DALLAS--(BUSINESS WIRE)--Tenet Healthcare Corporation (NYSE:THC) reported Adjusted EBITDA of $646 million for the fourth quarter ended December 31, 2014, an increase of $202 million, or 45.5 percent, compared to $444 million in the fourth quarter of 2013.
“Another quarter of robust earnings growth across our entire business capped off Tenet’s strongest year in a decade,” said Trevor Fetter, president and chief executive officer. “Our strategies to capture incremental market share, combined with an improving economy and expanded health coverage, generated admissions growth that was among the highest in the industry. Conifer also achieved record growth and continues to gain recognition as a leading provider of revenue cycle management and value-based care services. We are well-positioned to continue driving strong performance in 2015.”
Discussion of Results (Percentage changes in operating metrics compare Q4’14 to Q4’13 on a same-hospital basis unless otherwise noted.)
Tenet generated same-hospital growth in admissions and adjusted admissions of 4.0 percent and 4.5 percent, respectively, compared to the fourth quarter of 2013. In addition, the company achieved one of the strongest quarterly percentage increases in same-hospital commercial volumes in more than a decade. We achieved an increase in paying admissions of 6.1 percent, driven in part by growth in commercial admissions. Surgeries increased 7.5 percent and emergency department visits increased 7.2 percent. The company estimates that approximately 70 percent of its volume growth in the quarter is related to investments in service line development, quality improvements, and enhanced physician alignment. This is independent of growth attributable to expanded insurance coverage under the Affordable Care Act (ACA).
Tenet increased outpatient visits by 9.6 percent. Approximately 92 percent of this growth was organic. At the end of 2014, Tenet operated 210 outpatient facilities, an increase of 27 facilities over the prior year.
Payer mix improved in the quarter. In the five states that expanded Medicaid, uninsured plus charity admissions declined by 2,547 admissions, or 62.4 percent, and Medicaid admissions increased by 4,355 admissions, or 20.5 percent. Uninsured plus charity outpatient visits decreased by 23,336 visits, or 34.3 percent, and Medicaid outpatient visits grew by 67,252 visits, or 25.2 percent, in these same five states. Across the entire company, uninsured plus charity admissions decreased by 3,109 admissions, or 21.9 percent, and Medicaid admissions increased by 4,555 admissions, or 9.0 percent. There was a decline in charity and uninsured outpatient visits of 18,917 visits, or 10.3 percent, and an increase in Medicaid outpatient visits of 86,891 visits, or 17.9 percent.
Tenet’s exchange volumes were 3,768 admissions and 32,133 outpatient visits in the fourth quarter. Compared to the third quarter of 2014, the company drove increases in exchange admissions and exchange outpatient visits of 11.0 percent and 7.4 percent, respectively.
Net operating revenues, after provision for doubtful accounts, grew by $583 million, or 15.0 percent, to $4.468 billion, compared to net operating revenues of $3.885 billion in the fourth quarter of 2013. Tenet drove revenue growth by increasing patient volumes, improving terms in commercial managed care contracts and growing the company’s Conifer services businesses. In addition, the California Provider Fee program contributed $165 million to net operating revenues in the fourth quarter of 2014, an increase of $146 million compared to $19 million in the fourth quarter of 2013, due to the 2014 program being approved in the fourth quarter of 2014. Including only the impact of the California Provider Fee program related to the fourth quarter of 2014, or $38 million on a same-hospital basis, Tenet increased patient revenue net of bad debt expense per adjusted admission by 4.9 percent. The company grew commercial managed care revenue by 6.7 percent per admission and 0.9 percent per outpatient visit. Tenet continued to increase its investments in urgent care centers, which have lower acuity and generate lower revenues and costs per patient encounter. This contributed to a smaller percentage increase in commercial outpatient pricing.
Selected operating expenses for hospital operations, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased by 3.8 percent. The selected operating expense metric for hospital operations excludes the company’s Conifer services business, health plans, and a provider network in Southern California. Excluding incremental expenses related to increased physician employment, selected operating expenses per adjusted admission increased by 2.6 percent.
Tenet recorded $32 million in electronic health records incentives in the fourth quarter of 2014, a $16 million decrease compared to $48 million in the fourth quarter of 2013. Electronic health record incentive payments are recorded based on the timing of when the company’s hospitals achieve meaningful use criteria.
The company’s bad debt expense ratio was 7.4 percent of revenues before bad debt, a decrease of 80 basis points compared to 8.2 percent in the fourth quarter of 2013. This improvement reflects the benefits of healthcare reform.
Conifer generated an increase in Adjusted EBITDA of $28 million, or 77.8 percent, to $64 million, compared to $36 million in the fourth quarter of 2013. Conifer’s revenue increased by $63 million, or 23.9 percent, to $327 million in the fourth quarter of 2014, compared to revenues of $264 million in the fourth quarter of 2013.
Tenet generated after-tax income from continuing operations in the fourth quarter of 2014 of $104 million, or $1.03 per diluted share. This excludes $43 million, or $0.42 per share in after-tax impairments, restructuring charges, acquisition-related costs, and litigation and investigation costs. The company reported income from continuing operations in the fourth quarter of 2013 of $43 million, or $0.43 per diluted share, excluding the comparable items which totaled $60 million after-tax, or $0.60 per share.
Tenet drove net income attributable to common shareholders of $61 million after-tax, or $0.61 per share in the fourth quarter of 2014, compared to a net loss of $24 million after-tax, or $0.24 per share, in the fourth quarter of 2013.
Cash and cash equivalents were $193 million at December 31, 2014, compared to $200 million at September 30, 2014. Net revenues related to the California Provider Fee program, the Texas Medicaid disproportionate share funding, and the Texas uncompensated care 1115 Waiver programs of approximately $300 million had not been received by the company as of December 31, 2014. Tenet’s outstanding borrowings on its credit line were $220 million as of December 31, 2014. Accounts receivable days increased by 0.2 days to 49.5 days at December 31, 2014, compared to 49.3 days at September 30, 2014.
Outlook for First Quarter and Full Year 2015 Adjusted EBITDA
The company confirmed its existing 2015 Outlook for Adjusted EBITDA to be in a range of $2.05 billion to $2.15 billion. The company expects 2015 earnings per share to be in a range of $1.32 to $2.40 per share. For the first quarter ending March 31, 2015, the company expects Adjusted EBITDA of $475 million to $525 million and earnings per share of $0.05 to $0.55 per share.
Management’s Webcast Discussion of Fourth Quarter Results
Tenet management will discuss the Company’s fourth quarter 2014 results on a webcast scheduled for 9:00 a.m. (CST) / 10:00 a.m. (EST) on February 24, 2015. Investors can access the webcast through Tenet’s website at www.tenethealth.com/investors. A set of slides, which will be referred to on the conference call, is available on the Quarterly Results section of the Company’s website.
Additional information regarding Tenet’s quarterly results of operations, including detailed tabular operational data, is contained in its Form 10-K report, which will be filed with the Securities and Exchange Commission and posted on the Tenet 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 is a national, diversified healthcare services company with more than 109,000 employees united around a common mission: to help people live happier, healthier lives. The company operates 80 hospitals, 214 outpatient centers, six health plans and Conifer Health Solutions, a leading provider of healthcare business process services in the areas of revenue cycle management, value based care and patient communications. For more information, please visit www.tenethealth.com.
The terms "THC", "Tenet Healthcare Corporation", "the company", "we", "us" or "our" refer to Tenet Healthcare Corporation or one or more of its subsidiaries or affiliates as applicable.
This release contains “forward-looking statements” – that is, statements that relate to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “assume,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include, but are not limited to, the factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended December 31, 2014 and other filings with the Securities and Exchange Commission. The information contained in this release is as of the date hereof. The company assumes no obligation to update forward-looking statements contained in this release as a result of new information or future events or developments.
Tenet uses its company website to provide important information to investors about the company including the posting of important announcements regarding financial performance and corporate developments.
|
TENET HEALTHCARE CORPORATION |
||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (Dollars in millions except per share amounts) | Three Months Ended December 31, | |||||||||||||||||||
| 2014 | % | 2013 | % | Change | ||||||||||||||||
| Net operating revenues: | ||||||||||||||||||||
| Net operating revenues before provision for doubtful accounts | $ | 4,824 | $ | 4,233 | 14.0 | % | ||||||||||||||
| Less: Provision for doubtful accounts | 356 | 348 | 2.3 | % | ||||||||||||||||
| Net operating revenues | 4,468 | 100.0 | % | 3,885 | 100.0 | % | 15.0 | % | ||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Salaries, wages and benefits | 2,118 | 47.4 | % | 1,872 | 48.2 | % | 13.1 | % | ||||||||||||
| Supplies | 688 | 15.4 | % | 626 | 16.1 | % | 9.9 | % | ||||||||||||
| Other operating expenses, net | 1,048 | 23.5 | % | 991 | 25.5 | % | 5.8 | % | ||||||||||||
| Electronic health record incentives | (32 | ) | (0.7 |
)% |
(48 | ) | (1.2 |
)% |
(33.3 |
)% |
||||||||||
| Depreciation and amortization | 240 | 5.4 | % | 191 | 4.9 | % | 25.7 | % | ||||||||||||
| Impairment and restructuring charges, and acquisition-related costs |
63 |
1.4 | % | 58 | 1.5 | % | ||||||||||||||
| Litigation and investigation costs | 6 | 0.1 | % | 28 | 0.7 | % | ||||||||||||||
| Operating income | 337 | 7.5 | % | 167 | 4.3 | % | ||||||||||||||
| Interest expense | (196 | ) | (182 | ) | ||||||||||||||||
| Income (loss) from continuing operations, before income taxes | 141 | (15 | ) | |||||||||||||||||
| Income tax benefit (expense) | (60 | ) | 8 | |||||||||||||||||
|
Income (loss) from continuing operations, before discontinued operations |
81 | (7 | ) | |||||||||||||||||
| Discontinued operations: | ||||||||||||||||||||
| Loss from operations | — | — | ||||||||||||||||||
| Income tax expense | — | (7 | ) | |||||||||||||||||
| Net loss from discontinued operations | — | (7 | ) | |||||||||||||||||
| Net income (loss) | 81 | (14 | ) | |||||||||||||||||
| Less: Net income attributable to noncontrolling interests | 20 | 10 | ||||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | 61 | $ | (24 | ) | |||||||||||||||
| Amounts attributable to Tenet Healthcare Corporation common shareholders | ||||||||||||||||||||
| Income (loss) from continuing operations, net of tax | $ | 61 | $ | (17 | ) | |||||||||||||||
| Loss from discontinued operations, net of tax | — | (7 | ) | |||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | 61 | $ | (24 | ) | |||||||||||||||
| Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders: | ||||||||||||||||||||
| Basic | ||||||||||||||||||||
| Continuing operations | $ | 0.62 | $ | (0.17 | ) | |||||||||||||||
| Discontinued operations | — | (0.07 | ) | |||||||||||||||||
| $ | 0.62 | $ | (0.24 | ) | ||||||||||||||||
| Diluted | ||||||||||||||||||||
| Continuing operations | $ | 0.61 | $ | (0.17 | ) | |||||||||||||||
| Discontinued operations | — | (0.07 | ) | |||||||||||||||||
| $ | 0.61 | $ | (0.24 | ) | ||||||||||||||||
|
Weighted average shares and dilutive securities outstanding (in thousands): |
||||||||||||||||||||
| Basic | 98,331 | 98,586 | ||||||||||||||||||
| Diluted* | 101,279 | 98,586 | ||||||||||||||||||
|
*Had we generated income from continuing operations in the three months ended December 31, 2013, the effect of employee stock options, restricted stock units and deferred compensation units on the diluted shares calculation would have been an increase of 2,472 shares. |
||||||||||||||||||||
|
TENET HEALTHCARE CORPORATION |
||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (Dollars in millions except per share amounts) | Year Ended December 31, | |||||||||||||||||||
| 2014 | % | 2013 | % | Change | ||||||||||||||||
| Net operating revenues: | ||||||||||||||||||||
| Net operating revenues before provision for doubtful accounts | $ | 17,920 | $ | 12,074 | 48.4 | % | ||||||||||||||
| Less: Provision for doubtful accounts | 1,305 | 972 | 34.3 | % | ||||||||||||||||
| Net operating revenues | 16,615 | 100.0 | % | 11,102 | 100.0 | % | 49.7 | % | ||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Salaries, wages and benefits | 8,023 | 48.3 | % | 5,371 | 48.4 | % | 49.4 | % | ||||||||||||
| Supplies | 2,630 | 15.8 | % | 1,784 | 16.1 | % | 47.4 | % | ||||||||||||
| Other operating expenses, net | 4,114 | 24.8 | % | 2,701 | 24.3 | % | 52.3 | % | ||||||||||||
| Electronic health record incentives | (104 | ) | (0.7 |
)% |
(96 | ) | (0.9 |
)% |
8.3 | % | ||||||||||
| Depreciation and amortization | 849 | 5.1 | % | 545 | 4.9 | % | 55.8 | % | ||||||||||||
| Impairment and restructuring charges, and acquisition-related costs | 153 | 0.9 | % | 103 | 0.9 | % | ||||||||||||||
| Litigation and investigation costs | 25 | 0.2 | % | 31 | 0.3 | % | ||||||||||||||
| Operating income | 925 | 5.6 | % | 663 | 6.0 | % | ||||||||||||||
| Interest expense | (754 | ) | (474 | ) | ||||||||||||||||
| Loss from early extinguishment of debt | (24 | ) | (348 | ) | ||||||||||||||||
| Investment earnings | — | 1 | ||||||||||||||||||
| Income (loss) from continuing operations, before income taxes | 147 | (158 | ) | |||||||||||||||||
| Income tax benefit (expense) | (49 | ) | 65 | |||||||||||||||||
|
Net income (loss) from continuing operations, before discontinued operations |
98 | (93 | ) | |||||||||||||||||
| Discontinued operations: | ||||||||||||||||||||
| Loss from operations | (17 | ) | (5 | ) | ||||||||||||||||
| Litigation and investigation costs | (18 | ) | (2 | ) | ||||||||||||||||
| Income tax benefit (expense) | 13 | (4 | ) | |||||||||||||||||
| Loss from discontinued operations | (22 | ) | (11 | ) | ||||||||||||||||
| Net income (loss) | 76 | (104 | ) | |||||||||||||||||
| Less: Net income attributable to noncontrolling interests | 64 | 30 | ||||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | 12 | $ | (134 | ) | |||||||||||||||
| Amounts attributable to Tenet Healthcare Corporation common shareholders | ||||||||||||||||||||
| Net income (loss) from continuing operations, net of tax | $ | 34 | $ | (123 | ) | |||||||||||||||
| Loss from discontinued operations, net of tax | (22 | ) | (11 | ) | ||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | 12 | $ | (134 | ) | |||||||||||||||
| Net income (loss) per share attributable to Tenet Healthcare Corporation common shareholders: | ||||||||||||||||||||
| Basic | ||||||||||||||||||||
| Continuing operations | $ | 0.35 | $ | (1.21 | ) | |||||||||||||||
| Discontinued operations | (0.23 | ) | (0.11 | ) | ||||||||||||||||
| $ | 0.12 | $ | (1.32 | ) | ||||||||||||||||
| Diluted | ||||||||||||||||||||
| Continuing operations | $ | 0.34 | $ | (1.21 | ) | |||||||||||||||
| Discontinued operations | (0.22 | ) | (0.11 | ) | ||||||||||||||||
| $ | 0.12 | $ | (1.32 | ) | ||||||||||||||||
|
Weighted average shares and dilutive securities outstanding (in thousands): |
||||||||||||||||||||
| Basic | 97,801 | 101,648 | ||||||||||||||||||
| Diluted* | 100,287 | 101,648 | ||||||||||||||||||
|
*Had we generated income from continuing operations available to shareholders in the year ended December 31, 2013, the effect (in thousands) of employee stock options, restricted stock units and deferred compensation units on the diluted shares calculation would have been an increase in shares of 2,310 shares. |
||||||||||||||||||||
| TENET HEALTHCARE CORPORATION | ||||||||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| December 31, | December 31, | |||||||||||||||||||
| (Dollars in millions) | 2014 | 2013 | ||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Current assets: | ||||||||||||||||||||
| Cash and cash equivalents | $ | 193 | $ | 113 | ||||||||||||||||
| Accounts receivable, less allowance for doubtful accounts | 2,404 | 1,890 | ||||||||||||||||||
| Inventories of supplies, at cost | 276 | 260 | ||||||||||||||||||
| Income tax receivable | 2 | — | ||||||||||||||||||
| Current portion of deferred income taxes | 747 | 692 | ||||||||||||||||||
| Other current assets | 1,095 | 737 | ||||||||||||||||||
| Total current assets | 4,717 | 3,692 | ||||||||||||||||||
| Investments and other assets | 384 | 357 | ||||||||||||||||||
| Deferred income taxes, net of current portion | 116 | 148 | ||||||||||||||||||
| Property and equipment, at cost, less accumulated depreciation and amortization | 7,733 | 7,582 | ||||||||||||||||||
| Goodwill | 3,913 | 3,566 | ||||||||||||||||||
| Other intangible assets, at cost, less accumulated amortization | 1,278 | 1,105 | ||||||||||||||||||
| Total assets | $ | 18,141 | $ | 16,450 | ||||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||||||||
| Current liabilities: | ||||||||||||||||||||
| Current portion of long-term debt | $ | 112 | $ | 153 | ||||||||||||||||
| Accounts payable | 1,179 | 1,085 | ||||||||||||||||||
| Accrued compensation and benefits | 852 | 622 | ||||||||||||||||||
| Professional and general liability reserves | 189 | 156 | ||||||||||||||||||
| Accrued interest payable | 194 | 198 | ||||||||||||||||||
| Other current liabilities | 1,051 | 879 | ||||||||||||||||||
| Total current liabilities | 3,577 | 3,093 | ||||||||||||||||||
| Long-term debt, net of current portion | 11,695 | 10,696 | ||||||||||||||||||
| Professional and general liability reserves | 492 | 555 | ||||||||||||||||||
| Defined benefit plan obligations | 633 | 398 | ||||||||||||||||||
| Other long-term liabilities | 558 | 490 | ||||||||||||||||||
| Total liabilities | 16,955 | 15,232 | ||||||||||||||||||
| Commitments and contingencies | ||||||||||||||||||||
| Redeemable noncontrolling interests in equity of consolidated subsidiaries | 401 | 340 | ||||||||||||||||||
| Equity: | ||||||||||||||||||||
| Shareholders’ equity: | ||||||||||||||||||||
| Common stock | 7 | 7 | ||||||||||||||||||
| Additional paid-in capital | 4,614 | 4,572 | ||||||||||||||||||
| Accumulated other comprehensive loss | (182 | ) | (24 | ) | ||||||||||||||||
| Accumulated deficit | (1,410 | ) | (1,422 | ) | ||||||||||||||||
| Common stock in treasury, at cost | (2,378 | ) | (2,378 | ) | ||||||||||||||||
| Total shareholders’ equity | 651 | 755 | ||||||||||||||||||
| Noncontrolling interests | 134 | 123 | ||||||||||||||||||
| Total equity | 785 | 878 | ||||||||||||||||||
| Total liabilities and equity | $ | 18,141 | $ | 16,450 | ||||||||||||||||
|
TENET HEALTHCARE CORPORATION |
|||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (Unaudited) | |||||||||||
| (Dollars in millions) |
Year Ended December 31, |
||||||||||
| 2014 | 2013 | ||||||||||
| Net income (loss) | $ | 76 | $ | (104 | ) | ||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 849 | 545 | |||||||||
| Provision for doubtful accounts | 1,305 | 972 | |||||||||
| Deferred income tax benefit | 30 | (67 | ) | ||||||||
| Stock-based compensation expense | 51 | 36 | |||||||||
| Impairment and restructuring charges, and acquisition-related costs | 153 | 103 | |||||||||
| Litigation and investigation costs | 25 | 31 | |||||||||
| Loss from early extinguishment of debt | 24 | 348 | |||||||||
| Amortization of debt discount and debt issuance costs | 28 | 19 | |||||||||
| Pre-tax income from discontinued operations | 35 | 7 | |||||||||
| Other items, net | (40 | ) | (33 | ) | |||||||
| Changes in cash from operating assets and liabilities: | |||||||||||
| Accounts receivable | (1,896 | ) | (987 | ) | |||||||
| Inventories and other current assets | (314 | ) | (203 | ) | |||||||
| Income taxes | 3 | — | |||||||||
| Accounts payable, accrued expenses and other current liabilities | 505 | 38 | |||||||||
| Other long-term liabilities | 44 | 13 | |||||||||
| Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (168 | ) | (114 | ) | |||||||
| Net cash used in operating activities from discontinued operations, excluding income taxes | (23 | ) | (15 | ) | |||||||
| Net cash provided by operating activities | 687 | 589 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of property and equipment — continuing operations | (933 | ) | (691 | ) | |||||||
| Purchases of businesses or joint venture interests, net of cash acquired | (428 | ) | (1,515 | ) | |||||||
| Proceeds from sales of facilities and other assets — discontinued operations | 6 | 16 | |||||||||
| Proceeds from sales of marketable securities, long-term investments and other assets | 31 | 15 | |||||||||
| Other long-term assets | 1 | 8 | |||||||||
| Other items, net | 1 | 3 | |||||||||
| Net cash used in investing activities | (1,322 | ) | (2,164 | ) | |||||||
| Cash flows from financing activities: | |||||||||||
| Repayments of borrowings under credit facility | (2,430 | ) | (1,286 | ) | |||||||
| Proceeds from borrowings under credit facility | 2,245 | 1,691 | |||||||||
| Repayments of other borrowings | (683 | ) | (5,133 | ) | |||||||
| Proceeds from other borrowings | 1,608 | 6,507 | |||||||||
| Deferred debt issuance costs | (27 | ) | (154 | ) | |||||||
| Repurchases of common stock | — | (400 | ) | ||||||||
| Distributions paid to noncontrolling interests | (45 | ) | (27 | ) | |||||||
| Contributions from noncontrolling interests | 17 | 99 | |||||||||
| Proceeds from exercise of stock options | 26 | 22 | |||||||||
| Other items, net | 4 | 5 | |||||||||
| Net cash provided by financing activities | 715 | 1,324 | |||||||||
| Net increase (decrease) in cash and cash equivalents | 80 | (251 | ) | ||||||||
| Cash and cash equivalents at beginning of period | 113 | 364 | |||||||||
| Cash and cash equivalents at end of period | $ | 193 | $ | 113 | |||||||
| Supplemental disclosures: | |||||||||||
| Interest paid, net of capitalized interest | $ | (726 | ) | $ | (426 | ) | |||||
| Income tax payments, net | $ | (8 | ) | $ | (6 | ) | |||||
|
TENET HEALTHCARE CORPORATION |
|||||||||||||||||||||||||
| SELECTED STATISTICS – CONTINUING SAME HOSPITALS INCLUDING VANGUARD PROFORMA FOR FULL YEAR 2013 | |||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||
|
(Dollars in millions except per patient day, per admission and per visit amounts) |
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
| 2014 | 2013 | Change | 2014 | 2013 | Change | ||||||||||||||||||||
| Net inpatient revenues | $ | 2,669 | $ | 2,372 | 12.5 | % | $ | 9,927 | $ | 9,651 | 2.9 | % | |||||||||||||
| Net outpatient revenues | $ | 1,495 | $ | 1,357 | 10.2 | % | $ | 5,712 | $ | 5,343 | 6.9 | % | |||||||||||||
| Number of acute care hospitals (at end of period) | 77 | 77 | — | * | 77 | 77 | — | * | |||||||||||||||||
| Licensed beds (at end of period) | 20,407 | 20,293 | 0.6 | % | 20,407 | 20,293 | 0.6 | % | |||||||||||||||||
| Average licensed beds | 20,398 | 20,294 | 0.5 | % | 20,328 | 20,295 | 0.2 | % | |||||||||||||||||
| Utilization of licensed beds | 49.1 | % | 47.2 | % | 1.9 | % | * | 49.4 | % | 48.1 | % | 1.3 | % | * | |||||||||||
| Patient days – total | 921,926 | 880,737 | 4.7 | % | 3,665,814 | 3,562,658 | 2.9 | % | |||||||||||||||||
| Adjusted patient days | 1,562,581 | 1,481,407 | 5.5 | % | 6,201,568 | 5,971,291 | 3.9 | % | |||||||||||||||||
| Net inpatient revenue per patient day | $ | 2,895 | $ | 2,693 | 7.5 | % | $ | 2,708 | $ | 2,709 | — | % | |||||||||||||
| Total admissions | 198,219 | 190,506 | 4.0 | % | 783,268 | 764,695 | 2.4 | % | |||||||||||||||||
| Adjusted patient admissions | 340,125 | 325,377 | 4.5 | % | 1,340,444 | 1,295,720 | 3.5 | % | |||||||||||||||||
| Charity and uninsured admissions | 11,104 | 14,189 | (21.7 |
)% |
45,308 | 55,548 | (18.4 |
)% |
|||||||||||||||||
| Net inpatient revenue per admission | $ | 13,465 | $ | 12,451 | 8.1 | % | $ | 12,674 | $ | 12,621 | 0.4 | % | |||||||||||||
| Average length of stay (days) | 4.65 | 4.62 | 0.6 | % | 4.68 | 4.66 | 0.4 | % | |||||||||||||||||
| Total surgeries | 181,336 | 168,730 | 7.5 | % | 694,272 | 640,960 | 8.3 | % | |||||||||||||||||
| Admissions through emergency department | 124,600 | 116,592 | 6.9 | % | 490,006 | 472,515 | 3.7 | % | |||||||||||||||||
| Emergency department visits | 711,351 | 663,114 | 7.3 | % | 2,775,281 | 2,664,278 | 4.2 | % | |||||||||||||||||
|
Total emergency department admissions and visits |
835,951 | 779,706 | 7.2 | % | 3,265,287 | 3,136,793 | 4.1 | % | |||||||||||||||||
| Outpatient visits | 2,100,683 | 1,916,932 | 9.6 | % | 8,198,002 | 7,646,969 | 7.2 | % | |||||||||||||||||
| Charity and uninsured outpatient visits | 164,746 | 183,586 | (10.3 |
)% |
664,082 | 761,027 | (12.7 | ) % | |||||||||||||||||
| Net outpatient revenue per visit | $ | 712 | $ | 708 | 0.6 | % | $ | 697 | $ | 699 | (0.3 | ) % | |||||||||||||
| Net patient revenue per adjusted patient admission | $ | 12,243 | $ | 11,461 | 6.8 | % | $ | 11,667 | $ | 11,572 | 0.8 | % | |||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,665 | $ | 2,517 | 5.9 | % | $ | 2,522 | $ | 2,511 | 0.4 | % | |||||||||||||
| Net Patient Revenues from: | |||||||||||||||||||||||||
| Medicare | 20.9 | % | 21.8 | % | (0.9 |
)% |
* | 21.8 | % | 22.5 | % | (0.7 |
)% |
* | |||||||||||
| Medicaid | 10.9 | % | 9.3 | % | 1.6 | % | * | 9.4 | % | 10.2 | % | (0.8 |
)% |
* | |||||||||||
| Managed care | 58.1 | % | 57.7 | % | 0.4 | % | * | 58.6 | % | 56.0 | % | 2.6 | % | * | |||||||||||
| Indemnity, self-pay and other | 10.1 | % | 11.2 | % | (1.1 |
)% |
* | 10.2 | % | 11.3 | % | (1.1 |
)% |
* | |||||||||||
| * This change is the difference between the 2014 and 2013 amounts shown | |||||||||||||||||||||||||
|
TENET HEALTHCARE CORPORATION |
||||||||||||||||||||||||||
| SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||
|
(Dollars in millions except per patient day, per admission and per visit amounts) |
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||||
| 2014 | 2013 | Change | 2014 | 2013 | Change | |||||||||||||||||||||
| Net inpatient revenues | $ | 2,719 | $ | 2,372 | 14.6 | % | $ | 10,015 | $ | 6,952 | 44.1 | % | ||||||||||||||
| Net outpatient revenues | $ | 1,539 | $ | 1,357 | 13.4 | % | $ | 5,774 | $ | 3,859 | 49.6 | % | ||||||||||||||
| Number of acute care hospitals (at end of period) | 80 | 77 | 3 | * | 80 | 77 | 3 | * | ||||||||||||||||||
| Licensed beds (at end of period) | 20,814 | 20,293 | 2.6 | % | 20,814 | 20,293 | 2.6 | % | ||||||||||||||||||
| Average licensed beds | 20,805 | 20,294 | 2.5 | % | 20,531 | 14,963 | 37.2 | % | ||||||||||||||||||
| Utilization of licensed beds | 49.0 | % | 47.2 | % | 1.8 | % | * | 49.3 | % | 48.0 | % | 1.3 | % | * | ||||||||||||
| Patient days – total | 937,803 | 880,737 | 6.5 | % | 3,695,288 | 2,621,245 | 41.0 | % | ||||||||||||||||||
| Adjusted patient days | 1,592,166 | 1,481,291 | 7.5 | % | 6,255,572 | 4,243,334 | 47.4 | % | ||||||||||||||||||
| Net inpatient revenue per patient day | $ | 2,899 | $ | 2,693 | 7.6 | % | $ | 2,710 | $ | 2,652 | 2.2 | % | ||||||||||||||
| Total admissions | 202,337 | 190,506 | 6.2 | % | 791,165 | 558,726 | 41.6 | % | ||||||||||||||||||
| Adjusted patient admissions | 347,790 | 325,410 | 6.9 | % | 1,354,896 | 915,276 | 48.0 | % | ||||||||||||||||||
| Charity and uninsured admissions | 11,256 | 14,190 | (20.7 |
)% |
45,703 | 40,487 | 12.9 | % | ||||||||||||||||||
| Net inpatient revenue per admission | $ | 13,438 | $ | 12,451 | 7.9 | % | $ | 12,659 | $ | 12,443 | 1.7 | % | ||||||||||||||
| Average length of stay (days) | 4.63 | 4.62 | 0.2 | % |
4.67 |
4.69 | (0.4 | ) % | ||||||||||||||||||
| Total surgeries | 183,250 | 168,730 | 8.6 | % | 697,635 | 489,867 | 42.4 | % | ||||||||||||||||||
| Admissions through emergency department | 127,361 | 116,592 | 9.2 | % | 495,195 | 347,920 | 42.3 | % | ||||||||||||||||||
| Emergency department visits | 737,680 | 663,114 | 11.2 | % | 2,824,526 | 1,865,239 | 51.4 | % | ||||||||||||||||||
|
Total emergency department admissions and visits |
865,041 | 779,706 | 10.9 | % | 3,319,721 | 2,213,159 | 50.0 | % | ||||||||||||||||||
| Outpatient visits | 2,145,138 | 1,916,932 | 11.9 | % | 8,283,878 | 5,115,854 | 61.9 | % | ||||||||||||||||||
| Charity and uninsured outpatient visits | 168,284 | 183,587 | (8.3 |
)% |
673,320 | 522,781 | 28.8 | % | ||||||||||||||||||
| Net outpatient revenue per visit | $ | 717 | $ | 708 | 1.3 | % | $ | 697 | $ | 754 | (7.6 |
)% |
||||||||||||||
| Net patient revenue per adjusted patient admission | $ | 12,243 | $ | 11,459 | 6.8 | % | $ | 11,653 | $ | 11,812 | (1.3 |
)% |
||||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,674 | $ | 2,517 | 6.2 | % | $ | 2,524 | $ | 2,548 | (0.9 |
)% |
||||||||||||||
| Net Patient Revenues from: | ||||||||||||||||||||||||||
| Medicare | 20.9 | % | 21.8 | % | (0.9 |
)% |
* | 21.9 | % | 21.8 | % | 0.1 | % | * | ||||||||||||
| Medicaid | 11.1 | % | 9.3 | % | 1.8 | % | * | 9.4 | % | 9.0 | % | 0.4 | % | * | ||||||||||||
| Managed care | 57.9 | % | 57.7 | % | 0.2 | % | * | 58.6 | % | 58.1 | % | 0.5 | % | * | ||||||||||||
| Indemnity, self-pay and other | 10.1 | % | 11.2 | % | (1.1 |
)% |
* | 10.1 | % | 11.1 | % | (1.0 |
)% |
* | ||||||||||||
| * This change is the difference between the 2014 and 2013 amounts shown | ||||||||||||||||||||||||||
| TENET HEALTHCARE CORPORATION | |||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| (Dollars in millions except per share amounts) | Three Months Ended |
Year Ended
12/31/14 |
|||||||||||||||||||||||
| 03/31/14 | 06/30/14 | 09/30/14 | 12/31/14 | ||||||||||||||||||||||
| Net operating revenues: | |||||||||||||||||||||||||
| Net operating revenues before provision for doubtful accounts | $ | 4,306 | $ | 4,362 | $ | 4,428 | $ | 4,824 | $ | 17,920 | |||||||||||||||
| Less: Provision for doubtful accounts | 380 | 320 | 249 | 356 | 1,305 | ||||||||||||||||||||
| Net operating revenues | 3,926 | 4,042 | 4,179 | 4,468 | 16,615 | ||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||
| Salaries, wages and benefits | 1,921 | 1,956 | 2,028 | 2,118 | 8,023 | ||||||||||||||||||||
| Supplies | 628 | 649 | 665 | 688 | 2,630 | ||||||||||||||||||||
| Other operating expenses, net | 999 | 1,035 | 1,032 | 1,048 | 4,114 | ||||||||||||||||||||
| Electronic health record incentives | (9 | ) | (58 | ) | (5 | ) | (32 | ) | (104 | ) | |||||||||||||||
| Depreciation and amortization | 193 | 209 | 207 | 240 | 849 | ||||||||||||||||||||
| Impairment and restructuring charges, and acquisition-related costs | 21 | 32 | 37 | 63 | 153 | ||||||||||||||||||||
| Litigation and investigation costs | 3 | 12 | 4 | 6 | 25 | ||||||||||||||||||||
| Operating income | 170 | 207 | 211 | 337 | 925 | ||||||||||||||||||||
| Interest expense | (182 | ) | (190 | ) | (186 | ) | (196 | ) | (754 | ) | |||||||||||||||
| Loss from early extinguishment of debt | — | — | (24 | ) | — | (24 | ) | ||||||||||||||||||
| Income (loss) from continuing operations, before income taxes | (12 | ) | 17 | 1 | 141 | 147 | |||||||||||||||||||
| Income tax benefit (expense) | 1 | (8 | ) | 18 | (60 | ) | (49 | ) | |||||||||||||||||
| Income (loss) from continuing operations, before discontinued operations | (11 | ) | 9 | 19 | 81 | 98 | |||||||||||||||||||
| Discontinued operations: | |||||||||||||||||||||||||
| Loss from operations | (8 | ) | (7 | ) | (2 | ) | — | (17 | ) | ||||||||||||||||
| Litigation and investigation costs | — | (18 | ) | — | — | (18 | ) | ||||||||||||||||||
| Income tax benefit | 3 | 9 | 1 | — | 13 | ||||||||||||||||||||
| Net loss from discontinued operations | (5 | ) | (16 | ) | (1 | ) | — | (22 | ) | ||||||||||||||||
| Net income (loss) | (16 | ) | (7 | ) | 18 | 81 | 76 | ||||||||||||||||||
| Less: Net income attributable to noncontrolling interests | 16 | 19 | 9 | 20 | 64 | ||||||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | (32 | ) | $ | (26 | ) | $ | 9 | $ | 61 | $ | 12 | |||||||||||||
| Amounts attributable to Tenet Healthcare Corporation common shareholders | |||||||||||||||||||||||||
| Income (loss) from continuing operations, net of tax | $ | (27 | ) | $ | (10 | ) | $ | 10 | $ | 61 | $ | 34 | |||||||||||||
| Loss from discontinued operations, net of tax | (5 | ) | (16 | ) | (1 | ) | — | (22 | ) | ||||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | (32 | ) | $ | (26 | ) | $ | 9 | $ | 61 | $ | 12 | |||||||||||||
| Net income (loss) per share attributable to Tenet Healthcare Corporation common shareholders: | |||||||||||||||||||||||||
| Basic | |||||||||||||||||||||||||
| Continuing operations | $ | (0.28 | ) | $ | (0.11 | ) | $ | 0.10 | $ | 0.61 | $ | 0.35 | |||||||||||||
| Discontinued operations | (0.05 | ) | (0.16 | ) | (0.01 | ) | — | (0.23 | ) | ||||||||||||||||
| $ | (0.33 | ) | $ | (0.27 | ) | $ | 0.09 | $ | 0.61 | $ | 0.12 | ||||||||||||||
| Diluted | |||||||||||||||||||||||||
| Continuing operations | $ | (0.28 | ) | $ | (0.11 | ) | $ | 0.10 | $ | 0.61 | $ | 0.34 | |||||||||||||
| Discontinued operations | (0.05 | ) | (0.16 | ) | (0.01 | ) | — | (0.22 | ) | ||||||||||||||||
| $ | (0.33 | ) | $ | (0.27 | ) | $ | 0.09 | $ | 0.61 | $ | 0.12 | ||||||||||||||
|
Weighted average shares and dilutive securities outstanding (in thousands): |
|||||||||||||||||||||||||
| Basic | 97,161 | 97,677 | 98,036 | 98,331 | 97,801 | ||||||||||||||||||||
| Diluted | 97,161 | 97,677 | 100,926 | 101,279 | 100,287 | ||||||||||||||||||||
|
TENET HEALTHCARE CORPORATION |
|||||||||||||||||||||||||
| SELECTED STATISTICS – CONTINUING SAME HOSPITALS INCLUDING VANGUARD | |||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
|
(Dollars in millions except per patient days, per admission and per visit amounts) |
Three Months Ended |
Year
Ended |
|||||||||||||||||||||||
| 03/31/14 | 06/30/14 | 09/30/14 | 12/31/14 | 12/31/14 | |||||||||||||||||||||
| Net inpatient revenues | $ | 2,440 | $ | 2,400 | $ | 2,418 | $ | 2,669 | $ | 9,927 | |||||||||||||||
| Net outpatient revenues | $ | 1,346 | $ | 1,436 | $ | 1,435 | $ | 1,495 | $ | 5,712 | |||||||||||||||
| Number of acute care hospitals (at end of period) | 77 | 77 | 77 | 77 | 77 | ||||||||||||||||||||
| Licensed beds (at end of period) | 20,255 | 20,355 | 20,355 | 20,407 | 20,407 | ||||||||||||||||||||
| Average licensed beds | 20,255 | 20,304 | 20,355 | 20,398 | 20,328 | ||||||||||||||||||||
| Utilization of licensed beds | 51.0 | % | 49.0 | % | 48.5 | % | 49.1 | % | 49.4 | % | |||||||||||||||
| Patient days – total | 929,164 | 905,839 | 908,885 | 921,926 | 3,665,814 | ||||||||||||||||||||
| Adjusted patient days | 1,535,545 | 1,551,263 | 1,552,179 | 1,562,581 | 6,201,568 | ||||||||||||||||||||
| Net inpatient revenue per patient day | $ | 2,626 | $ | 2,649 | $ | 2,660 | $ | 2,895 | $ | 2,708 | |||||||||||||||
| Total admissions | 194,273 | 194,167 | 196,609 | 198,219 | 783,268 | ||||||||||||||||||||
| Adjusted patient admissions | 324,475 | 335,991 | 339,853 | 340,125 | 1,340,444 | ||||||||||||||||||||
| Charity and uninsured admissions | 12,530 | 10,900 | 10,774 | 11,104 | 45,308 | ||||||||||||||||||||
| Net inpatient revenue per admission | $ | 12,560 | $ | 12,360 | $ | 12,299 | $ | 13,465 | $ | 12,674 | |||||||||||||||
| Average length of stay (days) | 4.78 | 4.67 | 4.62 | 4.65 | 4.68 | ||||||||||||||||||||
| Total surgeries | 162,282 | 173,463 | 177,191 | 181,336 | 694,272 | ||||||||||||||||||||
| Admissions through emergency department | 122,601 | 121,872 | 120,933 | 124,600 | 490,006 | ||||||||||||||||||||
| Emergency department visits | 665,002 | 699,423 | 699,505 | 711,351 | 2,775,281 | ||||||||||||||||||||
| Total emergency department admissions and visits | 787,603 | 821,295 | 820,438 | 835,951 | 3,265,287 | ||||||||||||||||||||
| Outpatient visits | 1,947,687 | 2,063,026 | 2,086,606 | 2,100,683 | 8,198,002 | ||||||||||||||||||||
| Charity and uninsured outpatient visits | 165,248 | 168,967 | 165,121 | 164,746 | 664,082 | ||||||||||||||||||||
| Net outpatient revenue per visit | $ | 691 | $ | 696 | $ | 688 | $ | 712 | $ | 697 | |||||||||||||||
| Net patient revenue per adjusted patient admission | $ | 11,668 | $ | 11,417 | $ | 11,337 | $ | 12,243 | $ | 11,667 | |||||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,466 | $ | 2,473 | $ | 2,482 | $ | 2,665 | $ | 2,522 | |||||||||||||||
| Net Patient Revenues from: | |||||||||||||||||||||||||
| Medicare | 22.6 | % | 22.5 | % | 21.3 | % | 20.9 | % | 21.8 | % | |||||||||||||||
| Medicaid | 7.7 | % | 9.9 | % | 8.8 | % | 10.9 | % | 9.4 | % | |||||||||||||||
| Managed care | 57.8 | % | 58.0 | % | 60.8 | % | 58.1 | % | 58.6 | % | |||||||||||||||
| Indemnity, self-pay and other | 11.9 | % | 9.6 | % | 9.1 | % | 10.1 | % | 10.2 | % | |||||||||||||||
|
TENET HEALTHCARE CORPORATION |
|||||||||||||||||||||||||
| SELECTED STATISTICS – CONTINUING SAME HOSPITALS INCLUDING VANGUARD PROFORMA FOR FULL YEAR 2013 | |||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
|
(Dollars in millions except per patient days, per admission and per visit amounts) |
Three Months Ended |
Year
Ended |
|||||||||||||||||||||||
| 03/31/13 | 06/30/13 | 09/30/13 | 12/31/13 | 12/31/13 | |||||||||||||||||||||
| Net inpatient revenues | $ | 2,404 | $ | 2,436 | $ | 2,439 | $ | 2,372 | $ | 9,651 | |||||||||||||||
| Net outpatient revenues | $ | 1,295 | $ | 1,346 | $ | 1,345 | $ | 1,357 | $ | 5,343 | |||||||||||||||
| Number of acute care hospitals (at end of period) | 77 | 77 | 77 | 77 | 77 | ||||||||||||||||||||
| Licensed beds (at end of period) | 20,295 | 20,295 | 20,295 | 20,293 | 20,293 | ||||||||||||||||||||
| Average licensed beds | 20,295 | 20,295 | 20,295 | 20,294 | 14,963 | ||||||||||||||||||||
| Utilization of licensed beds | 51.0 | % | 47.3 | % | 47.0 | % | 47.2 | % | 48.0 | % | |||||||||||||||
| Patient days – total | 931,291 | 873,643 | 876,987 | 880,737 | 3,562,658 | ||||||||||||||||||||
| Adjusted patient days | 1,525,151 | 1,479,667 | 1,485,066 | 1,481,407 | 5,971,291 | ||||||||||||||||||||
| Net inpatient revenue per patient day | $ | 2,581 | $ | 2,788 | $ | 2,781 | $ | 2,693 | $ | 2,709 | |||||||||||||||
| Total admissions | 196,102 | 188,789 | 189,298 | 190,506 | 764,695 | ||||||||||||||||||||
| Adjusted patient admissions | 323,496 | 323,000 | 323,847 | 325,377 | 1,295,720 | ||||||||||||||||||||
| Charity and uninsured admissions | 13,217 | 13,931 | 14,211 | 14,189 | 55,548 | ||||||||||||||||||||
| Net inpatient revenue per admission | $ | 12,259 | $ | 12,903 | $ | 12,884 | $ | 12,451 | $ | 12,621 | |||||||||||||||
| Average length of stay (days) | 4.75 | 4.63 | 4.63 | 4.62 | 4.66 | ||||||||||||||||||||
| Total surgeries | 150,716 | 160,192 | 161,322 | 168,730 | 640,960 | ||||||||||||||||||||
| Admissions through emergency department | 123,063 | 117,194 | 115,666 | 116,592 | 472,515 | ||||||||||||||||||||
| Emergency department visits | 669,774 | 666,261 | 665,129 | 663,114 | 2,664,278 | ||||||||||||||||||||
| Total emergency department admissions and visits | 792,837 | 783,455 | 780,795 | 779,706 | 3,136,793 | ||||||||||||||||||||
| Outpatient visits | 1,880,002 | 1,926,196 | 1,923,839 | 1,916,932 | 7,646,969 | ||||||||||||||||||||
| Charity and uninsured outpatient visits | 188,112 | 193,974 | 195,354 | 183,586 | 761,027 | ||||||||||||||||||||
| Net outpatient revenue per visit | $ | 689 | $ | 699 | $ | 699 | $ | 708 | $ | 699 | |||||||||||||||
| Net patient revenue per adjusted patient admission | $ | 11,434 | $ | 11,709 | $ | 11,685 | $ | 11,461 | $ | 11,572 | |||||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,425 | $ | 2,556 | $ | 2,548 | $ | 2,517 | $ | 2,511 | |||||||||||||||
| Net Patient Revenues from: | |||||||||||||||||||||||||
| Medicare | 24.0 | % | 22.1 | % | 22.0 | % | 21.8 | % | 22.5 | % | |||||||||||||||
| Medicaid | 9.3 | % | 11.7 | % | 10.7 | % | 9.3 | % | 10.2 | % | |||||||||||||||
| Managed care | 55.9 | % | 55.0 | % | 55.5 | % | 57.7 | % | 56.0 | % | |||||||||||||||
| Indemnity, self-pay and other | 10.8 | % | 11.2 | % | 11.8 | % | 11.2 | % | 11.3 | % | |||||||||||||||
|
TENET HEALTHCARE CORPORATION |
||||||||||||||||||||||||||
| SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
|
(Dollars in millions except per patient days, per admission and per visit amounts) |
Three Months Ended |
Year
Ended |
||||||||||||||||||||||||
| 03/31/14 | 06/30/14 | 09/30/14 | 12/30/14 | 12/31/14 | ||||||||||||||||||||||
| Net inpatient revenues | $ | 2,440 |
$ |
2,393 |
$ |
2,463 |
$ | 2,719 | $ | 10,015 | ||||||||||||||||
| Net outpatient revenues | $ | 1,346 | $ | 1,448 |
$ |
1,441 |
$ | 1,539 | $ | 5,774 | ||||||||||||||||
| Number of acute care hospitals (at end of period) | 77 | 79 | 80 | 80 | 80 | |||||||||||||||||||||
| Licensed beds (at end of period) | 20,279 | 20,553 | 20,762 | 20,814 | 20,814 | |||||||||||||||||||||
| Average licensed beds | 20,263 | 20,370 | 20,692 | 20,805 | 20,531 | |||||||||||||||||||||
| Utilization of licensed beds | 51.0 | % | 48.9 | % | 48.4 | % | 49.0 | % | 49.3 | % | ||||||||||||||||
| Patient days – total | 929,164 | 907,093 | 921,228 | 937,803 | 3,695,288 | |||||||||||||||||||||
| Adjusted patient days | 1,535,545 | 1,553,515 | 1,574,346 | 1,592,166 | 6,255,572 | |||||||||||||||||||||
| Net inpatient revenue per patient day | $ | 2,626 | $ | 2,638 |
$ |
2,674 |
$ | 2,899 | $ | 2,710 | ||||||||||||||||
| Total admissions | 194,273 | 194,641 | 199,914 | 202,337 | 791,165 | |||||||||||||||||||||
| Adjusted patient admissions | 324,475 | 336,844 | 345,787 | 347,790 | 1,354,896 | |||||||||||||||||||||
| Charity and uninsured admissions | 12,530 | 10,927 | 10,990 | 11,256 | 45,703 | |||||||||||||||||||||
| Net inpatient revenue per admission | $ | 12,560 | $ | 12,294 |
$ |
12,320 |
$ | 13,438 | $ | 12,659 | ||||||||||||||||
| Average length of stay (days) | 4.78 | 4.66 | 4.61 | 4.63 |
4.67 |
|||||||||||||||||||||
| Total surgeries | 162,282 | 173,664 | 178,439 | 183,250 | 697,635 | |||||||||||||||||||||
| Admissions through emergency department | 122,601 | 122,086 | 123,147 | 127,361 | 495,195 | |||||||||||||||||||||
| Emergency department visits | 665,002 | 702,009 | 719,835 | 737,680 | 2,824,526 | |||||||||||||||||||||
| Total emergency department admissions and visits | 787,603 | 824,095 | 842,982 | 865,041 | 3,319,721 | |||||||||||||||||||||
| Outpatient visits | 1,947,687 | 2,066,051 | 2,125,002 | 2,145,138 | 8,283,878 | |||||||||||||||||||||
| Charity and uninsured outpatient visits | 165,248 | 169,766 | 170,022 | 168,284 | 673,320 | |||||||||||||||||||||
| Net outpatient revenue per visit | $ | 691 | $ | 701 |
$ |
678 |
$ | 717 | $ | 697 | ||||||||||||||||
| Net patient revenue per adjusted patient admission | $ | 11,692 | $ | 11,380 |
$ |
11,290 |
$ | 12,243 | $ | 11,653 | ||||||||||||||||
| Net patient revenue per adjusted patient day | $ | 2,482 | $ | 2,456 |
$ |
2,480 |
$ | 2,674 | $ | 2,524 | ||||||||||||||||
| Net Patient Revenues from: | ||||||||||||||||||||||||||
| Medicare | 22.6 | % | 22.5 | % | 21.5 | % | 20.9 | % | 21.9 | % | ||||||||||||||||
| Medicaid | 7.7 | % | 9.9 | % | 8.7 | % | 11.1 | % | 9.4 | % | ||||||||||||||||
| Managed care | 57.8 | % | 58.0 | % | 60.7 | % | 57.9 | % | 58.6 | % | ||||||||||||||||
| Indemnity, self-pay and other | 11.9 | % | 9.6 | % | 9.1 | % | 10.1 | % | 10.1 | % | ||||||||||||||||
|
TENET HEALTHCARE CORPORATION
SEGMENT REPORTING (Unaudited) |
|||||||||||||||||
| December 31, | December 31, | ||||||||||||||||
| 2014 | 2013 | ||||||||||||||||
| Assets | |||||||||||||||||
| Hospital Operations and other | $ | 17,212 | $ | 15,865 | |||||||||||||
| Conifer | 929 | 585 | |||||||||||||||
| Total | $ | 18,141 | $ | 16,450 | |||||||||||||
|
Three Months Ended
December 31, |
Year Ended
December 31, |
||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | ||||||||||||||
| Capital expenditures: | |||||||||||||||||
| Hospital Operations and other | $ | 191 | $ 283 | $ | 908 | $ | 670 | ||||||||||
| Conifer | 8 | 10 | 25 | 21 | |||||||||||||
| Total | $ | 199 | $ 293 | $ | 933 | $ | 691 | ||||||||||
| Net operating revenues: | |||||||||||||||||
| Hospital Operations and other | $ | 4,306 | $ 3,747 | $ | 16,013 | $ | 10,587 | ||||||||||
| Conifer | |||||||||||||||||
| Tenet | 165 | 126 | 591 | 404 | |||||||||||||
| Other customers | 162 | 138 | 602 | 515 | |||||||||||||
| 4,633 | 4,011 | 17,206 | 11,506 | ||||||||||||||
| Intercompany eliminations | (165 | ) | (126 | ) | (591 | ) | (404 | ) | |||||||||
| Total | $ | 4,468 | $ 3,885 | $ | 16,615 | $ | 11,102 | ||||||||||
| Adjusted EBITDA: | |||||||||||||||||
| Hospital Operations and other | $ | 582 | $ 408 | $ | 1,749 | $ | 1,210 | ||||||||||
| Conifer | 64 | 36 | 203 | 132 | |||||||||||||
| Total | $ | 646 | $ 444 | $ | 1,952 | $ | 1,342 | ||||||||||
| Depreciation and amortization: | |||||||||||||||||
| Hospital Operations and other | $ | 230 | $ 187 | $ | 824 | $ | 526 | ||||||||||
| Conifer | 10 | 4 | 25 | 19 | |||||||||||||
| Total | $ | 240 | $ 191 | $ | 849 | $ | 545 | ||||||||||
| Adjusted EBITDA | $ | 646 | $ 444 | $ | 1,952 | $ | 1,342 | ||||||||||
| Depreciation and amortization | (240 | ) | (191 | ) | (849 | ) | (545 | ) | |||||||||
|
Impairments and restructuring charges, and acquisition-related costs |
(63 | ) | (58 | ) | (153 | ) | (103 | ) | |||||||||
| Litigation and investigation costs | (6 | ) | (28 | ) | (25 | ) | (31 | ) | |||||||||
| Interest expense | (196 | ) | (182 | ) | (754 | ) | (474 | ) | |||||||||
| Loss from early extinguishment of debt | — | — | (24 | ) | (348 | ) | |||||||||||
| Investment earnings | — | — | — | 1 | |||||||||||||
| Income (loss) from continuing operations before income taxes | $ | 141 | $ (15 | ) | $ | 147 | $ | (158 | ) | ||||||||
(1) 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) the cumulative effect of changes in accounting principle, net of tax; (2) net loss (income) attributable to noncontrolling interests; (3) preferred stock dividends; (4) income (loss) from discontinued operations, net of tax; (5) income tax benefit (expense); (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 benefit (costs), net of insurance recoveries; (11) hurricane insurance recoveries, net of costs; (12) impairment and restructuring charges and acquisition-related costs; 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 twelve months ended December 31, 2014 and 2013.
For certain pro financial information of the Company as if the Vanguard acquisition had occurred at January 1, 2013, see Note 19 of the notes to the consolidated financial statements in the Company’s Form 10-K for the year ended December 31, 2014.
| TENET HEALTHCARE CORPORATION | ||||||||||||||||||
| Additional Supplemental Non-GAAP Disclosures | ||||||||||||||||||
| Table #1 - Reconciliation of Adjusted EBITDA to Net Income (Loss) Attributable to Tenet Healthcare Corporation Common Shareholders | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| (Dollars in millions) |
Three Months Ended December 31, |
Year Ended December 31, |
||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||
| Net income (loss) attributable to Tenet Healthcare Corporation common shareholders | $ | 61 | $ | (24 | ) | $ | 12 | $ | (134 | ) | ||||||||
| Less: Net (income) attributable to noncontrolling interests | (20 | ) | (10 | ) | (64 | ) | (30 | ) | ||||||||||
| Loss from discontinued operations, net of tax | — | (7 | ) | (22 | ) | (11 | ) | |||||||||||
| Income (loss) from continuing operations | 81 | (7 | ) | 98 | (93 | ) | ||||||||||||
| Income tax benefit (expense) | (60 | ) | 8 | (49 | ) | 65 | ||||||||||||
| Investment earnings | — | — | — | 1 | ||||||||||||||
| Loss from early extinguishment of debt | — | — | (24 | ) | (348 | ) | ||||||||||||
| Interest expense | (196 | ) | (182 | ) | (754 | ) | (474 | ) | ||||||||||
| Operating income | 337 | 167 | 925 | 663 | ||||||||||||||
| Litigation and investigation costs | (6 | ) | (28 | ) | (25 | ) | (31 | ) | ||||||||||
| Impairment and restructuring charges, and acquisition-related costs | (63 | ) | (58 | ) | (153 | ) | (103 | ) | ||||||||||
| Depreciation and amortization | (240 | ) | (191 | ) | (849 | ) | (545 | ) | ||||||||||
| Adjusted EBITDA | $ | 646 | $ | 444 | $ | 1,952 | $ | 1,342 | ||||||||||
| Net operating revenues | $ | 4,468 | $ | 3,885 | $ | 16,615 | $ | 11,102 | ||||||||||
| Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) | 14.5 | % | 11.4 | % | 11.7 | % | 12.1 | % | ||||||||||
|
TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures Table #2 - Reconciliation of Adjusted Free Cash Flow |
||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| (Dollars in millions) |
Three Months Ended December 31, |
Year Ended December 31, |
||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||
| Net cash provided by operating activities | $ | 219 | $ | 255 | $ | 687 | $ | 589 | ||||||||||
| Less: | ||||||||||||||||||
|
Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements |
(53 | ) | (78 | ) | (168 | ) | (114 | ) | ||||||||||
| Net cash provided by (used in) operating activities from discontinued operations | (7 | ) | (10 | ) | (23 | ) | (15 | ) | ||||||||||
| Adjusted net cash provided by operating activities – continuing operations | 279 | 343 | 878 | 718 | ||||||||||||||
| Purchases of property and equipment – continuing operations | (199 | ) | (293 | ) | (933 | ) | (691 | ) | ||||||||||
| Adjusted free cash flow – continuing operations | $ | 80 | $ | 50 | $ | (55 | ) | $ | (27 | ) | ||||||||
| TENET HEALTHCARE CORPORATION | ||||||||||||||||||
| Additional Supplemental Non-GAAP Disclosures | ||||||||||||||||||
|
Table #3 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Net Income Attributable to Tenet Healthcare Corporation Common Shareholders for the Year Ending December 31, 2015 |
||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| (Dollars in millions) | Q1 2015 | 2015 | ||||||||||||||||
| Low | High | Low | High | |||||||||||||||
| Net income attributable to Tenet Healthcare Corporation common shareholders | $ | 3 | $ | 55 | $ | 130 | $ | 245 | ||||||||||
| Less: Net (income) attributable to noncontrolling interests | (30 | ) | (25 | ) | (120 | ) | (100 | ) | ||||||||||
| Loss from discontinued operations, net of tax | (2 | ) | 0 | (5 | ) | 0 | ||||||||||||
| Income from continuing operations | $ | 35 | $ | 80 | $ | 255 | $ | 345 | ||||||||||
| Income tax (expense) | (10 | ) | (45 | ) | (95 | ) | (175 | ) | ||||||||||
| Income from continuing operations, before income taxes | $ | 45 | $ | 125 | $ | 350 | $ | 520 | ||||||||||
| Interest expense, net | (200 | ) | (190 | ) | (800 | ) | (770 | ) | ||||||||||
| Operating income | $ | 245 | $ | 315 | $ | 1,150 | $ | 1,290 | ||||||||||
| Impairment and restructuring charges, acquisition-related costs and litigation costs and settlements(a) | 0 | 0 | 0 | 0 | ||||||||||||||
| Depreciation and amortization | (230 | ) | (210 | ) | (900 | ) | (860 | ) | ||||||||||
| Adjusted EBITDA | $ | 475 | $ | 525 | $ | 2,050 | $ | 2,150 | ||||||||||
| Net operating revenues | $ | 4,300 | $ | 4,500 | $ | 17,400 | $ | 17,700 | ||||||||||
| Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) | 11.0 | % | 11.7 | % | 11.8 | % | 12.1 | % | ||||||||||
|
(a) Company does not forecast impairment and restructuring charges, acquisition-related and litigation costs and settlements |
||||||||||||||||||
|
TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures Table #4 - Reconciliation of Outlook Adjusted EBITDA to Outlook Normalized Income from Continuing Operations for the Year Ending December 31, 2015 |
||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| (Dollars in millions) | Q1 2015 | 2015 | ||||||||||||||||
| Low | High | Low | High | |||||||||||||||
| Adjusted EBITDA | $ | 475 | $ | 525 | $ | 2,050 | $ | 2,150 | ||||||||||
| Depreciation and amortization | (230 | ) | (210 | ) | (900 | ) | (860 | ) | ||||||||||
| Interest expense, net | (200 | ) | (190 | ) | (800 | ) | (770 | ) | ||||||||||
| Income from continuing operations before income taxes | $ | 45 | $ | 125 | $ | 350 | $ | 520 | ||||||||||
| Income tax (expense) | (10 | ) | (45 | ) | (95 | ) | (175 | ) | ||||||||||
| Normalized income from continuing operations | $ | 35 | $ | 80 | $ | 255 | $ | 345 | ||||||||||
| Net (income) attributable to noncontrolling interests | (30 | ) | (25 | ) | (120 | ) | (100 | ) | ||||||||||
| Net income attributable to common shareholders | 5 | 55 | 135 | 245 | ||||||||||||||
| Fully diluted weighted average share outstanding (in millions) | 100 | 100 | 102 | 102 | ||||||||||||||
| Normalized fully diluted earnings per share – continuing operations | $ | 0.05 | $ | 0.55 | $ | 1.32 | $ | 2.40 | ||||||||||
|
TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures Table #5 - Reconciliation of Outlook Adjusted Free Cash Flow for the Year Ending December 31, 2015 |
|||||||||
| (Unaudited) | |||||||||
| (Dollars in millions) | 2015 | ||||||||
| Low | High | ||||||||
| Net cash provided by operating activities | $ | 1,130 | $ | 1,240 | |||||
| Less: | |||||||||
|
Payments for restructuring charges, acquisition-related costs and litigation costs and settlements((a)) |
0 | 0 | |||||||
| Net cash used in operating activities from discontinued operations | (20 | ) | (10 | ) | |||||
| Adjusted net cash provided by operating activities – continuing operations | $ | 1,150 | $ | 1,250 | |||||
| Purchases of property and equipment – continuing operations | (1,000 | ) | (900 | ) | |||||
| Adjusted free cash flow – continuing operations | $ | 150 | $ | 350 | |||||
|
(a) Company does not forecast impairment and restructuring charges, acquisition-related and litigation costs and settlements |
|||||||||
