Equity (Deficit) for the Three and Nine Months Ended September 30, 2023 and 2022	6

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022	8

	Notes to the Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37

Item 4.	Controls and Procedures	37

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	39

Item 1A.	Risk Factors	39

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39

Item 5 .	Other Information	39

Item 6.	Exhibits	40

Signatures		41

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

agilon health, inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)


	September 30, 2023		December 31, 2022
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	168,339	$	497,070
Restricted cash and equivalents	10,204		10,610
Marketable securities	395,878		411,901
Receivables, net	1,345,711		497,574
Prepaid expenses and other current assets	36,512		34,119
Total current assets	1,956,644		1,451,274
Property and equipment, net	26,203		20,050
Intangible assets, net	92,657		67,680
Goodwill	62,387		41,540
Other assets, net	140,184		116,924
Total assets	$	2,278,075	$	1,697,468
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Medical claims and related payables	$	1,005,762	$	346,727
Accounts payable and accrued expenses	290,563		183,364
Current portion of long-term debt	5,000		5,000
Total current liabilities	1,301,325		535,091
Long-term debt, net of current portion	34,780		38,482
Other liabilities	70,370		83,286
Total liabilities	1,406,475		656,859

Commitments and contingencies

Stockholders' equity (deficit):
Common stock, $0.01 par value: $2,000,000 shares authorized; 405,980 and 412,385 shares issued and outstanding, respectively	4,060		4,124
Additional paid-in capital	1,970,930		2,106,886
Accumulated deficit	(1,096,393)		(1,064,230)
Accumulated other comprehensive income (loss)	(6,230)		(5,560)
Total agilon health, inc. stockholders' equity (deficit)	872,367		1,041,220
Noncontrolling interests	(767)		(611)
Total stockholders’ equity (deficit)	871,600		1,040,609
Total liabilities and stockholders’ equity (deficit)	$	2,278,075	$	1,697,468

The condensed consolidated balance sheets include assets and liabilities of consolidated variable interest entities (“VIEs”) as agilon health, inc., together with its consolidated subsidiaries and variable interest entities (the “Company”), is the primary beneficiary of these VIEs. The condensed consolidated balance sheets include total assets that can only be used to settle obligations of the Company’s consolidated VIEs totaling $1.48 billion and $703.30 million as of September 30, 2023 and December 31, 2022, respectively, and total liabilities of the Company’s consolidated VIEs for which creditors do not have recourse to the general credit of the primary beneficiary of $1.23 billion and $462.40 million as of September 30, 2023 and December 31, 2022, respectively. See Note 14 for additional details.

See accompanying Notes to the Condensed Consolidated Financial Statements.

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agilon health, inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenues:
Medical services revenue	$	1,212,132	$	693,934	$	3,494,006	$	2,015,541
Other operating revenue	3,528		924		6,853		2,896
Total revenues	1,215,660		694,858		3,500,859		2,018,437
Expenses:
Medical services expense	1,104,396		618,287		3,085,957		1,771,635
Other medical expenses	80,787		50,659		249,936		144,512
General and administrative (including noncash stock-based compensation expense of $20,736, $7,907, $53,980 and $18,430, respectively)	74,138		51,980		222,483		143,738
Depreciation and amortization	5,310		3,450		15,014		9,865
Total expenses	1,264,631		724,376		3,573,390		2,069,750
Income (loss) from operations	(48,971)		(29,518)		(72,531)		(51,313)
Other income (expense):
Income (loss) from equity method investments	14,659		(4,314)		24,507		3,473
Other income (expense), net	5,690		4,888		21,001		6,367
Gain (loss) on lease terminations	—		—		—		(5,458)
Interest expense	(1,651)		(1,000)		(4,772)		(2,816)
Income (loss) before income taxes	(30,273)		(29,944)		(31,795)		(49,747)
Income tax benefit (expense)	(1,210)		(559)		(524)		(1,068)
Income (loss) from continuing operations	(31,483)		(30,503)		(32,319)		(50,815)
Discontinued operations:
Income (loss) before income taxes	—		(224)		—		526
Income tax benefit (expense)	—		(12)		—		(26)
Total discontinued operations

SEC Form 10-Q filed by agilon health inc.