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8-K - FORM 8-K - MEDCATH CORP | g26064e8vk.htm |
EX-99.2 - EX-99.2 - MEDCATH CORP | g26064exv99w2.htm |
Exhibit 99.1
MEDCATH CONTACT: O. Edwin French President/Chief Executive Officer (704) 815-7700 |
Art Parker Chief Financial Officer (704) 815-7700 |
MEDCATH CORPORATION REPORTS FIRST FISCAL QUARTER EARNINGS
CHARLOTTE, N.C., Feb. 9, 2011 MedCath Corporation (Nasdaq: MDTH), a healthcare provider
focused on high acuity healthcare services, today announced operating results for its first fiscal
quarter ended December 31, 2010.
First Fiscal Quarter Highlights
| Net revenue of $88.9 million, up 1.2% compared to the first quarter of fiscal 2010. | ||
| Total admissions decrease of 1.0%, and adjusted admissions increase of 5.5%, compared to first quarter of fiscal 2010. | ||
| Income (loss) from continuing operations of $7.2 million, or $0.36 per share, compared to $(1.9) million, or $(0.09) per share, in the first quarter of fiscal 2010. | ||
| Adjusted EBITDA of $5.8 million, excluding share based compensation and other items described below. Adjusted EPS of $(0.02). |
MedCaths consolidated results presented in this release and the attached financial schedules
account for TexSAn Heart Hospital as a discontinued operation. On November 8, 2010, MedCath
announced that it entered into a definitive agreement to sell substantially all of the assets in
TexSAn Heart Hospital to a third party, which sale
closed effective December 31, 2010. This reflects the Companys most recent activity related
to the previously announced strategic options process. Additional
information related to the strategic options
process is available in the Companys Form 10-Q for the fiscal quarter
ended December 31, 2010 that
is being filed today with the Securities and Exchange Commission.
First Quarter of Fiscal 2011 Results Compared to First Quarter of Fiscal 2010 Results
MedCaths reported net revenue increased 1.2% to $88.9 million in the first quarter of fiscal
2011 compared to $87.8 million in the first quarter of fiscal 2010. Net income (loss) was $37.0
million in the first quarter of fiscal 2011 compared to $(2.7) million in the first quarter of
fiscal 2010. MedCaths income from continuing operations was $7.2 million, or $0.36 per diluted
share, in the first quarter of fiscal 2011 compared to a loss of $(1.9) million, or $(0.09) per
diluted share, in the first quarter of fiscal 2010.
MedCaths first quarter of fiscal 2011 financial results include the following items:
| $2.6 million, or $0.08 per diluted share, of professional fees and other expenses incurred in connection with MedCaths strategic options process announced on March 1, 2010; | ||
| $1.9 million, or $0.06 per diluted share, in share-based compensation expense; | ||
| $(2.1) million, or $(0.05) per diluted share, realized in connection with the refund of sales taxes, net of related consulting fees; and | ||
| $(15.3) million, or $(0.47) per diluted share, in gains related to the disposition of two minority owned entities during the quarter. |
MedCaths first quarter of fiscal 2010 financial results include the following items:
| $0.9 million, or $0.02 per diluted share, in pre-opening expense; and | ||
| $0.6 million, or $0.02 per diluted share, in share-based compensation expense. |
Adjusted EBITDA was $5.8 million in the first quarter of fiscal 2011 compared to $4.8 million
in the same period of the prior year. MedCaths Adjusted EPS for the first quarter of fiscal 2011
was $(0.02) compared with $(0.05) in the first quarter of fiscal 2010.
Commenting on the quarter, O. Edwin French, MedCath President and Chief Executive Officer,
stated In general, we are pleased with this quarters adjusted admission growth and patient
activity at our hospitals. We are also pleased with the continued
progress made regarding our strategic options process as we completed
the sale of TexSAn Heart Hospital during our first fiscal
quarter.
Operating
Statistics and Cash Flow
MedCaths financial results for the first fiscal quarter ended December 31, 2010, reflect a
1.0% decrease in total admissions and a 5.5% increase in adjusted admissions compared to the first
quarter of fiscal 2010. Hospital outpatient cases, including emergency department visits, totaled
14,607 in the first quarter of fiscal 2011, up 31.5% compared to the first quarter of fiscal 2010.
Total uncompensated care, which includes charity care plus bad debt expense, equaled 13.4% of
hospital division net patient revenue before the deduction for charity care in the first quarter of
fiscal 2011 compared to 11.1% in the first quarter of fiscal 2010.
Net cash provided by operating activities from continuing operations for the first quarter of
fiscal 2011 was $0.5 million compared to $2.0 million in the first quarter of fiscal 2010. This
decline in net cash provided by operating activities resulted from the annual payment of certain
management and employee incentives paid in the quarter related to fiscal 2010.
Use of Non-GAAP Financial Measures
Included in this press release and the supplemental financial information furnished herewith
are certain financial measures that are not calculated and presented in conformity with generally
accepted accounting principles (non-GAAP measures), such as adjusted earnings before interest,
taxes, depreciation, and amortization (Adjusted EBITDA) and adjusted diluted earnings per share
from continuing operations (Adjusted EPS). The supplemental financial information furnished
herewith provides a quantitative reconciliation of Adjusted EBITDA and Adjusted EPS based on the
following calculations as and for the periods identified below.
Adjusted EBITDA for the first fiscal quarter of 2011 represents MedCaths income (loss) from
continuing operations, net of taxes attributable to MedCaths common stockholders; income tax
expense, net income attributable to noncontrolling interests; equity in net earnings of
unconsolidated affiliates; interest and other income, net; gain on sale of unconsolidated entities,
interest expense; loss on disposal of property, equipment and other assets; depreciation;
share-based compensation expense; professional fees associated with MedCaths exploration of
strategic options, and sales tax refunds, net. Adjusted EPS for the first fiscal quarter of fiscal
2011 represents MedCaths diluted loss per share from continuing operations adjusted for gain on
sale of unconsolidated investees, professional fees associated with MedCaths consideration of
strategic options, sales tax refunds, net, and share-based compensation expense.
represents MedCaths income (loss) from continuing operations, net of taxes attributable to
MedCaths common stockholders, income tax benefit; net income
attributable to noncontrolling interest; equity in earnings of unconsolidated affiliates;
interest and other income, net; interest expense; loss on disposal of property, equipment and other
assets; depreciation; pre-opening expenses, and share-based
compensation expense. Adjusted EPS for
the first fiscal quarter of fiscal 2010 represents MedCaths diluted loss per share from continuing
operations adjusted for share-based compensation expense and pre-opening expenses.
MedCaths management uses Adjusted EBITDA to measure the performance of MedCaths various
operating entities, to compare actual results to historical and budgeted results and to make
capital allocation decisions. Management provides Adjusted EBITDA and Adjusted EPS to investors to
assist them in performing their analyses of MedCaths historical operating results. Further,
management believes that many investors in MedCath also invest in, or have knowledge of, other
healthcare companies that use Adjusted EBITDA and/or Adjusted EPS as a financial performance
measure. Because Adjusted EBITDA and Adjusted EPS are non-GAAP measures, Adjusted EBITDA and
Adjusted EPS, as defined above, may not be comparable to other similarly titled measures of other
companies. MedCath has included a supplemental schedule with the financial statements that
accompanies this press release that reconciles historical Adjusted EBITDA to MedCaths income from
continuing operations attributable to MedCaths common stockholders and Adjusted EPS to diluted EPS
from continuing operations.
This press release and the financial information included therewith will be accessible on the
web, by going to www.medcath.com, Investor Relations, then clicking on News.
MedCath Corporation, headquartered in Charlotte, N.C., is a healthcare provider focused on
high acuity services with the diagnosis and treatment of cardiovascular disease being a primary
service offering. MedCath owns an interest in and operates six hospitals with a total of 533
licensed beds, located in Arizona, Arkansas, California, Louisiana, New Mexico, and Texas. In
addition, MedCath and its subsidiary MedCath Partners provide services in diagnostic and
therapeutic facilities.
# # #
Parts of this announcement contain forward-looking statements that involve risks and
uncertainties. Although management believes that these forward-looking statements are based on
reasonable assumptions, these assumptions are inherently subject to significant economic,
regulatory and competitive uncertainties and contingencies that are difficult or impossible to
predict accurately and are beyond our control including, but not limited to, the implementation of
healthcare reform legislation and future enactment of changes in federal law that would further
limit physician hospital ownership. Actual results could differ materially from those projected in
these forward-looking statements. We do not assume any obligation to update these statements in a
news release or otherwise should material facts or circumstances change in ways that would affect
their accuracy. The preparation of MedCaths first
quarter of fiscal 2011 operating results required management to make estimates and assumptions
that affect reported amounts of revenues and expenses. There is a reasonable possibility that
actual results may vary significantly from those estimates.
These various risks and uncertainties are described in detail in Risk Factors in MedCaths
Annual Report or Form 10-K for the year ended September 30, 2010 filed with the Securities and
Exchange Commission on December 14, 2010. Copies of our filings with the Securities and Exchange
Commission, including exhibits, are available at http://www.sec.gov.