Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - HEALTH MANAGEMENT ASSOCIATES, INC | d415422d8k.htm |
Exhibit 99.1
PRESS RELEASE
FOR IMMEDIATE RELEASE
| Contact: | John C. Merriwether | |||
| Vice President of Financial Relations | ||||
| Health Management Associates, Inc. | ||||
| (239) 598-3131 |
HEALTH MANAGEMENT ANNOUNCES 3rd QUARTER 2012 RESULTS
Diluted EPS from continuing operations increased 5.9% to $0.18, excluding impact of interest rate swap accounting, mark-to-market adjustments and HCIT payments, net of Medicaid rate adjustments. Overall diluted EPS from continuing operations of $0.17.
NAPLES, FLORIDA (October 22, 2012) Health Management Associates, Inc. (NYSE: HMA) today announced its consolidated financial results for the third quarter and nine months ended September 30, 2012.
Key metrics from continuing operations for the third quarter (all percentage changes compare the third quarter of 2012 to the third quarter of 2011) include:
| • | As shown in the tables accompanying this press release, excluding the impact of approximately $23.9 million, or $0.06 per diluted share, of interest rate swap accounting as well as a mark-to-market adjustments on the swap due to interest rate conditions, and excluding approximately $20.3 million, or $0.05 per diluted share, of Medicare and Medicaid Healthcare Information Technology (“HCIT”) incentive payments, net of Medicaid rate adjustments, diluted earnings per share from continuing operations increased 5.9% to $0.18 as compared to $0.17 per diluted share for the same quarter a year ago; |
| • | Net revenue increased 18.1% to $1.440 billion; |
| • | Adjusted EBITDA increased 26.9% to $236.4 million; |
| • | Admissions increased 4.0% while adjusted admissions increased 10.4%; |
| • | Same hospital net revenue increased 4.5% to $1.274 billion; |
| • | Same hospital net revenue per adjusted admission increased 6.9%; |
| • | Same hospital Adjusted EBITDA increased 14.2% to $259.6 million, resulting in a 180 basis point improvement in margin to 20.4%. Excluding HCIT incentive payments of approximately $24.2 million and $1.7 million for the third quarter 2012 and 2011, respectively, same hospital Adjusted EBITDA increased 4.3% to $235.4 million; and |
| • | Same hospital surgeries and emergency room visits increased 0.8% and 4.2%, respectively. |
Health Management Associates, Inc. / Page 2
The tables accompanying this press release include reconciliations of consolidated net income to all presentations of Adjusted EBITDA (which is not a GAAP measure) contained in this press release. Those tables also reconcile earnings per share on a GAAP basis to those amounts presented in this press release and contain disclaimers and other important information regarding how Health Management defines and uses Adjusted EBITDA.
For continuing operations at hospitals operated by Health Management for one year or more, referred to as same hospital operations, net revenue in the third quarter increased $54.4 million, or 4.5%, to $1.274 billion compared to the same quarter in the prior year. Adjusted EBITDA from same hospital operations grew 14.2% to $259.6 million, representing 20.4% of net revenue, as compared to $227.3 million and 18.6%, respectively, for the same quarter a year ago. Same hospital Adjusted EBITDA includes approximately $24.2 million of HCIT incentive payments, which were offset by approximately $3.9 million of Medicaid program payment reductions.
The effects of Hurricane Isaac on Health Management hospitals in Mississippi and Florida coupled with declines in uninsured admissions and increases in observation stays greater than 24-hours contributed to a 6.4% decline in third quarter same hospital admissions while same hospital adjusted admissions declined 2.2%.
“Through the efforts of our more than 45,000 associates and 10,000 physicians, we continued to deliver consistent quality performance and EBITDA growth in the third quarter, despite a very challenging and unpredictable economy,” said Gary D. Newsome, Health Management’s President and Chief Executive Officer. “We are pleased with these results and continue to see growth in outpatient services. By focusing on our patient-centered approach, managing our costs, and investing our resources where they can generate the most value, we are creating a culture and environment that is attractive to patients, physicians and associates. This culture and track record of solid operating performance is also attracting a significant number of hospitals and hospital systems that are seeking a strategic partner capable of investing the necessary capital to enhance and expand services, and provide the operating expertise to leverage future opportunities.”
For the third quarter, Health Management’s provision for doubtful accounts was $224.1 million, or 13.5% of net revenue before the provision for doubtful accounts, compared to $178.9 million, or 12.8% of net revenue before the provision of doubtful accounts, for the same quarter a year ago.
Health Management Associates, Inc. / Page 3
Uninsured self-pay patient discounts for the third quarter were $334.7 million, compared to $227.0 million for the same quarter a year ago. Charity/indigent care write-offs were $28.1 million for the third quarter, compared to $24.0 million for the same quarter a year ago.
The sum of uninsured discounts, charity/indigent write-offs and the provision for doubtful accounts, as a percent of the sum of net revenue before the provision for doubtful accounts, uninsured discounts and charity/indigent write-offs (which Health Management refers to as its Uncompensated Patient Care Percentage) was 29.0% for the third quarter, compared to 26.1% for the third quarter a year ago, and 27.2% for the quarter ended June 30, 2012. Health Management believes that its Uncompensated Patient Care Percentage provides key information regarding the aggregate level of patient care for which it does not receive payment.
Cash flow from continuing operating activities for the third quarter was $167.1 million, after cash interest and cash tax payments aggregating $119.8 million. Health Management’s cash flows in the third quarter reflect the negative impact of the INTEGRIS Oklahoma receivables, as not all post-acquisition government tie-in notices were received as of September 30, 2012. The Company expects to receive the government tie-in notices during the fourth quarter. Health Management’s total leverage ratio was 3.6 and interest coverage ratio was 4.2 at September 30, 2012, both ratios being well within debt covenant requirements.
For the nine months ended September 30, 2012, Health Management reported an 18.9% growth in net revenue to $4.397 billion and a 17.7% increase in Adjusted EBITDA to $709.2 million. Excluding approximately $31.7 million and $1.7 million of HCIT incentive payments for 2012 and 2011 respectively, Adjusted EBITDA increased 12.8% to $677.5 million. As shown in the tables accompanying this press release, excluding the impact of approximately $82.9 million, or $0.20 per diluted share, for interest rate swap accounting as well as mark-to-market adjustments on the swap due to interest rate conditions, and the impact of approximately $18.6 million, or $0.05 per diluted share, of HCIT incentive payments, net of Medicaid rate adjustments, for the nine months ended September 30, 2012, diluted earnings per share from continuing operations increased 6.8% to $0.63 as compared to $0.59 per diluted share for the same nine month period a year ago. Consolidated diluted earnings per share from continuing operations were $0.48 for the nine months ended September 30, 2012.
Health Management Associates, Inc. / Page 4
Health Management hospitals recognized approximately $24.2 million and $31.7 million of HCIT incentive payments in the three and nine months ended September 30, 2012, respectively, and approximately $1.7 million of HCIT incentive payments for both the three and nine month ended September 30, 2011. Health Management expects to recognize approximately $90 to $100 million of HCIT incentive payments during the year ending December 31, 2012.
Health Management is updating its 2012 Adjusted EBITDA objective range for the year ending December 31, 2012 to be between $875 and $915 million. The Company is also updating its diluted EPS from continuing operations objective range for the year ending December 31, 2012 to be between $0.80 and $0.85. This diluted EPS range for 2012 does not include approximately $103 to $107 million, or $0.26 to $0.27 per diluted share, of impact expected from interest rate swap accounting and mark-to-market adjustments nor does it include approximately $90 to $100 million, or $0.23 to $0.25 per diluted share, of anticipated HCIT incentive payments. Health Management is also updating its 2012 annual same hospital admissions objective range. The Company now expects same hospital admissions for 2012 to decline between 3.0% and 5.0%. In addition, the Company is affirming its 2012 annual same hospital adjusted admissions objective range. The Company continues to expect same hospital adjusted admissions growth for 2012 to be between 1.0% and (1.0%).
Health Management’s executive team will hold a conference call and webcast to discuss the contents of this press release and Health Management’s consolidated financial results for the three and nine months ended September 30, 2012 on Tuesday, October 23, 2012 at 11:00 a.m. EDT. Investors are invited to access the webcast via Health Management’s website at www.HMA.com or via www.streetevents.com. Alternatively, investors may join the conference call by dialing 877-476-3476.
Health Management will archive a copy of the audio webcast of the conference call, along with any related information that Health Management may be required to provide pursuant to Securities and Exchange Commission rules, on its website under the heading “Investor Relations” for a period of 60 days following the conference call.
Health Management Associates, Inc. / Page 5
Health Management enables America’s best local health care by providing the people, processes, capital and expertise necessary for its hospital and physician partners to fulfill their local missions of delivering superior health care services. Health Management, through its subsidiaries, operates 70 hospitals with approximately 10,500 licensed beds in non-urban communities located throughout the United States.
All references to “Health Management,” “HMA” or the “Company” used in this release refer to Health Management Associates, Inc. and its affiliates.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as “expects,” “estimates,” “projects,” “anticipates,” “believes,” “intends,” “plans,” “may,” “continues,” “should,” “could” and other similar words. All statements addressing operating performance, events or developments that Health Management Associates, Inc. expects or anticipates will occur in the future, including but not limited to incurrence of indebtedness, projections of revenue, income or loss, capital expenditures, earnings per share, debt structure, the provision for doubtful accounts, capital structure, repayment of indebtedness, the amount and timing of funds under the meaningful use measurement standard of various HCIT incentive programs, other financial items and operating statistics, statements regarding the plans and objectives of management for future operations, innovations, or market service development, statements regarding acquisitions, joint ventures, divestitures and other proposed or contemplated transactions (including but not limited to statements regarding the potential for future acquisitions and perceived benefits of acquisitions), statements of future economic performance, statements regarding legal proceedings and other loss contingencies, statements regarding market risk exposures, statements regarding the effects and/or interpretations of recently enacted or future health care laws and regulations, statements of the assumptions underlying or relating to any of the foregoing statements, and other statements which are other than statements of historical fact, are considered to be “forward-looking statements.”
Because they are forward-looking, such statements should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties are more fully described in Health Management Associates, Inc.’s most recent Annual Report on Form 10-K, and most recent Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012, including under the heading entitled “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should any of Health Management Associates, Inc.’s underlying assumptions prove incorrect, actual results could vary materially from those currently anticipated. In addition, undue reliance should not be placed on Health Management Associates, Inc.’s forward-looking statements. Except as required by law, Health Management Associates, Inc. disclaims any obligation to update its risk factors or to publicly announce updates to the forward-looking statements contained in this press release to reflect new information, future events or other developments.
(financial tables follow)
HEALTH MANAGEMENT ASSOCIATES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands, except per share amounts)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Net revenue before the provision for doubtful accounts |
$ | 1,664,187 | $ | 1,398,495 | $ | 5,037,246 | $ | 4,220,677 | ||||||||
| Provision for doubtful accounts |
(224,078 | ) | (178,873 | ) | (639,902 | ) | (521,729 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net revenue |
1,440,109 | 1,219,622 | 4,397,344 | 3,698,948 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Salaries and benefits |
637,305 | 549,857 | 1,942,322 | 1,665,093 | ||||||||||||
| Supplies |
216,819 | 179,993 | 677,416 | 560,248 | ||||||||||||
| Rent expense |
41,882 | 38,117 | 130,746 | 110,738 | ||||||||||||
| Other operating expenses |
331,935 | 267,140 | 969,350 | 762,115 | ||||||||||||
| Medicare and Medicaid HCIT incentive payments |
(24,224 | ) | (1,749 | ) | (31,685 | ) | (1,749 | ) | ||||||||
| Depreciation and amortization |
91,610 | 65,605 | 255,716 | 194,434 | ||||||||||||
| Interest expense |
76,814 | 50,018 | 240,743 | 152,088 | ||||||||||||
| Other |
(2,363 | ) | (1,450 | ) | (1,745 | ) | (1,783 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 1,369,778 | 1,147,531 | 4,182,863 | 3,441,184 | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations before income taxes |
70,331 | 72,091 | 214,481 | 257,764 | ||||||||||||
| Provision for income taxes |
(20,913 | ) | (22,387 | ) | (70,931 | ) | (89,178 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations |
49,418 | 49,704 | 143,550 | 168,586 | ||||||||||||
| Income (loss) from discontinued operations, net of income taxes |
(1,389 | ) | 255 | (5,805 | ) | (1,182 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Consolidated net income |
48,029 | 49,959 | 137,745 | 167,404 | ||||||||||||
| Net income attributable to noncontrolling interests |
(6,685 | ) | (6,231 | ) | (21,757 | ) | (19,541 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income attributable to Health Management Associates, Inc. |
$ | 41,344 | $ | 43,728 | $ | 115,988 | $ | 147,863 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Earnings (loss) per share attributable to Heath Management Associates, Inc. common stockholders: |
||||||||||||||||
| Basic and Diluted: |
||||||||||||||||
| Continuing operations |
$ | 0.17 | $ | 0.17 | $ | 0.48 | $ | 0.59 | ||||||||
| Discontinued operations |
(0.01 | ) | — | (0.03 | ) | (0.01 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income |
$ | 0.16 | $ | 0.17 | $ | 0.45 | $ | 0.58 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Weighted average number of shares outstanding: |
||||||||||||||||
| Basic |
254,516 | 252,157 | 254,111 | 251,327 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Diluted |
256,784 | 255,124 | 256,172 | 254,703 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income attributable to Health Management Associates, Inc. |
||||||||||||||||
| Income from continuing operations, net of income taxes |
$ | 42,733 | $ | 43,473 | $ | 121,793 | $ | 149,045 | ||||||||
| Income (loss) from discontinued operations, net of income taxes |
(1,389 | ) | 255 | (5,805 | ) | (1,182 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income attributable to Health Management Associates, Inc. |
$ | 41,344 | $ | 43,728 | $ | 115,988 | $ | 147,863 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
HEALTH MANAGEMENT ASSOCIATES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
| Nine Months Ended September 30, | ||||||||
| 2012 | 2011 | |||||||
| Cash flows from operating activities: |
||||||||
| Consolidated net income |
$ | 137,745 | $ | 167,404 | ||||
| Adjustments to reconcile consolidated net income to net cash provided by continuing operating activities: |
||||||||
| Depreciation and amortization |
263,960 | 199,428 | ||||||
| Amortization related to interest rate swap contract |
59,937 | — | ||||||
| Fair value adjustment related to interest rate swap contract |
22,965 | — | ||||||
| Provision for doubtful accounts |
639,902 | 521,729 | ||||||
| Stock-based compensation expense |
19,492 | 19,301 | ||||||
| Losses on sales of assets, net |
2,114 | 1,096 | ||||||
| Gains on sales of available-for-sale securities, net |
(2,350 | ) | (706 | ) | ||||
| Deferred income tax (benefit) expense |
(20,156 | ) | 48,375 | |||||
| Changes in assets and liabilities of continuing operations, net of the effects of acquisitions: |
||||||||
| Accounts receivable |
(719,495 | ) | (573,902 | ) | ||||
| Supplies, prepaid expenses and other current assets |
(1,962 | ) | (12,251 | ) | ||||
| Prepaid and recoverable income taxes |
52,641 | (8 | ) | |||||
| Deferred charges and other long-term assets |
(1,839 | ) | (1,584 | ) | ||||
| Accounts payable, accrued expenses and other liabilities |
831 | 79,806 | ||||||
| Equity compensation excess income tax benefits |
(1,444 | ) | (2,919 | ) | ||||
| Loss from discontinued operations, net of income taxes |
5,805 | 1,182 | ||||||
|
|
|
|
|
|||||
| Net cash provided by continuing operating activities |
458,146 | 446,951 | ||||||
|
|
|
|
|
|||||
| Cash flows from investing activities: |
||||||||
| Additions to property, plant and equipment |
(282,424 | ) | (202,819 | ) | ||||
| Acquisitions of hospitals and other |
(71,475 | ) | (573,439 | ) | ||||
| Proceeds from sales of assets and insurance recoveries |
1,932 | 1,792 | ||||||
| Proceeds from sales of discontinued operations |
1,392 | 4,851 | ||||||
| Purchases of available-for-sale securities |
(1,431,548 | ) | (1,153,492 | ) | ||||
| Proceeds from sales of available-for-sale securities |
1,412,580 | 1,173,348 | ||||||
| Increase in restricted funds |
(18,723 | ) | (28,260 | ) | ||||
|
|
|
|
|
|||||
| Net cash used in continuing investing activities |
(388,266 | ) | (778,019 | ) | ||||
|
|
|
|
|
|||||
| Cash flows from financing activities: |
||||||||
| Principal payments on debt and capital lease obligations |
(87,927 | ) | (34,047 | ) | ||||
| Payments for debt issuance costs |
(636 | ) | (10,625 | ) | ||||
| Proceeds from long-term borrowings |
17,000 | 370,700 | ||||||
| Cash payments to noncontrolling shareholders |
(30,815 | ) | (21,828 | ) | ||||
| Cash received from noncontrolling shareholders |
3,591 | — | ||||||
| Proceeds from exercises of stock options |
— | 14,067 | ||||||
| Equity compensation excess income tax benefits |
1,444 | 2,919 | ||||||
|
|
|
|
|
|||||
| Net cash provided by (used in) continuing financing activities |
(97,343 | ) | 321,186 | |||||
|
|
|
|
|
|||||
| Net decrease in cash and cash equivalents before discontinued operations |
(27,463 | ) | (9,882 | ) | ||||
| Net increases (decreases) in cash and cash equivalents from discontinued operations: |
||||||||
| Operating activities |
(1,327 | ) | 8,004 | |||||
| Investing activities |
(135 | ) | (11,583 | ) | ||||
|
|
|
|
|
|||||
| Net decrease in cash and cash equivalents |
(28,925 | ) | (13,461 | ) | ||||
| Cash and cash equivalents at the beginning of the period |
64,143 | 101,812 | ||||||
|
|
|
|
|
|||||
| Cash and cash equivalents at the end of the period |
$ | 35,218 | $ | 88,351 | ||||
|
|
|
|
|
|||||
HEALTH MANAGEMENT ASSOCIATES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS AND STATISTICS
| September 30, | December 31, | |||||||
| (unaudited, dollars in thousands) | 2012 | 2011 | ||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 35,218 | $ | 64,143 | ||||
| Available-for-sale securities |
146,569 | 122,277 | ||||||
| Accounts receivable, net |
972,104 | 903,517 | ||||||
| Other current assets |
262,210 | 305,640 | ||||||
| Assets of discontinued operations |
8,100 | 14,561 | ||||||
| Property, plant and equipment, net |
3,415,431 | 3,263,172 | ||||||
| Restricted funds |
120,161 | 96,244 | ||||||
| Other assets |
1,346,935 | 1,234,635 | ||||||
|
|
|
|
|
|||||
| Total assets |
$ | 6,306,728 | $ | 6,004,189 | ||||
|
|
|
|
|
|||||
| Liabilities and Stockholders’ Equity |
||||||||
| Current liabilities |
$ | 902,678 | $ | 803,824 | ||||
| Deferred income taxes |
281,644 | 234,080 | ||||||
| Other long-term liabilities |
690,644 | 691,680 | ||||||
| Long-term debt |
3,476,368 | 3,489,489 | ||||||
| Stockholders’ equity |
955,394 | 785,116 | ||||||
|
|
|
|
|
|||||
| Total liabilities and stockholders’ equity |
$ | 6,306,728 | $ | 6,004,189 | ||||
|
|
|
|
|
|||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
| 2012 | 2011 | % Change | 2012 | 2011 | % Change | |||||||||||||||||||
| Continuing Operations |
||||||||||||||||||||||||
| Occupancy |
38.9 | % | 41.1 | % | 41.0 | % | 43.6 | % | ||||||||||||||||
| Patient days |
357,613 | 335,934 | 6.5 | % | 1,120,642 | 1,059,584 | 5.8 | % | ||||||||||||||||
| Admissions |
84,704 | 81,411 | 4.0 | % | 264,548 | 250,307 | 5.7 | % | ||||||||||||||||
| Adjusted admissions |
171,206 | 155,097 | 10.4 | % | 521,459 | 466,547 | 11.8 | % | ||||||||||||||||
| Average length of stay |
4.2 | 4.1 | 4.2 | 4.2 | ||||||||||||||||||||
| Surgeries |
97,230 | 81,665 | 19.1 | % | 297,609 | 246,998 | 20.5 | % | ||||||||||||||||
| Emergency room visits |
455,372 | 376,539 | 20.9 | % | 1,352,451 | 1,145,401 | 18.1 | % | ||||||||||||||||
| Net revenue (in thousands) |
$ | 1,440,109 | $ | 1,219,622 | 18.1 | % | $ | 4,397,344 | $ | 3,698,948 | 18.9 | % | ||||||||||||
| Net revenue per adjusted admission |
$ | 8,412 | $ | 7,864 | 7.0 | % | $ | 8,433 | $ | 7,928 | 6.4 | % | ||||||||||||
| Total inpatient revenue percentage |
44.6 | % | 46.9 | % | 45.6 | % | 48.3 | % | ||||||||||||||||
| Total outpatient revenue percentage |
55.4 | % | 53.1 | % | 54.4 | % | 51.7 | % | ||||||||||||||||
| Same Hospitals |
||||||||||||||||||||||||
| Occupancy |
38.9 | % | 41.1 | % | 41.2 | % | 43.6 | % | ||||||||||||||||
| Patient days |
318,357 | 335,934 | -5.2 | % | 1,004,736 | 1,059,584 | -5.2 | % | ||||||||||||||||
| Admissions |
76,166 | 81,411 | -6.4 | % | 238,108 | 250,307 | -4.9 | % | ||||||||||||||||
| Adjusted admissions |
151,620 | 155,097 | -2.2 | % | 462,422 | 466,547 | -0.9 | % | ||||||||||||||||
| Average length of stay |
4.2 | 4.1 | 4.2 | 4.2 | ||||||||||||||||||||
| Surgeries |
82,322 | 81,665 | 0.8 | % | 253,230 | 246,998 | 2.5 | % | ||||||||||||||||
| Emergency room visits |
392,181 | 376,539 | 4.2 | % | 1,177,775 | 1,145,401 | 2.8 | % | ||||||||||||||||
| Net revenue (in thousands) |
$ | 1,274,050 | $ | 1,219,622 | 4.5 | % | $ | 3,899,472 | $ | 3,698,948 | 5.4 | % | ||||||||||||
| Net revenue per adjusted admission |
$ | 8,403 | $ | 7,864 | 6.9 | % | $ | 8,433 | $ | 7,928 | 6.4 | % | ||||||||||||
| Total inpatient revenue percentage |
44.5 | % | 46.9 | % | 45.7 | % | 48.3 | % | ||||||||||||||||
| Total outpatient revenue percentage |
55.5 | % | 53.1 | % | 54.3 | % | 51.7 | % | ||||||||||||||||
HEALTH MANAGEMENT ASSOCIATES, INC.
SUPPLEMENTAL CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(unaudited, dollars in thousands)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Net revenue |
$ | 1,440,109 | $ | 1,219,622 | $ | 4,397,344 | $ | 3,698,948 | ||||||||
| Less acquisitions |
166,059 | — | 497,872 | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Same hospital net revenue |
$ | 1,274,050 | $ | 1,219,622 | $ | 3,899,472 | $ | 3,698,948 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Consolidated net income |
$ | 48,029 | $ | 49,959 | $ | 137,745 | $ | 167,404 | ||||||||
| Adjustments: |
||||||||||||||||
| (Income) loss from discontinued operations, net of income taxes |
1,389 | (255 | ) | 5,805 | 1,182 | |||||||||||
| Provision for income taxes |
20,913 | 22,387 | 70,931 | 89,178 | ||||||||||||
| (Gains) losses on sales of assets, net |
(77 | ) | 302 | 2,114 | 1,096 | |||||||||||
| Interest and other income, net |
(2,286 | ) | (1,752 | ) | (3,859 | ) | (2,879 | ) | ||||||||
| Interest expense |
76,814 | 50,018 | 240,743 | 152,088 | ||||||||||||
| Depreciation and amortization |
91,610 | 65,605 | 255,716 | 194,434 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted EBITDA (a) |
236,392 | 186,264 | 709,195 | 602,503 | ||||||||||||
| Adjustment for acquisitions, corporate and other |
23,185 | 41,041 | 69,771 | 110,274 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Same hospital operating Adjusted EBITDA (a) |
$ | 259,577 | $ | 227,305 | $ | 778,966 | $ | 712,777 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Same hospital operating Adjusted EBITDA margins = |
||||||||||||||||
| Same hospital operating Adjusted EBITDA / Same hospital net revenue (a) |
20.4 | % | 18.6 | % | 20.0 | % | 19.3 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) | Adjusted EBITDA is defined as consolidated net income before discontinued operations, net gains (losses) on sales of assets, net interest and other income, interest expense, income taxes, and depreciation and amortization. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by net revenue. Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP. Nevertheless, Health Management believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Health Management’s consolidated financial statements, as it is commonly used as an analytical indicator within the health care industry and Health Management’s debt facilities contain covenants that use Adjusted EBITDA in their calculations. Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies. |
HEALTH MANAGEMENT ASSOCIATES, INC.
SUPPLEMENTAL CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(unaudited, in thousands, except per share amounts)
The following table provides information regarding income from continuing operations attributable to Health Management, excluding the impact of the interest rate swap amortization, mark-to-market adjustments, HCIT incentive payments, and Medicaid rate adjustments. This table is a non-GAAP presentation; nonetheless, Health Management believes that providing this detail is beneficial to investors and other readers of Health Management’s financial statements due to the significant impact these items had on income from continuing operations attributable to Health Management.
Three Months Ended September 30, 2012
| Continuing Operations |
Interest Rate Swap Amortization and Mark-To-Market Adjustments |
HCIT Incentive Payments, Less Medicaid Rate Adjustments |
Total, As Reported |
|||||||||||||
| Income from continuing operations before income taxes |
$ | 73,941 | $ | (23,921 | ) | $ | 20,311 | $ | 70,331 | |||||||
| Net income from continuing operations attributable to noncontrolling interests |
(6,685 | ) | — | — | (6,685 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations before income taxes attributable to Health Management Associates, Inc. |
67,256 | (23,921 | ) | 20,311 | 63,646 | |||||||||||
| Provision for income taxes |
(22,099 | ) | 7,860 | (6,674 | ) | (20,913 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations attributable to Health Management Associates, Inc. common stockholders |
$ | 45,157 | $ | (16,061 | ) | $ | 13,637 | $ | 42,733 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Earnings per share from continuing operations attributable to Health Management Associates, Inc. common stockholders: |
||||||||||||||||
| Basic |
$ | 0.18 | $ | (0.06 | ) | $ | 0.05 | $ | 0.17 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Diluted |
$ | 0.18 | $ | (0.06 | ) | $ | 0.05 | $ | 0.17 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
Nine Months Ended September 30, 2012
| Continuing Operations |
Interest Rate Swap Amortization and Mark-To-Market Adjustments |
HCIT Incentive Payments, Less Medicaid Rate Adjustments |
Total, As Reported |
|||||||||||||
| Income from continuing operations before income taxes |
$ | 278,740 | $ | (82,902 | ) | $ | 18,643 | $ | 214,481 | |||||||
| Net income from continuing operations attributable to noncontrolling interests |
(21,757 | ) | — | — | (21,757 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations before income taxes attributable to Health Management Associates, Inc. |
256,983 | (82,902 | ) | 18,643 | 192,724 | |||||||||||
| Provision for income taxes |
(94,578 | ) | 30,508 | (6,861 | ) | (70,931 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations attributable to Health Management Associates, Inc. common stockholders |
$ | 162,405 | $ | (52,394 | ) | $ | 11,782 | $ | 121,793 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Earnings per share from continuing operations attributable to Health Management Associates, Inc. common stockholders: |
||||||||||||||||
| Basic |
$ | 0.64 | $ | (0.21 | ) | $ | 0.05 | $ | 0.48 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Diluted |
$ | 0.63 | $ | (0.20 | ) | $ | 0.05 | $ | 0.48 | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
###