•

Net operating revenue was $156.8 million compared to $163.3 million in the second quarter of 2022 and $159.0 million in the third quarter of 2021, a decrease of 4% quarter over quarter and 1% year over year.

◾

Net patient revenue was $142.3 million compared to $148.5 million in the second quarter of 2022 and $141.9 million in the third quarter of 2021, a decrease of 4% quarter over quarter and essentially flat year over year.  See below for discussion of drivers to net patient revenue i.e., patient visits and Rate per Visit.

◾

Other revenue was $14.5 million compared to $14.8 million in the second quarter of 2022 and $17.2 million in the third quarter of 2021, a decrease of 2% quarter over quarter and 16% year over year.  The year over year decrease was primarily due to sale of the Home Health service line on October 1, 2021.

•

Visits per Day (“VPD”) were 21,493 compared to 22,403 in the second quarter of 2022 and 20,674 in the third quarter of 2021, a decrease of 4% quarter over quarter primarily due to seasonality and scheduled vacations and an increase of 4% year over year mostly due to higher clinical FTE.

•

Rate per Visit was $103.46 compared to $103.57 in the second quarter of 2022 and $105.56 in the third quarter of 2021, essentially flat quarter over quarter and a decrease of 2% year over year.  The year over year decrease was primarily due to the 2022 Medicare Physician Fee Schedule, which introduced a 0.75% decrease in overall rates and an additional 15% decrease in rates paid for services performed by physical therapy assistants, and unfavorable mix shifts in payors and states.  This decrease was partially offset by favorable mix shift in services.

•

Salaries and related costs were $90.3 million compared to $89.6 million in the second quarter of 2022 and $86.8 million in the third quarter of 2021, an increase of 1% quarter over quarter due to wage inflation and an increase of 4% year over year due to higher number of clinical FTE and wage inflation.

•

Rent, clinic supplies, contract labor and other was $51.4 million compared to $50.4 million in the second quarter of 2022 and $45.8 million in the third quarter of 2021, an increase of 2% quarter over quarter due to higher expenditures on a per clinic basis and an increase of 12% year over year due to more clinics and higher expenditures on a per clinic basis.

•

Provision for doubtful accounts was $2.8 million compared to $3.5 million in the third quarter of 2021.  PT provision as a percent of net patient revenue was 2% in both quarters.

•

Selling, general and administrative expenses were $25.3 million compared to $31.8 million in the second quarter of 2022 and $30.8 million in the third quarter of 2021.  The quarter over quarter decrease of 21% was primarily due to a $3.0 million one-time loss on a probable legal settlement recorded in the second quarter of 2022 and lower non-ordinary legal and regulatory matters expense and reorganization and severance costs.  The year over year decrease of 18% was due to lower reorganization and severance costs and transaction costs.

•

Non-cash goodwill and intangible assets charge was approximately $106.7 million.  Primarily due to an increase in discount rates and lower public company comparative multiples, it was determined that the fair value amounts of goodwill and intangible assets were below their respective carrying amounts.

•

Income tax benefit was $7.2 million compared to $13.0 million in the second quarter of 2022 and $35.3 million in the third quarter of 2021.

•

Net loss was $116.7 million compared to $135.7 million in the second quarter of 2022 and $326.8 million in the third quarter of 2021.

•

Adjusted EBITDA1 was $(0.4) million compared to $5.4 million in the second quarter of 2022 and $8.5 million in the third quarter of 2021.  Quarter over quarter and year over year, the decreases were primarily driven by lower revenue and higher clinic operating costs partially offset by lower provision for doubtful accounts and selling, general, and administrative expenses as detailed above.

•

Net increase (decrease) in cash was approximately $(0.0) million year-to-date 2022 compared to $(76.0) million in the first nine months of 2021.

•

Cash and cash equivalents totaled $48.6 million, and the revolving credit facility was undrawn with available capacity of $48.2 million, net of usage by letters of credit, equaling $96.8 million in available liquidity.

•

Opened 11 new clinics in existing states, including Alabama, Pennsylvania, and Texas; and 8 clinics were closed.  This brings the total number of clinics to 929.  The Company continues to capitalize on growth opportunities in individual markets, while optimizing its footprint and financial return in other local markets.

•

Net Promotor Score (“NPS”) of 76 and Google Star Rating of 4.8, reflecting continued high customer satisfaction and brand loyalty.

(i)

changes in domestic business, market, financial, political and legal conditions, including shifts and trends in payor mix;

(ii)

the ability to execute on our sales and marketing strategies;

(iii)

the ability to maintain the listing of the Company's securities on NYSE;

(iv)

risks related to the execution of ATI's business strategy, including but not limited to ramping of visits, growing clinical headcount, and opening new clinics, and the timing of expected business milestones;

(v)

the effects of competition on ATI's future business and the ability of ATI to grow and manage growth profitably, maintain relationships with patients, payors and referral sources and retain its management and key employees;

(vi)

the ability of the Company to attract and retain physical therapists consistent with its business plan;

(vii)

the ability of the Company to develop new and retain and expand relationships with referral sources;

(viii)

the outcome of any legal proceedings or regulatory investigations that have or may be instituted against the Company or any of its directors or officers and the availability of insurance coverage for such matters;

(ix)

the ability of the company to comply with its covenants in its credit facility and preferred stock financing arrangements or to redeem preferred stock;

(x)

the ability of the company to generate sufficient cash flow to run its business, comply with its covenants in its credit facility, and continue to operate as a going concern;

(xi)

the ability of the Company to issue equity or equity-linked securities or obtain debt financing in the future;

(xii)

risks related to political and macroeconomic uncertainty, including recession, inflation, higher interest rates and the ongoing conflict between Russia and Ukraine;

(xiii)

the impact of the global COVID-19 pandemic (and existing or emerging variants) on any of the foregoing risks;

(xiv)

risks related to the impact on our workforce of mandatory COVID-19 vaccination of employees;

(xv)

risks related to further impairments of goodwill and other intangible assets, which represent a significant portion of the Company’s total assets, especially in view of the Company’s recent market valuation;

(xvi)

risks associated with the Company’s inability to remediate material weaknesses in internal controls over financial reporting related to income taxes and to maintain effective internal controls over financial reporting; and

		Three Months Ended								Nine Months Ended
		September 30, 2022				September 30, 2021				September 30, 2022				September 30, 2021
Net patient revenue		$	142,313			$	141,855			$	429,744			$	420,805
Other revenue			14,479				17,158				44,163				51,303
Net operating revenue			156,792				159,013				473,907				472,108
Cost of services:
Salaries and related costs			90,309				86,838				267,330				248,409
Rent, clinic supplies, contract labor and other			51,417				45,765				153,437				133,140
Provision for doubtful accounts			2,797				3,514				11,408				14,270
Total cost of services			144,523				136,117				432,175				395,819
Selling, general and administrative expenses			25,263				30,795				87,095				81,912
Goodwill and intangible asset impairment charges			106,663				508,972				390,224				962,303
Operating loss			(119,657	)			(516,871	)			(435,587	)			(967,926	)
Change in fair value of warrant liability			(790	)			(15,885	)			(3,651	)			(20,424	)
Change in fair value of contingent common shares liability			(6,930	)			(146,317	)			(32,760	)			(167,265	)
Loss on settlement of redeemable preferred stock			—				—				—				14,037
Interest expense, net			11,780				7,386				31,815				39,105
Interest expense on redeemable preferred stock			—				—				—				10,087
Other expense, net			195				52				3,181				5,831
Loss before taxes			(123,912	)			(362,107	)			(434,172	)			(849,297	)
Income tax benefit			(7,218	)			(35,333	)			(43,532	)			(65,579	)
Net loss		$	(116,694	)		$	(326,774	)		$	(390,640	)		$	(783,718	)

		September 30, 2022				December 31, 2021
Assets:
Current assets:
Cash and cash equivalents		$	48,569			$	48,616
Accounts receivable (net of allowance for doubtful accounts of $50,910 and $53,533 at June 30, 2022 and December 31, 2021, respectively)			82,323				82,455
Prepaid expenses			12,470				9,303
Other current assets			13,765				3,204
Total current assets			157,127				143,578
Property and equipment, net			129,761				139,730
Operating lease right-of-use assets			238,476				256,646
Goodwill, net			338,011				608,811
Trade name and other intangible assets, net			291,767				411,696
Other non-current assets			2,068				2,233
Total assets		$	1,157,210			$	1,562,694
Liabilities, Mezzanine Equity and Stockholders' Equity:
Current liabilities:
Accounts payable		$	11,099			$	15,146
Accrued expenses and other liabilities			52,511				64,584
Current portion of operating lease liabilities			52,366				49,433
Current portion of long-term debt			—				8,167
Total current liabilities			115,976				137,330
Long-term debt, net			479,906				543,799
Warrant liability			690				4,341
Contingent common shares liability			12,600				45,360
Deferred income tax liabilities			23,927				67,459
Operating lease liabilities			229,460				250,597
Other non-current liabilities			1,944				2,301
Total liabilities			864,503				1,051,187
Commitments and contingencies
Mezzanine equity:
Series A Senior Preferred Stock, $0.0001 par value; 1.0 million shares authorized; $1,074.32 stated value per share and 0.2 million shares issued and outstanding at June 30, 2022; none issued and outstanding at December 31, 2021			140,340				—
Stockholders' equity:
Class A common stock, $0.0001 par value; 470.0 million shares authorized; 207.3 million shares issued, 198.1 million shares outstanding at September 30, 2022; 207.4 million shares issued, 197.4 million shares outstanding at December 31, 2021			20				20
Treasury stock, at cost, 0.06 million shares and 0.03 million shares at September 30, 2022 and December 31, 2021, respectively			(136	)			(95	)
Additional paid-in capital			1,377,152				1,351,597
Accumulated other comprehensive income			7,143				28
Accumulated deficit			(1,236,746	)			(847,132	)
Total ATI Physical Therapy, Inc. equity			147,433				504,418
Non-controlling interests			4,934				7,089
Total stockholders' equity			152,367				511,507
Total liabilities, mezzanine equity and stockholders' equity		$	1,157,210			$	1,562,694

		Nine Months Ended
		September 30, 2022				September 30, 2021
Operating activities:
Net loss		$	(390,640	)		$	(783,718	)
Adjustments to reconcile net loss to net cash used in operating activities:
Goodwill and intangible asset impairment charges			390,224				962,303
Depreciation and amortization			30,477				27,990
Provision for doubtful accounts			11,408				14,270
Deferred income tax provision			(43,532	)			(65,579	)
Amortization of right-of-use assets			36,155				33,868
Non-cash share-based compensation			5,830				4,864
Amortization of debt issuance costs and original issue discount			1,934				2,644
Non-cash interest expense			889				—
Non-cash interest expense on redeemable preferred stock			—				10,087
Loss on extinguishment of debt			2,809				5,534
Loss on settlement of redeemable preferred stock			—				14,037
(Gain) loss on disposal and impairment of assets			(42	)			219
Change in fair value of warrant liability			(3,651	)			(20,424	)
Change in fair value of contingent common shares liability			(32,760	)			(167,265	)
Changes in:
Accounts receivable, net			(11,276	)			(8,564	)
Prepaid expenses and other current assets			(5,507	)			(6,580	)
Other non-current assets			52				(269	)
Accounts payable			(2,100	)			151
Accrued expenses and other liabilities			(702	)			(11,820	)
Operating lease liabilities			(36,431	)			(39,084	)
Other non-current liabilities			52				824
Medicare Accelerated and Advance Payment Program Funds			(12,269	)			(8,540	)
Transaction-related amount due to former owners			—				(3,611	)
Net cash used in operating activities			(59,080	)			(38,663	)
Investing activities:
Purchases of property and equipment			(22,091	)			(27,701	)
Purchases of intangible assets			—				(1,375	)
Proceeds from sale of property and equipment			152				125
Proceeds from sale of clinics			77				248
Net cash used in investing activities			(21,862	)			(28,703	)

Financing activities:
Proceeds from long-term debt			500,000				—
Deferred financing costs			(12,952	)			—
Original issue discount			(10,000	)			—
Principal payments on long-term debt			(555,048	)			(454,160	)
Proceeds from issuance of Series A Senior Preferred Stock			144,667				—
Proceeds from issuance of 2022 Warrants			20,333				—
Cash inflow from Business Combination			—				229,338
Payments to Series A Preferred stockholders			—				(59,000	)
Proceeds from shares issued through PIPE investment			—				300,000
Equity issuance costs and original issue discount			(4,935	)			(19,233	)
Taxes paid on behalf of employees for shares withheld			(41	)			—
Distribution to non-controlling interest holders			(1,129	)			(5,615	)
Net cash provided by (used in) financing activities			80,895				(8,670	)
Changes in cash and cash equivalents:
Net decrease in cash and cash equivalents			(47	)			(76,036	)
Cash and cash equivalents at beginning of period			48,616				142,128
Cash and cash equivalents at end of period		$	48,569			$	66,092
Supplemental noncash disclosures:
Derivative changes in fair value		$	(7,115	)		$	(1,378	)
Purchases of property and equipment in accounts payable		$	2,230			$	1,733
Warrant liability recognized upon the closing of the Business Combination		$	—			$	(26,936	)
Contingent common shares liability recognized upon the closing of the Business Combination		$	—			$	(220,500	)
Shares issued to Wilco Holdco Series A Preferred stockholders		$	—			$	128,453
Other supplemental disclosures:
Cash paid for interest		$	29,453			$	35,334
Cash received from hedging activities		$	1,080			$	—
Cash paid for taxes		$	82			$	156

			Financial Metrics ($ in 000’s)
			Net Patient Revenue				Other Revenue				Net Operating Revenue				Adjusted EBITDA(1)				Adj EBITDA margin(1)
Q1 2019			$	170,940			$	16,277			$	187,217			$	25,989				13.9	%
Q2 2019			$	182,757			$	16,015			$	198,772			$	33,342				16.8	%
Q3 2019			$	179,561			$	16,624			$	196,185			$	29,455				15.0	%
Q4 2019			$	184,338			$	18,946			$	203,284			$	39,606				19.5	%
Q1 2020			$	164,939			$	17,799			$	182,738			$	26,487				14.5	%
Q2 2020			$	95,003			$	12,751			$	107,754			$	1,189				1.1	%
Q3 2020			$	132,803			$	15,852			$	148,655			$	17,321				11.7	%
Q4 2020			$	136,840			$	16,266			$	153,106			$	18,622				12.2	%
Q1 2021			$	132,271			$	16,791			$	149,062			$	5,590				3.8	%
Q2 2021			$	146,679			$	17,354			$	164,033			$	23,999				14.6	%
Q3 2021			$	141,855			$	17,158			$	159,013			$	8,539				5.4	%
Q4 2021			$	140,275			$	15,488			$	155,763			$	1,643				1.1	%
Q1 2022			$	138,925			$	14,897			$	153,822			$	(4,695	)			(3.1	)%
Q2 2022			$	148,506			$	14,787			$	163,293			$	5,436				3.3	%
Q3 2022			$	142,313			$	14,479			$	156,792			$	(392	)			(0.3	)%

(1)	Excludes CARES Act Provider Relief Funds of $44.3 million in the second quarter of 2020, $23.1 million in the third quarter of 2020, and $24.1 million in the fourth quarter of 2020.

			Operational Metrics: PT Clinics
			Ending Clinic Count				Visits per Day(1)				Clinical FTE(2)				VPD per cFTE(3)				Annualized Clinician Adds %(4)				Annualized Clinician Turnover %(5)
Q1 2019				825				24,142				2,833				8.5				20	%			19	%
Q2 2019				836				25,527				2,862				8.9				26	%			21	%
Q3 2019				847				25,229				2,901				8.7				37	%			26	%
Q4 2019				872				25,693				2,936				8.8				17	%			26	%
Q1 2020				868				22,855				2,841				8.0				17	%			22	%
Q2 2020				866				12,643				1,487				8.5				0	%			20	%
Q3 2020				873				18,159				2,004				9.1				9	%			82	%
Q4 2020				875				19,441				2,214				8.8				43	%			34	%
Q1 2021				882				19,520				2,284				8.5				44	%			32	%
Q2 2021				889				21,569				2,325				9.3				44	%			44	%
Q3 2021				900				20,674				2,359				8.8				63	%			41	%
Q4 2021				910				20,649				2,490				8.3				44	%			37	%
Q1 2022				922				21,062				2,466				8.5				39	%			28	%
Q2 2022				926				22,403				2,465				9.1				38	%			37	%
Q3 2022				929				21,493				2,465				8.7				45	%			36	%

(1)	Equals patient visits divided by operating days.

(2)	Represents clinical staff hours divided by 8 hours divided by number of paid days.

(3)	Equals patient visits divided by operating days divided by clinical full-time equivalent employees.

(4)	Represents clinician headcount new hire adds divided by average clinician headcount, multiplied by 4 to annualize.

(5)	Represents clinician headcount separations divided by average clinician headcount, multiplied by 4 to annualize.

			Unit Economics: PT Clinics ($ actual)
			PT Revenue per Clinic(1)				VPD per Clinic(2)				PT Rate per Visit(3)				PT Salaries per Visit(4)				PT Rent and Other per Clinic(5)				PT Provision as % PT Revenue(6)
Q1 2019			$	208,803				29.5			$	112.39			$	57.21			$	48,682				4.3	%
Q2 2019			$	219,748				30.7			$	111.87			$	55.21			$	48,130				3.2	%
Q3 2019			$	213,255				30.0			$	111.21			$	56.47			$	48,995				2.8	%
Q4 2019			$	213,767				29.8			$	112.10			$	54.65			$	47,843				2.1	%
Q1 2020			$	189,658				26.3			$	112.76			$	55.11			$	50,258				3.6	%
Q2 2020			$	109,872				14.6			$	117.41			$	53.39			$	43,621				4.1	%
Q3 2020			$	152,472				20.8			$	112.51			$	53.83			$	44,140				2.2	%
Q4 2020			$	155,913				22.2			$	109.98			$	52.16			$	47,168				2.4	%
Q1 2021			$	150,536				22.2			$	107.56			$	54.14			$	47,722				5.4	%
Q2 2021			$	165,241				24.3			$	106.26			$	48.22			$	47,857				2.4	%
Q3 2021			$	158,556				23.1			$	105.56			$	53.70			$	49,499				2.5	%
Q4 2021			$	154,772				22.8			$	104.51			$	55.73			$	50,976				1.5	%
Q1 2022			$	151,225				22.9			$	103.06			$	55.47			$	54,472				3.7	%
Q2 2022			$	160,431				24.2			$	103.57			$	53.64			$	53,017				2.4	%
Q3 2022			$	153,410				23.2			$	103.46			$	56.20			$	53,945				2.0	%

(1)	Equals Net Patient Revenue divided by average clinics over the quarter.

(2)	Equals patient visits divided by operating days divided by average clinics over the quarter

(3)	Equals Net Patient Revenue divided by patient visits.

(4)	Equals estimated patient-related portion of Salaries and Related Costs divided by patient visits.

(5)	Equals estimated patient-related portion of Rent, Clinic Supplies, Contract Labor and Other divided by average clinics over the quarter.

(6)	Equals estimated patient-related portion of Provision for Doubtful Accounts divided by Net Patient Revenue.

							Customer Satisfaction Metrics
							Net Promoter Score(1)	Google Star Rating(2)
Q1 2019							77	4.6
Q2 2019							79	4.9
Q3 2019							78	4.9
Q4 2019							79	4.8
Q1 2020							77	4.9
Q2 2020							77	4.9
Q3 2020							78	4.6
Q4 2020							76	4.7
Q1 2021							75	4.9
Q2 2021							77	4.9
Q3 2021							73	4.9
Q4 2021							78	4.8
Q1 2022							74	4.9
Q2 2022							75	4.9
Q3 2022							76	4.8

(1)	NPS measures customer experience from ATI patient survey responses. The score is calculated as the percentage of promoters less the percentage of detractors.

(2)	A Google Star rating is a five-star rating scale that ranks businesses based on customer reviews. Customers are given the opportunity to leave a business review after interacting with a business, which involves choosing from one star (poor) to five stars (excellent).

		Three Months Ended
		September 30, 2022				June 30, 2022				March 31, 2022
Net loss		$	(116,694	)		$	(135,723	)		$	(138,223	)
Plus (minus):
Net loss attributable to non-controlling interests			376				177				473
Interest expense, net			11,780				11,379				8,656
Income tax benefit			(7,218	)			(13,033	)			(23,281	)
Depreciation and amortization expense			9,907				10,055				9,900
EBITDA		$	(101,849	)		$	(127,145	)		$	(142,475	)
Goodwill and intangible asset impairment charges(1)			106,663				127,820				155,741
Goodwill and intangible asset impairment charges attributable to non-controlling interests(1)			(457	)			(654	)			(940	)
Changes in fair value of warrant liability and contingent common shares liability(2)			(7,720	)			(2,680	)			(26,011	)
Loss on debt extinguishment(3)			—				—				2,809
Loss on legal settlement(4)			—				3,000				—
Share-based compensation			1,920				2,004				1,964
Non-ordinary legal and regulatory matters(5)			772				2,202				2,497
Pre-opening de novo costs(6)			224				286				381
Transaction and integration costs(7)			55				603				1,538
Gain on sale of Home Health service line, net			—				—				(199	)
Adjusted EBITDA		$	(392	)		$	5,436			$	(4,695	)

(1)	Represents non-cash charges related to the write-down of goodwill and trade name indefinite-lived intangible assets.

(2)	Represents non-cash amounts related to the change in the estimated fair value of IPO Warrants, Earnout Shares and Vesting Shares.

(3)	Represents charges related to the derecognition of the unamortized deferred financing costs and original issuance discount associated with the full repayment of the 2016 first lien term loan.

(4)	Represents estimated charge for probable net settlement liability related to billing dispute.

(5)	Represents non-ordinary course legal costs related to the previously disclosed ATIP shareholder class action complaints, derivative complaint and SEC inquiry.

(6)	Represents expenses associated with renovation, equipment and marketing costs relating to the start-up and launch of new locations incurred prior to opening.

(7)	Represents costs related to the Business Combination with FVAC II and non-capitalizable debt transaction costs.

		Three Months Ended
		December 31,				September 30,				June 30,				March 31,
		2021				2021				2021				2021
Net income (loss)		$	1,690			$	(326,774	)		$	(439,126	)		$	(17,818	)
Plus (minus):
Net (income) loss attributable to non-controlling interests			(869	)			2,109				3,769				(1,309	)
Interest expense, net			7,215				7,386				15,632				16,087
Interest expense on redeemable preferred stock			—				—				4,779				5,308
Income tax benefit			(5,381	)			(35,333	)			(19,731	)			(10,515	)
Depreciation and amortization expense			10,005				9,222				9,149				9,619
EBITDA			12,660				(343,390	)			(425,528	)			1,372
Goodwill and intangible asset impairment charges(1)			—				508,972				453,331				—
Goodwill and intangible asset impairment charges attributable to non-controlling interest(1)			—				(2,928	)			(5,021	)			—
Changes in fair value of warrant liability and contingent common shares liability(2)			(10,046	)			(162,202	)			(25,487	)			—
Gain on sale of Home Health service line, net			(5,846	)			—				—				—
Reorganization and severance costs(3)			—				3,551				—				362
Transaction and integration costs(4)			955				2,335				3,580				2,918
Share-based compensation			905				1,248				3,112				504
Pre-opening de novo costs(5)			543				511				441				434
Non-ordinary legal and regulatory matters(6)			2,472				442				—				—
Loss on debt extinguishment(7)			—				—				5,534				—
Loss on settlement of redeemable preferred stock(8)			—				—				14,037				—
Adjusted EBITDA		$	1,643			$	8,539			$	23,999			$	5,590

(1)	Represents non-cash charges related to the write-down of goodwill and trade name indefinite-lived intangible assets.

(2)	Represents non-cash amounts related to the change in the estimated fair value of Warrants, Earnout Shares and Vesting Shares.

(3)	Represents severance, consulting and other costs related to discrete initiatives focused on reorganization and delayering of the Company’s labor model, management structure and support functions.

(4)	Represents costs related to the Company’s business combination with FVAC II, non-capitalizable debt transaction costs, clinic acquisitions and acquisition-related integration and consulting and planning costs related to preparation to operate as a public company.

(5)	Represents expenses associated with renovation, equipment and marketing costs relating to the start-up and launch of new locations incurred prior to opening.

(6)	Represents non-ordinary course legal costs related to the previously disclosed ATIP shareholder class action complaints, derivative complaint and SEC inquiry.

(7)

Represents charges related to the derecognition of the proportionate amount of remaining unamortized deferred financing costs and original issuance discount associated with the partial repayment of the first lien term loan and derecognition of the unamortized original issuance discount associated with the full repayment of the subordinated second lien term loan.

(8)	Represents loss on settlement of redeemable preferred stock based on the value of cash and equity provided to preferred stockholders in relation to the outstanding redeemable preferred stock liability at the time of the closing of the business combination with FVAC II.

		Three Months Ended
		December 31,				September 30,				June 30,				March 31,
		2020				2020				2020				2020
Net income (loss)		$	2,190			$	1,022			$	4,596			$	(8,106	)
Plus (minus):
Net income attributable to non-controlling interests			(987	)			(901	)			(1,855	)			(1,330	)
Interest expense, net			16,404				17,346				17,683				17,858
Interest expense on redeemable preferred stock			5,154				4,896				4,604				4,377
Income tax (benefit) expense			(2,033	)			2,322				3,568				(1,792	)
Depreciation and amortization expense			10,072				9,880				9,763				9,985
EBITDA			30,800				34,565				38,359				20,992
Reorganization and severance costs(1)			679				4,436				1,255				1,142
Transaction and integration costs(2)			3,747				75				100				868
Share-based compensation			503				473				466				494
Pre-opening de novo costs(3)			335				368				268				594
Business optimization costs(4)			2,450				519				5,011				2,397
Charges related to lease terminations(5)			4,253				—				—				—
Adjusted EBITDA		$	42,767			$	40,436			$	45,459			$	26,487

(1)	Represents severance, consulting and other costs related to discrete initiatives focused on reorganization and delayering of the Company’s labor model, management structure and support functions.

(2)	Represents costs related to the Company’s business combination with FVAC II, clinic acquisitions and acquisition-related integration and consulting and planning costs related to preparation to operate as a public company.

(3)	Represents expenses associated with renovation, equipment and marketing costs relating to the start-up and launch of new locations incurred prior to opening.

(4)

Represents non-recurring costs to optimize our platform and ATI transformative initiatives. Costs primarily relate to duplicate costs driven by IT and Revenue Cycle Management conversions, labor related costs during the transition of key positions and other incremental costs of driving optimization initiatives.

(5)	Represents charges related to lease terminations prior to the end of term for corporate facilities no longer in use.

		Three Months Ended
		December 31,				September 30,				June 30,				March 31,
		2019				2019				2019				2019
Net income (loss)		$	31,914			$	(6,046	)		$	(4,816	)		$	(11,303	)
Plus (minus):
Net income attributable to non-controlling interests			(1,234	)			(878	)			(933	)			(1,355	)
Interest expense, net			18,022				19,263				19,927				19,760
Interest expense on redeemable preferred stock			4,206				4,000				3,763				3,542
Income tax benefit			(36,095	)			(2,055	)			(1,825	)			(4,044	)
Depreciation and amortization expense			9,884				9,567				9,635				10,018
EBITDA			26,697				23,851				25,751				16,618
Reorganization and severance costs(1)			3,401				120				775				4,035
Transaction and integration costs(2)			3,998				198				310				29
Share-based compensation			(57	)			559				795				525
Pre-opening de novo costs(3)			438				757				487				593
Business optimization costs(4)			5,129				3,970				5,224				4,189
Adjusted EBITDA		$	39,606			$	29,455			$	33,342			$	25,989

(1)	Represents severance, consulting and other costs related to discrete initiatives focused on reorganization and delayering of the Company’s labor model, management structure and support functions.

(2)	Represents costs related to the Company’s business combination with FVAC II, clinic acquisitions and acquisition-related integration and consulting and planning costs related to preparation to operate as a public company.

(3)	Represents expenses associated with renovation, equipment and marketing costs relating to the start-up and launch of new locations incurred prior to opening.

(4)

Represents non-recurring costs to optimize our platform and ATI transformative initiatives. Costs primarily relate to duplicate costs driven by IT and Revenue Cycle Management conversions, labor related costs during the transition of key positions and other incremental costs of driving optimization initiatives.