Attached files
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EX-99.1 - EX-99.1 - VANGUARD HEALTH SYSTEMS INC | g25814exv99w1.htm |
EX-99.2 - EX-99.2 - VANGUARD HEALTH SYSTEMS INC | g25814exv99w2.htm |
EX-99.3 - EX-99.3 - VANGUARD HEALTH SYSTEMS INC | g25814exv99w3.htm |
EX-99.4 - EX-99.4 - VANGUARD HEALTH SYSTEMS INC | g25814exv99w4.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant To Section 13 or 15(d) of The Securities Exchange Act of 1934
Pursuant To Section 13 or 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported) January 19, 2011
(January 19, 2011)
VANGUARD HEALTH SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE | 333-71934 | 62-1698183 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification Number) |
20 Burton Hills Boulevard, Suite 100, Nashville, Tennessee | 37215 | |
(Address of principal executive offices) | (Zip Code) |
Registrants Telephone Number, including area code (615) 665-6000
Not applicable
(Former name or former address, if changed since last report.)
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Table of Contents
Item 2.02
Results of Operations and Financial Condition.
The information set forth below under Item 7.01 of this Current
Report on Form 8-K is incorporated herein by reference into this Item
2.02.
Item 7.01 Regulation FD Disclosure.
Vanguard Health Systems, Inc.
(Vanguard), is disclosing under Item 7.01 of this Current Report on Form 8-K the information included as
Exhibit 99.1 and Exhibit 99.2. This information includes (1) certain unaudited pro forma
financial information of Vanguard for the twelve months ended
September 30, 2010 giving effect to the acquisitions of The Detroit
Medical Center (DMC), acquired on January 1, 2011, and Westlake Hospital and West Suburban Medical Center and related ancillary operations
(the Resurrection Facilities), acquired on August 1,
2010; (2) certain historical financial information of DMC
(collectively the Supplemental Financial Information),
both of which are provided for
informational purposes for interested investors. The Supplemental
Financial Information set forth in Exhibits 99.1 and 99.2 are attached hereto and
incorporated herein by reference.
The
Supplemental Financial Information included in Exhibits 99.1 and
99.2 contain a non-GAAP financial measure, Adjusted
EBITDA. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of an
entitys historical or future financial performance, financial position or cash flows that excludes
amounts, or is subject to adjustments that have the effect of excluding amounts, that are included
in the most directly comparable measure calculated and presented in accordance with GAAP in the
statement of operations, balance sheet or statement of cash flows of the registrant; or includes
amounts, or is subject to adjustments that have the effect of including amounts, that are excluded
from the most directly comparable measure so calculated and presented. In this regard, GAAP refers
to generally accepted accounting principles in the United States. Pursuant to the requirements of
Regulation G, Vanguard has provided a reconciliation of Adjusted EBITDA to the most directly
comparable GAAP financial measure to Adjusted EBITDA, income
(loss) attributable to stockholders, or excess of revenue over
expenses (expenses over revenues), which Vanguard deems to be
equivalent to income (loss) attributable to stockholders, in
the Supplemental Financial Information included in Exhibits 99.1
and 99.2.
Vanguard defines Adjusted EBITDA as income
(loss) attributable to stockholders before interest expense (net of interest
income), income taxes, depreciation and amortization, non-controlling interests, equity method
income, stock compensation, gain or loss on disposal of assets, monitoring and management fees and expenses,
realized and unrealized gains or losses on investments, acquisition related expenses,
debt extinguishment costs, impairment losses, pension expense,
regulatory settlement expense and discontinued operations, net of taxes.
Monitoring and management fees and include fees and reimbursed expenses paid to affiliates of The
Blackstone Group and Metalmark Subadvisor LLC for advisory and oversight services. Adjusted EBITDA
is not intended as a substitute for net income (loss) attributable to stockholders, operating cash
flows or other cash flow data determined in accordance with GAAP. Adjusted EBITDA, as
presented by Vanguard, may not be comparable to similarly titled measures of other companies due to varying methods of
calculation.
Management
believes that Adjusted EBITDA provides useful information about
Vanguards, DMCs and the Resurrection Facilities financial performance to investors, lenders, financial analysts and rating agencies since
these groups have historically used EBITDA-related measures in the healthcare industry, along with
other measures, to estimate the value of a company, to make informed investment decisions, to
evaluate a companys operating performance compared to that of other companies in the healthcare
industry and to evaluate a companys leverage capacity and its ability to meet its debt requirements. Adjusted EBITDA
eliminates the uneven effects of non-cash depreciation of tangible assets and amortization of
intangible assets, much of which results from acquisitions accounted for under the purchase method
of accounting. Adjusted EBITDA also eliminates the effects of changes in interest rates which
management believes relate to general trends in global capital markets, but are not necessarily
indicative of a companys operating performance. Adjusted EBITDA is also used by Vanguards
management to measure individual performance for incentive compensation purposes and as an
analytical indicator for purposes of allocating resources to its operating businesses and assessing
their performance, both internally and relative to Vanguards peers, as well as to evaluate the
performance of Vanguards operating management teams.
A limitation of Adjusted EBITDA, however, is that it does not reflect the periodic cost of
certain capitalized assets that an issuer uses to generate its revenues. These costs are
evaluated through other financial measures such as capital expenditures. Adjusted EBITDA also does
not include interest expense, which is a significant expense because of Vanguards substantial indebtedness. Despite
these limitations, management believes that Adjusted EBITDA, as an operating performance measure,
and not as a liquidity measure, provides investors and analysts with a useful measure of operating
results unaffected by differences in capital structures, capital investment cycles and ages of
related assets among otherwise comparable companies. Finally, management believes it is useful to
investors to provide them with disclosure of Vanguards and DMCs operating results using the same
key financial metric as that used by management.
Vanguard
has also included certain unaudited interim Consolidated Financial
Statements
of DMC, which is set forth in Exhibit 99.3, attached hereto and
incorporated herein by reference, for informational purposes for
interested investors. Vanguard has also included certain historical and pro forma Vanguard revenues by geographical market information, which is set forth in Exhibit 99.3,
attached hereto and incorporated herein by reference, for informational purposes for interested investors.
Section 9
Financial Statements and Exhibits
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits. | The exhibits filed as part of this Current Report on Form 8-K are listed in the Exhibit Index which is located at the end of this Current Report on Form 8-K. |
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has
duly authorized this report to be signed on its behalf by the undersigned thereunto duly
authorized.
VANGUARD HEALTH SYSTEMS, INC. |
||||
BY: | /s/ Gary D. Willis | |||
Gary D. Willis | ||||
Senior Vice President, Controller and Chief Accounting Officer | ||||
Date:
January 19, 2011
Table of Contents
EXHIBIT INDEX
Exhibit | |||
Number | Description | ||
99.1 | Supplemental Financial Information - Reconciliation of
Adjusted EBITDA to Net Income (Loss) Attributable to Stockholders for Vanguard Health Systems, Inc. on a Pro Forma Basis.
|
||
99.2 | Supplemental
Financial Information - Reconciliation of Adjusted EBITDA of Excess
of Revenue over Expenses for The Detroit Medical Center.
|
||
99.3 | Unaudited Interim Consolidated Financial Statements of The Detroit Medical Center
and Subsidiaries as of September 30, 2010 and for the three months and nine months ended September 30, 2010 and 2009.
|
||
99.4 | Historical
and Pro Forma Vanguard Revenues By Geographic Market.
|