NHC Reports Year End Earnings

Business Wire

MURFREESBORO, Tenn.--(BUSINESS WIRE)-- National HealthCare Corporation (NYSE American: NHC), the nation's oldest publicly traded senior health care company, announced today net operating revenues for the year ended December 31, 2017 totaled $966,996,000 compared to $926,638,000 for the year ended December 31, 2016, an increase of 4.4%. For the year ended December 31, 2017, net income attributable to NHC was $56,205,000 compared to $50,538,000 for the 2016 year, an increase of 11.2% and reflects the 2017 fourth quarter tax benefit adjustment of $8.5 million from the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). Excluding the 2017 Tax Act adjustment and the operating losses from the two newly constructed skilled nursing facilities and three assisted living facilities placed in service in 2017 and 2016, net income attributable to NHC would have been $51,526,000 for the year ended December 31, 2017.

Diluted earnings per share were $3.69 and $3.32 for the years ended December 31, 2017 and 2016, respectively, which is an increase of 11.1% and also reflects the positive 2017 Tax Act adjustment.

Net operating revenues for the three months ended December 31, 2017 totaled $246,311,000 compared to $238,001,000 for the same three months in 2016, an increase of 3.5%. The fourth quarter of 2017 net income attributable to NHC was $21,470,000, or $1.41 per diluted share, which includes the $8.5 million Tax Act adjustment. In the fourth quarter of 2016, net income attributable to NHC was $13,863,000, or $0.91 per diluted share.

Forward-Looking Statements

Statements in this press release that are not historical facts are forward-looking statements. NHC cautions investors that any forward-looking statements made involve risks and uncertainties and are not guarantees of future performance. The risks and uncertainties are detailed from time to time in reports filed by NHC with the S.E.C., including Forms 8-K, 10-Q and 10-K, and include, among others, the following: liabilities and other claims asserted against us and patient care liabilities, as well as the resolution of current litigation; availability of insurance and assets for indemnification; national and local economic conditions; including their effect on the availability and cost of labor, utilities and materials; the effect of government regulations and changes in regulations governing the healthcare industry, including our compliance with such regulations; changes in Medicare and Medicaid payment levels and methodologies and the application of such methodologies by the government and its fiscal intermediaries; and other factors referenced or incorporated by reference in the S.E.C. filings. The risks included here are not exhaustive. All forward-looking statements represent NHC’s best judgment as of the date of this release.

About NHC

NHC affiliates operate for themselves and third parties 76 skilled nursing facilities with 9,597 beds. NHC affiliates also operate 24 assisted living communities, five independent living communities, and 36 homecare programs. NHC’s other services include Alzheimer’s units, long-term care pharmacies, hospice, a rehabilitation services company, and providing management and accounting services to third parties. Other information about the company can be found on our web site at www.nhccare.com.


Consolidated Statements of Income
(in thousands, except share and per share amounts)
	Three Months Ended					Year Ended
	December 31					December 31
	2017		2016			2017			2016
	(unaudited)
Revenues:
Net patient revenues	$	233,989	$	227,484		$	919,843		$	880,724
Other revenues		12,322		10,517			47,153			45,914
Net operating revenues		246,311		238,001			966,996			926,638

Costs and expenses:
Salaries, wages and benefits		145,404		142,516			572,043			548,007
Other operating		62,156		56,262			252,934			233,833
Facility rent		10,094		10,332			40,367			41,292
Depreciation and amortization		11,043		10,176			42,652			39,023
Interest		1,291		1,028			4,890			3,941
Total costs and expenses		229,988		220,314			912,886			866,096

Income before non-operating income		16,323		17,687			54,110			60,542
Non-operating income		4,392		4,876			20,439			19,665

Income before income taxes		20,715		22,563			74,549			80,207
Income tax (provision)/benefit		581		(8,700	)		(18,867	)		(29,669	)
Net income		21,296		13,863			55,682			50,538

Loss attributable to noncontrolling interest		174		-			523			-

Net income attributable to National HealthCare Corporation	$	21,470	$	13,863		$	56,205		$	50,538

Earnings per common share
Basic	$	1.41	$	0.92		$	3.70		$	3.34
Diluted	$	1.41	$	0.91		$	3.69		$	3.32

Weighted average common shares outstanding
Basic		15,200,619		15,150,514			15,189,920			15,134,518
Diluted		15,222,343		15,176,453			15,218,962			15,206,997

Dividends declared per common share	$	0.48	$	0.45		$	1.89		$	1.75

Balance Sheet Data
(in thousands)	Dec. 31		Dec. 31
	2017		2016

Cash, cash equivalents and marketable securities	$	198,203	$	164,348
Restricted cash, cash equivalents and marketable securities		174,698		188,958
Current assets		329,311		290,857
Property and equipment, net		549,319		559,624
Total assets		1,096,526		1,087,447
Current liabilities		155,065		150,928
Long-term debt		100,000		120,000
NHC stockholders' equity		702,738		669,611


Selected Operating Statistics


	Three Months Ended				Year Ended
	December 31				December 31
	2017		2016		2017		2016
	(unaudited)
Skilled Nursing Per Diems:
Medicare	$	459.14	$	462.59	$	460.82	$	452.51
Managed Care		400.91		413.40		405.67		404.78
Medicaid		187.07		186.24		186.53		182.89
Private Pay and Other		231.17		225.98		231.61		224.53

Average Skilled Nursing Per Diem	$	265.30	$	262.87	$	266.45	$	259.80

Skilled Nursing Patient Days:
Medicare		121,295		115,970		481,580		475,637
Managed Care		58,421		56,342		244,908		222,635
Medicaid		321,653		325,940		1,281,432		1,284,722
Private Pay and Other		183,633		180,787		725,460		712,570

Total Skilled Nursing Patient Days		685,002		679,039		2,733,380		2,695,564