Attached files
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| 8-K - LIFEPOINT HOSPITALS, INC. 8-K - LEGACY LIFEPOINT HEALTH, INC. | a50678476.htm |
Exhibit 99.1
LifePoint Hospitals Reports Second Quarter 2013 Results
Second Quarter Revenues of $894.9 Million Up 8.2% Over Prior Year Period
BRENTWOOD, Tenn.--(BUSINESS WIRE)--July 26, 2013--LifePoint Hospitals, Inc. (NASDAQ: LPNT) today announced results for the second quarter and six months ended June 30, 2013.
For the second quarter ended June 30, 2013, revenues from continuing operations were $894.9 million, up 8.2% from $827.3 million for the same period a year ago. Income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders for the second quarter ended June 30, 2013, decreased 32.6% to $27.1 million, or $0.57 per diluted share, compared with $40.2 million, or $0.83 per diluted share, for the same period a year ago.
For the first half of 2013, revenues from continuing operations were $1,826.0 million, up 8.8% from $1,678.3 million for the same period a year ago. Income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders for the first half of 2013, decreased 38.3% to $59.4 million, or $1.25 per diluted share, compared with $96.2 million, or $1.99 per diluted share, for the same period last year.
In commenting on the results, William F. Carpenter III, chairman and chief executive officer of LifePoint Hospitals, said, “We continue to position LifePoint to benefit from healthcare reform in a challenging operating environment. Our growth and quality initiatives drove sequential improvements in outpatient and inpatient volumes this quarter, while our M&A program allowed us to build out our networks in several key regions. As we look ahead to the remainder of 2013, our strong balance sheet and solid cash flow will provide us with the flexibility to keep investing in our business, pursuing strategic acquisitions and returning value to shareholders.”
The Company reaffirms its previously issued revenues guidance at $3.65 billion to $3.75 billion for the year and issues the following revised guidance for 2013:
| Estimated Adjusted EBITDA – $530 million - $550 million | |
| Estimated Diluted EPS – $2.67 - $2.94 | |
During the three months ended June 30, 2013, the Company recognized a net reduction to revenues of approximately $4.8 million, or $0.06 per diluted share, as a result of recent reimbursement changes under the Sole Community Provider Program in the state of New Mexico (the “New Mexico SCPP”). This is in comparison to approximately $9.9 million, or $0.13 per diluted share, recognized during the same period of the prior year and approximately $7.0 million, or $0.09 per diluted share, in accordance with the Company’s second quarter of 2013 financial plan. Consistent with its original guidance for 2013, the Company expects to recognize approximately $7.0 million per quarter under the New Mexico SCPP for the remainder of 2013.
Furthermore, in connection with an acquisition completed in 2012, the Company’s management made reasonable estimates and recorded an estimated obligation representing the fair values of the Company’s potential contingent obligations to the seller pursuant to the asset purchase agreement. Subsequently, the seller finalized its settlement of certain of these obligations at an amount that was less than the Company originally estimated. As a result, during the three months ended June 30, 2013, the Company reduced its originally recorded contingent obligations and recognized a gain of approximately $5.6 million, or $0.07 per diluted share.
The Company provides the following table summarizing the financial impact that these two matters had on the Company’s diluted earnings per share attributable to LifePoint Hospitals, Inc. for the three months ended June 30, 2013:
|
Diluted earnings per share attributable to LifePoint Hospitals, Inc. stockholders |
$ | 0.57 | |||
|
Add: Second quarter of 2013 net reduction to revenues under the New Mexico SCPP |
0.06 | ||||
|
Second quarter of 2013 financial plan for the New Mexico SCPP funding |
0.09 | ||||
|
Less: Gain on settlement of pre-acquisition contingent obligation |
(0.07 | ) | |||
|
Adjusted diluted earnings per share attributable to LifePoint Hospitals, Inc. stockholders |
$ | 0.65 | |||
A listen-only simulcast, as well as a 30-day replay, of LifePoint Hospitals’ second quarter 2013 conference call will be available on line at www.lifepointhospitals.com/news/press-releases today, Friday, July 26, 2013, beginning at 10:00 a.m. Eastern Time.
LifePoint Hospitals, Inc. is a leading hospital company focused on providing quality healthcare services close to home. Through its subsidiaries, LifePoint operates 57 hospital campuses in 20 states. With a mission of “Making Communities Healthier®,” LifePoint is the sole community hospital provider in the majority of the communities it serves. More information about the Company, which is headquartered in Brentwood, Tennessee, can be found on its website, www.LifePointHospitals.com. All references to “LifePoint,” “LifePoint Hospitals,” or the “Company” used in this release refer to LifePoint Hospitals, Inc. or its affiliates.
Important Legal Information. Certain statements contained in this release, including LifePoint’s revised guidance for the year ended December 31, 2013, are based on current management expectations and are “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, and are intended to qualify for the safe harbor protections from liability provided by the Private Securities Litigation Reform Act of 1995. Numerous factors exist which may cause results to differ from these expectations. Many of the factors that will determine our future results are beyond our ability to control or predict with accuracy. Such forward-looking statements reflect the current expectations and beliefs of the management of LifePoint, are not guarantees of performance and are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results to differ from those described in the forward-looking statements. These forward-looking statements may also be subject to other risk factors and uncertainties, including without limitation: (i) the effects related to the enactment and implementation of healthcare reform, the possible enactment of additional federal or state healthcare reforms and possible changes in healthcare reform laws and other federal, state or local laws or regulations affecting the healthcare industry including the timing of the implementation of reform; (ii) the extent to which states support increases, decreases or changes in Medicaid programs, implement healthcare exchanges or alter the provision of healthcare to state residents through regulation or otherwise; (iii) delays in receiving payments for services provided, reductions in Medicare or Medicaid payments (including increased recoveries made by Recovery Audit Contractors (RAC) and similar governmental agents), compared to the timing of expanded coverage; (iv) reductions in reimbursements from commercial payors, whether due to a change in our revenue mix, service mix, reduction in commercial rates or otherwise; (v) our ability to acquire hospitals and other healthcare providers on favorable terms, the business risks and costs associated therewith and the uncertainty in operating and integrating such hospitals and other providers; (vi) our ongoing ability to demonstrate meaningful use of certified electronic health record technology and recognize income for the related Medicare or Medicaid incentive payments; (vii) the failure or closure of employers in our markets, especially those that are dependent on a small number of local employers; (viii) the growth of “bad debt” and “patient due” accounts, the number of individuals without insurance coverage (or who are underinsured) who seek care at our hospitals, and deterioration in the collectability of these accounts; (ix) changes in general economic conditions nationally and regionally in our markets; (x) whether our core strategies will result in anticipated operating results, including measureable quality and satisfaction improvements; (xi) whether our efforts to reduce the cost of providing healthcare while increasing the quality of care are successful; (xii) the ability to attract, recruit and retain qualified physicians, nurses, medical technicians and other healthcare professionals and the increasing costs associated with doing so, including the direct costs associated with employing physicians and other healthcare professionals; (xiii) the loss of certain physicians in markets where such a loss can have a disproportionate impact on our hospital in such market; (xiv) the application, interpretation and enforcement of increasingly stringent and complex laws and regulations governing our operations and healthcare generally (and changing interpretations of applicable laws and regulations), related enforcement activity and the potentially adverse impact of known and unknown government investigations, litigation and other claims that may be made against us; (xv) any interruption of or restriction in our access to licensed information (and information technology systems) or failure in our ability to integrate changes to LifePoint’s existing information systems or information systems of acquired hospitals; (xvi) the highly competitive nature of the health care business; (xvii) adverse events in states where a large portion of our revenues are concentrated; (xviii) the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities, and any changes in accounting practices; (xix) liabilities resulting from potential malpractice and related legal claims brought against our hospitals or the healthcare providers associated with, or employed by, such hospitals or affiliated entities; (xx) our increased dependence on third parties to provide purchasing, revenue cycle and payroll services and information technology and whether they are able to do so effectively; (xxi) the continued viability of Duke – LifePoint Healthcare and our partnership with Duke University Medical Center; and (xxii) those other risks and uncertainties described from time to time in our filings with the Securities and Exchange Commission. Specifically, without limiting the cautionary statements made above, with respect to LifePoint’s revised guidance for the year ended December 31, 2013, management has assumed, among other things, that (1) RAC activity and the level of one day stays in 2013 will be similar to that in 2012 and (2) governmental and commercial payor reimbursements will remain as projected. Therefore, our future results may differ materially from those described in this release. LifePoint undertakes no obligation to update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
All references to “our,” “LifePoint,” “LifePoint Hospitals” and the “Company” as used throughout this release refer to LifePoint Hospitals, Inc. and its subsidiaries.
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LIFEPOINT HOSPITALS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS Dollars in millions, except per share amounts |
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Three Months Ended
June 30, |
Six Months Ended
June 30, |
||||||||||||||||||||||||||||||||||||
| 2013 | 2012 | 2013 | 2013 | ||||||||||||||||||||||||||||||||||
| Amount |
% of Revenues |
Amount |
% of Revenues |
Amount |
% of Revenues |
Amount |
% of Revenues |
||||||||||||||||||||||||||||||
|
Revenues before provision for doubtful accounts |
$ | 1,075.7 | $ | 980.1 | $ | 2,175.9 | $ | 1,978.2 | |||||||||||||||||||||||||||||
| Provision for doubtful accounts | 180.8 | 152.8 | 349.9 | 299.9 | |||||||||||||||||||||||||||||||||
| Revenues | 894.9 | 100.0 | % | 827.3 | 100.0 | % | 1,826.0 | 100.0 | % | 1,678.3 | 100.0 | % | |||||||||||||||||||||||||
| Salaries and benefits | 422.1 | 47.2 | 369.9 | 44.7 | 855.3 | 46.8 | 739.9 | 44.1 | |||||||||||||||||||||||||||||
| Supplies | 144.1 | 16.1 | 124.4 | 15.0 | 288.8 | 15.8 | 253.4 | 15.1 | |||||||||||||||||||||||||||||
| Other operating expenses | 222.9 | 24.8 | 195.7 | 23.7 | 444.4 | 24.4 | 384.2 | 22.9 | |||||||||||||||||||||||||||||
| Other income | (11.0 | ) | (1.2 | ) | (1.5 | ) | (0.2 | ) | (16.7 | ) | (0.9 | ) | (2.7 | ) | (0.2 | ) | |||||||||||||||||||||
| Depreciation and amortization | 55.9 | 6.3 | 46.9 | 5.7 | 111.7 | 6.2 | 92.0 | 5.4 | |||||||||||||||||||||||||||||
| Interest expense, net | 22.6 | 2.5 | 25.7 | 3.1 | 46.5 | 2.5 | 51.2 | 3.1 | |||||||||||||||||||||||||||||
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Gain on settlement of pre-acquisition contingent obligation |
(5.6 | ) | (0.6 | ) | – | – | (5.6 | ) | (0.3 | ) | – | – | |||||||||||||||||||||||||
| Debt extinguishment costs | – | – | – | – | 4.4 | 0.2 | – | – | |||||||||||||||||||||||||||||
| Impairment charge | – | – | – | – | – | – | 3.1 | 0.2 | |||||||||||||||||||||||||||||
| 851.0 | 95.1 | 761.1 | 92.0 | 1,728.8 | 94.7 | 1,521.1 | 90.6 | ||||||||||||||||||||||||||||||
|
Income from continuing operations before income taxes |
43.9 |
4.9 | 66.2 | 8.0 | 97.2 | 5.3 | 157.2 | 9.4 | |||||||||||||||||||||||||||||
| Provision for income taxes | 16.7 | 1.9 | 24.3 | 2.9 | 37.0 | 2.0 | 58.4 | 3.5 | |||||||||||||||||||||||||||||
| Income from continuing operations | 27.2 | 3.0 | 41.9 | 5.1 | 60.2 | 3.3 | 98.8 | 5.9 | |||||||||||||||||||||||||||||
|
Income from discontinued operations, net of income taxes |
0.3 | 0.1 | 0.1 | – | 0.4 | – | 0.2 | – | |||||||||||||||||||||||||||||
| Net income | 27.5 | 3.1 | 42.0 | 5.1 | 60.6 | 3.3 | 99.0 | 5.9 | |||||||||||||||||||||||||||||
|
Less: Net income attributable to noncontrolling interests |
(0.1 | ) | – | (1.7 | ) | (0.2 | ) | (0.8 | ) | – | (2.6 | ) | (0.2 | ) | |||||||||||||||||||||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 27.4 | 3.1 | % | $ | 40.3 | 4.9 | % | $ | 59.8 | 3.3 | % | $ | 96.4 | 5.7 | % | |||||||||||||||||||||
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Earnings per share attributable to LifePoint Hospitals, Inc. stockholders: |
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| Basic: | |||||||||||||||||||||||||||||||||||||
| Continuing operations | $ | 0.58 | $ | 0.85 | $ | 1.29 | $ | 2.04 | |||||||||||||||||||||||||||||
| Discontinued operations | 0.01 | – | 0.01 | 0.01 | |||||||||||||||||||||||||||||||||
| $ | 0.59 | $ | 0.85 | $ | 1.30 | $ | 2.05 | ||||||||||||||||||||||||||||||
| Diluted: | |||||||||||||||||||||||||||||||||||||
| Continuing operations | $ | 0.57 | $ | 0.83 | $ | 1.25 | $ | 1.99 | |||||||||||||||||||||||||||||
| Discontinued operations | – | – | 0.01 | – | |||||||||||||||||||||||||||||||||
| $ | 0.57 | $ | 0.83 | $ | 1.26 | $ | 1.99 | ||||||||||||||||||||||||||||||
| Amounts attributable to LifePoint Hospitals, Inc. stockholders: | |||||||||||||||||||||||||||||||||||||
|
Income from continuing operations, net of income taxes |
$ | 27.1 | $ | 40.2 | $ | 59.4 | $ | 96.2 | |||||||||||||||||||||||||||||
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Income from discontinued operations, net of income taxes |
0.3 | 0.1 | 0.4 | 0.2 | |||||||||||||||||||||||||||||||||
| Net income | $ | 27.4 | $ | 40.3 | $ | 59.8 | $ | 96.4 | |||||||||||||||||||||||||||||
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LIFEPOINT HOSPITALS, INC. UNAUDITED EARNINGS PER SHARE CALCULATIONS In millions, except per share amounts |
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Three Months Ended June 30, |
Six Months Ended June 30, |
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| 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
| Income from continuing operations | $ | 27.2 | $ | 41.9 | $ | 60.2 | $ | 98.8 | ||||||||||||||||
| Less: Net income attributable to noncontrolling interests | (0.1 | ) | (1.7 | ) | (0.8 | ) | (2.6 | ) | ||||||||||||||||
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Income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders |
27.1 | 40.2 | 59.4 | 96.2 | ||||||||||||||||||||
| Income from discontinued operations, net of income taxes | 0.3 | 0.1 | 0.4 | 0.2 | ||||||||||||||||||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 27.4 | $ | 40.3 | $ | 59.8 | $ | 96.4 | ||||||||||||||||
| Weighted average shares outstanding – basic | 46.5 | 47.3 | 46.2 | 47.1 | ||||||||||||||||||||
| Effect of dilutive securities: stock options and other stock-based awards | 1.2 | 1.1 | 1.3 | 1.3 | ||||||||||||||||||||
| Weighted average shares outstanding – diluted | 47.7 | 48.4 | 47.5 | 48.4 | ||||||||||||||||||||
| Earnings per share attributable to LifePoint Hospitals, Inc. stockholders: | ||||||||||||||||||||||||
| Basic: | ||||||||||||||||||||||||
| Continuing operations | $ | 0.58 | $ | 0.85 | $ | 1.29 | $ | 2.04 | ||||||||||||||||
| Discontinued operations | 0.01 | – | 0.01 | 0.01 | ||||||||||||||||||||
| $ | 0.59 | $ | 0.85 | $ | 1.30 | $ | 2.05 | |||||||||||||||||
| Diluted: | ||||||||||||||||||||||||
| Continuing operations | $ | 0.57 | $ | 0.83 | $ | 1.25 | $ | 1.99 | ||||||||||||||||
| Discontinued operations | – | – | 0.01 | – | ||||||||||||||||||||
| $ | 0.57 | $ | 0.83 | $ | 1.26 | $ | 1.99 | |||||||||||||||||
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LIFEPOINT HOSPITALS, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS In millions |
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|
June 30,
2013 |
Dec. 31,
2012 |
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| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 175.0 | $ | 85.0 | |||||||
|
Accounts receivable, less allowances for doubtful accounts of $666.4 and $558.4 at June 30, 2013, and December 31, 2012, respectively |
552.3 | 518.8 | |||||||||
| Inventories | 96.3 | 97.0 | |||||||||
| Prepaid expenses | 31.7 | 31.8 | |||||||||
| Deferred tax assets | 162.7 | 142.5 | |||||||||
| Other current assets | 52.9 | 50.2 | |||||||||
| 1,070.9 | 925.3 | ||||||||||
| Property and equipment: | |||||||||||
| Land | 102.0 | 101.9 | |||||||||
| Buildings and improvements | 1,824.8 | 1,815.2 | |||||||||
| Equipment | 1,356.3 | 1,289.7 | |||||||||
| Construction in progress | 81.7 | 81.0 | |||||||||
| 3,364.8 | 3,287.8 | ||||||||||
| Accumulated depreciation | (1,354.8 | ) | (1,256.9 | ) | |||||||
| 2,010.0 | 2,030.9 | ||||||||||
| Deferred loan costs, net | 16.2 | 21.9 | |||||||||
| Intangible assets, net | 78.9 | 84.5 | |||||||||
| Other | 32.7 | 47.8 | |||||||||
| Goodwill | 1,619.9 | 1,611.8 | |||||||||
| Total assets | $ | 4,828.6 | $ | 4,722.2 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 108.5 | $ | 117.4 | |||||||
| Accrued salaries | 111.9 | 128.2 | |||||||||
| Income taxes payable | 20.2 | 0.7 | |||||||||
| Other current liabilities | 194.3 | 185.3 | |||||||||
| Current maturities of long-term debt | 572.5 | 13.3 | |||||||||
| 1,007.4 | 444.9 | ||||||||||
| Long-term debt | 1,154.2 | 1,696.5 | |||||||||
| Deferred income tax liabilities | 220.5 | 249.2 | |||||||||
| Long-term portion of reserves for self-insurance claims | 140.4 | 133.0 | |||||||||
| Other long-term liabilities | 88.1 | 79.2 | |||||||||
| Long-term income tax liability | 20.2 | 16.9 | |||||||||
| Total liabilities | 2,630.8 | 2,619.7 | |||||||||
| Redeemable noncontrolling interests | 29.8 | 29.4 | |||||||||
| Equity: | |||||||||||
| LifePoint Hospitals, Inc. stockholders’ equity: | |||||||||||
| Preferred stock | – | – | |||||||||
| Common stock | 0.6 | 0.6 | |||||||||
| Capital in excess of par value | 1,446.7 | 1,403.5 | |||||||||
| Accumulated other comprehensive income | 0.2 | 0.2 | |||||||||
| Retained earnings | 1,278.6 | 1,218.8 | |||||||||
| Common stock in treasury, at cost | (579.8 | ) | (572.6 | ) | |||||||
| Total LifePoint Hospitals, Inc. stockholders’ equity | 2,146.3 | 2,050.5 | |||||||||
| Noncontrolling interests | 21.7 | 22.6 | |||||||||
| Total equity | 2,168.0 | 2,073.1 | |||||||||
| Total liabilities and equity | $ | 4,828.6 | $ | 4,722.2 | |||||||
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LIFEPOINT HOSPITALS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Dollars in millions |
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Three Months Ended June 30, |
Six Months Ended June 30, |
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| 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||||||
| Net income | $ | 27.5 | $ | 42.0 | $ | 60.6 | $ | 99.0 | |||||||||||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||||||||||||||||
| Income from discontinued operations | (0.3 | ) | (0.1 | ) | (0.4 | ) | (0.2 | ) | |||||||||||||
| Stock-based compensation | 6.3 | 6.5 | 13.1 | 13.3 | |||||||||||||||||
| Depreciation and amortization | 55.9 | 46.9 | 111.7 | 92.0 | |||||||||||||||||
| Amortization of physician minimum revenue guarantees | 4.5 | 4.8 | 9.0 | 9.8 | |||||||||||||||||
| Amortization of debt discounts and deferred loan costs | 6.0 | 7.8 | 13.1 | 15.6 | |||||||||||||||||
| Gain on settlement of pre-acquisition contingent obligation | (5.6 | ) | – | (5.6 | ) | – | |||||||||||||||
| Debt extinguishment costs | – | – | 4.4 | – | |||||||||||||||||
| Impairment charge | – | – | – | 3.1 | |||||||||||||||||
| Deferred income tax benefit | (36.6 | ) | (17.1 | ) | (43.7 | ) | (38.6 | ) | |||||||||||||
| Reserve for self-insurance claims, net of payments | 2.1 | (7.5 | ) | 6.7 | (2.8 | ) | |||||||||||||||
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Increase (decrease) in cash from operating assets and liabilities, net of effects from acquisitions and divestitures: |
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|
Accounts receivable |
10.9 | 46.7 | (18.6 | ) | (35.7 | ) | |||||||||||||||
| Inventories and other current assets | 10.9 | 6.3 | 4.8 | 7.3 | |||||||||||||||||
| Accounts payable and accrued expenses | (15.8 | ) | (11.2 | ) | (26.0 | ) | (18.1 | ) | |||||||||||||
| Income taxes payable/receivable | (7.5 | ) | (21.4 | ) | 19.5 | 32.6 | |||||||||||||||
| Other | (0.8 | ) | 0.5 | 0.7 | 0.7 | ||||||||||||||||
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Net cash provided by operating activities – continuing operations |
57.5 | 104.2 | 149.3 | 178.0 | |||||||||||||||||
|
Net cash (used in) provided by operating activities – discontinued operations |
(0.6 | ) | 0.1 | (0.2 | ) | (0.7 | ) | ||||||||||||||
| Net cash provided by operating activities | 56.9 | 104.3 | 149.1 | 177.3 | |||||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||||||
| Purchases of property and equipment | (37.3 | ) | (49.3 | ) | (75.8 | ) | (110.1 | ) | |||||||||||||
| Acquisitions, net of cash acquired | (4.9 | ) | – | (6.2 | ) | (20.1 | ) | ||||||||||||||
| Other | 1.2 | (0.1 | ) | 1.4 | (0.3 | ) | |||||||||||||||
| Net cash used in investing activities | (41.0 | ) | (49.4 | ) | (80.6 | ) | (130.5 | ) | |||||||||||||
| Cash flows from financing activities: | |||||||||||||||||||||
| Proceeds from borrowings | – | – | 323.0 | – | |||||||||||||||||
| Payments of borrowings | (3.6 | ) | – | (317.2 | ) | – | |||||||||||||||
| Repurchases of common stock | (0.1 | ) | (0.4 | ) | (7.2 | ) | (5.9 | ) | |||||||||||||
| Payment of debt financing costs | (0.1 | ) | – | (1.0 | ) | – | |||||||||||||||
| Proceeds from exercise of stock options | 4.6 | 1.6 | 28.2 | 5.5 | |||||||||||||||||
| (Refunds of) proceeds from employee stock purchase plans | (0.2 | ) | (0.2 | ) | (0.2 | ) | 0.5 | ||||||||||||||
| Distributions to noncontrolling interests | (1.3 | ) | (0.7 | ) | (2.8 | ) | (1.4 | ) | |||||||||||||
| Sales of redeemable noncontrolling interests | – | 1.6 | – | 1.6 | |||||||||||||||||
| Capital lease payments and other | (0.6 | ) | (0.6 | ) | (1.3 | ) | (1.0 | ) | |||||||||||||
| Net cash (used in) provided by financing activities | (1.3 | ) | 1.3 | 21.5 | (0.7 | ) | |||||||||||||||
| Change in cash and cash equivalents | 14.6 | 56.2 | 90.0 | 46.1 | |||||||||||||||||
| Cash and cash equivalents at beginning of period | 160.4 | 116.1 | 85.0 | 126.2 | |||||||||||||||||
| Cash and cash equivalents at end of period | $ | 175.0 | $ | 172.3 | $ | 175.0 | $ | 172.3 | |||||||||||||
| Supplemental disclosure of cash flow information: | |||||||||||||||||||||
| Interest payments | $ | 28.2 | $ | 28.8 | $ | 35.4 | $ | 36.8 | |||||||||||||
| Capitalized interest | $ | 0.3 | $ | 0.5 | $ | 0.7 | $ | 1.3 | |||||||||||||
| Income tax payments, net | $ | 60.9 | $ | 63.0 | $ | 61.4 | $ | 64.6 | |||||||||||||
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LIFEPOINT HOSPITALS, INC. UNAUDITED STATISTICS |
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|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
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| 2013 | 2012 |
%
Change |
2013 | 2012 |
%
Change |
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| Continuing Operations: (1) | |||||||||||||||||||||||||
| Number of hospitals at end of period | 57 | 55 | 3.6 | % | 57 | 55 | 3.6 | % | |||||||||||||||||
| Admissions | 49,220 | 48,072 | 2.4 | 101,469 | 99,560 | 1.9 | |||||||||||||||||||
| Equivalent admissions (2) | 117,017 | 109,923 | 6.5 | 233,480 | 222,218 | 5.1 | |||||||||||||||||||
| Revenues per equivalent admission | $ | 7,648 | $ | 7,526 | 1.6 | $ | 7,821 | $ | 7,552 | 3.6 | |||||||||||||||
| Medicare case mix index | 1.36 | 1.30 | 4.6 | 1.37 | 1.30 | 5.4 | |||||||||||||||||||
| Average length of stay (days) | 4.5 | 4.4 | 2.3 | 4.6 | 4.4 | 4.5 | |||||||||||||||||||
| Inpatient surgeries | 13,292 | 13,120 | 1.3 | 26,832 | 26,725 | 0.4 | |||||||||||||||||||
| Outpatient surgeries | 45,860 | 43,024 | 6.6 | 89,896 | 86,023 | 4.5 | |||||||||||||||||||
| Emergency room visits | 288,516 | 284,612 | 1.4 | 580,600 | 557,525 | 4.1 | |||||||||||||||||||
| Outpatient factor (2) | 2.38 | 2.29 | 3.9 | 2.30 | 2.23 | 3.1 | |||||||||||||||||||
| Same-hospital: (3) | |||||||||||||||||||||||||
| Number of hospitals at end of period | 53 | 53 | – | % | 53 | 53 | – | % | |||||||||||||||||
| Admissions | 45,565 | 47,137 | (3.3 | ) | 94,040 | 98,625 | (4.6 | ) | |||||||||||||||||
| Equivalent admissions (2) | 106,914 | 107,639 | (0.7 | ) | 213,753 | 219,934 | (2.8 | ) | |||||||||||||||||
| Revenues per equivalent admission | $ | 7,429 | $ | 7,568 | (1.8 | ) | $ | 7,601 | $ | 7,573 | 0.4 | ||||||||||||||
| Medicare case mix index | 1.33 | 1.30 | 2.3 | 1.34 | 1.30 | 3.1 | |||||||||||||||||||
| Average length of stay (days) | 4.3 | 4.4 | (2.3 | ) | 4.4 | 4.4 | – | ||||||||||||||||||
| Inpatient surgeries | 11,985 | 12,868 | (6.9 | ) | 24,201 | 26,473 | (8.6 | ) | |||||||||||||||||
| Outpatient surgeries | 41,431 | 42,296 | (2.0 | ) | 81,458 | 85,295 | (4.5 | ) | |||||||||||||||||
| Emergency room visits | 270,680 | 278,836 | (2.9 | ) | 544,649 | 551,749 | (1.3 | ) | |||||||||||||||||
| Outpatient factor (2) | 2.35 | 2.28 | 3.1 | 2.27 | 2.23 | 1.8 | |||||||||||||||||||
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(1) Continuing operations information includes the results of (i) our hospital support center, (ii) our same-hospital operations, (iii) the results of Scott Memorial Hospital (“Scott Memorial”), which we acquired effective January 1, 2013, though our joint venture with Norton Healthcare, Inc., (iv) Marquette General Health System (“Marquette General”), which we acquired effective September 1, 2012, Twin County Regional Hospital (“Twin County”), in which we acquired an 80% interest effective April 1, 2012, each through Duke LifePoint Healthcare and (v) Woods Memorial Hospital (“Woods Memorial”), which we acquired effective July 1, 2012. |
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(2) Management and investors use equivalent admissions as a general measure of combined inpatient and outpatient volume. We compute equivalent admissions by multiplying admissions (inpatient volumes) by the outpatient factor (the sum of gross inpatient revenue and gross outpatient revenue and then dividing the resulting amount by gross inpatient revenue). The equivalent admissions computation “equates” outpatient revenue to the volume measure (admissions) used to measure inpatient volume resulting in a general measure of combined inpatient and outpatient volume. |
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(3) Same-hospital information includes the results of our hospital support center and the same 53 hospitals operated during the three months and six months ended June 30, 2013 and 2012. Same-hospital information excludes the results of Scott Memorial, Marquette General, Twin County and Woods Memorial. |
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LIFEPOINT HOSPITALS, INC.
UNAUDITED SUPPLEMENTAL INFORMATION
Dollars
in millions, except Diluted EPS amounts
Adjusted EBITDA is defined by the Company as earnings before depreciation and amortization; interest expense, net; gain on settlement of pre-acquisition contingent obligation; debt extinguishment costs; impairment charge; provision for income taxes; income from discontinued operations, net of income taxes; and net income attributable to noncontrolling interests. LifePoint’s management and Board of Directors use Adjusted EBITDA to evaluate the Company’s operating performance and as a measure of performance for incentive compensation purposes. LifePoint’s credit facilities use Adjusted EBITDA for certain financial covenants. The Company believes Adjusted EBITDA is a measure of performance used by some investors, equity analysts and others to make informed investment decisions. In addition, multiples of current or projected Adjusted EBITDA are used to estimate current or prospective enterprise value. Adjusted EBITDA should not be considered as a measure of financial performance under U.S. generally accepted accounting principles (“GAAP”), and the items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to net income, cash flows generated by operating, investing or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. Because Adjusted EBITDA is not a measurement determined in accordance with GAAP and is susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies.
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
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| 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||||||||||||||||
| Amount |
% of Revenues |
Amount |
% of Revenues |
Amount |
% of Revenues |
Amount |
% of Revenues |
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|
Revenues before provision for doubtful accounts |
$ | 1,075.7 | $ | 980.1 | $ | 2,175.9 | $ | 1,978.2 | ||||||||||||||||||||||||||||||||||
|
Provision for doubtful accounts |
180.8 | 152.8 | 349.9 | 299.9 | ||||||||||||||||||||||||||||||||||||||
| Revenues | 894.9 | 100.0 | % | 827.3 | 100.0 | % | 1,826.0 | 100.0 | % | 1,678.3 | 100.0 | % | ||||||||||||||||||||||||||||||
| Salaries and benefits | 422.1 | 47.2 | 369.9 | 44.7 | 855.3 | 46.8 | 739.9 | 44.1 | ||||||||||||||||||||||||||||||||||
| Supplies | 144.1 | 16.1 | 124.4 | 15.0 | 288.8 | 15.8 | 253.4 | 15.1 | ||||||||||||||||||||||||||||||||||
| Other operating expenses | 222.9 | 24.8 | 195.7 | 23.7 | 444.4 | 24.4 | 384.2 | 22.9 | ||||||||||||||||||||||||||||||||||
| Other income | (11.0 | ) | (1.2 | ) | (1.5 | ) | (0.2 | ) | (16.7 | ) | (0.9 | ) | (2.7 | ) | (0.2 | ) | ||||||||||||||||||||||||||
| 778.1 | 86.9 | 688.5 | 83.2 | 1,571.8 | 86.1 | 1,374.8 | 81.9 | |||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 116.8 | 13.1 | % | $ | 138.8 | 16.8 | % | $ | 254.2 | 13.9 | % | $ | 303.5 | 18.1 | % | ||||||||||||||||||||||||||
|
The following table reconciles Adjusted EBITDA as presented above to net income attributable to LifePoint Hospitals, Inc. as reflected in the unaudited condensed consolidated statements of operations: |
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|
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||||||||||||||||||
| 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||
| Adjusted EBITDA | $ | 116.8 | $ | 138.8 | $ | 254.2 | $ | 303.5 | |||||||||||||||||||
| Less: Depreciation and amortization | 55.9 | 46.9 | 111.7 | 92.0 | |||||||||||||||||||||||
| Interest expense, net | 22.6 | 25.7 | 46.5 | 51.2 | |||||||||||||||||||||||
| Gain on settlement of pre-acquisition contingent obligation | (5.6 | ) | – | (5.6 | ) | – | |||||||||||||||||||||
| Debt extinguishment costs | – | – | 4.4 | – | |||||||||||||||||||||||
| Impairment charge | – | – | – | 3.1 | |||||||||||||||||||||||
| Provision for income taxes | 16.7 | 24.3 | 37.0 | 58.4 | |||||||||||||||||||||||
| Income from discontinued operations, net of income taxes | (0.3 | ) | (0.1 | ) | (0.4 | ) | (0.2 | ) | |||||||||||||||||||
| Net income attributable to noncontrolling interests | 0.1 | 1.7 | 0.8 | 2.6 | |||||||||||||||||||||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 27.4 | $ | 40.3 | $ | 59.8 | $ | 96.4 | |||||||||||||||||||
| LIFEPOINT HOSPITALS, INC. | |||||||||||||
| UNAUDITED SUPPLEMENTAL INFORMATION (Continued) | |||||||||||||
| Dollars in millions, except Diluted EPS amounts | |||||||||||||
|
The following table reconciles Adjusted EBITDA as presented for the Company’s revised guidance ranges for 2013: |
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|
Low
End |
High End |
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| Adjusted EBITDA | $ | 530.0 | $ | 550.0 | |||||||||
| Less: Depreciation and amortization | 227.0 | 227.0 | |||||||||||
| Interest expense, net | 94.0 | 94.0 | |||||||||||
| Gain on settlement of pre-acquisition contingent obligation | (5.6 | ) | (5.6 | ) | |||||||||
| Debt extinguishment costs | 4.4 | 4.4 | |||||||||||
| Provision for income taxes | 79.6 | 87.3 | |||||||||||
| Net income attributable to noncontrolling interests | 2.4 | 2.4 | |||||||||||
|
Net income from continuing operations attributable to LifePoint Hospitals, Inc. |
$ | 128.2 | $ | 140.5 | |||||||||
CONTACT:
LifePoint Hospitals, Inc.
Jeff Sherman,
615-372-8501
Executive Vice President and
Chief
Financial Officer