AAC Implements $15 Mln Cost Reduction Program, Incl Reduction Of About 200 Jobs

(RTTNews) - AAC Holdings, Inc. (AAC) announced a cost reduction initiative to improve operating performance across the organization. The company's implemented cost reduction program is currently expected to reduce the Company's total expenses on an annualized basis by approximately $15 million and includes an aggregate reduction of approximately 200 positions across the Company.

The actions taken include the consolidation of the San Diego outpatient and sober-living facilities into the Laguna operations in California to provide more efficient operations and stronger financial performance. The Company expects this consolidation to be fully executed prior to December 31, 2018; A strategic alternative for Townsend operations in Louisiana; and Effective November 30, 2018, a reduction of about 100 positions, including corporate functions, which is intended to align staffing levels with current occupancy.

The Company currently expects to incur less than approximately $1 million in one-time cash expenditures to fully execute the initiatives outlined above, the majority of which we expect to be incurred during 2019.

The Company currently expects to be able to grow its top line revenue in 2019 at or better than the industry growth rate long-term, driving corresponding improvements in profitability and cash flow generation.

The company said it is poised to reap the near-term benefits of strategic initiatives implemented during 2018. These initiatives include Key hires of Michael Nanko as President and Chief Operating Officer, Stephen Ebbett as Chief Digital & Marketing Office and Dr. Larry Weinstein as Chief Medical Officer; The implementation of new technology used to interact with prospective patients; Revising admissions compensation structure and training to improve best practices.