Tenet Reports Results for the First Quarter Ended March 31, 2017
- Reported a net loss from continuing operations of
$52 million or$0.52 per share. Adjusted diluted earnings per share from continuing operations was a loss of$0.27 . - Adjusted EBITDA was
$527 million including a$7 million benefit from a change in pension accounting. - Same-hospital patient revenue declined 1.0% and reflects a 1.6% increase in revenue per adjusted admission offset by a 2.5% decline in adjusted admissions. Hospital segment Adjusted EBITDA totaled
$309 million . - Ambulatory Care segment revenue increased 6.1% on a same-facility system-wide basis, with cases increasing 0.5% and revenue per case increasing 5.6%. Adjusted EBITDA for the Ambulatory segment was
$153 million , a 12.5% increase, representing a margin of 33.6%. - Revenue from
Conifer Health Solutions increased 4.4% with revenue from third parties increasing 11.5%. Conifer generated$65 million of Adjusted EBITDA, a 3.2% increase, representing a margin of 16.2%. - Net cash provided by operating activities was
$186 million , a$39 million improvement when compared to$147 million in the first quarter of 2016. Adjusted Free Cash Flow was$9 million , a$2 million decline when compared to$11 million in the first quarter of 2016. - Reached new multi-year agreement with Humana to restore in-network access to all Tenet providers between
June 1, 2017 andOctober 1, 2017 . - Entered into definitive agreement to sell acute care hospitals and related operations in
Houston to HCA, with net proceeds anticipated to be approximately$725 million . - Accelerating the purchase of USPI and anticipate owning 80% of the joint venture on or before
July 3, 2017 and 95% inJuly 2019 . - Updated the Outlook for 2017 to reflect a change in accounting for pension expense. The Outlook for 2017 includes net income from continuing operations attributable to Tenet common shareholders of
$71 million to$95 million , Adjusted EBITDA of$2.525 billion to$2.625 billion and Adjusted diluted earnings per share from continuing operations of$1.05 to$1.30 .
“In the first quarter, we achieved strong financial results, delivering Adjusted EBITDA that was at the high end of our Outlook range,” said
Adjusted EBITDA of
(i) no revenue being recorded under the California Provider Fee program in the first quarter of 2017 versus
(ii) the sale of Tenet’s hospitals in
(iii) approximately
Note that the
Hospital Operations and Other Segment
Net operating revenue in the Hospital Operations and other segment was
On a same-hospital basis, patient revenue decreased to
Adjusted EBITDA in Tenet’s hospital segment was
Tenet’s health plan business generated losses of
Selected operating expenses in the segment, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased 1.9 percent on a per adjusted admission basis.
Exchanges
Tenet’s same-hospital exchange admissions were 5,168 in the first quarter of 2017, down 1.8 percent from the first quarter of 2016. Same-hospital exchange outpatient visits were 51,008 in the first quarter of 2017, up 13.9 percent from the first quarter of 2016.
Uncompensated Care
Tenet’s provision for doubtful accounts was
Tenet’s uncompensated care costs, defined as the sum of the provision for doubtful accounts, charity care write-offs and uninsured discounts, was
Uninsured plus charity admissions increased by 516 admissions, or 5.4 percent on a same-hospital basis in the first quarter of 2017 compared to the first quarter of 2016. Uninsured plus charity outpatient visits decreased by 17,998 visits, or 12.5 percent, on a same-hospital basis.
Ambulatory Care Segment
During the first quarter of 2017, the Ambulatory segment produced net operating revenues of
The results of many of the facilities in which the Ambulatory segment has an investment are not consolidated by Tenet. To help analyze the segment’s results of operations, management uses system-wide measures which include revenues and cases of both consolidated and unconsolidated facilities. On a same-facility system-wide basis, revenue in the Ambulatory segment increased 6.1 percent, with cases increasing 0.5 percent and revenue per case increasing 5.6 percent. Excluding patients insured by Humana in both periods, same-facility system-wide cases increased 2.4 percent in the first quarter of 2017.
Conifer Segment
During the first quarter of 2017, Conifer’s revenue increased 4.4 percent to
Net Income and Earnings Per Share
Tenet reported a net loss from continuing operations of
After adjusting for certain items which are listed on Table #2, Tenet recorded an Adjusted net loss from continuing operations of
A reconciliation of GAAP net income available (loss attributable) to
Cash Flow and Liquidity
Cash and cash equivalents were
Net cash provided by operating activities for the three months ended
Net cash used in investing activities was
Net cash used by financing activities was
Reconciliations of net cash provided by operating activities to both Free Cash Flow and Adjusted Free Cash Flow are contained in Table #3 at the end of this release.
Humana Agreement
The Company’s hospitals that are being added to Humana’s network on
Definitive Agreement to Sell Acute Care Hospitals and Related Operations in
The facilities included in the sale are three acute care hospitals (
During 2016, these facilities generated net revenue after the provision for doubtful accounts of approximately
Accelerating the Purchase of USPI
The Company has amended its put/call agreement with
Tenet expects to buy from Welsh Carson another 7.5 percent of USPI in 2018 and 7.5 percent in 2019. As a result, Tenet expects to own 95 percent of USPI in 2019 with the remaining 5 percent owned by a subsidiary of
The Company expects to fund these payments from general sources of corporate liquidity, including cash on hand, proceeds of asset divestitures and borrowings under the Company’s credit agreement.
Health Plan,
The Company anticipates receiving net proceeds of approximately
Outlook
The Company is raising its 2017 Adjusted EBITDA Outlook range by
The Company’s Outlook for 2017 includes:
- Revenue of
$19.7 billion to$20.1 billion , - Net income from continuing operations attributable to Tenet common shareholders of
$71 million to$95 million , - Adjusted EBITDA of
$2.525 billion to$2.625 billion , - Net cash provided by operating activities of
$1.3 billion to$1.5 billion , - Adjusted Free Cash Flow of
$600 million to$800 million , - Diluted earnings per share from continuing operations of
$0.70 to$0.93 , and - Adjusted diluted earnings per share from continuing operations of
$1.05 to$1.30 .
The
The Outlook for 2017 assumes equity in earnings of unconsolidated affiliates of
The Outlook includes a full year of financial results from the Company’s hospitals in
The Company’s Outlook for the second quarter of 2017 includes:
- Revenue of
$4.85 billion to$5.05 billion , - Net loss from continuing operations attributable to Tenet common shareholders ranging from a loss of
$30 million to a loss of$25 million , - Adjusted EBITDA of
$550 million to$600 million , - A loss per share from continuing operations ranging from a loss of
$0.30 to a loss of$0.25 , and - An Adjusted loss per share from continuing operations ranging from a loss of
$0.20 to a loss of$0.10 .
The Outlook for the second quarter assumes equity in earnings of unconsolidated affiliates of approximately
Additional details on Tenet’s Outlook for both the second quarter and calendar year 2017 are available in Tables 4 and 5 at the end of this press release and in an accompanying slide presentation that is accessible through the Company’s website at www.tenethealth.com/investors.
Management’s Webcast Discussion of First Quarter Results
Tenet management will discuss the Company’s first quarter 2017 results on a webcast scheduled for
Additional information regarding Tenet’s quarterly results of operations is contained in its Form 10-K report for the twelve months ended
This press release includes certain non-GAAP measures, such as Adjusted EBITDA, Adjusted net income from continuing operations, Adjusted diluted earnings per share from continuing operations, Free Cash Flow and Adjusted Free Cash Flow. Reconciliations of these measures to the most comparable GAAP measure are contained in the tables at the end of this release.
The terms "THC", "
This release contains “forward-looking statements” – that is, statements that relate to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “assume,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include, but are not limited to, the factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended
Tenet uses its Company website to provide important information to investors about the Company including the posting of important announcements regarding financial performance and corporate developments.
| |
||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| (Dollars in millions except per share amounts) | Three Months Ended |
|||||||||||||||||||||
| 2017 | % | 2016 | % | Change | ||||||||||||||||||
| Net operating revenues: | ||||||||||||||||||||||
| Net operating revenues before provision for doubtful accounts | $ | 5,196 | $ | 5,420 | (4.1 | )% | ||||||||||||||||
| Less: Provision for doubtful accounts | 383 | 376 | 1.9 | % | ||||||||||||||||||
| Net operating revenues | 4,813 | 100.0 | % | 5,044 | 100.0 | % | (4.6 | )% | ||||||||||||||
| Equity in earnings of unconsolidated affiliates | 29 | 0.6 | % | 24 | 0.5 | % | 20.8 | % | ||||||||||||||
| Operating expenses: | ||||||||||||||||||||||
| Salaries, wages and benefits | 2,380 | 49.4 | % | 2,395 | 47.5 | % | (0.6 | )% | ||||||||||||||
| Supplies | 765 | 15.9 | % | 811 | 16.1 | % | (5.7 | )% | ||||||||||||||
| Other operating expenses, net | 1,187 | 24.7 | % | 1,242 | 24.6 | % | (4.4 | )% | ||||||||||||||
| Electronic health record incentives | (1 | ) | — | % | — | — | % | 100.0 | % | |||||||||||||
| Depreciation and amortization | 221 | 4.6 | % | 212 | 4.2 | % | ||||||||||||||||
| Impairment and restructuring charges, and acquisition-related costs | 33 | 0.7 | % | 28 | 0.6 | % | ||||||||||||||||
| Litigation and investigation costs | 5 | 0.1 | % | 173 | 3.4 | % | ||||||||||||||||
| Gains on sales, consolidation and deconsolidation of facilities | (15 | ) | (0.3 | )% | (147 | ) | (2.9 | )% | ||||||||||||||
| Operating income | 267 | 5.5 | % | 354 | 7.0 | % | ||||||||||||||||
| Interest expense | (258 | ) | (243 | ) | ||||||||||||||||||
| Other non-operating income (expense), net | (5 | ) | (6 | ) | ||||||||||||||||||
| Net income from continuing operations, before income taxes | 4 | 105 | ||||||||||||||||||||
| Income tax benefit (expense) | 33 | (67 | ) | |||||||||||||||||||
| Net income from continuing operations, before discontinued operations | 37 | 38 | ||||||||||||||||||||
| Discontinued operations: | ||||||||||||||||||||||
| Net loss from operations | (2 | ) | (5 | ) | ||||||||||||||||||
| Income tax benefit | 1 | 1 | ||||||||||||||||||||
| Net loss from discontinued operations | (1 | ) | (4 | ) | ||||||||||||||||||
| Net income | 36 | 34 | ||||||||||||||||||||
| Less: Net income attributable to noncontrolling interests | 89 | 93 | ||||||||||||||||||||
| Net loss attributable to |
$ | (53 | ) | $ | (59 | ) | ||||||||||||||||
| Amounts attributable to |
||||||||||||||||||||||
| Net loss from continuing operations, net of tax | $ | (52 | ) | $ | (55 | ) | ||||||||||||||||
| Net loss from discontinued operations, net of tax | (1 | ) | (4 | ) | ||||||||||||||||||
| Net loss attributable to |
$ | (53 | ) | $ | (59 | ) | ||||||||||||||||
| Loss per share attributable to |
||||||||||||||||||||||
| Basic | ||||||||||||||||||||||
| Continuing operations | $ | (0.52 | ) | $ | (0.56 | ) | ||||||||||||||||
| Discontinued operations | (0.01 | ) | (0.04 | ) | ||||||||||||||||||
| $ | (0.53 | ) | $ | (0.60 | ) | |||||||||||||||||
| Diluted | ||||||||||||||||||||||
| Continuing operations | $ | (0.52 | ) | $ | (0.56 | ) | ||||||||||||||||
| Discontinued operations | (0.01 | ) | (0.04 | ) | ||||||||||||||||||
| $ | (0.53 | ) | $ | (0.60 | ) | |||||||||||||||||
| Weighted average shares and dilutive securities outstanding (in thousands): | ||||||||||||||||||||||
| Basic | 100,000 | 98,768 | ||||||||||||||||||||
| Diluted* | 100,000 | 98,768 | ||||||||||||||||||||
| * | Had the Company generated income from continuing operations in the three months ended |
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||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||
| (Unaudited) | ||||||||||
| |
|
|||||||||
| (Dollars in millions) | 2017 | 2016 | ||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 572 | $ | 716 | ||||||
| Accounts receivable, less allowance for doubtful accounts | 2,960 | 2,897 | ||||||||
| Inventories of supplies, at cost | 324 | 326 | ||||||||
| Income tax receivable | 26 | 4 | ||||||||
| Assets held for sale | 3 | 29 | ||||||||
| Other current assets | 1,167 | 1,285 | ||||||||
| Total current assets | 5,052 | 5,257 | ||||||||
| Investments and other assets | 1,260 | 1,250 | ||||||||
| Deferred income taxes | 930 | 871 | ||||||||
| Property and equipment, at cost, less accumulated depreciation and amortization | 7,976 | 8,053 | ||||||||
| |
7,429 | 7,425 | ||||||||
| Other intangible assets, at cost, less accumulated amortization | 1,863 | 1,845 | ||||||||
| Total assets | $ | 24,510 | $ | 24,701 | ||||||
| LIABILITIES AND EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Current portion of long-term debt | $ | 147 | $ | 191 | ||||||
| Accounts payable | 1,179 | 1,329 | ||||||||
| Accrued compensation and benefits | 739 | 872 | ||||||||
| Professional and general liability reserves | 201 | 181 | ||||||||
| Accrued interest payable | 327 | 210 | ||||||||
| Liabilities held for sale | — | 9 | ||||||||
| Accrued legal settlement costs | 11 | 8 | ||||||||
| Other current liabilities | 1,163 | 1,234 | ||||||||
| Total current liabilities | 3,767 | 4,034 | ||||||||
| Long-term debt, net of current portion | 15,071 | 15,064 | ||||||||
| Professional and general liability reserves | 614 | 613 | ||||||||
| Defined benefit plan obligations | 624 | 626 | ||||||||
| Deferred income taxes | 289 | 279 | ||||||||
| Other long-term liabilities | 621 | 610 | ||||||||
| Total liabilities | 20,986 | 21,226 | ||||||||
| Commitments and contingencies | ||||||||||
| Redeemable noncontrolling interests in equity of consolidated subsidiaries | 2,430 | 2,393 | ||||||||
| Equity: | ||||||||||
| Shareholders’ equity: | ||||||||||
| Common stock | 7 | 7 | ||||||||
| Additional paid-in capital | 4,834 | 4,827 | ||||||||
| Accumulated other comprehensive loss | (255 | ) | (258 | ) | ||||||
| Accumulated deficit | (1,739 | ) | (1,742 | ) | ||||||
| Common stock in treasury, at cost | (2,417 | ) | (2,417 | ) | ||||||
| Total shareholders’ equity | 430 | 417 | ||||||||
| Noncontrolling interests | 664 | 665 | ||||||||
| Total equity | 1,094 | 1,082 | ||||||||
| Total liabilities and equity | $ | 24,510 | $ | 24,701 | ||||||
| |
||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOW | ||||||||||
| (Unaudited) | ||||||||||
| (Dollars in millions) | |
|||||||||
| 2017 | 2016 | |||||||||
| Net Income | $ | 36 | $ | 34 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||
| Depreciation and amortization | 221 | 212 | ||||||||
| Provision for doubtful accounts | 383 | 376 | ||||||||
| Deferred income tax expense | — | 31 | ||||||||
| Stock-based compensation expense | 13 | 16 | ||||||||
| Impairment and restructuring charges, and acquisition-related costs | 33 | 28 | ||||||||
| Litigation and investigation costs | 5 | 173 | ||||||||
| Gains on sales, consolidation and deconsolidation of facilities | (15 | ) | (147 | ) | ||||||
| Equity in earnings of unconsolidated affiliates, net of distributions received | 4 | 12 | ||||||||
| Amortization of debt discount and debt issuance costs | 11 | 10 | ||||||||
| Pre-tax loss from discontinued operations | 2 | 5 | ||||||||
| Other items, net | (2 | ) | 2 | |||||||
| Changes in cash from operating assets and liabilities: | ||||||||||
| Accounts receivable | (446 | ) | (453 | ) | ||||||
| Inventories and other current assets | 132 | (18 | ) | |||||||
| Income taxes | (34 | ) | 28 | |||||||
| Accounts payable, accrued expenses and other current liabilities | (161 | ) | (114 | ) | ||||||
| Other long-term liabilities | 26 | 24 | ||||||||
| Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (24 | ) | (69 | ) | ||||||
| Net cash provided by (used in) operating activities from discontinued operations, excluding income taxes | 2 | (3 | ) | |||||||
| Net cash provided by operating activities | 186 | 147 | ||||||||
| Cash flows from investing activities: | ||||||||||
| Purchases of property and equipment — continuing operations | (198 | ) | (208 | ) | ||||||
| Purchases of businesses or joint venture interests, net of cash acquired | (6 | ) | (29 | ) | ||||||
| Proceeds from sales of facilities and other assets | 20 | 573 | ||||||||
| Proceeds from sales of marketable securities, long-term investments and other assets | 9 | 12 | ||||||||
| Purchases of equity investments | (1 | ) | (18 | ) | ||||||
| Other assets | (12 | ) | (10 | ) | ||||||
| Other items, net | (1 | ) | — | |||||||
| Net cash provided by (used in) investing activities | (189 | ) | 320 | |||||||
| Cash flows from financing activities: | ||||||||||
| Repayments of borrowings under credit facility | — | (995 | ) | |||||||
| Proceeds from borrowings under credit facility | — | 995 | ||||||||
| Repayments of other borrowings | (89 | ) | (38 | ) | ||||||
| Proceeds from other borrowings | 6 | 1 | ||||||||
| Debt issuance costs | (2 | ) | — | |||||||
| Distributions paid to noncontrolling interests | (63 | ) | (44 | ) | ||||||
| Proceeds from sales of noncontrolling interest | 10 | — | ||||||||
| Proceeds from employee stock plan purchases | 2 | — | ||||||||
| Other items, net | (5 | ) | (14 | ) | ||||||
| Net cash used in financing activities | (141 | ) | (95 | ) | ||||||
| Net increase (decrease) in cash and cash equivalents | (144 | ) | 372 | |||||||
| Cash and cash equivalents at beginning of period | 716 | 356 | ||||||||
| Cash and cash equivalents at end of period | $ | 572 | $ | 728 | ||||||
| Supplemental disclosures: | ||||||||||
| Interest paid, net of capitalized interest | $ | (130 | ) | $ | (132 | ) | ||||
| Income tax payments, net | $ | (1 | ) | $ | (6 | ) | ||||
| |
|||||||||||||||
|
SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS(1) |
|||||||||||||||
| (Unaudited) | |||||||||||||||
| (Dollars in millions except per patient day, | |||||||||||||||
| per admission, per adjusted admission | Three Months Ended |
||||||||||||||
| and per visit amounts) | 2017 | 2016 | Change | ||||||||||||
| Admissions, |
|||||||||||||||
| Number of hospitals (at end of period) | 76 | 80 | (4 | ) | * | ||||||||||
| Total admissions | 196,907 | 211,799 | (7.0 | )% | |||||||||||
| Adjusted patient admissions | 347,150 | 362,819 | (4.3 | )% | |||||||||||
| Paying admissions (excludes charity and uninsured) | 186,648 | 201,436 | (7.3 | )% | |||||||||||
| Charity and uninsured admissions | 10,259 | 10,363 | (1.0 | )% | |||||||||||
| Admissions through emergency department | 126,473 | 136,056 | (7.0 | )% | |||||||||||
| Paying admissions as a percentage of total admissions | 94.8 | % | 95.1 | % | (0.3 | )% | * | ||||||||
| Charity and uninsured admissions as a percentage of total admissions | 5.2 | % | 4.9 | % | 0.3 | % | * | ||||||||
| Emergency department admissions as a percentage of total admissions | 64.2 | % | 64.2 | % | — | % | * | ||||||||
| Surgeries — inpatient | 51,800 | 55,755 | (7.1 | )% | |||||||||||
| Surgeries — outpatient | 69,604 | 76,829 | (9.4 | )% | |||||||||||
| Total surgeries | 121,404 | 132,584 | (8.4 | )% | |||||||||||
| Patient days — total | 923,339 | 1,010,514 | (8.6 | )% | |||||||||||
| Adjusted patient days | 1,603,698 | 1,714,369 | (6.5 | )% | |||||||||||
| Average length of stay (days) | 4.69 | 4.77 | (1.7 | )% | |||||||||||
| Licensed beds (at end of period) | 20,439 | 21,529 | (5.1 | )% | |||||||||||
| Average licensed beds | 20,440 | 21,524 | (5.0 | )% | |||||||||||
| Utilization of licensed beds | 50.2 | % | 51.6 | % | (1.4 | )% | * | ||||||||
| Outpatient Visits | |||||||||||||||
| Total visits | 2,039,942 | 2,146,618 | (5.0 | )% | |||||||||||
| Paying visits (excludes charity and uninsured) | 1,908,212 | 1,984,515 | (3.8 | )% | |||||||||||
| Charity and uninsured visits | 131,730 | 162,103 | (18.7 | )% | |||||||||||
| Emergency department visits | 733,051 | 789,916 | (7.2 | )% | |||||||||||
| Paying visits as a percentage of total visits | 93.5 | % | 92.4 | % | 1.1 | % | * | ||||||||
| Charity and uninsured visits as a percentage of total visits | 6.5 | % | 7.6 | % | (1.1 | )% | * | ||||||||
| Total emergency department admissions and visits | 859,524 | 925,972 | (7.2 | )% | |||||||||||
| Revenues | |||||||||||||||
| Net inpatient revenues | $ | 2,609 | $ | 2,781 | (6.2 | )% | |||||||||
| Net outpatient revenues | $ | 1,482 | $ | 1,514 | (2.1 | )% | |||||||||
|
Total patient revenues |
$ | 4,091 | $ | 4,295 | (4.7 | )% | |||||||||
| Revenues on a Per Admission, Per |
|||||||||||||||
| Net inpatient revenue per admission | $ | 13,250 | $ | 13,130 | 0.9 | % | |||||||||
| Net inpatient revenue per patient day | $ | 2,826 | $ | 2,752 | 2.7 | % | |||||||||
| Net outpatient revenue per visit | $ | 726 | $ | 705 | 3.0 | % | |||||||||
| Net patient revenue per adjusted patient admission | $ | 11,785 | $ | 11,838 | (0.4 | )% | |||||||||
| Net patient revenue per adjusted patient day | $ | 2,551 | $ | 2,505 | 1.8 | % | |||||||||
| Total selected operating expenses (salaries, wages and benefits, supplies and other operating expenses) per adjusted patient admission(2) | $ | 10,290 | $ | 10,103 | 1.9 | % | |||||||||
| Net Patient Revenues from: | |||||||||||||||
| |
21.0 | % | 20.0 | % | 1.0 | % | * | ||||||||
| |
6.7 | % | 8.7 | % | (2.0 | )% | * | ||||||||
| Managed care | 62.3 | % | 61.1 | % | 1.2 | % | * | ||||||||
| Indemnity, self-pay and other | 10.0 | % | 10.2 | % | (0.2 | )% | * | ||||||||
| (1) | Represents the consolidated results of Tenet’s Hospital Operations and other segment. | |
| (2) | Excludes operating expenses from Tenet’s health plans. | |
| * | This change is the difference between the 2017 and 2016 amounts shown |
| |
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|
SELECTED STATISTICS – CONTINUING SAME HOSPITALS(1) |
|||||||||||||||
| (Unaudited) | |||||||||||||||
| (Dollars in millions except per patient day, | |||||||||||||||
| per admission, per adjusted admission | Three Months Ended |
||||||||||||||
| and per visit amounts) | 2017 | 2016 | Change | ||||||||||||
| Admissions, |
|||||||||||||||
| Number of hospitals (at end of period) | 75 | 75 | — | * | |||||||||||
| Total admissions | 196,182 | 202,873 | (3.3 | )% | |||||||||||
| Adjusted patient admissions | 339,522 | 348,221 | (2.5 | )% | |||||||||||
| Paying admissions (excludes charity and uninsured) | 186,079 | 193,286 | (3.7 | )% | |||||||||||
| Charity and uninsured admissions | 10,103 | 9,587 | 5.4 | % | |||||||||||
| Admissions through emergency department | 126,067 | 129,606 | (2.7 | )% | |||||||||||
| Paying admissions as a percentage of total admissions | 94.9 | % | 95.3 | % | (0.4 | )% | * | ||||||||
| Charity and uninsured admissions as a percentage of total admissions | 5.1 | % | 4.7 | % | 0.4 | % | * | ||||||||
| Emergency department admissions as a percentage of total admissions | 64.3 | % | 63.9 | % | 0.4 | % | * | ||||||||
| Surgeries — inpatient | 51,723 | 53,739 | (3.8 | )% | |||||||||||
| Surgeries — outpatient | 69,553 | 74,360 | (6.5 | )% | |||||||||||
| Total surgeries | 121,276 | 128,099 | (5.3 | )% | |||||||||||
| Patient days — total | 921,014 | 960,998 | (4.2 | )% | |||||||||||
| Adjusted patient days | 1,583,962 | 1,637,408 | (3.3 | )% | |||||||||||
| Average length of stay (days) | 4.69 | 4.74 | (1.1 | )% | |||||||||||
| Licensed beds (at end of period) | 20,333 | 20,380 | (0.2 | )% | |||||||||||
| Average licensed beds | 20,334 | 20,375 | (0.2 | )% | |||||||||||
| Utilization of licensed beds | 50.3 | % | 52.4 | % | (2.1 | )% | * | ||||||||
| Outpatient Visits | |||||||||||||||
| Total visits | 2,009,408 | 2,052,169 | (2.1 | )% | |||||||||||
| Paying visits (excludes charity and uninsured) | 1,883,235 | 1,907,998 | (1.3 | )% | |||||||||||
| Charity and uninsured visits | 126,173 | 144,171 | (12.5 | )% | |||||||||||
| Emergency department visits | 703,035 | 733,756 | (4.2 | )% | |||||||||||
| Paying visits as a percentage of total visits | 93.7 | % | 93.0 | % | 0.7 | % | * | ||||||||
| Charity and uninsured visits as a percentage of total visits | 6.3 | % | 7.0 | % | (0.7 | )% | * | ||||||||
| Total emergency department admissions and visits | 829,102 | 863,362 | (4.0 | )% | |||||||||||
| Revenues | |||||||||||||||
| Net inpatient revenues | $ | 2,605 | $ | 2,663 | (2.2 | )% | |||||||||
| Net outpatient revenues | $ | 1,463 | $ | 1,445 | 1.2 | % | |||||||||
| Total patient revenues | $ | 4,068 | $ | 4,108 | (1.0 | )% | |||||||||
| Revenues on a Per Admission, Per |
|||||||||||||||
| Net inpatient revenue per admission | $ | 13,278 | $ | 13,126 | 1.2 | % | |||||||||
| Net inpatient revenue per patient day | $ | 2,828 | $ | 2,771 | 2.1 | % | |||||||||
| Net outpatient revenue per visit | $ | 728 | $ | 704 | 3.4 | % | |||||||||
| Net patient revenue per adjusted patient admission | $ | 11,982 | $ | 11,797 | 1.6 | % | |||||||||
| Net patient revenue per adjusted patient day | $ | 2,568 | $ | 2,509 | 2.4 | % | |||||||||
| Net Patient Revenues from: | |||||||||||||||
| |
21.1 | % | 20.0 | % | 1.1 | % | * | ||||||||
| |
6.8 | % | 8.6 | % | (1.8 | )% | * | ||||||||
| Managed care | 62.0 | % | 61.6 | % | 0.4 | % | * | ||||||||
| Indemnity, self-pay and other | 10.1 | % | 9.8 | % | 0.3 | % | * | ||||||||
| (1) | Information for our Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same 75 hospitals operated throughout the three months ended |
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* |
This change is the difference between the 2017 and 2016 amounts shown |
| |
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|
SELECTED STATISTICS – CONTINUING SAME HOSPITALS(1) |
|||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| (Dollars in millions except per patient day, | |||||||||||||||||||||||||
| per admission, per adjusted admission | Three Months Ended | Year Ended | |||||||||||||||||||||||
| and per visit amounts) | |
|
|
|
|
||||||||||||||||||||
| Admissions, |
|||||||||||||||||||||||||
| Number of hospitals (at end of period) | 75 | 75 | 75 | 75 | 75 | ||||||||||||||||||||
| Total admissions | 202,873 | 193,779 | 194,179 | 191,910 | 782,741 | ||||||||||||||||||||
| Adjusted patient admissions | 348,221 | 340,792 | 341,665 | 334,268 | 1,364,946 | ||||||||||||||||||||
| Paying admissions (excludes charity and uninsured) | 193,286 | 183,474 | 182,937 | 181,597 | 741,294 | ||||||||||||||||||||
| Charity and uninsured admissions | 9,587 | 10,305 | 11,242 | 10,313 | 41,447 | ||||||||||||||||||||
| Admissions through emergency department | 129,606 | 122,239 | 120,459 | 120,549 | 492,853 | ||||||||||||||||||||
| Paying admissions as a percentage of total admissions | 95.3 | % | 94.7 | % | 94.2 | % | 94.6 | % | 94.7 | % | |||||||||||||||
| Charity and uninsured admissions as a percentage of total admissions | 4.7 | % | 5.3 | % | 5.8 | % | 5.4 | % | 5.3 | % | |||||||||||||||
| Emergency department admissions as a percentage of total admissions | 63.9 | % | 63.1 | % | 62.0 | % | 62.8 | % | 63.0 | % | |||||||||||||||
| Surgeries — inpatient | 53,739 | 54,376 | 54,701 | 53,071 | 215,887 | ||||||||||||||||||||
| Surgeries — outpatient | 74,360 | 75,825 | 72,646 | 73,678 | 296,509 | ||||||||||||||||||||
| Total surgeries | 128,099 | 130,201 | 127,347 | 126,749 | 512,396 | ||||||||||||||||||||
| Patient days — total | 960,998 | 897,127 | 893,990 | 887,840 | 3,639,955 | ||||||||||||||||||||
| Adjusted patient days | 1,637,408 | 1,568,680 | 1,564,827 | 1,539,374 | 6,310,289 | ||||||||||||||||||||
| Average length of stay (days) | 4.74 | 4.63 | 4.60 | 4.63 | 4.65 | ||||||||||||||||||||
| Licensed beds (at end of period) | 20,380 | 20,380 | 20,340 | 20,354 | 20,354 | ||||||||||||||||||||
| Average licensed beds | 20,375 | 20,380 | 20,367 | 20,326 | 18,127 | ||||||||||||||||||||
| Utilization of licensed beds | 52.4 | % | 48.4 | % | 47.7 | % | 47.5 | % | 55.0 | % | |||||||||||||||
| Outpatient Visits | |||||||||||||||||||||||||
| Total visits | 2,052,169 | 2,025,946 | 1,991,999 | 1,928,913 | 7,999,027 | ||||||||||||||||||||
| Paying visits (excludes charity and uninsured) | 1,907,998 | 1,884,716 | 1,847,999 | 1,817,262 | 7,457,975 | ||||||||||||||||||||
| Charity and uninsured visits | 144,171 | 141,230 | 144,000 | 111,651 | 541,052 | ||||||||||||||||||||
| Emergency department visits | 733,756 | 703,276 | 690,692 | 679,463 | 2,807,187 | ||||||||||||||||||||
| Paying visits as a percentage of total visits | 93.0 | % | 93.0 | % | 92.8 | % | 94.2 | % | 93.2 | % | |||||||||||||||
| Charity and uninsured visits as a percentage of total visits | 7.0 | % | 7.0 | % | 7.2 | % | 5.8 | % | 6.8 | % | |||||||||||||||
| Total emergency department admissions and visits | 863,362 | 825,515 | 811,151 | 800,012 | 3,300,040 | ||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||
| Net inpatient revenues | $ | 2,663 | $ | 2,568 | $ | 2,634 | $ | 2,610 | $ | 10,475 | |||||||||||||||
| Net outpatient revenues | $ | 1,445 | $ | 1,451 | $ | 1,404 | $ | 1,445 | $ | 5,745 | |||||||||||||||
| Total patient revenues | $ | 4,108 | $ | 4,019 | $ | 4,038 | $ | 4,055 | $ | 16,220 | |||||||||||||||
| Revenues on a Per Admission, Per |
|||||||||||||||||||||||||
| Net inpatient revenue per admission | $ | 13,126 | $ | 13,252 | $ | 13,565 | $ | 13,600 | $ | 13,382 | |||||||||||||||
| Net inpatient revenue per patient day | $ | 2,771 | $ | 2,862 | $ | 2,946 | $ | 2,940 | $ | 2,878 | |||||||||||||||
| Net outpatient revenue per visit | $ | 704 | $ | 716 | $ | 705 | $ | 749 | $ | 718 | |||||||||||||||
| Net patient revenue per adjusted patient admission | $ | 11,797 | $ | 11,793 | $ | 11,819 | $ | 12,131 | $ | 11,883 | |||||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,509 | $ | 2,562 | $ | 2,580 | $ | 2,634 | $ | 2,570 | |||||||||||||||
| Net Patient Revenues from: | |||||||||||||||||||||||||
| |
20.0 | % | 21.8 | % | 20.1 | % | 20.5 | % | 20.6 | % | |||||||||||||||
| |
8.6 | % | 7.6 | % | 8.5 | % | 8.2 | % | 8.2 | % | |||||||||||||||
| Managed care | 61.6 | % | 59.6 | % | 64.0 | % | 61.0 | % | 61.6 | % | |||||||||||||||
| Indemnity, self-pay and other | 9.8 | % | 11.0 | % | 7.4 | % | 10.3 | % | 9.6 | % | |||||||||||||||
| (1) | Information for our Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same 75 hospitals operated throughout 2016, associated outpatient facilities and excludes the results of our new hospital THOP Transmountain Campus opened in |
| |
||||||||||
| SEGMENT REPORTING | ||||||||||
| (Unaudited) | ||||||||||
| |
|
|||||||||
| 2017 | 2016 | |||||||||
| Assets | ||||||||||
| Hospital Operations and other | $ | 17,619 | $ | 17,871 | ||||||
| Ambulatory Care | 5,747 | 5,722 | ||||||||
| Conifer | 1,144 | 1,108 | ||||||||
| Total | $ | 24,510 | $ | 24,701 | ||||||
| Three Months Ended | ||||||||||
| |
||||||||||
| 2017 | 2016 | |||||||||
| Capital expenditures: | ||||||||||
| Hospital Operations and other | $ | 183 | $ | 191 | ||||||
| Ambulatory Care | 11 | 12 | ||||||||
| Conifer | 4 | 5 | ||||||||
| Total | $ | 198 | $ | 208 | ||||||
| Net operating revenues: | ||||||||||
| Hospital Operations and other(1) | $ | 4,115 | $ | 4,397 | ||||||
| Ambulatory Care | 455 | 429 | ||||||||
| Conifer | ||||||||||
| Tenet | 159 | 167 | ||||||||
| Other customers | 243 | 218 | ||||||||
| Total Conifer revenues | 402 | 385 | ||||||||
| Intercompany eliminations | (159 | ) | (167 | ) | ||||||
| Total | $ | 4,813 | $ | 5,044 | ||||||
| Equity in earnings of unconsolidated affiliates: | ||||||||||
| Hospital Operations and other | $ | 2 | $ | (1 | ) | |||||
| Ambulatory Care | 27 | 25 | ||||||||
| Total | $ | 29 | $ | 24 | ||||||
| Adjusted EBITDA: | ||||||||||
| Hospital Operations and other(2) | $ | 309 | $ | 418 | ||||||
| Ambulatory Care | 153 | 136 | ||||||||
| Conifer | 65 | 63 | ||||||||
| Total | $ | 527 | $ | 617 | ||||||
| Depreciation and amortization: | ||||||||||
| Hospital Operations and other | $ | 187 | $ | 174 | ||||||
| Ambulatory Care | 22 | 25 | ||||||||
| Conifer | 12 | 13 | ||||||||
| Total | $ | 221 | $ | 212 | ||||||
| (1) | Hospital Operations and other revenues includes health plan revenues of |
|
| (2) | Hospital Operations and other EBITDA excludes health plan losses of |
|
|
||||||||||||||||||||
| |
||||||||||||||||||||
| STATEMENT OF OPERATIONS – AMBULATORY CARE SEGMENT | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (Dollars in millions) | Three Months Ended |
|||||||||||||||||||
| 2017 | 2016 | |||||||||||||||||||
|
Ambulatory |
Unconsolidated |
Ambulatory |
Unconsolidated |
|||||||||||||||||
| Net operating revenues: | ||||||||||||||||||||
| Net operating revenues before provision for doubtful accounts | $ | 462 | $ | 475 | $ | 437 | $ | 479 | ||||||||||||
| Less: Provision for doubtful accounts | (7 | ) | (10 | ) | (8 | ) | (14 | ) | ||||||||||||
|
Net operating revenues(1) |
(455 | ) | (465 | ) | (429 | ) | (465 | ) | ||||||||||||
|
Equity in earnings of unconsolidated affiliates(2) |
(27 | ) | (— | ) | (25 | ) | (— | ) | ||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Salaries, wages and benefits | 150 | 114 | 146 | 118 | ||||||||||||||||
| Supplies | 94 | 121 | 86 | 123 | ||||||||||||||||
| Other operating expenses, net | 85 | 97 | 86 | 102 | ||||||||||||||||
| Electronic health record incentives | — | — | — | — | ||||||||||||||||
| Depreciation and amortization | 22 | 16 | 25 | 18 | ||||||||||||||||
| Impairment and restructuring charges, and acquisition-related costs | 5 | — | 1 | — | ||||||||||||||||
| (Gains) loss on sales, consolidation and deconsolidation of facilities | (7 | ) | — | (29 | ) | (4 | ) | |||||||||||||
| Operating income | 133 | 117 | 139 | 108 | ||||||||||||||||
| Interest expense | (35 | ) | (6 | ) | (35 | ) | (6 | ) | ||||||||||||
| Other | 1 | — | — | — | ||||||||||||||||
| Net income from continuing operations, before income taxes | 99 | 111 | 104 | 102 | ||||||||||||||||
| Income tax expense | (18 | ) | (2 | ) | (8 | ) | (2 | ) | ||||||||||||
| Net income | $ | 81 | $ | 109 | $ | 96 | $ | 100 | ||||||||||||
| Less: Net income attributable to noncontrolling interests(3) | 66 | 75 | ||||||||||||||||||
| Net income attributable to |
$ | 15 | $ | 21 | ||||||||||||||||
| Equity in earnings of unconsolidated affiliates | $ | 27 | $ | 25 | ||||||||||||||||
| (1) | On a same-facility system-wide basis, net revenue in Tenet’s Ambulatory Care segment increased 6.1% during the three months ended |
|
| (2) | At |
|
| (3) | During the three months ended |
Non-GAAP Financial Measures
Adjusted EBITDA, a non-GAAP measure, is defined by the Company as net income (loss) attributable to
Adjusted net income (loss) from continuing operations attributable to
Free Cash Flow, a non-GAAP measure, is defined by the Company as (1) net cash provided by (used in) operating activities, less (2) purchases of property and equipment from continuing operations.
Adjusted Free Cash Flow, a non-GAAP measure, is defined by the Company as (1) Adjusted net cash provided by (used in) operating activities from continuing operations, less (2) purchases of property and equipment from continuing operations. Adjusted net cash provided by (used in) operating activities, a non-GAAP measure, is defined by the Company as cash provided by (used in) operating activities prior to (1) payments for restructuring charges, acquisition-related costs and litigation costs and settlements, and, (2) net cash provided by (used in) operating activities from discontinued operations.
The Company believes the foregoing non-GAAP measures are useful to investors and analysts because they present additional information on the Company’s financial performance. Investors, analysts, Company management and the Company’s Board of Directors utilize these non-GAAP measures, in addition to GAAP measures, to track the company’s financial and operating performance and compare the Company’s performance to its peer companies, which utilize similar non-GAAP measures in their presentations. The
The Company believes that Adjusted EBITDA is a useful measure, in part, because certain investors and analysts use both historical and projected Adjusted EBITDA, in addition to other GAAP and non-GAAP measures, as factors in determining the estimated fair value of shares of the Company’s common stock. Company management also regularly reviews the Adjusted EBITDA performance for each operating segment. The Company does not use Adjusted EBITDA to measure liquidity, but instead to measure operating performance.
We use, and we believe investors and analysts use, Free Cash Flow and Adjusted Free Cash Flow as supplemental measures to analyze cash flows generated from our operations because we believe it is useful to investors in evaluating our ability to fund distributions paid to noncontrolling interests, acquisitions, purchasing equity interests in joint ventures or repaying debt.
These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Because these measures exclude many items that are included in our financial statements, they do not provide a complete measure of our operating performance. For example, the Company’s definitions of Free Cash Flow and Adjusted Free Cash Flow do not include other important uses of cash including (1) cash used to purchase businesses or joint venture interests, or (2) any items that are classified as Cash Flows From Financing Activities on the Company’s Consolidated Statement of Cash Flows, including items such as (i) cash used to repay borrowings, (ii) distributions paid to noncontrolling interests, or (iii) payments under the Put/Call Agreement for USPI redeemable noncontrolling interest, which are recorded on the Statement of Cash Flows as the purchase of noncontrolling interest. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance.
A reconciliation of Adjusted EBITDA to net income (loss) attributable to
|
|
||||||||||
|
Additional Supplemental Non-GAAP disclosures |
||||||||||
| Table #1 – Reconciliation of Adjusted EBITDA to Loss Attributable | ||||||||||
| to Tenet Healthcare Corporation Common Shareholders | ||||||||||
|
(Unaudited) |
||||||||||
| (Dollars in millions) | Three Months Ended | |||||||||
| |
||||||||||
| 2017 | 2016 | |||||||||
| (Expense) Income | ||||||||||
| Net loss attributable to |
$ | (53 | ) | $ | (59 | ) | ||||
| Less: Net income attributable to noncontrolling interests | (89 | ) | (93 | ) | ||||||
| Net loss from discontinued operations, net of tax | (1 | ) | (4 | ) | ||||||
| Net income from continuing operations | 37 | 38 | ||||||||
| Income tax benefit (expense) | 33 | (67 | ) | |||||||
| Other non-operating income (expense), net | (5 | ) | (6 | ) | ||||||
| Interest expense | (258 | ) | (243 | ) | ||||||
| Operating income | 267 | 354 | ||||||||
| Litigation and investigation costs | (5 | ) | (173 | ) | ||||||
| Gains on sales, consolidation and deconsolidation of facilities | 15 | 147 | ||||||||
| Impairment and restructuring charges, and acquisition-related costs | (33 | ) | (28 | ) | ||||||
| Depreciation and amortization | (221 | ) | (212 | ) | ||||||
| Income (loss) from divested and closed businesses | (16 | ) | 3 | |||||||
| Adjusted EBITDA | $ | 527 | $ | 617 | ||||||
| Net operating revenues | $ | 4,813 | $ | 5,044 | ||||||
| Less Net operating revenues from health plans | 65 | 127 | ||||||||
| Adjusted net operating revenues | $ | 4,748 | $ | 4,917 | ||||||
| Net loss from continuing operations as a % of net operating revenues | (1.1 | )% | (1.1 | )% | ||||||
| Adjusted EBITDA as % of adjusted net operating revenues (Adjusted EBITDA margin) | 11.1 | % | 12.5 | % | ||||||
|
|
||||||||||
|
Additional Supplemental Non-GAAP disclosures |
||||||||||
| Table #2 – Pre-Tax, After-Tax and Earnings Per Share Impact of Certain Items | ||||||||||
| on Continuing Operations | ||||||||||
|
(Unaudited) |
||||||||||
| Three Months Ended | ||||||||||
| (Dollars in millions except per share amounts) | |
|||||||||
| 2017 | 2016 | |||||||||
| Adjustments to calculate Adjusted Diluted EPS | (Expense) Income | |||||||||
| Impairment and restructuring charges, and acquisition-related costs | $ | (33 | ) | $ | (28 | ) | ||||
| Litigation and investigation costs | (5 | ) | (173 | ) | ||||||
| Gain on sales, consolidation and deconsolidation of facilities | 15 | 147 | ||||||||
| Income (loss) from divested and closed businesses | (16 | ) | 3 | |||||||
| Pre-tax impact | $ | (39 | ) | $ | (51 | ) | ||||
| Tax impact of above items | $ | 14 | $ | (31 | ) | |||||
| Total after-tax impact | $ | (25 | ) | $ | (82 | ) | ||||
| Noncontrolling interests impact | — | (18 | ) | |||||||
| Total loss from items above | $ | (25 | ) | $ | (100 | ) | ||||
| Net loss attributable to common shareholders | $ | (53 | ) | $ | (59 | ) | ||||
| Less net loss discontinued operations, net of tax | (1 | ) | (4 | ) | ||||||
| Net loss from continuing operations, net of tax | $ | (52 | ) | $ | (55 | ) | ||||
| Net loss from adjustments above | 25 | 100 | ||||||||
| Adjusted net income (loss) from continuing operations attributable to common shareholders | $ | (27 | ) | $ | 45 | |||||
| Weighted average dilutive shares outstanding (in thousands) | 100,000 | 100,335 | ||||||||
| Diluted loss per share from continuing operations | $ | (0.52 | ) | $ | (0.56 | ) | ||||
| Adjusted diluted EPS from continuing operations | $ | (0.27 | ) | $ | 0.45 | |||||
|
|
||||||||||
|
Additional Supplemental Non-GAAP disclosures |
||||||||||
| Table #3 – Reconciliations of Free Cash Flow and Adjusted Free Cash Flow | ||||||||||
|
(Unaudited) |
||||||||||
| Three Months Ended | ||||||||||
| (Dollars in millions) | |
|||||||||
| 2017 | 2016 | |||||||||
| Net cash provided by (used in) operating activities | $ | 186 | $ | 147 | ||||||
| Purchases of property and equipment | (198 | ) | (208 | ) | ||||||
| Free cash flow | $ | (12 | ) | $ | (61 | ) | ||||
| Net cash provided by (used in) investing activities | $ | (189 | ) | $ | 320 | |||||
| Net cash provided by (used in) financing activities | $ | (141 | ) | $ | (95 | ) | ||||
| Net cash provided by (used in) operating activities | $ | 186 | $ | 147 | ||||||
| Less: | ||||||||||
| Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (24 | ) | (69 | ) | ||||||
| Net cash used in operating activities from discontinued operations | 3 | (3 | ) | |||||||
| Adjusted net cash provided by operating activities – continuing operations | 207 | 219 | ||||||||
| Purchases of property and equipment – continuing operations | (198 | ) | (208 | ) | ||||||
| Adjusted free cash flow – continuing operations | $ | 9 | $ | 11 | ||||||
|
|
||||||||||||||||||||
|
Additional Supplemental Non-GAAP disclosures |
||||||||||||||||||||
| Table #4 – Reconciliation of Outlook Adjusted EBITDA to | ||||||||||||||||||||
| Outlook Net Income Attributable to |
||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||
| (Dollars in millions) | Q2 2017 | 2017 | ||||||||||||||||||
| Low | High | Low | High | |||||||||||||||||
| Net income (loss) attributable to |
$ | (35 | ) | $ | (25 | ) | $ | 61 | $ | 95 | ||||||||||
| Less: Net income attributable to noncontrolling interests | (90 | ) | (100 | ) | (390 | ) | (410 | ) | ||||||||||||
| Net loss from discontinued operations, net of tax | (5 | ) | - | (10 | ) | - | ||||||||||||||
| Income from continuing operations | 60 | 75 | 461 | 505 | ||||||||||||||||
| Income tax benefit (expense) | (10 | ) | (20 | ) | (91 | ) | (107 | ) | ||||||||||||
| Income from continuing operations, before income taxes | 70 | 95 | 552 | 612 | ||||||||||||||||
| Interest expense | (250 | ) | (260 | ) | (1,025 | ) | (1,035 | ) | ||||||||||||
| Other non-operating income (expense), net | (5 | ) | (5 | ) | (25 | ) | (25 | ) | ||||||||||||
| Operating income | 325 | 360 | 1,602 | 1,672 | ||||||||||||||||
| Gains on sales, consolidation and deconsolidation of facilities(a) | - | - | 15 | 15 | ||||||||||||||||
| Impairment and restructuring charges, acquisition-related costs | ||||||||||||||||||||
| and litigation costs and settlements(a) | - | - | (38 | ) | (38 | ) | ||||||||||||||
| Depreciation and amortization | (215 | ) | (225 | ) | (860 | ) | (880 | ) | ||||||||||||
| Income (loss) from divested and closed businesses | (10 | ) | (15 | ) | (40 | ) | (50 | ) | ||||||||||||
| Adjusted EBITDA | $ | 550 | $ | 600 | $ | 2,525 | $ | 2,625 | ||||||||||||
| Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) | 11.3 | % | 11.9 | % | 12.8 | % | 13.1 | % | ||||||||||||
| Net income (loss) from continuing operations | $ | (30 | ) | $ | (25 | ) | $ | 71 | $ | 95 | ||||||||||
| Net income (loss) from continuing operations as a % of operating revenues | (0.6 | )% | (0.5 | )% | 0.4 | % | 0.5 | % | ||||||||||||
| Net operating revenues | $ | 4,850 | $ | 5,050 | $ | 19,700 | $ | 20,100 | ||||||||||||
| Adjusted EBITDA | $ | 550 | $ | 600 | $ | 2,525 | $ | 2,625 | ||||||||||||
| Depreciation and amortization | (215 | ) | (225 | ) | (860 | ) | (880 | ) | ||||||||||||
| Interest expense | (250 | ) | -(260 | ) | (1,025 | ) | (1,035 | ) | ||||||||||||
| Other non-operating income (expense), net | (5 | ) | (5 | ) | (25 | ) | (25 | ) | ||||||||||||
| Adjusted income from continuing operations before income taxes | 80 | 110 | 615 | 685 | ||||||||||||||||
| Income tax benefit (expense) | (10 | ) | (20 | ) | (118 | ) | (142 | ) | ||||||||||||
| Adjusted net income from continuing operations | 70 | 90 | 497 | 543 | ||||||||||||||||
| Net income attributable to noncontrolling interests | (90 | ) | (100 | ) | (390 | ) | (410 | ) | ||||||||||||
| Adjusted net income (loss) from continuing operations attributable to common shareholders | $ | (20 | ) | $ | (10 | ) | $ | 107 | $ | 133 | ||||||||||
| Basic weighted average shares outstanding (in millions) | 100 | 100 | 100 | 100 | ||||||||||||||||
| Fully diluted weighted average shares outstanding (in millions) | 102 | 102 | 102 | 102 | ||||||||||||||||
| Diluted earnings (loss) per share from continuing operations | $ | (0.30 | ) | $ | (0.25 | ) | $ | 0.70 | $ | 0.93 | ||||||||||
| Adjusted diluted earnings (loss) per share from continuing operations | $ | (0.20 | ) | $ | (0.10 | ) | $ | 1.05 | $ | 1.30 | ||||||||||
|
(a) |
The Company does not forecast impairment and restructuring charges, acquisition-related costs and litigation costs and settlements and gains on sales, consolidation and deconsolidation of facilities because the Company does not believe that it can forecast these items with sufficient accuracy since some of these items are indeterminable at the time the Company provides its financial Outlook. |
|
|
|||||||||
|
Additional Supplemental Non-GAAP disclosures |
|||||||||
| Table #5 – Reconciliation of Outlook Adjusted Free Cash Flow | |||||||||
| for the Year Ending December 31, 2017 | |||||||||
| (Dollars in millions) | 2017 | ||||||||
| Low | High | ||||||||
| Net cash provided by operating activities | $ | 1,271 | $ | 1,526 | |||||
| Less: | |||||||||
| Payments for restructuring charges, acquisition-related costs and | |||||||||
|
litigation costs and settlements (1) |
(24 | ) | (24 | ) | |||||
| Net cash used in operating activities from discontinued operations | (5 | ) | 0 | ||||||
| Adjusted net cash provided by operating activities – continuing operations | $ | 1,300 | $ | 1,550 | |||||
| Purchases of property and equipment – continuing operations | (700 | ) | (750 | ) | |||||
|
Adjusted free cash flow – continuing operations (2) |
$ | 600 | $ | 800 | |||||
| (1) | The Company does not forecast impairment and restructuring charges, acquisition-related costs and litigation costs and settlements because the Company does not believe that it can forecast these items with sufficient accuracy since some of these items may be indeterminable at the time the Company provides its financial Outlook. | |
| (2) | The Company’s definition of Adjusted Free Cash Flow does not include other important uses of cash including (1) cash used to purchase businesses or joint venture interests, or (2) any items that are classified as Cash Flows From Financing Activities on the Company’s Consolidated Statement of Cash Flows, including items such as (i) cash used to repay borrowings, (ii) distributions paid to noncontrolling interests, or (iii) payments under the Put/Call Agreement for USPI redeemable noncontrolling interest, which are recorded on the Statement of Cash Flows as the purchase of noncontrolling interest. |
View source version on businesswire.com: http://www.businesswire.com/news/home/20170501006256/en/
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Community Health Systems, Inc. Announces First Quarter 2017 Results with Net Operating Revenues of $4.486 Billion
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