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| 8-K - IASIS HEALTHCARE LLC 8-K - IASIS Healthcare LLC | a50556837.htm |
Exhibit 99.1
IASIS Healthcare Announces First Quarter 2013 Results
FRANKLIN, Tenn.--(BUSINESS WIRE)--February 7, 2013--IASIS Healthcare® LLC (“IASIS”) today announced financial and operating results for the fiscal first quarter ended December 31, 2012.
Net revenue for the first quarter totaled $641.3 million, an increase of 2.8% compared to $623.7 million in the prior year quarter. Adjusted EBITDA for the first quarter totaled $69.4 million, compared to $72.2 million in the prior year quarter. Included in adjusted EBITDA for the first quarter were EHR incentives of $5.5 million, compared to $6.7 million in the prior year quarter, and $1.5 million of start-up related costs associated with our new campus of St. Joseph Medical Center located in the Heights community of Houston. Net earnings from continuing operations for the first quarter totaled $3.7 million, compared to $3.6 million in the prior year quarter.
In the first quarter, admissions decreased 0.4% and adjusted admissions increased 3.1%, while net patient revenue per adjusted admission increased 2.4%, each compared to the prior year quarter.
A listen-only simulcast and 30-day replay of IASIS’ first quarter 2013 conference call will be available by clicking the “For Investors” link on the Company’s Web site at www.iasishealthcare.com beginning at 11:00 a.m. Eastern Time on February 7, 2013. A copy of this press release will also be available on the Company’s Web site.
IASIS Healthcare, located in Franklin, Tennessee, is a leading provider of high quality, affordable healthcare services in urban and suburban markets. With total annual net revenue of approximately $2.6 billion, IASIS owns and operates 19 acute care hospitals, one behavioral health hospital, several outpatient service facilities, more than 160 physician clinics, and Medicaid and Medicare managed health plans in Arizona and Utah that serve more than 174,000 members. IASIS’ healthcare facilities offer a variety of access points for convenient patient care in numerous regions across the U.S., including: Salt Lake City, Utah; Phoenix, Arizona; Tampa-St. Petersburg, Florida; five cities in Texas, including Houston and San Antonio; Las Vegas, Nevada; and West Monroe, Louisiana. For more information on IASIS, please visit the Company’s Web site at www.iasishealthcare.com.
Some of the statements we make in this press release are forward-looking within the meaning of the federal securities laws, which are intended to be covered by the safe harbors created thereby. Those forward-looking statements include all statements that are not historical statements of fact and those regarding our intent, belief or expectations including, but not limited to, future financial and operating results, the Company’s plans, objectives, expectations and other statements that are not historical facts. Forward-looking statements involve known and unknown risks and uncertainties that may cause actual results in future periods to differ materially from those anticipated in the forward-looking statements. These risk factors and uncertainties are more fully described in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2012, and other filings with the Securities and Exchange Commission.
Although we believe that the assumptions underlying the forward-looking statements contained in this press release are reasonable, any of these assumptions could prove to be inaccurate, and, therefore, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, you should not regard the inclusion of such information as a representation by the Company or any other person that our objectives and plans will be achieved. We undertake no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.
Adjusted EBITDA represents net earnings from continuing operations before interest expense, income tax expense, depreciation and amortization, stock-based compensation, gain on disposal of assets and management fees. Management fees represent monitoring and advisory fees paid to TPG, the Company’s majority financial sponsor, and certain other members of IASIS Investment LLC. Management routinely calculates and communicates adjusted EBITDA and believes that it is useful to investors because it is commonly used as an analytical indicator within the healthcare industry to evaluate hospital performance, allocate resources and measure leverage capacity and debt service ability. In addition, the Company uses adjusted EBITDA as a measure of performance for its business segments and for incentive compensation purposes. Adjusted EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, 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 earnings, 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. Adjusted EBITDA, as presented, differs from what is defined under the Company’s senior secured credit facilities and may not be comparable to similarly titled measures of other companies. A table describing adjusted EBITDA and reconciling net earnings from continuing operations to adjusted EBITDA is included in this press release in the attached Supplemental Consolidated Statements of Operations Information.
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IASIS HEALTHCARE LLC Consolidated Statements of Operations (Unaudited) (in thousands) |
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Quarter Ended
December 31, |
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| 2012 | 2011 | |||||||||
| Net revenue | ||||||||||
| Acute care revenue before provision for bad debts | $ | 597,101 | $ | 543,214 | ||||||
| Less: Provision for bad debts | (94,656 | ) | (70,279 | ) | ||||||
| Acute care revenue | 502,445 | 472,935 | ||||||||
| Premium revenue | 138,854 | 150,738 | ||||||||
| Net revenue | 641,299 | 623,673 | ||||||||
| Costs and expenses | ||||||||||
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Salaries and benefits (includes stock-based compensation of $1,137 and $500, respectively) |
246,288 | 223,964 | ||||||||
| Supplies | 89,899 | 84,170 | ||||||||
| Medical claims | 113,343 | 124,245 | ||||||||
| Rentals and leases | 13,965 | 12,266 | ||||||||
| Other operating expenses | 115,093 | 113,983 | ||||||||
| Medicare and Medicaid EHR incentives | (5,536 | ) | (6,677 | ) | ||||||
| Interest expense, net | 33,845 | 34,940 | ||||||||
| Depreciation and amortization | 26,852 | 28,534 | ||||||||
| Management fees | 1,250 | 1,250 | ||||||||
| Total costs and expenses | 634,999 | 616,675 | ||||||||
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Earnings from continuing operations before gain on disposal of assets and income taxes |
6,300 | 6,998 | ||||||||
| Gain on disposal of assets, net | 88 | 240 | ||||||||
| Earnings from continuing operations before income taxes | 6,388 | 7,238 | ||||||||
| Income tax expense | 2,735 | 3,605 | ||||||||
| Net earnings from continuing operations | 3,653 | 3,633 | ||||||||
| Earnings (loss) from discontinued operations, net of income taxes | 415 | (48 | ) | |||||||
| Net earnings | 4,068 | 3,585 | ||||||||
| Net earnings attributable to non-controlling interests | (1,599 | ) | (2,232 | ) | ||||||
| Net earnings attributable to IASIS Healthcare LLC | $ | 2,469 | $ | 1,353 | ||||||
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IASIS HEALTHCARE LLC Consolidated Balance Sheets (Unaudited) (in thousands) |
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Dec. 31,
2012 |
Sept. 30,
2012 |
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| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 10,013 | $ | 48,882 | ||||
| Accounts receivable, net | 364,793 | 339,749 | ||||||
| Inventories | 63,722 | 67,650 | ||||||
| Deferred income taxes | 20,697 | 19,744 | ||||||
| Prepaid expenses and other current assets | 94,758 | 117,851 | ||||||
| Total current assets | 553,983 | 593,876 | ||||||
| Property and equipment, net | 1,176,479 | 1,171,657 | ||||||
| Goodwill | 818,475 | 818,424 | ||||||
| Other intangible assets, net | 28,341 | 29,161 | ||||||
| Other assets, net | 68,656 | 68,498 | ||||||
| Total assets | $ | 2,645,934 | $ | 2,681,616 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 112,193 | $ | 101,706 | ||||
| Salaries and benefits payable | 48,583 | 65,390 | ||||||
| Accrued interest payable | 10,087 | 28,034 | ||||||
| Medical claims payable | 56,599 | 61,142 | ||||||
| Other accrued expenses and other current liabilities | 79,619 | 83,243 | ||||||
| Current portion of long-term debt and capital lease obligations | 13,015 | 13,387 | ||||||
| Total current liabilities | 320,096 | 352,902 | ||||||
| Long-term debt and capital lease obligations | 1,850,208 | 1,853,107 | ||||||
| Deferred income taxes | 126,123 | 120,961 | ||||||
| Other long-term liabilities | 97,196 | 104,110 | ||||||
| Non-controlling interests with redemption rights | 99,667 | 99,164 | ||||||
| Equity | ||||||||
| Member’s equity | 142,837 | 141,589 | ||||||
| Non-controlling interests | 9,807 | 9,783 | ||||||
| Total equity | 152,644 | 151,372 | ||||||
| Total liabilities and equity | $ | 2,645,934 | $ | 2,681,616 | ||||
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IASIS HEALTHCARE LLC Consolidated Statements of Cash Flows (Unaudited) (in thousands) |
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Quarter Ended
December 31, |
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| 2012 | 2011 | |||||||||
| Cash flows from operating activities | ||||||||||
| Net earnings | $ | 4,068 | $ | 3,585 | ||||||
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Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: |
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| Depreciation and amortization | 26,852 | 28,534 | ||||||||
| Amortization of loan costs | 1,828 | 1,902 | ||||||||
| Stock-based compensation | 1,137 | 500 | ||||||||
| Deferred income taxes | 1,964 | 3,067 | ||||||||
| Income tax benefit from stock-based compensation | 16 | 6 | ||||||||
| Fair value change in interest rate hedges | – | (845 | ) | |||||||
| Amortization of other comprehensive loss | – | 1,234 | ||||||||
| Gain on disposal of assets, net | (88 | ) | (240 | ) | ||||||
| Loss (earnings) from discontinued operations, net | (415 | ) | 48 | |||||||
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Changes in operating assets and liabilities, net of the effect of acquisitions and dispositions: |
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| Accounts receivable, net | (25,043 | ) | (26,860 | ) | ||||||
| Inventories, prepaid expenses and other current assets | 27,196 | (2,839 | ) | |||||||
| Accounts payable, other accrued expenses and other accrued liabilities | (37,349 | ) | (40,766 | ) | ||||||
| Net cash provided by (used in) operating activities – continuing operations | 166 | (32,674 | ) | |||||||
| Net cash provided by (used in) operating activities – discontinued operations | 435 | (27 | ) | |||||||
| Net cash provided by (used in) operating activities | 601 | (32,701 | ) | |||||||
| Cash flows from investing activities | ||||||||||
| Purchases of property and equipment, net | (30,974 | ) | (24,357 | ) | ||||||
| Cash paid for acquisitions, net | (1,088 | ) | 602 | |||||||
| Proceeds from sale of assets | 12 | – | ||||||||
| Change in other assets, net | (1,313 | ) | 1,171 | |||||||
| Net cash used in investing activities | (33,363 | ) | (22,584 | ) | ||||||
| Cash flows from financing activities | ||||||||||
| Payment of debt and capital lease obligations | (3,647 | ) | (3,745 | ) | ||||||
| Debt financing costs incurred | – | (998 | ) | |||||||
| Distributions to non-controlling interests | (2,963 | ) | (3,303 | ) | ||||||
| Cash received for the sale of non-controlling interests | 700 | – | ||||||||
| Cash paid for the repurchase of non-controlling interests | (197 | ) | – | |||||||
| Net cash used in financing activities | (6,107 | ) | (8,046 | ) | ||||||
| Change in cash and cash equivalents | (38,869 | ) | (63,331 | ) | ||||||
| Cash and cash equivalents at beginning of period | 48,882 | 147,327 | ||||||||
| Cash and cash equivalents at end of period | $ | 10,013 | $ | 83,996 | ||||||
| Supplemental disclosure of cash flow information | ||||||||||
| Cash paid for interest | $ | 49,966 | $ | 53,182 | ||||||
| Cash paid for income taxes, net | $ | 5 | $ | 13 | ||||||
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IASIS HEALTHCARE LLC Segment Information (Unaudited) (in thousands) |
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| For the Quarter Ended December 31, 2012 | |||||||||||||||||||
| Acute Care | Health Choice | Eliminations | Consolidated | ||||||||||||||||
|
Acute care revenue before provision for bad debts |
$ | 597,101 | $ | – | $ | – | $ | 597,101 | |||||||||||
| Less: Provision for bad debts | (94,656 | ) | – | – | (94,656 | ) | |||||||||||||
| Acute care revenue | 502,445 | – | – | 502,445 | |||||||||||||||
| Premium revenue | – | 138,854 | – | 138,854 | |||||||||||||||
| Revenue between segments | 1,567 | – | (1,567 | ) | – | ||||||||||||||
| Net revenue | 504,012 | 138,854 | (1,567 | ) | 641,299 | ||||||||||||||
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Salaries and benefits (excludes stock-based compensation) |
239,385 | 5,766 | – | 245,151 | |||||||||||||||
| Supplies | 89,845 | 54 | – | 89,899 | |||||||||||||||
| Medical claims | – | 114,910 | (1,567 | ) | 113,343 | ||||||||||||||
| Rentals and leases | 13,572 | 393 | – | 13,965 | |||||||||||||||
| Other operating expenses | 109,336 | 5,757 | – | 115,093 | |||||||||||||||
| Medicare and Medicaid EHR incentives | (5,536 | ) | – | – | (5,536 | ) | |||||||||||||
| Adjusted EBITDA | 57,410 | 11,974 | – | 69,384 | |||||||||||||||
| Interest expense, net | 33,845 | – | – | 33,845 | |||||||||||||||
| Depreciation and amortization | 25,817 | 1,035 | – | 26,852 | |||||||||||||||
| Stock-based compensation | 1,137 | – | – | 1,137 | |||||||||||||||
| Management fees | 1,250 | – | – | 1,250 | |||||||||||||||
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Earnings (loss) from continuing operations before gain on disposal of assets and income taxes |
(4,639 | ) | 10,939 | – | 6,300 | ||||||||||||||
| Gain on disposal of assets, net | 88 | – | – | 88 | |||||||||||||||
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Earnings (loss) from continuing operations before income taxes |
$ | (4,551 | ) | $ | 10,939 | $ | – | $ | 6,388 | ||||||||||
| For the Quarter Ended December 31, 2011 | |||||||||||||||||||
| Acute Care | Health Choice | Eliminations | Consolidated | ||||||||||||||||
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Acute care revenue before provision for bad debts |
$ | 543,214 | $ | – | $ | – | $ | 543,214 | |||||||||||
| Less: Provision for bad debts | (70,279 | ) | – | – | (70,279 | ) | |||||||||||||
| Acute care revenue | 472,935 | – | – | 472,935 | |||||||||||||||
| Premium revenue | – | 150,738 | – | 150,738 | |||||||||||||||
| Revenue between segments | 1,629 | – | (1,629 | ) | – | ||||||||||||||
| Net revenue | 474,564 | 150,738 | (1,629 | ) | 623,673 | ||||||||||||||
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Salaries and benefits (excludes stock-based compensation) |
218,337 | 5,127 | – | 223,464 | |||||||||||||||
| Supplies | 84,119 | 51 | – | 84,170 | |||||||||||||||
| Medical claims | – | 125,874 | (1,629 | ) | 124,245 | ||||||||||||||
| Rentals and leases | 11,886 | 380 | – | 12,266 | |||||||||||||||
| Other operating expenses | 108,297 | 5,686 | – | 113,983 | |||||||||||||||
| Medicare and Medicaid EHR incentives | (6,677 | ) | – | – | (6,677 | ) | |||||||||||||
| Adjusted EBITDA | 58,602 | 13,620 | – | 72,222 | |||||||||||||||
| Interest expense, net | 34,940 | – | – | 34,940 | |||||||||||||||
| Depreciation and amortization | 27,656 | 878 | – | 28,534 | |||||||||||||||
| Stock-based compensation | 500 | – | – | 500 | |||||||||||||||
| Management fees | 1,250 | – | – | 1,250 | |||||||||||||||
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Earnings (loss) from continuing operations before gain on disposal of assets and income taxes |
(5,744 | ) | 12,742 | – | 6,998 | ||||||||||||||
| Gain on disposal of assets, net | 240 | – | – | 240 | |||||||||||||||
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Earnings (loss) from continuing operations before income taxes |
$ | (5,504 | ) | $ | 12,742 | $ | – | $ | 7,238 | ||||||||||
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IASIS HEALTHCARE LLC Consolidated Financial and Operating Data (Unaudited) |
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Quarter Ended
December 31, |
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| 2012 | 2011 | |||||||
| Consolidated Hospital Facilities | ||||||||
| Number of acute care hospital facilities at end of period | 19 | 18 | ||||||
| Licensed beds at end of period | 4,485 | 4,365 | ||||||
| Average length of stay (days) | 5.0 | 4.9 | ||||||
| Occupancy rates (average beds in service) | 48.4 | % | 48.9 | % | ||||
| Admissions | 31,512 | 31,634 | ||||||
| Percentage change | (0.4 | %) | ||||||
| Adjusted admissions | 54,975 | 53,315 | ||||||
| Percentage change | 3.1 | % | ||||||
| Patient days | 158,136 | 154,810 | ||||||
| Adjusted patient days | 275,882 | 252,163 | ||||||
| Outpatient revenue as a percentage of gross patient revenue | 42.7 | % | 40.7 | % | ||||
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IASIS HEALTHCARE LLC Supplemental Consolidated Statements of Operations Information (Unaudited) (in thousands) |
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Quarter Ended
December 31, |
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| 2012 | 2011 | |||||||||
| Consolidated Results | ||||||||||
| Net earnings from continuing operations | $ | 3,653 | $ | 3,633 | ||||||
| Add: | ||||||||||
| Interest expense, net | 33,845 | 34,940 | ||||||||
| Income tax expense | 2,735 | 3,605 | ||||||||
| Depreciation and amortization | 26,852 | 28,534 | ||||||||
| Stock-based compensation | 1,137 | 500 | ||||||||
| Gain on disposal of assets, net | (88 | ) | (240 | ) | ||||||
| Management fees | 1,250 | 1,250 | ||||||||
| Adjusted EBITDA | $ | 69,384 | $ | 72,222 | ||||||
CONTACT:
IASIS Healthcare LLC
Investor Contact:
W.
Carl Whitmer
President and Chief Executive Officer
or
John M.
Doyle
Chief Financial Officer
615-844-2747
or
Media
Contact:
Michele M. Simpson, 615-467-1255
VP, Corporate
Communications