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8-K - 8-K - 21st Century Oncology Holdings, Inc.a15-23112_18k.htm

Exhibit 99.1

 

 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

 

21st Century Oncology Contact:

 

Investor Contact:

LeAnne M. Stewart

 

The Ruth Group

Chief Financial Officer

 

Nick Laudico

239-931-7281

 

646-536-7030

leanne.stewart@21co.com

 

nlaudico@theruthgroup.com

 

 

 

 

 

Brandon Vazquez

 

 

646-536-7032

 

 

bvazquez@theruthgroup.com

 

21ST CENTURY ONCOLOGY HOLDINGS INC. REPORTS PRELIMINARY THIRD QUARTER 2015 FINANCIAL RESULTS

 

FORT MYERS, FL, November 16, 2015 — 21st Century Oncology Holdings, Inc. (“21C or the “Company”), the leading global, physician-led provider of integrated cancer care (“ICC”) services, announced today its financial results for the third quarter ended September 30, 2015.

 

Dr. Daniel Dosoretz, Founder, President and Chief Executive Officer, commented, “Although the financial results for the third quarter were disappointing, we are pleased with our continued organic performance and cash flow generation ability. In June 2015, ASTRO published coding guidance on its website advising providers to discontinue reporting the treatment simulation code when IMRT treatment planning is ordered.  We subsequently amended our coding policy to align with this guidance on July 1, which resulted in a net reimbursement decline. Additionally, during the quarter changes in treatment modality became more prevalent. The change resulted in a fewer number of treatments delivered due to improved technology that has allowed our physicians to treat certain tumors utilizing a more-intensive radiation dose, but with a fewer number of fractions. As the largest global provider of radiation therapy delivery we are at the forefront of implementing the latest advances in clinical radiation practices throughout our network.”

 

Dr. Dosoretz continued, “Our fourth quarter cases per day, which of course means an increase in new patients, are trending above third quarter levels, causing me to be optimistic in regards to our 4th quarter performance and for 2016. Our integration of SFRO is on schedule, and we expect to realize significant synergies from fully combining this operation with the existing 21C operations in 2016. Our recent acquisitions, joint ventures and international operations continue to perform well and have outstanding long-term prospects. We remain focused on providing the necessary technology, clinical best practices, and high quality operating support to our physician network, so as to provide them with the tools and resources to achieve superior outcomes.”

 



 

Third Quarter 2015 Results

 

Total pro forma revenues for the third quarter of 2015 were $258.2 million, up slightly compared to total pro-forma revenues of $257.6 million in the same quarter of 2014. Revenue growth from acquired and new operations as well as our international business was offset by approximately $2.3 million from simulation code bundling, approximately $3.3 million from a change in treatment modality, which resulted in fewer treatments per radiation oncology case, and $5.4 million of revenue adjustments at Medical Developers resulting from a correction in our revenue recognition process.

 

While total radiation oncology cases completed during the quarter increased 1.6%, revenue per radiation oncology case declined 3.8% due to modality shifts, particularly in breast and lung cases, along with the simulation code for IMRT cases now being combined with the planning code.

 

Pro Forma Adjusted EBITDA in the third quarter of 2015 was $27.2 million, or 10.5% of total pro forma revenues, as compared to $39.7 million, or 15.4% of total pro forma revenues, in the third quarter of 2014. The primary contributors to the EBITDA decline were the aforementioned $11.0 million of items affecting revenue combined with $4.2 million of additional compensation and benefits expenses and $1.1 million of minority interest distributions, partially offset by $2.5 million from acquisitions and $2.7 million resulting primarily from the ongoing implementation of our savings and synergies initiatives.

 

Total pro forma revenues for the nine months ended September 30, 2015 were $822.9 million, up 7.5% compared to total pro forma revenues of $765.7 million for the first nine months of 2014. Same store total radiation cases completed during the first nine months increased 6.6%, but same store revenues per completed radiation case declined 6.0% due to the impact of modality and the simulation code change. Pro Forma Adjusted EBITDA was $124.3 million for the nine months ended September 30, 2015, up 6.9% compared to $116.3 million for the first nine months ended September 30, 2014.  Pro-forma EBITDA margin was essentially flat for the two nine month periods.

 

Recent Developments

 

As previously announced, on July 2, 2015 we purchased the remaining 35% of SFRO for $44.1 million. Consideration for the purchase was comprised of $15.0 million in cash, $14.6 million in a seller financing note, and $14.5 million in 21st Century Oncology Investments LLC preferred stock.  The integration of SFRO continued during the quarter and is expected to be completed by March 31, 2016.

 

On August 1, 2015, 21C purchased a controlling stake in a joint venture with a leading oncology group.  This purchase resulted in the two entities having a controlling interest in the hospital based radiation center located at the Hospital Manuel Uribe Angel de Envigado in Medellin, Colombia.

 

On Friday October 30, 2015, CMS released the 2016 Physician Fee Schedule Final Rule, which includes an approximate 2% reduction to overall radiation oncology and an approximate 2.7% reduction to overall freestanding center reimbursement. Based on the Company’s preliminary

 



 

review of the Final Rule and its impact on its treatment and reimbursement code mix, the Company estimates the final rule will negatively impact its full year 2016 EBITDA by approximately $7-$9 million, down from an estimated $17-$20 million after the release of the 2016 Physician Fee Schedule Preliminary Rule. We have a dynamic and flexible infrastructure and remain the global leader in clinical quality and cost effectiveness, with an ICC model that has proven its ability to deliver same store volumes and incremental market share gains. Given these unique attributes, we remain the best-positioned provider to thrive in a wide range of different reimbursement scenarios.

 

Earnings Release Special Note:

 

During the quarter the Company changed its independent registered public accounting firm.  The Company continues to work with its independent accountants in finalizing their review of the Company’s financial statements for filing with the SEC on Form 10-Q for the quarter ended September 30, 2015. While adjustments may be made to these preliminary financial statements, the Company does not believe that the completion of this process will result in a material change to the preliminary Pro-Forma Adjusted EBITDA calculation nor the preliminary condensed consolidated statements of operations, comprehensive loss and cash flows results presented herein.

 

Conference Call

 

The Company will host a conference call on Monday, November 16, 2015 at 2:00 p.m. Eastern Time, during which management will discuss its financial results in further detail. The dial-in numbers are (877) 407-9039 for domestic callers and (201) 689-8470 for international callers.  In addition, a telephonic replay of the call will be available until November 30, 2015.  The replay dial-in numbers are (877) 870-5176 for domestic callers and (858) 384-5517 for international callers.  Please use the conference ID number 13622067 to access the replay.

 

A live webcast and webcast replay of the call will also be available from the Events section on the corporate web site at www.21co.com.

 

About 21st Century Oncology Holdings, Inc.

 

21st Century Oncology Holdings, Inc. is the largest global, physician led provider of integrated cancer care services. The Company offers a comprehensive range of cancer treatment services, focused on delivering academic quality, cost-effective patient care in personal and convenient settings. As of September 30, 2015, the Company operated 182 treatment centers, including 146 centers located in 17 U.S. states and 36 centers located in seven countries in Latin America.

 

Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended.  Statements preceded by, followed by or that otherwise include the words “believes”, “expects”, “anticipates”, “intends”, “projects”, “estimates”, “plans”, “may increase”, “forecast” and similar expressions or future or conditional verbs such as “will”, “should”, “would”, “may” and “could” are generally forward-looking in nature and not historical facts. Forward-looking

 



 

statements are based on management’s current expectations or beliefs about the Company’s future plans, expectations and objectives, including, but not limited to, the Company’s expected financial results and estimates for 2015 and the effects of the CMS’s Final Rule for the 2016 Physician Fee Schedule on its results.  These forward-looking statements are not historical facts and are subject to risks and uncertainties that could cause the actual results to differ materially from those projected in these forward-looking statements including, but not limited to reductions in Medicare reimbursement, healthcare reform, state and federal investigations, claims and litigation matters, decreases in payments by managed care organizations and other commercial payers and other risk factors that may be described from time to time in the Company’s filings with the Securities and Exchange Commission.  Readers of this release are cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date stated, or if no date is stated, as of the date of this press release. The Company undertakes no obligation to publicly update or revise the forward-looking statements contained herein to reflect changed events or circumstances after the date of this release, unless required by law.

 



 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

(unaudited)

 

 

 

PRELIMINARY

 

 

 

September 30,

 

December 31,

 

 

 

2015

 

2014

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

47,793

 

$

99,167

 

Restricted cash

 

80

 

7,051

 

Marketable securities

 

622

 

 

Accounts receivable, net

 

149,224

 

137,807

 

Prepaid expenses

 

9,381

 

8,728

 

Inventories

 

5,162

 

4,526

 

Deferred income taxes

 

191

 

227

 

Other

 

8,056

 

7,457

 

Total current assets

 

220,509

 

264,963

 

 

 

 

 

 

 

Equity investments in joint ventures

 

1,236

 

1,646

 

Property and equipment, net

 

249,392

 

270,757

 

Real estate subject to finance obligation

 

11,625

 

22,552

 

Goodwill

 

492,084

 

469,596

 

Intangible assets, net

 

74,434

 

81,680

 

Other assets

 

49,282

 

35,530

 

Total assets

 

$

1,098,562

 

$

1,146,724

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

59,397

 

$

57,635

 

Accrued expenses

 

111,084

 

82,609

 

Income taxes payable

 

1,814

 

2,114

 

Current portion of long-term debt

 

30,858

 

26,350

 

Current portion of finance obligation

 

481

 

433

 

Other current liabilities

 

6,484

 

19,687

 

Total current liabilities

 

210,118

 

188,828

 

Long-term debt, less current portion

 

1,009,196

 

940,771

 

Finance obligation, less current portion

 

12,057

 

23,610

 

Embedded derivative features of Series A convertible redeemable preferred stock

 

23,541

 

15,843

 

Other long-term liabilities

 

39,861

 

51,079

 

Deferred income taxes

 

3,716

 

4,480

 

Total liabilities

 

1,298,489

 

1,224,611

 

 

 

 

 

 

 

Series A convertible redeemable preferred stock, $0.001 par value, $1,000 stated value, 3,500,000 authorized, 385,000 issued and outstanding at September 30, 2015 and December 31, 2014

 

404,179

 

328,926

 

Noncontrolling interests - redeemable

 

19,934

 

49,797

 

 

 

 

 

 

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

Common stock, $0.01 par value, 1,000,000 shares authorized 1,059 and 1,028 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively

 

 

 

Additional paid-in capital

 

569,036

 

626,001

 

Retained deficit

 

(1,174,400

)

(1,067,487

)

Accumulated other comprehensive loss, net of tax

 

(45,008

)

(38,690

)

Total 21st Century Oncology Holdings, Inc. shareholder’s deficit

 

(650,372

)

(480,176

)

Noncontrolling interests - nonredeemable

 

26,332

 

23,566

 

Total deficit

 

(624,040

)

(456,610

)

Total liabilities and equity

 

$

1,098,562

 

$

1,146,724

 

 



 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands)

(unaudited)

 

 

 

PRELIMINARY

 

PRELIMINARY

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

Revenues:

 

 

 

 

 

 

 

 

 

Net patient service revenue

 

$

239,606

 

$

238,403

 

$

759,743

 

$

698,261

 

Management fees

 

14,180

 

16,762

 

45,261

 

50,215

 

Other revenue

 

4,199

 

2,453

 

16,673

 

8,437

 

Total revenues

 

257,985

 

257,618

 

821,677

 

756,913

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

142,640

 

134,599

 

436,996

 

396,311

 

Medical supplies

 

22,498

 

24,771

 

73,563

 

71,007

 

Facility rent expenses

 

16,821

 

14,867

 

50,618

 

47,529

 

Other operating expenses

 

16,049

 

15,558

 

47,046

 

46,035

 

General and administrative expenses

 

39,259

 

37,811

 

111,945

 

101,985

 

Depreciation and amortization

 

22,479

 

22,388

 

67,290

 

65,272

 

Provision for doubtful accounts

 

5,651

 

5,621

 

13,872

 

13,345

 

Interest expense, net

 

23,724

 

30,233

 

73,737

 

87,659

 

Impairment loss

 

 

47,526

 

 

229,526

 

Early extinguishment of debt

 

 

 

8,558

 

37,390

 

8,558

 

Other income and expenses

 

(7,613

)

1,161

 

2,362

 

5,965

 

Total expenses

 

281,508

 

343,093

 

914,819

 

1,073,192

 

 

 

 

 

 

 

 

 

 

 

Loss before income taxes

 

(23,523

)

(85,475

)

(93,142

)

(316,279

)

Income tax expense

 

1,152

 

1,173

 

6,930

 

4,213

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

(24,675

)

(86,648

)

(100,072

)

(320,492

)

 

 

 

 

 

 

 

 

 

 

Net income attributable to noncontrolling interests- redeemable and non-redeemable

 

(2,458

)

(729

)

(6,841

)

(4,590

)

 

 

 

 

 

 

 

 

 

 

Net loss attributable to 21st Century Oncology Holdings, Inc. shareholder

 

(27,133

)

(87,377

)

(106,913

)

(325,082

)

 

 

 

 

 

 

 

 

 

 

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

Unrealized loss on foreign currency translation

 

(2,688

)

(1,990

)

(7,185

)

(12,596

)

 

 

 

 

 

 

 

 

 

 

Comprehensive loss

 

(27,363

)

(88,638

)

(107,257

)

(333,088

)

Comprehensive income attributable to noncontrolling interests- redeemable and non-redeemable

 

(2,043

)

(512

)

(5,974

)

(3,502

)

Comprehensive loss attributable to 21st Century Oncology Holdings, Inc. shareholder

 

$

(29,406

)

$

(89,150

)

$

(113,231

)

$

(336,590

)

 



 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

 

PRELIMINARY

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2015

 

2014

 

Cash flows from operating activities

 

 

 

 

 

Net loss

 

$

(100,072

)

$

(320,492

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

67,290

 

65,272

 

Provision for doubtful accounts

 

13,872

 

13,345

 

Impairment loss

 

 

229,526

 

Early extinguishment of debt

 

37,390

 

8,558

 

Fair value adjustment of embedded derivatives

 

8,128

 

 

Amortization of debt discount

 

1,228

 

2,035

 

Amortization of loan costs

 

3,675

 

4,821

 

Paid in kind interest on notes payable

 

370

 

 

Equity interest in net (earnings) loss of joint ventures

 

(202

)

161

 

Distribution received from unconsolidated joint ventures

 

106

 

168

 

Other

 

(979

)

7,223

 

Changes in operating assets and liabilities:

 

 

 

 

 

Accounts receivable and other current assets

 

(33,058

)

(31,317

)

Income taxes payable

 

(109

)

(933

)

Inventories

 

(624

)

(195

)

Prepaid expenses

 

2,192

 

2,747

 

Accounts payable

 

3,921

 

12,320

 

Accrued deferred compensation

 

1,057

 

1,059

 

Accrued expenses / other liabilities

 

29,157

 

17,392

 

 

 

 

 

 

 

Net cash provided by operating activities

 

33,342

 

11,690

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Purchase of property and equipment

 

(33,595

)

(44,269

)

Acquisition of medical practices

 

(33,064

)

(50,121

)

Restricted cash associated with medical practice acquisitions

 

6,970

 

(3,471

)

Proceeds from the sale of property and equipment

 

1,143

 

91

 

Purchase of marketable securities

 

(4,633

)

 

Sale of marketable securities

 

4,013

 

 

Repayments from (loans to) employees

 

353

 

(871

)

Contribution of capital to joint venture entities

 

 

(620

)

Distribution received from joint venture entities

 

496

 

 

Proceeds from foreign currency derivative contracts

 

 

26

 

Premiums on life insurance policies

 

(1,015

)

(851

)

Change in other assets and other liabilities

 

45

 

(256

)

 

 

 

 

 

 

Net cash used in investing activities

 

(59,287

)

(100,342

)

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

Proceeds from issuance of debt

 

972,851

 

164,556

 

Principal repayments of debt

 

(921,871

)

(250,208

)

Repayments of finance obligation

 

(168

)

(167

)

Proceeds from issuance of Series A convertible redeemable preferred stock

 

 

325,000

 

Proceeds from issuance of noncontrolling interest

 

743

 

1,250

 

Proceeds from noncontrolling interest holders - redeemable and non-redeemable

 

3,230

 

229

 

Purchase of noncontrolling interest - non-redeemable

 

(16,233

)

 

Cash distributions to noncontrolling interest holders - redeemable and non-redeemable

 

(4,072

)

(2,050

)

Payments for contingent considerations

 

(8,537

)

 

Payments of costs for equity securities offering

 

 

(4,220

)

Payment of call premium on long-term debt

 

(24,877

)

 

Payments of loan costs

 

(26,481

)

(2,437

)

 

 

 

 

 

 

Net cash (used in) provided by financing activities

 

(25,415

)

231,953

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(14

)

(42

)

 

 

 

 

 

 

Net (decrease) increase in cash and cash equivalents

 

(51,374

)

143,259

 

Cash and cash equivalents, beginning of period

 

99,167

 

17,462

 

 

 

 

 

 

 

Cash and cash equivalents, end of period

 

$

47,793

 

$

160,721

 

 



 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

Supplemental Financial Information (Unaudited)

Reconciliation of Total Pro-forma Revenue and Pro-forma Adjusted EBITDA to Net Loss Attributable

to 21st Century Oncology Holdings, Inc. Shareholder

 

 

 

PRELIMINARY

 

PRELIMINARY

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

(in thousands):

 

2015

 

2014

 

2015

 

2014

 

Total revenues

 

$

257,985

 

$

257,618

 

$

821,677

 

$

756,913

 

Pro-forma full period effect of acquisitions (a)

 

169

 

 

1,183

 

8,819

 

Total pro-forma revenues

 

$

258,154

 

$

257,618

 

$

822,860

 

$

765,732

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to 21st Century Oncology Holdings, Inc. shareholder

 

$

(27,133

)

$

(87,377

)

$

(106,913

)

$

(325,082

)

Income tax expense

 

1,152

 

1,173

 

6,930

 

4,213

 

Interest expense, net

 

23,724

 

30,233

 

73,737

 

87,659

 

Depreciation and amortization

 

22,479

 

22,388

 

67,290

 

65,272

 

Impairment loss

 

 

47,526

 

 

229,526

 

Early extinguishment of debt

 

 

8,558

 

37,390

 

8,558

 

Net income attributable to noncontrolling interests, net of cash distributions

 

408

 

(365

)

2,769

 

2,540

 

Other expenses (b)

 

2,200

 

4,090

 

6,204

 

11,290

 

Non-cash expenses (c)

 

782

 

1,120

 

3,090

 

3,090

 

Other non-cash income / expense items (d)

 

(7,946

)

620

 

1,054

 

4,685

 

Acquisition-related costs (e)

 

1,128

 

1,371

 

3,507

 

9,955

 

Litigation matters (f)

 

10,279

 

1,097

 

28,798

 

4,423

 

Expenses associated with note-holder negotiations and management of liquidity (g)

 

 

9,258

 

 

9,378

 

Pro-Forma full period effect of acquisition EBITDA (a)

 

117

 

 

467

 

742

 

 

 

 

 

 

 

 

 

 

 

Pro-Forma Adjusted EBITDA (1)

 

$

27,190

 

$

39,692

 

$

124,323

 

$

116,249

 

 

 

 

 

 

 

 

 

 

 

Pro-Forma Adjusted EBITDA as a percentage of total pro-forma revenues

 

10.5

%

15.4

%

15.1

%

15.2

%

 


(1) Pro-Forma Adjusted EBITDA, as defined per the Credit Agreement dated as of April 30, 2015, calculated as income (loss) before interest expense (net of interest income), income taxes, depreciation and amortization, net income attributable to noncontrolling interests, net of cash distributions, gain on the sale of an interest in a joint venture, loss on sale leaseback transaction, early extinguishment of debt, fair value adjustment of earn-out liability, fair value adjustment of embedded derivative, impairment loss, foreign currency derivative contract loss (gain), management fees accrued to our sponsor, non-cash expenses including costs relating to stock compensation, amortization of straight-line rent and amortization of capital expenditures relating to repairs and maintenance, non-cash equipment rent, sale-lease back adjustments, acquisition-related costs, other expenses including loss on sale of assets, severance payments related to termination of employee staff reductions, tail premiums on termed physicians, franchise taxes, costs relating to consulting services on Medicare reimbursement, litigation settlements with physicians, costs associated with tradename and rebranding initiatives, expenses associated with idle / closed radiation therapy treatment facilities and pro-forma full period effect of acquisition EBITDA.

 

(a) Pro-forma amounts related to adjustments to total revenues and Pro-forma Adjusted EBITDA to reflect the full period effect of our acquisitions and Value Added Services contracts completed during 2015 and 2014.  The adjustments reflect the impact to our total revenues and Pro-forma Adjusted EBITDA as if the acquisitions and Value Added Services contracts had occurred at the beginning of the year.

 

(b) Other expenses include management fees accrued to our sponsor, Vestar Capital Partners, loss on sale of assets, severance payments related to termination of employee staff reductions, tail premiums paid on terminated physicians, franchise taxes and costs relating to consulting services on Medicare reimbursement. Expenses related to the costs associated with the Company’s tradename and rebranding initiatives and expenses associated with idle / closed radiation therapy facilities.

 



 

(c) Non-cash expenses including costs relating to stock compensation, amortization of straight-line rent, amortization of capital expenditures relating to warranty arrangements amortized to repairs and maintenance and non-cash equipment rent.

 

(d) Other non-cash income / expense items include: gain on BP settlement, equity initial public offering expenses, loss on sale lease back transaction, fair value adjustment of noncontrolling interest and earn-out liabilities, fair value adjustment of embedded derivative, gain on foreign currency derivative contracts, sale-lease back adjustments.

 

(e) Acquisition related costs associated with ASC 805, “Business Combinations,” including professional fees, corporate development, integration and due diligence costs relating to the acquisition of medical practices.

 

(f) Litigation matters relate to loss contingency reserves related to the Medicare investigative matters and costs associated with the termination of physicians.

 

(g) Expenses associated with negotiating with note-holders, recapitalization support agreement and legal and consulting fees associated with management of liquidity.

 

We believe the Pro-Forma Adjusted EBITDA provides useful information about our 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 company’s leverage capacity and its ability to meet its debt service requirements.  Pro-forma Adjusted EBITDA eliminates the uneven effect of non-cash depreciation of tangibles assets and amortization of intangible assets, much of which results from acquisitions accounted for under the purchase method of accounting.  Pro-forma Adjusted EBITDA is also used by us to measure individual performance for incentive compensation purposes and as an analytical indicator for purposes of allocating resources to our operating business and assessing their performance, both internally and relative to our peers, as well as to evaluate the performance of our operating management teams, and for purposes in the calculation of debt covenants and related disclosures.

 

Pro-Forma Adjusted EBITDA is not intended as a substitute for net income (loss) attributable to 21st Century Oncology Holdings, Inc.  shareholder, operating cash flows or other cash flow data determined in accordance with accounting principles generally accepted in the United States. Due to varying methods of calculation, Pro-forma Adjusted EBITDA as presented may not be comparable to similarly titled measures of other companies.

 



 

21ST CENTURY ONCOLOGY HOLDINGS, INC.

KEY OPERATING STATISTICS

(unaudited) PRELIMINARY

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

 

 

September 30,

 

%

 

September 30,

 

%

 

United States

 

2015

 

2014

 

Change

 

2015

 

2014

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of treatment days

 

64

 

64

 

 

 

191

 

191

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total treatments - freestanding centers (same store basis)

 

193,840

 

200,078

 

-3.1

%

586,160

 

583,594

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Treatments per day - freestanding centers (same store basis)

 

3,029

 

3,126

 

-3.1

%

3,069

 

3,055

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percentage change in freestanding revenues — same store basis

 

-3.4

%

3.5

%

 

 

0.2

%

6.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total radiation oncology cases completed *

 

8,168

 

8,042

 

1.6

%

25,866

 

23,767

 

8.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total radiation oncology cases completed (same store basis)*

 

8,042

 

8,010

 

0.4

%

24,926

 

23,374

 

6.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue per radiation oncology case (same store basis)

 

$

18,219

 

$

18,935

 

-3.8

%

$

17,911

 

$

19,055

 

-6.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radiation therapy centers - freestanding (global)

 

170

 

167

 

 

 

 

 

 

 

 

 

Radiation therapy centers - professional / other (global)

 

12

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total radiation therapy centers

 

182

 

178

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Days sales outstanding at quarter end

 

44

 

41

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net patient service revenue (global) - professional services only (in thousands)

 

$

81,135

 

$

78,001

 

4.0

%

$

261,902

 

$

230,919

 

13.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net patient service revenue (global) - excluding physician practice expense (in thousands)

 

$

260,961

 

$

260,953

 

0.0

%

$

822,892

 

$

764,595

 

7.6

%

 


* Total cases completed represents a count of patients that have completed their course of treatment. Total case counts are based on legacy and acquired clinical systems.

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

 

 

September 30,

 

%

 

September 30,

 

%

 

International

 

2015

 

2014

 

Change

 

2015

 

2014

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total number of new cases

 

4,907

 

4,480

 

9.5

%

14,034

 

13,361

 

5.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue per radiation oncology case

 

$

5,489

 

$

5,761

 

-4.7

%

$

6,216

 

$

5,328

 

16.7

%