Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES - TENET HEALTHCARE CORP | a12-17791_18k.htm |
Exhibit 99.1
Tenet Reports Second Quarter Adjusted EBITDA of $288 Million
6.2% Growth in Net Operating Revenues
1.5% Growth in Adjusted Admissions
4.9% Increase in Surgeries
Outlook for 2012 Adjusted EBITDA Reconfirmed in Range of $1.250 Billion to $1.375 Billion
DALLAS – August 7, 2012 – Tenet Healthcare Corporation (NYSE:THC) today reported Adjusted EBITDA of $288 million for the second quarter ended June 30, 2012, an increase of $13 million, or 4.7 percent, as compared to Adjusted EBITDA of $275 million in the second quarter of 2011. Income from continuing operations was $42 million, or $0.10 per diluted share, in the second quarter of 2012, compared to $40 million, or $0.08 per diluted share, in last year’s second quarter. Net income attributable to common shareholders was a loss of $6 million, or a loss of $0.01 per diluted share, compared to net income of $55 million, or $0.11 per diluted share in the second quarter of 2011. In the second quarter of 2012 net income attributable to common shareholders included impairment and restructuring charges in discontinued operations of $100 million pre-tax, $50 million after-tax and after the noncontrolling interest benefit, or $0.12 per share, related to the previously announced anticipated sale of Creighton University Medical Center. The California Provider Fee 30-month Program contributed $47 million pre-tax, of which approximately $28 million was attributable to other reporting periods.
“We are pleased with our second quarter results which came in above our expectations,” said Trevor Fetter, president and chief executive officer. “This strong performance was driven by growth in patient volumes and revenues. This was our seventh consecutive quarter in which adjusted admissions growth was positive. Several targeted service lines including major trauma and neuro-, thoracic-, oncology and vascular surgeries, contributed to volume growth in the quarter. And, on July 1 Conifer Health Solutions launched phase one of its ground-breaking partnership with Catholic Health Initiatives.”
Discussion of Results (Percentage changes compare Q2’12 to Q2’11, unless otherwise noted.)
Adjusted admissions increased by 1.5 percent and total admissions declined by 0.4 percent. Surgery growth was strong increasing by 4.9 percent, and emergency department visits increased 5.0 percent.
Net operating revenues were $2.265 billion, an increase of $133 million, or 6.2 percent, compared to net operating revenues of $2.132 billion in the second quarter of 2011. Net revenues in the second quarter of 2012 included a net contribution of $47 million from the California Provider Fee 30-month Program of which approximately $28 million was attributable to other reporting periods. Tenet expects to recognize additional net revenues of approximately $66 million in the second half of 2012 related to this program.
Bad debt expense was $190 million compared to $168 million in the second quarter of 2011. Bad debt expense as a percent of revenues was 7.7 percent, an increase of 40 basis points compared to 7.3 percent in the second quarter of 2011, which remained within our 2012 Outlook range. Increased self-pay volume and various favorable settlements of aged managed care accounts in the 2011 period contributed to the increase in bad debt expense.
Net patient revenue per adjusted patient day was $2,543, an increase of 5.3 percent. This pricing increase reflects improved terms in our contracts with commercial managed care payers, partially offset by an adverse shift in payer mix.
Selected operating expenses, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased by 3.5 percent per adjusted admission, which was favorable to the Company’s expectations for the quarter. Supply costs were extremely well-controlled, declining 2.3 percent per adjusted admission.
Selected operating expenses included an adverse impact of $8 million due to additional costs as a result of declining interest rates.
The comparison of the Company’s Adjusted EBITDA in the 2012 period to the second quarter of 2011 was adversely impacted by $25 million of healthcare information technology (“HIT”) incentive payments recognized as earnings in last year’s second quarter. No HIT incentive payments were recognized in the second quarter of 2012.
The Company initiated segment financial disclosures of Conifer Health Solutions (“Conifer”) in the current quarter. Conifer reported $25 million in Adjusted EBITDA in the second quarter of 2012, which included $16 million of earnings for Conifer services provided to the Company’s hospitals. No revenues were recognized in the second quarter of 2012 related to Conifer’s recently announced partnership with Catholic Health Initiatives, which commenced on July 1, 2012.
Cash and cash equivalents were $82 million at June 30, 2012, a decrease of $22 million from $104 million at March 31, 2012. The balance on the Company’s bank line was $200 million at June 30, 2012, a reduction of $83 million as compared to a balance of $283 million as of March 31, 2012. Cash flow from operations was $243 million in the second quarter of 2012, an increase of $65 million as compared to $178 million in the second quarter of 2011. Capital expenditures were $116 million in the second quarter of 2012 compared to $82 million in the second quarter of 2011.
Management’s Webcast Discussion of Second Quarter Results
Tenet management will discuss the Company’s second quarter 2012 results on a 10:00 AM (ET) webcast on August 7, 2012. This webcast may be accessed through Tenet’s website at www.tenethealth.com/investors. A set of slides, which will be referenced on the call, are posted on the Company’s website.
Additional information regarding Tenet’s quarterly results of operations, including detailed tabular operational data, is contained in its Form 10-Q report, which will be filed with the Securities and Exchange Commission and posted on the Tenet investor relations website before the webcast. This press release includes certain non-GAAP measures, such as Adjusted EBITDA. A reconciliation of Adjusted EBITDA to net income attributable to Tenet common shareholders is included in the financial tables at the end of this release.
Tenet Healthcare Corporation, a leading health care services company, through its subsidiaries operates 50 hospitals, over 100 free-standing outpatient centers and Conifer Health Solutions, a leader in business process solutions for health care providers serving nearly 400 hospital and health care entities nationwide. Tenet’s hospitals and related health care facilities are committed to providing high quality care to patients in the communities they serve. For more information, please visit www.tenethealth.com.
Media: Rick Black (469) 893-2647 Investors: Thomas Rice (469) 893-2522
Rick.Black@tenethealth.com Thomas.Rice@tenethealth.com
# # #
This document contains “forward-looking statements” — that is, statements relating 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,” “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 the factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended Dec. 31, 2011, our quarterly reports on Form 10-Q, periodic reports on Form 8-K and other filings with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking statements contained in this press release as a result of new information or future events or developments.
Tenet uses its company web site to provide important information to investors about the company including the posting of important announcements regarding financial performance and corporate developments.
TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
Three Months Ended June 30, |
| ||||||||||
|
(Dollars in millions except per share amounts) |
|
2012 |
|
% |
|
2011 |
|
% |
|
Change |
| ||
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Net operating revenues: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Net operating revenues before provision for doubtful accounts |
|
$ |
2,455 |
|
|
|
$ |
2,300 |
|
|
|
6.7 |
% |
|
Less: Provision for doubtful accounts |
|
190 |
|
|
|
168 |
|
|
|
13.1 |
% | ||
|
Net operating revenues |
|
2,265 |
|
100.0 |
% |
2,132 |
|
100.0 |
% |
6.2 |
% | ||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Salaries, wages and benefits |
|
1,054 |
|
46.5 |
% |
982 |
|
46.1 |
% |
7.3 |
% | ||
|
Supplies |
|
389 |
|
17.2 |
% |
392 |
|
18.4 |
% |
(0.8 |
)% | ||
|
Other operating expenses, net |
|
534 |
|
23.7 |
% |
508 |
|
23.8 |
% |
5.1 |
% | ||
|
Electronic health record incentives |
|
— |
|
— |
% |
(25 |
) |
(1.2 |
)% |
(100.0 |
)% | ||
|
Depreciation and amortization |
|
104 |
|
4.6 |
% |
100 |
|
4.7 |
% |
4.0 |
% | ||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
3 |
|
0.1 |
% |
2 |
|
0.1 |
% |
|
| ||
|
Litigation and investigation costs |
|
1 |
|
— |
% |
8 |
|
0.4 |
% |
|
| ||
|
Operating income |
|
180 |
|
7.9 |
% |
165 |
|
7.7 |
% |
|
| ||
|
Interest expense |
|
(102 |
) |
|
|
(98 |
) |
|
|
|
| ||
|
Investment earnings |
|
— |
|
|
|
1 |
|
|
|
|
| ||
|
Income from continuing operations, before income taxes |
|
78 |
|
|
|
68 |
|
|
|
|
| ||
|
Income tax expense |
|
(30 |
) |
|
|
(19 |
) |
|
|
|
| ||
|
Income from continuing operations, before discontinued operations |
|
48 |
|
|
|
49 |
|
|
|
|
| ||
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Income (loss) from operations |
|
1 |
|
|
|
(5 |
) |
|
|
|
| ||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
(100 |
) |
|
|
— |
|
|
|
|
| ||
|
Net gains on sales of facilities |
|
2 |
|
|
|
— |
|
|
|
|
| ||
|
Income tax benefit |
|
29 |
|
|
|
19 |
|
|
|
|
| ||
|
Income (loss) from discontinued operations |
|
(68 |
) |
|
|
14 |
|
|
|
|
| ||
|
Net income (loss) |
|
(20 |
) |
|
|
63 |
|
|
|
|
| ||
|
Less: Preferred stock dividends |
|
4 |
|
|
|
6 |
|
|
|
|
| ||
|
Less: Net income (loss) attributable to noncontrolling interests |
|
(18 |
) |
|
|
2 |
|
|
|
|
| ||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
(6 |
) |
|
|
$ |
55 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Amounts attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| ||
|
Income from continuing operations, net of tax |
|
$ |
42 |
|
|
|
$ |
40 |
|
|
|
|
|
|
Income (loss) from discontinued operations, net of tax |
|
(48 |
) |
|
|
15 |
|
|
|
|
| ||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
(6 |
) |
|
|
$ |
55 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| ||
|
Basic |
|
|
|
|
|
|
|
|
|
|
| ||
|
Continuing operations |
|
$ |
0.10 |
|
|
|
$ |
0.08 |
|
|
|
|
|
|
Discontinued operations |
|
(0.11 |
) |
|
|
0.03 |
|
|
|
|
| ||
|
|
|
$ |
(0.01 |
) |
|
|
$ |
0.11 |
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
| ||
|
Continuing operations |
|
$ |
0.10 |
|
|
|
$ |
0.08 |
|
|
|
|
|
|
Discontinued operations |
|
(0.11 |
) |
|
|
0.03 |
|
|
|
|
| ||
|
|
|
$ |
(0.01 |
) |
|
|
$ |
0.11 |
|
|
|
|
|
|
Weighted average shares and dilutive securities outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
| ||
|
Basic |
|
415,011 |
|
|
|
486,794 |
|
|
|
|
| ||
|
Diluted |
|
427,708 |
|
|
|
503,748 |
|
|
|
|
| ||
TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
Six Months Ended June 30, |
| ||||||||||
|
(Dollars in millions except per share amounts) |
|
2012 |
|
% |
|
2011 |
|
% |
|
Change |
| ||
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Net operating revenues: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Net operating revenues before provision for doubtful accounts |
|
$ |
4,946 |
|
|
|
$ |
4,729 |
|
|
|
4.6 |
% |
|
Less: Provision for doubtful accounts |
|
379 |
|
|
|
347 |
|
|
|
9.2 |
% | ||
|
Net operating revenues |
|
4,567 |
|
100.0 |
% |
4,382 |
|
100.0 |
% |
4.2 |
% | ||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Salaries, wages and benefits |
|
2,116 |
|
46.3 |
% |
1,999 |
|
45.6 |
% |
5.9 |
% | ||
|
Supplies |
|
788 |
|
17.3 |
% |
788 |
|
18.0 |
% |
— |
% | ||
|
Other operating expenses, net |
|
1,065 |
|
23.3 |
% |
999 |
|
22.8 |
% |
6.6 |
% | ||
|
Electronic health record incentives |
|
— |
|
— |
% |
(50 |
) |
(1.1 |
)% |
(100.0 |
)% | ||
|
Depreciation and amortization |
|
204 |
|
4.5 |
% |
198 |
|
4.5 |
% |
3.0 |
% | ||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
6 |
|
0.1 |
% |
10 |
|
0.2 |
% |
|
| ||
|
Litigation and investigation costs |
|
3 |
|
0.1 |
% |
19 |
|
0.4 |
% |
|
| ||
|
Operating income |
|
385 |
|
8.4 |
% |
419 |
|
9.6 |
% |
|
| ||
|
Interest expense |
|
(200 |
) |
|
|
(216 |
) |
|
|
|
| ||
|
Investment earnings |
|
1 |
|
|
|
2 |
|
|
|
|
| ||
|
Income from continuing operations, before income taxes |
|
186 |
|
|
|
205 |
|
|
|
|
| ||
|
Income tax expense |
|
(72 |
) |
|
|
(69 |
) |
|
|
|
| ||
|
Income from continuing operations, before discontinued operations |
|
114 |
|
|
|
136 |
|
|
|
|
| ||
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
| ||
|
Income (loss) from operations |
|
3 |
|
|
|
(15 |
) |
|
|
|
| ||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
(100 |
) |
|
|
— |
|
|
|
|
| ||
|
Net gains on sales of facilities |
|
2 |
|
|
|
— |
|
|
|
|
| ||
|
Income tax benefit |
|
28 |
|
|
|
24 |
|
|
|
|
| ||
|
Income (loss) from discontinued operations |
|
(67 |
) |
|
|
9 |
|
|
|
|
| ||
|
Net income |
|
47 |
|
|
|
145 |
|
|
|
|
| ||
|
Less: Preferred stock dividends |
|
10 |
|
|
|
12 |
|
|
|
|
| ||
|
Less: Net income (loss) attributable to noncontrolling interests |
|
(15 |
) |
|
|
5 |
|
|
|
|
| ||
|
Net income attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
52 |
|
|
|
$ |
128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Amounts attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| ||
|
Income from continuing operations, net of tax |
|
$ |
99 |
|
|
|
$ |
120 |
|
|
|
|
|
|
Income (loss) from discontinued operations, net of tax |
|
(47 |
) |
|
|
8 |
|
|
|
|
| ||
|
Net income attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
52 |
|
|
|
$ |
128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| ||
|
Basic |
|
|
|
|
|
|
|
|
|
|
| ||
|
Continuing operations |
|
$ |
0.24 |
|
|
|
$ |
0.24 |
|
|
|
|
|
|
Discontinued operations |
|
(0.11 |
) |
|
|
0.02 |
|
|
|
|
| ||
|
|
|
$ |
0.13 |
|
|
|
$ |
0.26 |
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
| ||
|
Continuing operations |
|
$ |
0.23 |
|
|
|
$ |
0.23 |
|
|
|
|
|
|
Discontinued operations |
|
(0.11 |
) |
|
|
0.02 |
|
|
|
|
| ||
|
|
|
$ |
0.12 |
|
|
|
$ |
0.25 |
|
|
|
|
|
|
Weighted average shares and dilutive securities outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
| ||
|
Basic |
|
413,192 |
|
|
|
486,848 |
|
|
|
|
| ||
|
Diluted |
|
434,718 |
|
|
|
563,951 |
|
|
|
|
| ||
TENET HEALTHCARE CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
|
June 30, |
|
December 31, |
| ||
|
(Dollars in millions) |
|
2012 |
|
2011 |
| ||
|
ASSETS |
|
|
|
|
| ||
|
Current assets: |
|
|
|
|
| ||
|
Cash and cash equivalents |
|
$ |
82 |
|
$ |
113 |
|
|
Accounts receivable, less allowance for doubtful accounts |
|
1,356 |
|
1,278 |
| ||
|
Inventories of supplies, at cost |
|
154 |
|
161 |
| ||
|
Income tax receivable |
|
13 |
|
7 |
| ||
|
Current portion of deferred income taxes |
|
409 |
|
418 |
| ||
|
Assets held for sale |
|
41 |
|
2 |
| ||
|
Other current assets |
|
509 |
|
378 |
| ||
|
Total current assets |
|
2,564 |
|
2,357 |
| ||
|
Investments and other assets |
|
120 |
|
156 |
| ||
|
Deferred income taxes, net of current portion |
|
345 |
|
374 |
| ||
|
Property and equipment, at cost, less accumulated depreciation and amortization |
|
4,181 |
|
4,350 |
| ||
|
Goodwill |
|
749 |
|
736 |
| ||
|
Other intangible assets, at cost, less accumulated amortization |
|
526 |
|
489 |
| ||
|
Total assets |
|
$ |
8,485 |
|
$ |
8,462 |
|
|
|
|
|
|
|
| ||
|
LIABILITIES AND EQUITY |
|
|
|
|
| ||
|
Current liabilities: |
|
|
|
|
| ||
|
Current portion of long-term debt |
|
$ |
237 |
|
$ |
66 |
|
|
Accounts payable |
|
644 |
|
760 |
| ||
|
Accrued compensation and benefits |
|
363 |
|
376 |
| ||
|
Professional and general liability reserves |
|
73 |
|
75 |
| ||
|
Accrued interest payable |
|
121 |
|
112 |
| ||
|
Accrued legal settlement costs |
|
7 |
|
64 |
| ||
|
Other current liabilities |
|
427 |
|
362 |
| ||
|
Total current liabilities |
|
1,872 |
|
1,815 |
| ||
|
Long-term debt, net of current portion |
|
4,511 |
|
4,294 |
| ||
|
Professional and general liability reserves |
|
336 |
|
337 |
| ||
|
Accrued legal settlement costs |
|
2 |
|
2 |
| ||
|
Other long-term liabilities |
|
519 |
|
506 |
| ||
|
Total liabilities |
|
7,240 |
|
6,954 |
| ||
|
Commitments and contingencies |
|
|
|
|
| ||
|
Redeemable noncontrolling interests in equity of consolidated subsidiaries |
|
16 |
|
16 |
| ||
|
Equity: |
|
|
|
|
| ||
|
Shareholders’ equity: |
|
|
|
|
| ||
|
Preferred stock |
|
45 |
|
334 |
| ||
|
Common stock |
|
27 |
|
27 |
| ||
|
Additional paid-in capital |
|
4,410 |
|
4,407 |
| ||
|
Accumulated other comprehensive loss |
|
(49 |
) |
(52 |
) | ||
|
Accumulated deficit |
|
(1,378 |
) |
(1,440 |
) | ||
|
Common stock in treasury, at cost |
|
(1,879 |
) |
(1,853 |
) | ||
|
Total shareholders’ equity |
|
1,176 |
|
1,423 |
| ||
|
Noncontrolling interests |
|
53 |
|
69 |
| ||
|
Total equity |
|
1,229 |
|
1,492 |
| ||
|
Total liabilities and equity |
|
$ |
8,485 |
|
$ |
8,462 |
|
TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
Six Months Ended |
| ||||
|
(Dollars in millions) |
|
2012 |
|
2011 |
| ||
|
Net income |
|
$ |
47 |
|
$ |
145 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
| ||
|
Depreciation and amortization |
|
204 |
|
198 |
| ||
|
Provision for doubtful accounts |
|
379 |
|
347 |
| ||
|
Deferred income tax expense |
|
37 |
|
91 |
| ||
|
Stock-based compensation expense |
|
17 |
|
12 |
| ||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
6 |
|
10 |
| ||
|
Litigation and investigation costs |
|
3 |
|
19 |
| ||
|
Fair market value adjustments related to interest rate swap and LIBOR cap agreements |
|
— |
|
17 |
| ||
|
Amortization of debt discount and debt issuance costs |
|
11 |
|
15 |
| ||
|
Pre-tax loss from discontinued operations |
|
95 |
|
15 |
| ||
|
Other items, net |
|
(4 |
) |
(3 |
) | ||
|
Changes in cash from changes in operating assets and liabilities: |
|
|
|
|
| ||
|
Accounts receivable |
|
(450 |
) |
(468 |
) | ||
|
Inventories and other current assets |
|
(116 |
) |
(54 |
) | ||
|
Income taxes |
|
(5 |
) |
(26 |
) | ||
|
Accounts payable, accrued expenses and other current liabilities |
|
23 |
|
(117 |
) | ||
|
Other long-term liabilities |
|
26 |
|
8 |
| ||
|
Payments against reserves for restructuring charges and litigation costs and settlements |
|
(50 |
) |
(22 |
) | ||
|
Net cash used in operating activities from discontinued operations, excluding income taxes |
|
(22 |
) |
(11 |
) | ||
|
Net cash provided by operating activities |
|
201 |
|
176 |
| ||
|
Cash flows from investing activities: |
|
|
|
|
| ||
|
Purchases of property and equipment — continuing operations |
|
(251 |
) |
(197 |
) | ||
|
Purchases of property and equipment — discontinued operations |
|
(1 |
) |
(1 |
) | ||
|
Purchases of businesses or joint venture interests |
|
(13 |
) |
(42 |
) | ||
|
Proceeds from sales of facilities and other assets — discontinued operations |
|
10 |
|
— |
| ||
|
Proceeds from sales of marketable securities, long-term investments and other assets |
|
2 |
|
(1 |
) | ||
|
Other items, net |
|
5 |
|
10 |
| ||
|
Net cash used in investing activities |
|
(248 |
) |
(231 |
) | ||
|
Cash flows from financing activities: |
|
|
|
|
| ||
|
Repayments of borrowings under credit facility |
|
(973 |
) |
— |
| ||
|
Proceeds from borrowings under credit facility |
|
1,093 |
|
— |
| ||
|
Repayments of other borrowings |
|
(67 |
) |
(2 |
) | ||
|
Proceeds from other borrowings |
|
292 |
|
— |
| ||
|
Deferred debt issuance costs |
|
(2 |
) |
— |
| ||
|
Repurchases of common stock |
|
(26 |
) |
(72 |
) | ||
|
Repurchases of preferred stock |
|
(292 |
) |
— |
| ||
|
Cash dividends on preferred stock |
|
(12 |
) |
(12 |
) | ||
|
Distributions paid to noncontrolling interests |
|
(6 |
) |
(4 |
) | ||
|
Other items, net |
|
9 |
|
4 |
| ||
|
Net cash provided by (used in) financing activities |
|
16 |
|
(86 |
) | ||
|
Net decrease in cash and cash equivalents |
|
(31 |
) |
(141 |
) | ||
|
Cash and cash equivalents at beginning of period |
|
113 |
|
405 |
| ||
|
Cash and cash equivalents at end of period |
|
$ |
82 |
|
$ |
264 |
|
|
Supplemental disclosures: |
|
|
|
|
| ||
|
Interest paid, net of capitalized interest |
|
$ |
(181 |
) |
$ |
(182 |
) |
|
Income tax (payments) refunds, net |
|
$ |
(11 |
) |
$ |
20 |
|
TENET HEALTHCARE CORPORATION
SELECTED STATISTICS — CONTINUING HOSPITALS
(Unaudited)
|
(Dollars in millions except per patient day, per |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| ||||||||||||
|
admission and per visit amounts) |
|
2012 |
|
2011 |
|
Change |
|
2012 |
|
2011 |
|
Change |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Net inpatient revenues |
|
$ |
1,548 |
|
$ |
1,466 |
|
5.6 |
% |
$ |
3,155 |
|
$ |
3,085 |
|
2.3 |
% |
|
Net outpatient revenues |
|
$ |
791 |
|
$ |
738 |
|
7.2 |
% |
$ |
1,557 |
|
$ |
1,458 |
|
6.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Number of acute care hospitals (at end of period) |
|
49 |
|
49 |
|
— |
* |
49 |
|
49 |
|
— |
* | ||||
|
Licensed beds (at end of period) |
|
13,176 |
|
13,086 |
|
0.7 |
% |
13,176 |
|
13,086 |
|
0.7 |
% | ||||
|
Average licensed beds |
|
13,176 |
|
13,111 |
|
0.5 |
% |
13,157 |
|
13,117 |
|
0.3 |
% | ||||
|
Utilization of licensed beds |
|
49.2 |
% |
50.0 |
% |
(0.8 |
)%* |
50.4 |
% |
51.9 |
% |
(1.5 |
)%* | ||||
|
Patient days |
|
590,437 |
|
595,986 |
|
(0.9 |
)% |
1,207,896 |
|
1,231,449 |
|
(1.9 |
)% | ||||
|
Adjusted patient days |
|
919,895 |
|
912,369 |
|
0.8 |
% |
1,867,011 |
|
1,860,725 |
|
0.3 |
% | ||||
|
Net inpatient revenue per patient day |
|
$ |
2,622 |
|
$ |
2,460 |
|
6.6 |
% |
$ |
2,612 |
|
$ |
2,505 |
|
4.3 |
% |
|
Total admissions |
|
125,136 |
|
125,592 |
|
(0.4 |
)% |
256,326 |
|
257,029 |
|
(0.3 |
)% | ||||
|
Adjusted patient admissions |
|
196,932 |
|
193,971 |
|
1.5 |
% |
399,792 |
|
391,430 |
|
2.1 |
% | ||||
|
Net inpatient revenue per admission |
|
$ |
12,371 |
|
$ |
11,673 |
|
6.0 |
% |
$ |
12,309 |
|
$ |
12,003 |
|
2.5 |
% |
|
Average length of stay (days) |
|
4.72 |
|
4.75 |
|
(0.6 |
)% |
4.71 |
|
4.79 |
|
(1.7 |
)% | ||||
|
Total surgeries |
|
95,422 |
|
91,005 |
|
4.9 |
% |
188,650 |
|
178,512 |
|
5.7 |
% | ||||
|
Outpatient visits |
|
1,046,768 |
|
994,204 |
|
5.3 |
% |
2,078,379 |
|
1,984,615 |
|
4.7 |
% | ||||
|
Net outpatient revenue per visit |
|
$ |
756 |
|
$ |
742 |
|
1.9 |
% |
$ |
749 |
|
$ |
735 |
|
1.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Sources of net patient revenue |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Medicare |
|
22.7 |
% |
23.5 |
% |
(0.8 |
)%* |
24.6 |
% |
23.3 |
% |
1.3 |
%* | ||||
|
Medicaid |
|
10.0 |
% |
7.5 |
% |
2.5 |
%* |
8.7 |
% |
9.6 |
% |
(0.9 |
)%* | ||||
|
Managed care |
|
56.8 |
% |
58.2 |
% |
(1.4 |
)%* |
56.3 |
% |
56.4 |
% |
(0.1 |
)%* | ||||
|
Indemnity, self-pay and other |
|
10.5 |
% |
10.8 |
% |
(0.3 |
)%* |
10.4 |
% |
10.7 |
% |
(0.3 |
)%* | ||||
* This change is the difference between the 2012 and 2011 amounts shown
TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Fiscal 2012 by Calendar Quarter
(Unaudited)
|
|
|
Three Months Ended |
|
Six Months |
| |||||
|
(Dollars in millions except per share amounts) |
|
03/31/12 |
|
06/30/12 |
|
06/30/12 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Net operating revenues: |
|
|
|
|
|
|
| |||
|
Net operating revenues before provision for doubtful accounts |
|
$ |
2,491 |
|
$ |
2,455 |
|
$ |
4,946 |
|
|
Less: Provision for doubtful accounts |
|
189 |
|
190 |
|
379 |
| |||
|
Net operating revenues |
|
2,302 |
|
2,265 |
|
4,567 |
| |||
|
Operating expenses: |
|
|
|
|
|
|
| |||
|
Salaries, wages and benefits |
|
1,062 |
|
1,054 |
|
2,116 |
| |||
|
Supplies |
|
399 |
|
389 |
|
788 |
| |||
|
Other operating expenses, net |
|
531 |
|
534 |
|
1,065 |
| |||
|
Depreciation and amortization |
|
100 |
|
104 |
|
204 |
| |||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
3 |
|
3 |
|
6 |
| |||
|
Litigation and investigation costs |
|
2 |
|
1 |
|
3 |
| |||
|
Operating income |
|
205 |
|
180 |
|
385 |
| |||
|
Interest expense |
|
(98 |
) |
(102 |
) |
(200 |
) | |||
|
Investment earnings |
|
1 |
|
— |
|
1 |
| |||
|
Income from continuing operations, before income taxes |
|
108 |
|
78 |
|
186 |
| |||
|
Income tax expense |
|
(42 |
) |
(30 |
) |
(72 |
) | |||
|
Income from continuing operations, before discontinued operations |
|
66 |
|
48 |
|
114 |
| |||
|
Discontinued operations: |
|
|
|
|
|
|
| |||
|
Income (loss) from operations |
|
2 |
|
1 |
|
3 |
| |||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
— |
|
(100 |
) |
(100 |
) | |||
|
Net gains on sales of facilities |
|
— |
|
2 |
|
2 |
| |||
|
Income tax benefit (expense) |
|
(1 |
) |
29 |
|
28 |
| |||
|
Income (loss) from discontinued operations |
|
1 |
|
(68 |
) |
(67 |
) | |||
|
Net income |
|
67 |
|
(20 |
) |
47 |
| |||
|
Less: Preferred stock dividends |
|
6 |
|
4 |
|
10 |
| |||
|
Less: Net income (loss) attributable to noncontrolling interests |
|
3 |
|
(18 |
) |
(15 |
) | |||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
58 |
|
$ |
(6 |
) |
$ |
52 |
|
|
|
|
|
|
|
|
|
| |||
|
Amounts attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
| |||
|
Income from continuing operations, net of tax |
|
$ |
57 |
|
$ |
42 |
|
$ |
99 |
|
|
Income (loss) from discontinued operations, net of tax |
|
1 |
|
(48 |
) |
(47 |
) | |||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
58 |
|
$ |
(6 |
) |
$ |
52 |
|
|
|
|
|
|
|
|
|
| |||
|
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
| |||
|
Basic |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
0.14 |
|
$ |
0.10 |
|
$ |
0.24 |
|
|
Discontinued operations |
|
— |
|
(0.11 |
) |
(0.11 |
) | |||
|
|
|
$ |
0.14 |
|
$ |
(0.01 |
) |
$ |
0.13 |
|
|
Diluted |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
0.13 |
|
$ |
0.10 |
|
$ |
0.23 |
|
|
Discontinued operations |
|
— |
|
(0.11 |
) |
(0.11 |
) | |||
|
|
|
$ |
0.13 |
|
$ |
(0.01 |
) |
$ |
0.12 |
|
|
Weighted average shares and dilutive securities outstanding (in thousands): |
|
|
|
|
|
|
| |||
|
Basic |
|
411,373 |
|
415,011 |
|
413,192 |
| |||
|
Diluted |
|
484,873 |
|
427,708 |
|
434,718 |
| |||
TENET HEALTHCARE CORPORATION
SELECTED STATISTICS — CONTINUING HOSPITALS
(Unaudited)
|
|
|
|
|
|
|
Six Months |
| |||
|
(Dollars in millions except per patient day, per |
|
Three Months Ended |
|
Ended |
| |||||
|
admission and per visit amounts) |
|
03/31/12 |
|
06/30/12 |
|
06/30/12 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Net inpatient revenues |
|
$ |
1,607 |
|
$ |
1,548 |
|
$ |
3,155 |
|
|
Net outpatient revenues |
|
$ |
766 |
|
$ |
791 |
|
$ |
1,557 |
|
|
|
|
|
|
|
|
|
| |||
|
Number of acute care hospitals (at end of period) |
|
49 |
|
49 |
|
49 |
* | |||
|
Licensed beds (at end of period) |
|
13,175 |
|
13,176 |
|
13,176 |
| |||
|
Average licensed beds |
|
13,138 |
|
13,176 |
|
13,157 |
| |||
|
Utilization of licensed beds |
|
51.6 |
% |
49.2 |
% |
50.4 |
%* | |||
|
Patient days |
|
617,459 |
|
590,437 |
|
1,207,896 |
| |||
|
Adjusted patient days |
|
947,116 |
|
919,895 |
|
1,867,011 |
| |||
|
Net inpatient revenue per patient day |
|
$ |
2,603 |
|
$ |
2,622 |
|
$ |
2,612 |
|
|
Total admissions |
|
131,190 |
|
125,136 |
|
256,326 |
| |||
|
Adjusted patient admissions |
|
202,860 |
|
196,932 |
|
399,792 |
| |||
|
Net inpatient revenue per admission |
|
$ |
12,249 |
|
$ |
12,371 |
|
$ |
12,309 |
|
|
Average length of stay (days) |
|
4.71 |
|
4.72 |
|
4.71 |
| |||
|
Total surgeries |
|
93,228 |
|
95,422 |
|
188,650 |
| |||
|
Outpatient visits |
|
1,031,611 |
|
1,046,768 |
|
2,078,379 |
| |||
|
Net outpatient revenue per visit |
|
$ |
743 |
|
$ |
756 |
|
$ |
749 |
|
|
|
|
|
|
|
|
|
| |||
|
Sources of net patient revenue |
|
|
|
|
|
|
| |||
|
Medicare |
|
26.5 |
% |
22.7 |
% |
24.6 |
%* | |||
|
Medicaid |
|
7.5 |
% |
10.0 |
% |
8.7 |
%* | |||
|
Managed care |
|
55.9 |
% |
56.8 |
% |
56.3 |
%* | |||
|
Indemnity, self-pay and other |
|
10.1 |
% |
10.5 |
% |
10.4 |
%* | |||
* This change is the difference between the 2012 and 2011 amounts shown
TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Fiscal 2011 by Calendar Quarter
(Unaudited)
|
|
|
Three Months Ended |
|
Year Ended |
| |||||||||||
|
(Dollars in millions except per share amounts) |
|
03/31/11 |
|
06/30/11 |
|
09/30/11 |
|
12/31/11 |
|
12/31/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net operating revenues: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net operating revenues before provision for doubtful accounts |
|
$ |
2,429 |
|
$ |
2,300 |
|
$ |
2,289 |
|
$ |
2,353 |
|
$ |
9,371 |
|
|
Less: Provision for doubtful accounts |
|
179 |
|
168 |
|
189 |
|
181 |
|
717 |
| |||||
|
Net operating revenues |
|
2,250 |
|
2,132 |
|
2,100 |
|
2,172 |
|
8,654 |
| |||||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Salaries, wages and benefits |
|
1,017 |
|
982 |
|
1,002 |
|
1,014 |
|
4,015 |
| |||||
|
Supplies |
|
396 |
|
392 |
|
379 |
|
381 |
|
1,548 |
| |||||
|
Other operating expenses, net |
|
491 |
|
508 |
|
527 |
|
494 |
|
2,020 |
| |||||
|
Electronic health record incentives |
|
(25 |
) |
(25 |
) |
— |
|
(5 |
) |
(55 |
) | |||||
|
Depreciation and amortization |
|
98 |
|
100 |
|
100 |
|
100 |
|
398 |
| |||||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
8 |
|
2 |
|
8 |
|
2 |
|
20 |
| |||||
|
Litigation and investigation costs |
|
11 |
|
8 |
|
5 |
|
31 |
|
55 |
| |||||
|
Operating income |
|
254 |
|
165 |
|
79 |
|
155 |
|
653 |
| |||||
|
Interest expense |
|
(118 |
) |
(98 |
) |
(59 |
) |
(100 |
) |
(375 |
) | |||||
|
Loss from early extinguishment of debt |
|
— |
|
— |
|
— |
|
(117 |
) |
(117 |
) | |||||
|
Investment earnings |
|
1 |
|
1 |
|
1 |
|
1 |
|
4 |
| |||||
|
Income (loss) from continuing operations, before income taxes |
|
137 |
|
68 |
|
21 |
|
(61 |
) |
165 |
| |||||
|
Income tax benefit (expense) |
|
(50 |
) |
(19 |
) |
(4 |
) |
12 |
|
(61 |
) | |||||
|
Income (loss) from continuing operations, before discontinued operations |
|
87 |
|
49 |
|
17 |
|
(49 |
) |
104 |
| |||||
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Loss from operations |
|
(10 |
) |
(5 |
) |
(2 |
) |
(1 |
) |
(18 |
) | |||||
|
Impairment of long-lived assets and goodwill, and restructuring charges, net |
|
— |
|
— |
|
— |
|
(6 |
) |
(6 |
) | |||||
|
Litigation settlements, and investigation costs |
|
— |
|
— |
|
— |
|
(17 |
) |
(17 |
) | |||||
|
Income tax benefit |
|
5 |
|
19 |
|
— |
|
8 |
|
32 |
| |||||
|
Income (loss) from discontinued operations |
|
(5 |
) |
14 |
|
(2 |
) |
(16 |
) |
(9 |
) | |||||
|
Net income (loss) |
|
82 |
|
63 |
|
15 |
|
(65 |
) |
95 |
| |||||
|
Less: Preferred stock dividends |
|
6 |
|
6 |
|
6 |
|
6 |
|
24 |
| |||||
|
Less: Net income attributable to noncontrolling interests |
|
3 |
|
2 |
|
3 |
|
5 |
|
13 |
| |||||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
73 |
|
$ |
55 |
|
$ |
6 |
|
$ |
(76 |
) |
$ |
58 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Amounts attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Income (loss) from continuing operations, net of tax |
|
$ |
80 |
|
$ |
40 |
|
$ |
8 |
|
$ |
(60 |
) |
$ |
68 |
|
|
Income (loss) from discontinued operations, net of tax |
|
(7 |
) |
15 |
|
(2 |
) |
(16 |
) |
(10 |
) | |||||
|
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
73 |
|
$ |
55 |
|
$ |
6 |
|
$ |
(76 |
) |
$ |
58 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Basic |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Continuing operations |
|
$ |
0.16 |
|
$ |
0.08 |
|
$ |
0.02 |
|
$ |
(0.13 |
) |
$ |
0.15 |
|
|
Discontinued operations |
|
(0.01 |
) |
0.03 |
|
— |
|
(0.04 |
) |
(0.03 |
) | |||||
|
|
|
$ |
0.15 |
|
$ |
0.11 |
|
$ |
0.02 |
|
$ |
(0.17 |
) |
$ |
0.12 |
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Continuing operations |
|
$ |
0.15 |
|
$ |
0.08 |
|
$ |
0.02 |
|
$ |
(0.13 |
) |
$ |
0.14 |
|
|
Discontinued operations |
|
(0.01 |
) |
0.03 |
|
— |
|
(0.04 |
) |
(0.02 |
) | |||||
|
|
|
$ |
0.14 |
|
$ |
0.11 |
|
$ |
0.02 |
|
$ |
(0.17 |
) |
$ |
0.12 |
|
|
Weighted average shares and dilutive securities outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Basic |
|
486,902 |
|
486,794 |
|
468,753 |
|
432,454 |
|
468,726 |
| |||||
|
Diluted |
|
565,181 |
|
503,748 |
|
483,632 |
|
432,454 |
|
485,181 |
| |||||
TENET HEALTHCARE CORPORATION
SELECTED STATISTICS — CONTINUING HOSPITALS
(Unaudited)
|
(Dollars in millions except per patient day, per |
|
Three Months Ended |
|
Year Ended |
| |||||||||||
|
admission and per visit amounts) |
|
03/31/11 |
|
06/30/11 |
|
09/30/11 |
|
12/31/11 |
|
12/31/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net inpatient revenues |
|
$ |
1,619 |
|
$ |
1,466 |
|
$ |
1,444 |
|
$ |
1,499 |
|
$ |
6,028 |
|
|
Net outpatient revenues |
|
$ |
720 |
|
$ |
738 |
|
$ |
734 |
|
$ |
736 |
|
$ |
2,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Number of acute care hospitals (at end of period) |
|
49 |
|
49 |
|
49 |
|
49 |
|
49 |
* | |||||
|
Licensed beds (at end of period) |
|
13,123 |
|
13,086 |
|
13,119 |
|
13,119 |
|
13,119 |
| |||||
|
Average licensed beds |
|
13,123 |
|
13,111 |
|
13,106 |
|
13,119 |
|
13,115 |
| |||||
|
Utilization of licensed beds |
|
53.8 |
% |
50.0 |
% |
49.1 |
% |
48.9 |
% |
50.4 |
%* | |||||
|
Patient days |
|
635,463 |
|
595,986 |
|
591,948 |
|
589,848 |
|
2,413,245 |
| |||||
|
Adjusted patient days |
|
948,356 |
|
912,369 |
|
909,960 |
|
902,762 |
|
3,673,447 |
| |||||
|
Net inpatient revenue per patient day |
|
$ |
2,548 |
|
$ |
2,460 |
|
$ |
2,439 |
|
$ |
2,541 |
|
$ |
2,498 |
|
|
Total admissions |
|
131,437 |
|
125,592 |
|
125,458 |
|
125,347 |
|
507,834 |
| |||||
|
Adjusted patient admissions |
|
197,459 |
|
193,971 |
|
194,965 |
|
193,631 |
|
780,026 |
| |||||
|
Net inpatient revenue per admission |
|
$ |
12,318 |
|
$ |
11,673 |
|
$ |
11,510 |
|
$ |
11,959 |
|
$ |
11,870 |
|
|
Average length of stay (days) |
|
4.83 |
|
4.75 |
|
4.72 |
|
4.71 |
|
4.75 |
| |||||
|
Total surgeries |
|
87,507 |
|
91,005 |
|
92,574 |
|
91,200 |
|
362,286 |
| |||||
|
Outpatient visits |
|
990,411 |
|
994,204 |
|
987,318 |
|
982,083 |
|
3,954,016 |
| |||||
|
Net outpatient revenue per visit |
|
$ |
727 |
|
$ |
742 |
|
$ |
743 |
|
$ |
749 |
|
$ |
741 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Sources of net patient revenue |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Medicare |
|
23.2 |
% |
23.5 |
% |
22.5 |
% |
23.1 |
% |
23.1 |
%* | |||||
|
Medicaid |
|
11.5 |
% |
7.5 |
% |
8.0 |
% |
8.6 |
% |
9.0 |
%* | |||||
|
Managed care |
|
54.6 |
% |
58.2 |
% |
58.2 |
% |
58.1 |
% |
57.2 |
%* | |||||
|
Indemnity, self-pay and other |
|
10.7 |
% |
10.8 |
% |
11.3 |
% |
10.2 |
% |
10.7 |
%* | |||||
* This change is the difference between the 2012 and 2011 amounts shown
TENET HEALTHCARE CORPORATION
SEGMENT REPORTING
(Unaudited)
|
|
|
June 30, |
|
December 31, |
| ||
|
(Dollars in millions) |
|
2012 |
|
2011 |
| ||
|
Assets: |
|
|
|
|
| ||
|
Hospital Operations and other |
|
$ |
8,410 |
|
$ |
8,389 |
|
|
Conifer |
|
75 |
|
73 |
| ||
|
Total |
|
$ |
8,485 |
|
$ |
8,462 |
|
|
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
|
|
|
2012 |
|
2011 |
|
2012 |
|
2011 |
| ||||
|
Capital expenditures: |
|
|
|
|
|
|
|
|
| ||||
|
Hospital Operations and other |
|
$ |
114 |
|
$ |
78 |
|
$ |
247 |
|
$ |
191 |
|
|
Conifer |
|
2 |
|
4 |
|
5 |
|
7 |
| ||||
|
Total |
|
$ |
116 |
|
$ |
82 |
|
$ |
252 |
|
$ |
198 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Revenues: |
|
|
|
|
|
|
|
|
| ||||
|
Hospital Operations and other |
|
$ |
2,247 |
|
$ |
2,113 |
|
$ |
4,532 |
|
$ |
4,349 |
|
|
Conifer |
|
|
|
|
|
|
|
|
| ||||
|
Tenet |
|
90 |
|
64 |
|
180 |
|
124 |
| ||||
|
Other customers |
|
18 |
|
19 |
|
35 |
|
33 |
| ||||
|
|
|
2,355 |
|
2,196 |
|
4,747 |
|
4,506 |
| ||||
|
Intercompany eliminations |
|
(90 |
) |
(64 |
) |
(180 |
) |
(124 |
) | ||||
|
Total |
|
$ |
2,265 |
|
$ |
2,132 |
|
$ |
4,567 |
|
$ |
4,382 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
| ||||
|
Hospital Operations and other |
|
$ |
263 |
|
$ |
266 |
|
$ |
548 |
|
$ |
632 |
|
|
Conifer |
|
25 |
|
9 |
|
50 |
|
14 |
| ||||
|
Total |
|
$ |
288 |
|
$ |
275 |
|
$ |
598 |
|
$ |
646 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Depreciation and amortization: |
|
|
|
|
|
|
|
|
| ||||
|
Hospital Operations and other |
|
$ |
101 |
|
$ |
98 |
|
$ |
199 |
|
$ |
194 |
|
|
Conifer |
|
3 |
|
2 |
|
5 |
|
4 |
| ||||
|
Total |
|
$ |
104 |
|
$ |
100 |
|
$ |
204 |
|
$ |
198 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Adjusted EBITDA: |
|
$ |
288 |
|
$ |
275 |
|
$ |
598 |
|
$ |
646 |
|
|
Depreciation and amortization |
|
(104 |
) |
(100 |
) |
(204 |
) |
(198 |
) | ||||
|
Interest expenses |
|
(102 |
) |
(98 |
) |
(200 |
) |
(216 |
) | ||||
|
Litigation and investigation costs |
|
(1 |
) |
(8 |
) |
(3 |
) |
(19 |
) | ||||
|
Impairments of long-lived assets |
|
(3 |
) |
(2 |
) |
(6 |
) |
(10 |
) | ||||
|
Investment earnings |
|
0 |
|
1 |
|
1 |
|
2 |
| ||||
|
Income before income taxes |
|
$ |
78 |
|
$ |
68 |
|
$ |
186 |
|
$ |
205 |
|
Due to the fact that Conifer’s revenues from providing services to Tenet’s hospitals were based on third-party billing terms in 2012 but not in 2011, the following table presents proforma EBITDA on a comparable basis to the prior year’s presentation.
|
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
|
|
|
2012 |
|
2011 |
|
2012 |
|
2011 |
| ||||
|
Adjusted supplemental EBITDA: |
|
|
|
|
|
|
|
|
| ||||
|
Hospital Operations and other |
|
$ |
279 |
|
$ |
266 |
|
$ |
580 |
|
$ |
632 |
|
|
Conifer |
|
9 |
|
9 |
|
18 |
|
14 |
| ||||
|
Total |
|
$ |
288 |
|
$ |
275 |
|
$ |
598 |
|
$ |
646 |
|
Reconciliation of Adjusted EBITDA
Adjusted EBITDA, a non-GAAP term, is defined by the Company as net income (loss) attributable to Tenet Healthcare Corporation common shareholders before (1) cumulative effect of changes in accounting principle, net of tax, (2) net income attributable to noncontrolling interests, (3) preferred stock dividends, (4) income (loss) from discontinued operations, net of tax, (5) income tax (expense) benefit, (6) investment earnings (loss), (7) gain (loss) from early extinguishment of debt, (8) net gain (loss) on sales of investments, (9) interest expense, (10) litigation and investigation (costs) benefit, net of insurance recoveries, (11) hurricane insurance recoveries, net of costs, (12) impairment of long-lived assets and goodwill and restructuring charges, net of insurance recoveries, and (13) depreciation and amortization. The Company’s Adjusted EBITDA may not be comparable to EBITDA reported by other companies.
The Company provides this information as a supplement to GAAP information to assist itself and investors in understanding the impact of various items on its financial statements, some of which are recurring or involve cash payments. The Company uses this information in its analysis of the performance of its business excluding items that it does not consider as relevant in the performance of its hospitals in continuing operations. In addition, from time to time we use this measure to define certain performance targets under our compensation programs. Adjusted EBITDA is not a measure of liquidity, but is a measure of operating performance that management uses in its business as an alternative to net income (loss) attributable to Tenet Healthcare Corporation common shareholders. Because Adjusted EBITDA excludes many items that are included in our financial statements, it does not provide a complete measure of our operating performance. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance.
The reconciliation of net income (loss) attributable to Tenet Healthcare Corporation common shareholders, the most comparable GAAP term, to Adjusted EBITDA, is set forth in the first table below for the three and six months ended June 30, 2012 and 2011.
TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures
Table #1 - Reconciliation of Adjusted EBITDA to Net Income Attributable to Tenet Healthcare Corporation Common Shareholders
(Unaudited)
|
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
|
(Dollars in millions) |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
| ||||
|
Net income attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
(6 |
) |
$ |
55 |
|
$ |
52 |
|
$ |
128 |
|
|
Less: Net loss/(income) attributable to noncontrolling interests |
|
18 |
|
(2 |
) |
15 |
|
(5 |
) | ||||
|
Preferred stock dividends |
|
(4 |
) |
(6 |
) |
(10 |
) |
(12 |
) | ||||
|
Income (loss) from discontinued operations, net of tax |
|
(68 |
) |
14 |
|
(67 |
) |
9 |
| ||||
|
Income from continuing operations |
|
48 |
|
49 |
|
114 |
|
136 |
| ||||
|
Income tax expense |
|
(30 |
) |
(19 |
) |
(72 |
) |
(69 |
) | ||||
|
Investment earnings |
|
— |
|
1 |
|
1 |
|
2 |
| ||||
|
Interest expense |
|
(102 |
) |
(98 |
) |
(200 |
) |
(216 |
) | ||||
|
Operating income |
|
180 |
|
165 |
|
385 |
|
419 |
| ||||
|
Litigation and investigation costs |
|
(1 |
) |
(8 |
) |
(3 |
) |
(19 |
) | ||||
|
Impairment of long-lived assets and goodwill, and restructuring charges |
|
(3 |
) |
(2 |
) |
(6 |
) |
(10 |
) | ||||
|
Depreciation and amortization |
|
(104 |
) |
(100 |
) |
(204 |
) |
(198 |
) | ||||
|
Adjusted EBITDA |
|
$ |
288 |
|
$ |
275 |
|
$ |
598 |
|
$ |
646 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Net operating revenues |
|
$ |
2,265 |
|
$ |
2,132 |
|
$ |
4,567 |
|
$ |
4,382 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) |
|
12.7 |
% |
12.9 |
% |
13.1 |
% |
14.7 |
% | ||||
Table #2 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Net Income Attributable to Tenet Healthcare Corporation Common Shareholders
for Year Ending December 31, 2012
(Unaudited)
|
(Dollars in millions) |
|
Low |
|
High |
| ||
|
|
|
|
|
|
| ||
|
Net income attributable to Tenet Healthcare Corporation common shareholders |
|
$ |
165 |
|
$ |
270 |
|
|
Less: |
|
|
|
|
| ||
|
Net loss attributable to noncontrolling interests |
|
5 |
|
10 |
| ||
|
Preferred stock dividends |
|
(12 |
) |
(12 |
) | ||
|
Loss from discontinued operations, net of tax |
|
(75 |
) |
(60 |
) | ||
|
Income from continuing operations |
|
247 |
|
332 |
| ||
|
Income tax expense |
|
(158 |
) |
(213 |
) | ||
|
Income from continuing operations, before income taxes |
|
405 |
|
545 |
| ||
|
Interest expense, net |
|
(410 |
) |
(390 |
) | ||
|
Operating income |
|
815 |
|
935 |
| ||
|
Litigation and investigation costs |
|
(10 |
) |
(5 |
) | ||
|
Impairment of long-lived assets and goodwill, and restructuring charges |
|
(15 |
) |
(5 |
) | ||
|
Depreciation and amortization |
|
(410 |
) |
(430 |
) | ||
|
Adjusted EBITDA |
|
$ |
1,250 |
|
$ |
1,375 |
|
|
|
|
|
|
|
| ||
|
Net operating revenues |
|
$ |
9,000 |
|
$ |
9,300 |
|
|
Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) |
|
13.9 |
% |
14.8 |
% | ||
Table #3 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Normalized Income From Continuing Operations
for Year Ending December 31, 2012
(Unaudited)
|
(Dollars in millions) |
|
Low |
|
High |
| ||
|
|
|
|
|
|
| ||
|
Adjusted EBITDA (from Table #2) |
|
$ |
1,250 |
|
$ |
1,375 |
|
|
|
|
|
|
|
| ||
|
Depreciation and amortization |
|
(410 |
) |
(430 |
) | ||
|
Interest expense, net |
|
(410 |
) |
(390 |
) | ||
|
Income from continuing operations, before income taxes |
|
430 |
|
555 |
| ||
|
Income tax expense (a) |
|
(168 |
) |
(216 |
) | ||
|
Income from continuing operations |
|
262 |
|
339 |
| ||
|
Preferred stock dividends |
|
(12 |
) |
(12 |
) | ||
|
Net income attributable to noncontrolling interests |
|
(15 |
) |
(10 |
) | ||
|
Income from continuing operations net of tax (a) |
|
$ |
235 |
|
$ |
317 |
|
|
|
|
|
|
|
| ||
|
Weighted average shares outstanding (in millions) |
|
437 |
|
437 |
| ||
|
Diluted earnings per share — continuing operations (a) |
|
$ |
0.54 |
|
$ |
0.73 |
|
(a) Uses tax rate of 39 percent