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8-K - FORM 8-K - MEDCATH CORP | g21977e8vk.htm |
EX-99.2 - EX-99.2 - MEDCATH CORP | g21977exv99w2.htm |
Exhibit 99.1
MEDCATH CONTACT: |
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O. Edwin French
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Art Parker | |
President/Chief Executive Officer
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Chief Financial Officer | |
(704) 815-7700
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(704) 815-7700 |
MEDCATH CORPORATION REPORTS FIRST QUARTER EARNINGS
CHARLOTTE, N.C., Feb 3, 2010 MedCath Corporation (Nasdaq: MDTH), a healthcare provider
focused on high acuity healthcare services, predominately the diagnosis and treatment of
cardiovascular disease, today announced its unaudited operating results for its first quarter of
fiscal 2010, which ended December 31, 2009.
First Quarter 2010 Highlights
| Same facility hospital admissions and outpatient cases were up 2.0% and 5.8%, respectively, for the first quarter of fiscal 2010 compared to the same period of the prior year. | ||
| Same facility hospital non-cardiovascular admissions increased 17% for the first quarter of 2010 compared to the same period of the prior year. | ||
| Same facility hospital emergency department visits increased 14.7% in the first quarter of fiscal 2010 compared to the same period of the prior year. |
References in this release to same facility results exclude the impact of Hualapai Mountain
Medical Center (HMMC), our newest hospital located in Kingman, Arizona, for the first quarter of
fiscal 2010, its first quarter of operations.
First Quarter 2010 Results
MedCaths net revenue for the first quarter of fiscal 2010 decreased 2.0% to $147.3 million
from $150.2 million in the first quarter of fiscal 2009. Contributing to the revenue decline was
lower cases and net revenue related to cardiovascular services, primarily heart surgeries, offset
by revenue from MedCaths newest hospital and revenue growth in non-cardiovascular cases at several
recently expanded hospitals. During the quarter, non-cardiovascular inpatient net revenue
represented 25% of net inpatient revenue, compared to 17% in the first quarter of 2009. Loss from
continuing operations, net of taxes was $(2.5) million, or $(0.13) per diluted share compared to
$(1.9) million, or $(0.10) per diluted share, for the same period of the prior year. Adjusted
EBITDA decreased to $7.8 million for the first quarter of fiscal 2010 from $16.1 million in the
same period of the prior year.
Same Facility First Quarter 2010 Results
Same facility net revenue decreased 5.0% from $150.2 million to $142.7 million for the first
quarter of fiscal 2010 compared to the same period of the prior year. Same facility loss from
continuing operations, net of taxes was $(0.2) million, or $(0.01) per diluted share, compared to a
loss from continuing operations, net of taxes of $(1.9) million in the first quarter of fiscal
2009, or $(0.10) per diluted share. Same facility Adjusted EBITDA was
$10.1 million for the first
quarter of fiscal 2010.
The significant increase we experienced this quarter in our non-cardiovascular related net
patient revenue is indicative that expansion at several of our hospitals is providing benefit to
the communities we serve as well as to our Company, said Ed French, MedCaths President and Chief
Executive Officer. Although we are disappointed with our core cardiovascular net patient revenue
this quarter, we are encouraged by our overall increase in admissions and outpatient cases.
Adjusted EBITDA excludes share-based compensation and pre-opening expenses, but these items
are included as a component of loss from continuing operations. Share-based compensation expense
totaled $0.6 million in the first quarter of fiscal 2010, or $0.02 per diluted share, compared to
$1.0 million, or $0.03 per diluted share, in the first quarter of fiscal 2009. Pre-opening expenses
related to the development of HMMC totaled $0.9 million, or $0.02 per diluted share, in the first
quarter of fiscal 2010, compared to $0.2 million, or $0.01 per diluted share, in the first quarter
of fiscal 2009.
HMMC contributed $4.6 million to net revenue, $(3.2) million to EBITDA, which includes $0.9
million of pre-opening expenses, and $(2.3) million to loss from continuing operations, net of
taxes, or $(0.12) per diluted share.
First Quarter Operating Statistics, Cash Flow and Capital Expenditures
Same facility hospital admissions in the first quarter of fiscal 2010 were 6,938, up 2.0%
compared to the first quarter of fiscal 2009. Adjusted admissions totaled 10,043, up 1.7% compared
with the first quarter of fiscal 2009. Same facility hospital outpatient cases totaled 16,671 in
the first quarter of fiscal 2010, up 5.8% compared to the first quarter of fiscal 2009.
Total same facility uncompensated care, which includes charity care plus bad debt expense,
equaled 9.6% of same facility hospital division net patient revenue before the deduction for
charity care in the first quarter of fiscal 2010 versus 8.5% for the first quarter of fiscal 2009.
Net cash provided by operating activities of continuing operations for the first quarter of
fiscal 2010 was $3.9 million, down from $18.9 million in the first quarter of fiscal 2009. Cash
provided by operating activities for the first quarter of fiscal 2010 includes $7.3 million cash used by
HMMC, MedCaths newest hospital. Cash paid for capital expenditures during the first quarter of
fiscal 2010 totaled $9.3 million, which included $4.5 million related to maintenance expenditures
and $4.8 million related to MedCaths construction projects. As of the first quarter of fiscal
2010, MedCaths balance sheet included cash and cash equivalents of $22.8 million, total debt and
capitalized leases of $122.2 million and total assets of $558.1 million.
Use of Non-GAAP Financial Measures
Included in the press release are certain financial measures that are not generally accepted
accounting principles (non-GAAP), such as adjusted earnings before interest, taxes, depreciation,
and amortization (Adjusted EBITDA); and adjusted diluted (loss) earnings per share from
continuing operations (Adjusted EPS). Adjusted EBITDA represents MedCaths loss from continuing
operations, net of taxes before interest expense; loss on early extinguishment of debt; income tax
benefit; depreciation; amortization; share-based compensation expense; loss on disposal of
property, equipment and other assets; interest and other income; equity in net earnings of
unconsolidated affiliates; net income attributable to noncontrolling interest; and pre-opening
expense. Adjusted EPS represents MedCaths diluted loss per share from continuing operations for
the three months ended December 31, 2009 adjusted for share-based compensation expense and
pre-opening expense. MedCaths management uses Adjusted EBITDA to measure the performance of
MedCaths various operating entities, to compare actual results to historical and budgeted results,
and to make capital allocation decisions. Further, management believes that many investors in
MedCath also invest in, or have knowledge of, other healthcare companies that use Adjusted EBITDA
and Adjusted EPS as a financial performance measure.
Because Adjusted EBITDA and Adjusted EPS are non-GAAP measures, Adjusted EBITDA and Adjusted
EPS, as defined above, may not be comparable to
other similarly titled measures of other companies. MedCath has included a supplemental
schedule with the financial statements that accompanies this press
release that reconciles historical Adjusted EBITDA to MedCaths income from continuing operations
and Adjusted EPS to diluted EPS from continuing operations.
Same facility non-GAAP measures are also computed as defined above with the exception that
they exclude the impact of Hualapai Mountain Medical Center.
Management will discuss and answer questions regarding MedCaths quarterly results on
Thursday, February 4, 2010, during a 10 a.m. EST conference call. In the United States, you may
participate by dialing (877) 697-5351. International callers should dial (706) 634-0602. The
conference ID for both domestic and international callers is 52092862. A live web cast will also
be available on MedCaths web site, www.medcath.com. This information will be available on the web
site on or immediately following the conference call for 30 days. A recorded replay of the call
will be available until 11:59 p.m. EST, February 18, 2010. To access the replay, domestic callers
should dial (800) 642-1687 and international callers should dial (706) 645-9291. The archived
conference ID is 52092862. This press release and the financial information included therewith
will be accessible on the web, by going to www.medcath.com, Investor Relations, then clicking on
News.
MedCath Corporation, headquartered in Charlotte, N.C., is a healthcare provider focused on
high acuity services with the diagnosis and treatment of cardiovascular disease being a primary
service offering. MedCath owns an interest in and operates ten hospitals with a total of 825
licensed beds, located in Arizona, Arkansas, California, Louisiana, New Mexico, South Dakota, and
Texas. In addition, MedCath and its subsidiary MedCath Partners provide services in diagnostic and
therapeutic facilities in various states.
# # #
Parts of this announcement contain forward-looking statements that involve risks and
uncertainties. Although management believes that these forward-looking statements are based on
reasonable assumptions, these assumptions are inherently subject to significant economic,
regulatory and competitive uncertainties and contingencies that are difficult or impossible to
predict accurately and are beyond our control including, but not limited to, enactment of changes
in federal law that would limit physician hospital ownership. Actual results could differ
materially from those projected in these forward-looking statements. We do not assume any
obligation to update these statements in a news release or otherwise should material facts or
circumstances change in ways that would affect their accuracy. The preparation of MedCaths first
quarter operating results required management to make estimates and assumptions that affect
reported amounts of revenues and expenses. There is a reasonable possibility that actual results
may vary significantly from those estimates.
These various risks and uncertainties are described in detail in Risk Factors in MedCaths
Annual Report or Form 10-K for the year ended September 30, 2009 filed with the Securities and
Exchange Commission on December 15, 2009. Copies of our
filings with the Securities and Exchange Commission, including exhibits, are available at
http://www.sec.gov.