Diplomat opened its doors in 1975 as a neighborhood pharmacy with one essential tenet: "Take good care of patients and the rest falls into place." Today, that tradition continues—always focused on improving patient care and clinical adherence. Non-GAAP Information Adjusted EPS adds back, net of income taxes, the impact of all merger and acquisition related expenses, including amortization of intangible assets, the change in fair value of contingent consideration, as well as transaction-related costs.We exclude merger and acquisition-related expenses from Adjusted EPS because we believe the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and such expenses can vary significantly between periods as a result of new acquisitions, full amortization of previously acquired intangible assets, or ultimate realization of contingent consideration.We consider Adjusted EBITDA and Adjusted EPS to be supplemental measures of our operating performance.We present Adjusted EBITDA and Adjusted EPS because they are used by our Board of Directors and management to evaluate our operating performance.Other companies in our industry may calculate Adjusted EBITDA and Adjusted EPS differently than we do and these calculations may not be comparable to our Adjusted EBITDA and Adjusted EPS metrics.A reconciliation of Adjusted EBITDA, a non-GAAP measure, to net income (loss) attributable to Diplomat can be found below.2017 is a transition year for Diplomat, and we continue to make significant strides, including broadening our services through our acquisitions of NPS and 8th Day Software and enhancing our senior management team to execute on our strategy to become a broader-based health care company." Third Quarter Financial Summary: Revenue for the third quarter of 2017 was and 6.6% in the third quarter of 2016.The gross margin increase in the quarter was primarily due to the continued growth of our specialty infusion therapeutic category, the impact of our WRB Communications acquisition, each having higher margins, the receipt and recognition of approximately increase in the fair value of contingent consideration, both of which are associated with our acquired entities.
Adjusted EBITDA is not in accordance with, or an alternative to, GAAP.
Net income attributable to Diplomat for the third quarter of 2017 was Our EPS and Adjusted EPS expectations assume approximately 68,600,000 weighted average common shares outstanding on a diluted basis and a tax rate of 19%, versus the previous tax rate of 26%, for the full year 2017, which could differ materially.
Earnings Conference Call Information As previously announced, the Company will hold a conference call to discuss its third quarter performance this evening, .
As a percentage of revenue, SG&A excluding change in fair value of contingent consideration and the prior year period impairment was 7.2% for the three months ended , compared to 6.1% in the prior year period.
This increase is primarily attributable to acquisition related amortization, professional fees, and the increased operating complexity associated with both our acquisitions and new drugs.
Adjusted EBITDA is also used as a factor in determining incentive compensation, for budgetary planning and forecasting overall financial and operational expectations, for identifying underlying trends, and for evaluating the effectiveness of our business strategies.