Attached files
| file | filename |
|---|---|
| EX-99.2 - EX-99.2 - KINDRED HEALTHCARE, INC | d133599dex992.htm |
| 8-K - FORM 8-K - KINDRED HEALTHCARE, INC | d133599d8k.htm |
|
EXHIBIT 99.1 |
| Contact: | Todd Flowers | |
| Investor Relations | ||
| (502) 596-6569 |
KINDRED HEALTHCARE REPORTS FOURTH QUARTER 2015 RESULTS
Consolidated Revenues of $1.8 billion, Core EBITDAR of $248 million(1),
Core Diluted EPS from Continuing Operations of $0.33(1) and
Adjusted Core Diluted EPS from Continuing Operations of $0.44(1) in the Fourth Quarter;
GAAP Diluted EPS from Continuing Operations of $0.50 and EBITDAR of $198 million(1) in the Fourth Quarter
Includes Costs of $51 million and an Income Tax Benefit of $66 million
Related to Litigation, Transaction, Integration, Impairment and Other Restructuring Costs
Consolidated Revenues of $7.1 billion, Core EBITDAR of $980 million(1), Core Diluted EPS from Continuing Operations
of $1.28(1) and Adjusted Core Diluted EPS from Continuing Operations of $1.70(1) for the Year
GAAP Diluted Loss Per Share of $1.12 and EBITDAR of $675 million(1) for the Year
Significant Core Operating Cash Flows of $318 million(1)(2) for the Year
GAAP Operating Cash Flows of $163 million for the Year
Company Establishes Full Year Outlook for 2016
LOUISVILLE, Ky. (February 25, 2016) – Kindred Healthcare, Inc. (“Kindred” or the “Company”) (NYSE:KND) today announced its operating results for the fourth quarter ended December 31, 2015.
Benjamin A. Breier, President and Chief Executive Officer of the Company, commented, “Throughout 2015, our focus at Kindred has been growing and transforming our operations and clinical capabilities to expand our national leadership in post-acute care and I am proud of our team’s significant accomplishments. We successfully completed and integrated two highly strategic transactions, Gentiva Health Services, Inc. (“Gentiva”) and Centerre Healthcare Corporation (“Centerre”), which together added more than $2 billion in revenues, 40,000 employees and 500 sites of service to our platform.
Mr. Breier added, “These transactions have strengthened our ability to deliver a full continuum of post-acute care, while also contributing operating results and cost synergies that exceeded our expectations. Gentiva and Centerre also accelerated the transformation of Kindred’s financial profile, such that today the Company is more focused than ever on higher growth, lower capital intensity businesses that generate substantial free cash flows.”
Mr. Breier continued, “Solid execution in each of our businesses remains our top priority as we drive effective patient-centered care solutions and adapt to change. We are confident that Kindred’s full continuum of post-acute services, which enables us to deliver care and services where and when patients need them the most, and our innovations in care management uniquely position us to successfully transition to a value-based healthcare system. As always, I thank the many stakeholders in Kindred, and especially our 102,000 teammates, for the exceptional care they provide to more than a million patients each year.”
All financial and statistical information included in this press release reflects the continuing operations of the Company’s businesses for all periods presented unless otherwise indicated. The acquisitions of Gentiva and Centerre have been included in the operating results presented since the respective dates of acquisition.
| (1) | See reconciliation of core results to generally accepted accounting principles (“GAAP”) results beginning on page 12, including a reconciliation of core EBITDAR and EBITDAR to the most comparable GAAP measure, income from continuing operations, of $56.0 million for the fourth quarter of 2015 and a loss from continuing operations of $51.9 million for the year ended December 31, 2015. |
| (2) | Core operating cash flows, similar to the GAAP presentation, include net changes in working capital and exclude routine capital expenditures and distributions to noncontrolling interests. |
– MORE –
680 South Fourth Street Louisville, Kentucky 40202
502.596.7300 www.kindredhealthcare.com
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 2
February 25, 2016
Fourth Quarter and Year Consolidated Highlights(1):
| • | Consolidated revenues for the fourth quarter increased 40.8% to $1.78 billion year-over-year and core earnings before interest, income taxes, depreciation, amortization, rent and certain charges (“core EBITDAR”) increased 45.7% to $248 million compared to the same period in 2014. For the year, consolidated revenues increased 40.3% to $7.1 billion and core EBITDAR increased 43.3% to $980 million, each as compared to the same period last year. A significant driver of the growth in both periods was the acquisition of Gentiva and Centerre. |
| • | Core diluted earnings per share (“EPS”) from continuing operations for the fourth quarter was $0.33 and adjusted core diluted EPS from continuing operations was $0.44 based upon 87.2 million weighted average diluted shares, an improvement compared to core diluted EPS of $0.26 and adjusted core diluted EPS of $0.38 for the same period a year ago based upon 63.2 million weighted average diluted shares. For the year, core diluted EPS from continuing operations was $1.28 and adjusted core diluted EPS from continuing operations was $1.70 based upon 86.1 million weighted average diluted shares, an improvement compared to core diluted EPS of $1.06 and adjusted core diluted EPS of $1.51 for the same period a year ago based upon 58.2 million weighted average diluted shares. |
| • | The Company generated core operating cash flows of $54 million(2) for the fourth quarter compared to $86 million(2) for the same period a year ago, and core free cash flows were $2 million(3) for the fourth quarter compared to $58 million(3) in the same period of 2014. The decline in both measures was attributable to the timing of certain year-end payroll expenditures in the fourth quarter of 2015 and a meaningful acceleration of accounts receivable collections in the fourth quarter of 2014 in the Hospital Division after the completion of central business office consolidations. Core free cash flows for the fourth quarter of 2015 were also negatively impacted by the timing of routine capital expenditures as compared to a year ago. |
For the year, core operating cash flows were $318 million(2) compared to $188 million(2) for the same period a year ago, and core free cash flows were $154 million(3) compared to $83 million(3) in the same period of 2014. These results reflect the Company’s changing business mix primarily driven by the addition of Gentiva and Centerre in 2015.
| • | GAAP operating results: |
| Three months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| (In thousands, except per share amounts) | ||||||||||||||||
| Diluted earnings (loss) per share from continuing operations |
$ | 0.50 | $ | (0.15 | ) | $ | (1.12 | ) | $ | (0.24 | ) | |||||
| Income (loss) from continuing operations |
55,984 | (4,803 | ) | (51,863 | ) | 4,896 | ||||||||||
| Operating cash flows |
70,195 | 81,149 | 163,262 | 105,471 | ||||||||||||
| • | The Kindred Board of Directors declared a cash dividend of $0.12 per share on the Company’s common stock payable on April 1, 2016 to shareholders of record as of the close of business on March 10, 2016. |
Fourth Quarter Segment Highlights(1)(4):
Kindred’s Hospital Division fourth quarter same-hospital revenues declined 3.3% over the prior year period to $594 million, with a decline in same-hospital admissions of 3.3% compared to the same period last year. Sequentially, same-hospital admissions increased 1.7% and same-hospital revenues per patient day increased 2.8% compared to the third quarter of 2015. Core EBITDAR for the fourth quarter declined to $118 million from $135 million a year ago, and increased from $97 million in the third quarter of 2015.
| (1) | See reconciliation of core results to GAAP results beginning on page 12. |
| (2) | Core operating cash flows, similar to the GAAP presentation, include net changes in working capital and exclude routine capital expenditures and distributions to noncontrolling interests. |
| (3) | Core free cash flows include net changes in working capital, routine capital expenditures and distributions to noncontrolling interests. |
| (4) | See same-hospital and full segment data on pages 8 and 9. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 3
February 25, 2016
Kindred at Home Division fourth quarter revenues and core EBITDAR increased to $604 million and $99 million, respectively. The home health segment experienced another quarter of solid growth, with episodic admissions increasing 1.5% and revenues increasing 4.8% to $358 million, both over the prior year period on a combined basis, notwithstanding a 12.6% consolidation of home health branches during 2015 from 427 to 373 sites. Average home health revenue per branch grew 18.0% during the course of this consolidation. The hospice segment generated $178 million of revenues with stable admissions during a seasonally weak quarter. Average hospice revenue per branch increased 13.8% as the Company consolidated the hospice branch network from 193 sites at the end of 2014 to 175 sites at the end of 2015.
Kindred Rehabilitation Services Division revenues increased 4.8% to $362 million and core EBITDAR contribution increased 42.7% to $57 million for the quarter. The Kindred Hospital Rehabilitation Services segment experienced strong revenue growth of $63 million or 67.4% over the prior year period, due to the successful integration of Centerre, and achieved core EBITDAR margin improvement from 25.7% to 29.0%. The RehabCare segment (“RHB”) revenues declined to $207 million from $253 million a year ago primarily due to contract losses that occurred in the first half of 2015. Excluding one customer with 23 sites of service that RHB terminated in the fourth quarter of 2015 in connection with litigation to collect past due amounts, RHB added 32 net new sites of service over the last half of 2015.
Kindred’s Nursing Center Division revenues grew 0.6% to $273 million in the fourth quarter. Core EBITDAR was $37 million, down $2 million from a year ago. Top line growth was driven by a 3.5% improvement in revenue per patient day, including a 4.9% increase in Medicaid revenue per patient day that was partially offset by a 3.9% admission decline. Operating costs per patient day increased 4.8% in the fourth quarter, primarily a result of the admissions decline, start-up costs for January 2016 new openings and continuing Medicare length of stay contraction.
2016 Outlook
Kindred today announced its outlook for 2016. Kindred expects:
| • | Annual revenues of approximately $7.250 billion, with a range of $7.2 billion to $7.3 billion |
| • | Core EBITDAR of approximately $990 million, with a range of $970 million to $1.010 billion |
| • | Core diluted EPS from continuing operations of approximately $0.90, with a range of $0.80 to $1.00(1) |
| • | Adjusted core diluted EPS from continuing operations of approximately $1.25, with a range of $1.15 to $1.35(1)(2) |
For the first quarter of 2016, the Company expects core EBITDAR to approximate $235 million to $250 million, core diluted EPS from continuing operations to approximate $0.17 to $0.27 and adjusted core diluted EPS from continuing operations to approximate $0.26 to $0.36.
Mr. Breier commented, “Our outlook reflects what we believe will be a transition period for our Hospital Division in 2016 and 2017 due to long-term acute care (“LTAC”) criteria implementation. We anticipate that over time, our LTAC criteria mitigation efforts, robust growth in other divisions, and strong cost management across the enterprise will offset the effects of these reimbursement changes. For the enterprise, we expect stable and consistent core EBITDAR of approximately $1 billion in 2016 and at least $1 billion in 2017. Throughout this transition period we expect to continue generating roughly $300 million(3) per year in core operating cash flows, and approximately half of that amount in core free cash flows(4).
Mr. Breier concluded, “Our extensive efforts to grow and diversify Kindred enable us to work through challenges within any individual business, while continuing to advance the enterprise. We will continue to invest in strategic growth, including a particular focus on investments that help to increase our capabilities as a post-acute benefits management company, preparing us for the ongoing transition from fee-for-service to fee-for-value. The substantial cash flows we expect from our diversified service offerings will allow us to continue investing aggressively in our platform, which will drive growth, reduce our leverage, and advance our Continue the Care strategy. The growth in our Kindred at Home division and Kindred Hospital Rehabilitation Services in 2015, our recent announcements regarding expansion in four integrated markets and our strategic partnership with Inovalon (NASDAQ:INOV) to create a unique set of post-acute benefits management tools and solutions are examples of these capabilities.”
| (1) | The EPS estimate is based upon an estimated weighted average annual diluted share count for 2016 of 88.5 million shares. |
| (2) | Adjusted core diluted EPS is calculated by excluding non-cash expenses, net of the income tax benefit, related to amortization of intangible assets, stock-based compensation and deferred financing costs, from core income from continuing operations. The estimated non-cash expenses for 2016 total approximately $53 million ($32 million net of income taxes) or approximately $0.35 per diluted share. |
| (3) | Core operating cash flows, similar to the GAAP presentation, include net changes in working capital and exclude routine capital expenditures and distributions to noncontrolling interests. |
| (4) | Core free cash flows include net changes in working capital, routine capital expenditures and distributions to noncontrolling interests. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 4
February 25, 2016
This outlook excludes transaction costs, the effect of any reimbursement changes, debt refinancing costs, severance, retirement, retention, consulting and restructuring costs, litigation and related contingency expense, integration costs, any further acquisitions or divestitures, any impairment charges, any further issuances of common stock or any repurchases of common stock.
All forward-looking non-GAAP financial measures contained in this section “2016 Outlook” are provided only on a non-GAAP basis. This is due to the inherent difficulty of forecasting the timing or amount of items that would be included in the most directly comparable forward-looking GAAP financial measures. As a result, reconciliation of the forward-looking non-GAAP financial measures to GAAP financial measures is not available without unreasonable effort and the Company is unable to address the probable significance of the unavailable information.
Cash Dividend
The Company announced that its Board of Directors has approved the payment of a cash dividend of $0.12 per share of common stock to be paid on April 1, 2016 to shareholders of record as of the close of business on March 10, 2016.
Conference Call
As previously announced, investors and the general public may access a live webcast of the fourth quarter 2015 conference call through a link on the Company’s website at http://investors.kindredhealthcare.com. The conference call will be held on February 26 at 10:00 a.m. (Eastern Time).
A telephone replay of the conference call will become available at approximately 1:00 p.m. on February 26 by dialing (719) 457-0820, access code: 4866232. The replay will be available through March 7.
Forward-Looking Statements and Non-GAAP Reconciliations
See page 11 for important disclosures regarding the Company’s forward-looking statements and the non-GAAP financial reconciliations that follow.
About Kindred Healthcare
Kindred Healthcare, Inc., a top-90 private employer in the United States, is a FORTUNE 500 healthcare services company based in Louisville, Kentucky with annual revenues of approximately $7.2 billion(1). At December 31, 2015, Kindred through its subsidiaries had approximately 102,000 employees providing healthcare services in 2,692 locations in 46 states, including 95 transitional care hospitals, 18 inpatient rehabilitation hospitals, 90 nursing centers, 19 sub-acute units, 604 Kindred at Home home health, hospice and non-medical home care sites of service, 100 inpatient rehabilitation units (hospital-based) and a contract rehabilitation services business, RehabCare, which served 1,766 non-affiliated sites of service. Ranked as one of Fortune magazine’s Most Admired Healthcare Companies for seven years, Kindred’s mission is to promote healing, provide hope, preserve dignity and produce value for each patient, resident, family member, customer, employee and shareholder we serve. For more information, go to www.kindredhealthcare.com. You can also follow us on Twitter and Facebook.
| (1) | Revenues were computed by combining the twelve months ended December 31, 2015 data for Kindred and one month ended January 2015 data for Gentiva. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 5
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Consolidated Statement of Operations
(In thousands, except per share amounts)
| Three months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Revenues |
$ | 1,780,949 | $ | 1,264,674 | $ | 7,054,907 | $ | 5,027,599 | ||||||||
|
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|||||||||
| Salaries, wages and benefits |
909,171 | 616,277 | 3,614,091 | 2,442,879 | ||||||||||||
| Supplies |
96,295 | 73,774 | 384,354 | 289,043 | ||||||||||||
| Rent |
97,823 | 79,167 | 382,609 | 313,039 | ||||||||||||
| Other operating expenses |
208,315 | 168,206 | 825,996 | 679,992 | ||||||||||||
| General and administrative expenses |
344,340 | 259,702 | 1,395,288 | 973,223 | ||||||||||||
| Other income |
(1,317 | ) | (278 | ) | (3,016 | ) | (872 | ) | ||||||||
| Litigation contingency expense |
8,261 | — | 138,648 | 4,600 | ||||||||||||
| Impairment charges |
18,031 | — | 24,757 | — | ||||||||||||
| Depreciation and amortization |
40,362 | 38,558 | 157,251 | 155,570 | ||||||||||||
| Interest expense |
56,267 | 39,919 | 232,395 | 168,763 | ||||||||||||
| Investment income |
(603 | ) | (1,021 | ) | (2,806 | ) | (3,996 | ) | ||||||||
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| 1,776,945 | 1,274,304 | 7,149,567 | 5,022,241 | |||||||||||||
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| Income (loss) from continuing operations before income taxes |
4,004 | (9,630 | ) | (94,660 | ) | 5,358 | ||||||||||
| Provision (benefit) for income taxes |
(51,980 | ) | (4,827 | ) | (42,797 | ) | 462 | |||||||||
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| Income (loss) from continuing operations |
55,984 | (4,803 | ) | (51,863 | ) | 4,896 | ||||||||||
| Discontinued operations, net of income taxes: |
||||||||||||||||
| Income (loss) from operations |
1,509 | (28,743 | ) | (235 | ) | (53,630 | ) | |||||||||
| Gain (loss) on divestiture of operations |
261 | (9,061 | ) | 1,244 | (12,698 | ) | ||||||||||
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| Income (loss) from discontinued operations |
1,770 | (37,804 | ) | 1,009 | (66,328 | ) | ||||||||||
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| Net income (loss) |
57,754 | (42,607 | ) | (50,854 | ) | (61,432 | ) | |||||||||
| (Earnings) loss attributable to noncontrolling interests: |
||||||||||||||||
| Continuing operations |
(12,082 | ) | (5,143 | ) | (42,564 | ) | (18,872 | ) | ||||||||
| Discontinued operations |
2 | 66 | 34 | 467 | ||||||||||||
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| (12,080 | ) | (5,077 | ) | (42,530 | ) | (18,405 | ) | |||||||||
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| Income (loss) attributable to Kindred |
$ | 45,674 | $ | (47,684 | ) | $ | (93,384 | ) | $ | (79,837 | ) | |||||
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| Amounts attributable to Kindred stockholders: |
||||||||||||||||
| Income (loss) from continuing operations |
$ | 43,902 | $ | (9,946 | ) | $ | (94,427 | ) | $ | (13,976 | ) | |||||
| Income (loss) from discontinued operations |
1,772 | (37,738 | ) | 1,043 | (65,861 | ) | ||||||||||
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| Net income (loss) |
$ | 45,674 | $ | (47,684 | ) | $ | (93,384 | ) | $ | (79,837 | ) | |||||
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| Earnings (loss) per common share: |
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| Basic: |
||||||||||||||||
| Income (loss) from continuing operations |
$ | 0.50 | $ | (0.15 | ) | $ | (1.12 | ) | $ | (0.24 | ) | |||||
| Discontinued operations: |
||||||||||||||||
| Income (loss) from operations |
0.02 | (0.44 | ) | — | (0.91 | ) | ||||||||||
| Gain (loss) on divestiture of operations |
— | (0.14 | ) | 0.01 | (0.21 | ) | ||||||||||
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| Income (loss) from discontinued operations |
0.02 | (0.58 | ) | 0.01 | (1.12 | ) | ||||||||||
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| Net income (loss) |
$ | 0.52 | $ | (0.73 | ) | $ | (1.11 | ) | $ | (1.36 | ) | |||||
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| Diluted: |
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| Income (loss) from continuing operations |
$ | 0.50 | $ | (0.15 | ) | $ | (1.12 | ) | $ | (0.24 | ) | |||||
| Discontinued operations: |
||||||||||||||||
| Income (loss) from operations |
0.02 | (0.44 | ) | — | (0.91 | ) | ||||||||||
| Gain (loss) on divestiture of operations |
— | (0.14 | ) | 0.01 | (0.21 | ) | ||||||||||
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| Income (loss) from discontinued operations |
0.02 | (0.58 | ) | 0.01 | (1.12 | ) | ||||||||||
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| Net income (loss) |
$ | 0.52 | $ | (0.73 | ) | $ | (1.11 | ) | $ | (1.36 | ) | |||||
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| Shares used in computing earnings (loss) per common share: |
||||||||||||||||
| Basic |
86,336 | 65,135 | 84,558 | 58,634 | ||||||||||||
| Diluted |
87,232 | 65,135 | 84,558 | 58,634 | ||||||||||||
| Cash dividends declared and paid per common share |
$ | 0.12 | $ | 0.12 | $ | 0.48 | $ | 0.48 | ||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 6
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Consolidated Balance Sheet
(In thousands, except per share amounts)
| December 31, | December 31, | |||||||
| 2015 | 2014 | |||||||
| ASSETS | ||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 98,758 | $ | 164,188 | ||||
| Insurance subsidiary investments |
106,638 | 99,951 | ||||||
| Accounts receivable less allowance for loss |
1,194,868 | 944,219 | ||||||
| Inventories |
27,791 | 25,702 | ||||||
| Income taxes |
11,790 | 8,575 | ||||||
| Interest deposit on senior unsecured notes held in escrow |
— | 23,438 | ||||||
| Other |
61,054 | 41,598 | ||||||
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| 1,500,899 | 1,307,671 | |||||||
| Property and equipment |
2,162,398 | 1,978,153 | ||||||
| Accumulated depreciation |
(1,190,402 | ) | (1,076,049 | ) | ||||
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| 971,996 | 902,104 | |||||||
| Goodwill |
2,669,810 | 997,597 | ||||||
| Intangible assets less accumulated amortization |
755,655 | 400,700 | ||||||
| Assets held for sale |
613 | 3,475 | ||||||
| Insurance subsidiary investments |
204,498 | 166,045 | ||||||
| Deferred tax assets |
104,130 | 93,565 | ||||||
| Proceeds from senior unsecured notes held in escrow |
— | 1,350,000 | ||||||
| Acquisition deposit |
18,489 | 195,000 | ||||||
| Other |
292,846 | 236,807 | ||||||
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| Total assets |
$ | 6,518,936 | $ | 5,652,964 | ||||
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| LIABILITIES AND EQUITY | ||||||||
| Current liabilities: |
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| Accounts payable |
$ | 187,061 | $ | 175,725 | ||||
| Salaries, wages and other compensation |
404,925 | 358,857 | ||||||
| Due to third party payors |
36,251 | 43,957 | ||||||
| Professional liability risks |
64,099 | 64,137 | ||||||
| Other accrued liabilities |
394,246 | 189,980 | ||||||
| Long-term debt due within one year |
24,630 | 24,607 | ||||||
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| 1,111,212 | 857,263 | |||||||
| Long-term debt |
3,137,025 | 2,852,531 | ||||||
| Professional liability risks |
263,273 | 243,614 | ||||||
| Deferred credits and other liabilities |
301,379 | 213,584 | ||||||
| Equity: |
||||||||
| Stockholders’ equity: |
||||||||
| Common stock, $0.25 par value; authorized 175,000 shares; issued 83,792 shares - December 31, 2015 and 69,977 shares - December 31, 2014 |
20,948 | 17,494 | ||||||
| Capital in excess of par value |
1,737,747 | 1,586,692 | ||||||
| Accumulated other comprehensive loss |
(2,632 | ) | (2,551 | ) | ||||
| Accumulated deficit |
(256,209 | ) | (159,768 | ) | ||||
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| 1,499,854 | 1,441,867 | |||||||
| Noncontrolling interests |
206,193 | 44,105 | ||||||
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| Total equity |
1,706,047 | 1,485,972 | ||||||
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| Total liabilities and equity |
$ | 6,518,936 | $ | 5,652,964 | ||||
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- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 7
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Consolidated Statement of Cash Flows
(In thousands)
| Three months ended December 31, |
Year ended December 31, |
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| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Cash flows from operating activities: |
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| Net income (loss) |
$ | 57,754 | $ | (42,607 | ) | $ | (50,854 | ) | $ | (61,432 | ) | |||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
||||||||||||||||
| Depreciation and amortization |
40,853 | 39,145 | 158,374 | 160,950 | ||||||||||||
| Amortization of stock-based compensation costs |
4,872 | 6,986 | 20,636 | 16,643 | ||||||||||||
| Amortization of deferred financing costs |
3,566 | 2,077 | 13,721 | 23,288 | ||||||||||||
| Payment of capitalized lender fees related to debt issuance |
— | (3,527 | ) | (28,012 | ) | (22,652 | ) | |||||||||
| Provision for doubtful accounts |
22,643 | 6,215 | 52,460 | 41,803 | ||||||||||||
| Deferred income taxes |
(45,738 | ) | (24,341 | ) | (46,632 | ) | (35,615 | ) | ||||||||
| Impairment charges |
18,031 | — | 24,757 | 673 | ||||||||||||
| (Gain) loss on divestiture of discontinued operations |
(261 | ) | 9,061 | (1,244 | ) | 12,698 | ||||||||||
| Other |
3,080 | 47 | 13,537 | 2,336 | ||||||||||||
| Change in operating assets and liabilities: |
||||||||||||||||
| Accounts receivable |
4,822 | 28,125 | (8,577 | ) | (74,378 | ) | ||||||||||
| Inventories and other assets |
10,312 | (13,074 | ) | 54,493 | (25,960 | ) | ||||||||||
| Accounts payable |
2,408 | 13,070 | (10,380 | ) | (9,399 | ) | ||||||||||
| Income taxes |
(6,254 | ) | 12,959 | 27,392 | 31,728 | |||||||||||
| Due to third party payors |
(26,917 | ) | (3,363 | ) | (30,882 | ) | 11,177 | |||||||||
| Other accrued liabilities |
(18,976 | ) | 50,376 | (25,527 | ) | 33,611 | ||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Net cash provided by operating activities |
70,195 | 81,149 | 163,262 | 105,471 | ||||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Cash flows from investing activities: |
||||||||||||||||
| Routine capital expenditures |
(41,240 | ) | (23,656 | ) | (121,931 | ) | (91,081 | ) | ||||||||
| Development capital expenditures |
(7,865 | ) | (2,564 | ) | (19,931 | ) | (5,257 | ) | ||||||||
| Acquisitions, net of cash acquired |
— | — | (673,547 | ) | (24,136 | ) | ||||||||||
| Acquisition deposit |
(18,489 | ) | (195,000 | ) | 176,511 | (195,000 | ) | |||||||||
| Sale of assets |
1,674 | 952 | 8,735 | 23,861 | ||||||||||||
| Proceeds from senior unsecured notes offering held in escrow |
— | (1,350,000 | ) | 1,350,000 | (1,350,000 | ) | ||||||||||
| Interest in escrow for senior unsecured notes |
— | (23,438 | ) | 23,438 | (23,438 | ) | ||||||||||
| Purchase of insurance subsidiary investments |
(26,036 | ) | (7,930 | ) | (85,222 | ) | (105,324 | ) | ||||||||
| Sale of insurance subsidiary investments |
24,295 | 16,749 | 75,075 | 51,716 | ||||||||||||
| Net change in insurance subsidiary cash and cash equivalents |
(3,875 | ) | (20,689 | ) | (12,271 | ) | 33,683 | |||||||||
| Proceeds from note receivable |
— | — | 25,000 | — | ||||||||||||
| Net change in other investments |
(4,995 | ) | 379 | (4,620 | ) | 1,406 | ||||||||||
| Other |
592 | 1,216 | 10,972 | 679 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net cash provided by (used in) investing activities |
(75,939 | ) | (1,603,981 | ) | 752,209 | (1,682,891 | ) | |||||||||
|
|
|
|
|
|
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|
|
|||||||||
| Cash flows from financing activities: |
||||||||||||||||
| Proceeds from borrowings under revolving credit |
325,600 | 83,000 | 1,740,450 | 1,551,515 | ||||||||||||
| Repayment of borrowings under revolving credit |
(312,000 | ) | (83,000 | ) | (1,631,850 | ) | (1,807,615 | ) | ||||||||
| Proceeds from issuance of term loan, net of discount |
— | — | 199,000 | 997,500 | ||||||||||||
| Proceeds from issuance of senior unsecured notes due 2022 |
— | — | — | 500,000 | ||||||||||||
| Proceeds from issuance of senior unsecured notes due 2020 and 2023 |
— | 1,350,000 | — | 1,350,000 | ||||||||||||
| Proceeds from issuance of debt component of tangible equity units |
— | 34,773 | — | 34,773 | ||||||||||||
| Repayment of Gentiva debt |
— | — | (1,177,363 | ) | — | |||||||||||
| Repayment of senior unsecured notes |
— | — | — | (550,000 | ) | |||||||||||
| Repayment of term loan |
(3,002 | ) | (2,500 | ) | (12,010 | ) | (788,563 | ) | ||||||||
| Repayment of other long-term debt |
(5,352 | ) | (58 | ) | (6,752 | ) | (273 | ) | ||||||||
| Payment of deferred financing costs |
(162 | ) | (279 | ) | (3,446 | ) | (3,431 | ) | ||||||||
| Equity offering, net of offering costs |
— | 101,615 | — | 321,968 | ||||||||||||
| Issuance of equity component of tangible equity units, net of issuance costs |
— | 133,336 | — | 133,336 | ||||||||||||
| Issuance of common stock in connection with employee benefit plans |
— | 26 | 534 | 6,243 | ||||||||||||
| Payment of costs associated with issuance of common stock and tangible equity units |
— | — | (915 | ) | — | |||||||||||
| Payment of dividend for mandatory redeemable preferred stock |
(2,752 | ) | — | (10,887 | ) | — | ||||||||||
| Dividends paid |
(10,052 | ) | (7,754 | ) | (40,119 | ) | (28,594 | ) | ||||||||
| Contributions made by noncontrolling interests |
660 | — | 2,152 | — | ||||||||||||
| Distributions to noncontrolling interests |
(10,635 | ) | (4,088 | ) | (42,458 | ) | (13,692 | ) | ||||||||
| Other |
1,306 | 165 | 2,763 | 2,469 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net cash provided by (used in) financing activities |
(16,389 | ) | 1,605,236 | (980,901 | ) | 1,705,636 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Change in cash and cash equivalents |
(22,133 | ) | 82,404 | (65,430 | ) | 128,216 | ||||||||||
| Cash and cash equivalents at beginning of period |
120,891 | 81,784 | 164,188 | 35,972 | ||||||||||||
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|
|
|
|
|
|
|||||||||
| Cash and cash equivalents at end of period |
$ | 98,758 | $ | 164,188 | $ | 98,758 | $ | 164,188 | ||||||||
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- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 8
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Consolidated and Business Segment Data (a)
(Unaudited)
(In thousands, except per share amounts)
| 2014 Quarters | 2015 Quarters | Fourth quarter % change v. |
||||||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | prior year | ||||||||||||||||||||||||||||||||||
| Consolidated income statement data: |
||||||||||||||||||||||||||||||||||||||||||||
| Revenues |
$ | 1,272,610 | $ | 1,261,397 | $ | 1,228,918 | $ | 1,264,674 | $ | 5,027,599 | $ | 1,675,967 | $ | 1,833,475 | $ | 1,764,516 | $ | 1,780,949 | $ | 7,054,907 | 40.8 | |||||||||||||||||||||||
| Core EBITDAR |
$ | 181,044 | $ | 175,865 | $ | 157,218 | $ | 170,088 | $ | 684,215 | $ | 234,211 | $ | 261,800 | $ | 236,477 | $ | 247,839 | $ | 980,327 | 45.7 | |||||||||||||||||||||||
| Rent |
78,530 | 77,452 | 77,643 | 79,167 | 312,792 | 91,199 | 95,528 | 95,436 | 96,934 | 379,097 | 22.4 | |||||||||||||||||||||||||||||||||
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| Core EBITDA |
102,514 | 98,413 | 79,575 | 90,921 | 371,423 | 143,012 | 166,272 | 141,041 | 150,905 | 601,230 | 66.0 | |||||||||||||||||||||||||||||||||
| Depreciation and amortization |
39,092 | 39,172 | 38,748 | 38,558 | 155,570 | 38,935 | 38,625 | 39,329 | 40,362 | 157,251 | 4.7 | |||||||||||||||||||||||||||||||||
| Interest, net |
25,617 | 21,438 | 22,171 | 21,857 | 91,083 | 44,346 | 56,140 | 56,008 | 55,664 | 212,158 | 154.7 | |||||||||||||||||||||||||||||||||
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| Income from continuing operations before income taxes |
37,805 | 37,803 | 18,656 | 30,506 | 124,770 | 59,731 | 71,507 | 45,704 | 54,879 | 231,821 | 79.9 | |||||||||||||||||||||||||||||||||
| Provision for income taxes |
14,445 | 13,612 | 6,168 | 8,471 | 42,696 | 22,466 | 25,721 | 15,298 | 13,758 | 77,243 | 62.4 | |||||||||||||||||||||||||||||||||
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| Income from continuing operations |
23,360 | 24,191 | 12,488 | 22,035 | 82,074 | 37,265 | 45,786 | 30,406 | 41,121 | 154,578 | 86.6 | |||||||||||||||||||||||||||||||||
| Noncontrolling interests |
(4,529 | ) | (4,828 | ) | (4,372 | ) | (5,143 | ) | (18,872 | ) | (8,847 | ) | (11,735 | ) | (9,900 | ) | (12,082 | ) | (42,564 | ) | 134.9 | |||||||||||||||||||||||
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| Net income attributable to Kindred |
$ | 18,831 | $ | 19,363 | $ | 8,116 | $ | 16,892 | $ | 63,202 | $ | 28,418 | $ | 34,051 | $ | 20,506 | $ | 29,039 | $ | 112,014 | 71.9 | |||||||||||||||||||||||
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| Core diluted EPS |
$ | 0.35 | $ | 0.35 | $ | 0.13 | $ | 0.26 | $ | 1.06 | $ | 0.34 | $ | 0.39 | $ | 0.23 | $ | 0.33 | $ | 1.28 | 26.9 | |||||||||||||||||||||||
| Adjusted Core EPS |
$ | 0.46 | $ | 0.50 | $ | 0.20 | $ | 0.38 | $ | 1.51 | $ | 0.43 | $ | 0.51 | $ | 0.33 | $ | 0.44 | $ | 1.70 | 15.8 | |||||||||||||||||||||||
| Diluted shares |
52,711 | 53,792 | 62,902 | 63,163 | (b) | 58,210 | (b) | 82,422 | 86,402 | 86,892 | 87,232 | 86,098 | 38.1 | |||||||||||||||||||||||||||||||
| Revenues by segment: |
||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 627,245 | $ | 612,517 | $ | 591,121 | $ | 619,185 | $ | 2,450,068 | $ | 640,483 | $ | 627,206 | $ | 579,497 | $ | 593,593 | $ | 2,440,779 | (4.1 | ) | ||||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||
| Home health |
74,791 | 75,502 | 74,026 | 74,588 | 298,907 | 300,867 | 427,820 | 424,054 | 425,759 | 1,578,500 | 470.8 | |||||||||||||||||||||||||||||||||
| Hospice |
12,913 | 12,484 | 12,160 | 12,538 | 50,095 | 119,057 | 178,005 | 181,140 | 178,325 | 656,527 | 1,322.3 | |||||||||||||||||||||||||||||||||
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| 87,704 | 87,986 | 86,186 | 87,126 | 349,002 | 419,924 | 605,825 | 605,194 | 604,084 | 2,235,027 | 593.3 | ||||||||||||||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
93,177 | 94,963 | 93,139 | 92,922 | 374,201 | 151,564 | 152,544 | 149,435 | 155,579 | 609,122 | 67.4 | |||||||||||||||||||||||||||||||||
| RehabCare |
253,943 | 253,694 | 246,732 | 252,667 | 1,007,036 | 252,595 | 236,791 | 219,518 | 206,582 | 915,486 | (18.2 | ) | ||||||||||||||||||||||||||||||||
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| 347,120 | 348,657 | 339,871 | 345,589 | 1,381,237 | 404,159 | 389,335 | 368,953 | 362,161 | 1,524,608 | 4.8 | ||||||||||||||||||||||||||||||||||
| Nursing center division |
262,590 | 264,437 | 263,897 | 271,625 | 1,062,549 | 274,308 | 273,870 | 270,510 | 273,387 | 1,092,075 | 0.6 | |||||||||||||||||||||||||||||||||
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| 1,324,659 | 1,313,597 | 1,281,075 | 1,323,525 | 5,242,856 | 1,738,874 | 1,896,236 | 1,824,154 | 1,833,225 | 7,292,489 | 38.5 | ||||||||||||||||||||||||||||||||||
| Eliminations |
(52,049 | ) | (52,200 | ) | (52,157 | ) | (58,851 | ) | (215,257 | ) | (62,907 | ) | (62,761 | ) | (59,638 | ) | (52,276 | ) | (237,582 | ) | (11.2 | ) | ||||||||||||||||||||||
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| $ | 1,272,610 | $ | 1,261,397 | $ | 1,228,918 | $ | 1,264,674 | $ | 5,027,599 | $ | 1,675,967 | $ | 1,833,475 | $ | 1,764,516 | $ | 1,780,949 | $ | 7,054,907 | 40.8 | ||||||||||||||||||||||||
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| Core EBITDAR by segment: |
||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 139,505 | $ | 131,990 | $ | 117,604 | $ | 134,791 | $ | 523,890 | $ | 134,786 | $ | 131,532 | $ | 97,128 | $ | 117,675 | $ | 481,121 | (12.7 | ) | ||||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||
| Home health |
2,845 | 5,769 | 5,961 | 7,398 | 21,973 | 46,798 | 72,917 | 68,155 | 68,826 | 256,696 | 830.3 | |||||||||||||||||||||||||||||||||
| Hospice |
1,852 | 2,139 | 1,149 | 524 | 5,664 | 16,996 | 27,887 | 34,025 | 30,212 | 109,120 | 5,665.6 | |||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||
| 4,697 | 7,908 | 7,110 | 7,922 | 27,637 | 63,794 | 100,804 | 102,180 | 99,038 | 365,816 | 1,150.2 | ||||||||||||||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
25,710 | 25,742 | 24,887 | 23,884 | 100,223 | 44,564 | 44,531 | 42,141 | 45,098 | 176,334 | 88.8 | |||||||||||||||||||||||||||||||||
| RehabCare |
18,016 | 19,863 | 17,080 | 16,029 | 70,988 | 16,493 | 14,681 | 14,544 | 11,858 | 57,576 | (26.0 | ) | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||
| 43,726 | 45,605 | 41,967 | 39,913 | 171,211 | 61,057 | 59,212 | 56,685 | 56,956 | 233,910 | 42.7 | ||||||||||||||||||||||||||||||||||
| Nursing center division |
37,572 | 38,614 | 35,920 | 38,810 | 150,916 | 36,963 | 40,461 | 35,923 | 36,601 | 149,948 | (5.7 | ) | ||||||||||||||||||||||||||||||||
| Support center |
(44,456 | ) | (48,252 | ) | (45,383 | ) | (51,348 | ) | (189,439 | ) | (62,389 | ) | (70,209 | ) | (55,439 | ) | (62,431 | ) | (250,468 | ) | 21.6 | |||||||||||||||||||||||
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|||||||||||||||||||||||||
| $ | 181,044 | $ | 175,865 | $ | 157,218 | $ | 170,088 | $ | 684,215 | $ | 234,211 | $ | 261,800 | $ | 236,477 | $ | 247,839 | $ | 980,327 | 45.7 | ||||||||||||||||||||||||
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|||||||||||||||||||||||||
| Core EBITDAR margin by segment: |
||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
22.2 | 21.5 | 19.9 | 21.8 | 21.4 | 21.0 | 21.0 | 16.8 | 19.8 | 19.7 | (9.2 | ) | ||||||||||||||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||
| Home health |
3.8 | 7.6 | 8.1 | 9.9 | 7.4 | 15.6 | 17.0 | 16.1 | 16.2 | 16.3 | 63.6 | |||||||||||||||||||||||||||||||||
| Hospice |
14.3 | 17.1 | 9.4 | 4.2 | 11.3 | 14.3 | 15.7 | 18.8 | 16.9 | 16.6 | 302.4 | |||||||||||||||||||||||||||||||||
| Kindred at Home |
5.4 | 9.0 | 8.2 | 9.1 | 7.9 | 15.2 | 16.6 | 16.9 | 16.4 | 16.4 | 80.2 | |||||||||||||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
27.6 | 27.1 | 26.7 | 25.7 | 26.8 | 29.4 | 29.2 | 28.2 | 29.0 | 28.9 | 12.8 | |||||||||||||||||||||||||||||||||
| RehabCare |
7.1 | 7.8 | 6.9 | 6.3 | 7.0 | 6.5 | 6.2 | 6.6 | 5.7 | 6.3 | (9.5 | ) | ||||||||||||||||||||||||||||||||
| Kindred Rehabilitation Services |
12.6 | 13.1 | 12.3 | 11.5 | 12.4 | 15.1 | 15.2 | 15.4 | 15.7 | 15.3 | 36.5 | |||||||||||||||||||||||||||||||||
| Nursing center division |
14.3 | 14.6 | 13.6 | 14.3 | 14.2 | 13.5 | 14.8 | 13.3 | 13.4 | 13.7 | (6.3 | ) | ||||||||||||||||||||||||||||||||
| Consolidated |
14.2 | 13.9 | 12.8 | 13.4 | 13.6 | 14.0 | 14.3 | 13.4 | 13.9 | 13.9 | 3.7 | |||||||||||||||||||||||||||||||||
| (a) | See reconciliation of core and adjusted results to GAAP results beginning on page 12. |
| (b) | Excludes share dilution from the fourth quarter 2014 common equity and tangible equity units offerings, both pre-closing financing activities of the Gentiva acquisition. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 9
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data (Continued)
(Unaudited)
(In thousands, except statistics)
| 2014 Quarters | 2015 Quarters | Fourth quarter % change v. |
||||||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | prior year | ||||||||||||||||||||||||||||||||||
| Hospital division: |
||||||||||||||||||||||||||||||||||||||||||||
| End of period data: |
||||||||||||||||||||||||||||||||||||||||||||
| Number of transitional care hospitals |
97 | 97 | 97 | 97 | 97 | 96 | 95 | 95 | ||||||||||||||||||||||||||||||||||||
| Number of licensed beds |
7,145 | 7,145 | 7,145 | 7,147 | 7,147 | 7,124 | 7,094 | 7,094 | ||||||||||||||||||||||||||||||||||||
| Revenue mix %: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
59.8 | 58.2 | 57.0 | 57.0 | 58.0 | 56.8 | 55.2 | 57.1 | 57.3 | 56.6 | ||||||||||||||||||||||||||||||||||
| Medicaid |
6.6 | 6.8 | 6.9 | 6.0 | 6.6 | 5.5 | 5.3 | 5.3 | 5.1 | 5.3 | ||||||||||||||||||||||||||||||||||
| Medicare Advantage |
11.4 | 11.2 | 10.5 | 10.5 | 10.9 | 11.9 | 11.6 | 10.8 | 11.1 | 11.4 | ||||||||||||||||||||||||||||||||||
| Medicaid Managed |
2.4 | 3.0 | 3.8 | 4.5 | 3.4 | 4.7 | 5.6 | 6.1 | 6.2 | 5.6 | ||||||||||||||||||||||||||||||||||
| Commercial insurance and other |
19.8 | 20.8 | 21.8 | 22.0 | 21.1 | 21.1 | 22.3 | 20.7 | 20.3 | 21.1 | ||||||||||||||||||||||||||||||||||
| Admissions: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
9,038 | 8,555 | 8,460 | 8,525 | 34,578 | 8,775 | 8,267 | 7,976 | 8,169 | 33,187 | (4.2 | ) | ||||||||||||||||||||||||||||||||
| Medicaid |
819 | 896 | 805 | 750 | 3,270 | 610 | 610 | 556 | 520 | 2,296 | (30.7 | ) | ||||||||||||||||||||||||||||||||
| Medicare Advantage |
1,435 | 1,389 | 1,250 | 1,359 | 5,433 | 1,555 | 1,352 | 1,212 | 1,304 | 5,423 | (4.0 | ) | ||||||||||||||||||||||||||||||||
| Medicaid Managed |
317 | 381 | 511 | 572 | 1,781 | 643 | 675 | 646 | 612 | 2,576 | 7.0 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
1,914 | 1,885 | 1,703 | 1,696 | 7,198 | 1,868 | 1,815 | 1,763 | 1,701 | 7,147 | 0.3 | |||||||||||||||||||||||||||||||||
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| 13,523 | 13,106 | 12,729 | 12,902 | 52,260 | 13,451 | 12,719 | 12,153 | 12,306 | 50,629 | (4.6 | ) | |||||||||||||||||||||||||||||||||
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| Patient days: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
230,350 | 220,035 | 213,170 | 220,548 | 884,103 | 228,483 | 218,577 | 210,870 | 210,409 | 868,339 | (4.6 | ) | ||||||||||||||||||||||||||||||||
| Medicaid |
32,712 | 32,619 | 30,480 | 30,454 | 126,265 | 28,663 | 25,213 | 23,167 | 21,795 | 98,838 | (28.4 | ) | ||||||||||||||||||||||||||||||||
| Medicare Advantage |
44,025 | 43,027 | 39,938 | 41,260 | 168,250 | 48,448 | 44,740 | 39,585 | 41,079 | 173,852 | (0.4 | ) | ||||||||||||||||||||||||||||||||
| Medicaid Managed |
10,733 | 13,191 | 16,556 | 20,000 | 60,480 | 22,013 | 24,833 | 24,412 | 24,802 | 96,060 | 24.0 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
59,567 | 59,293 | 57,486 | 59,295 | 235,641 | 62,241 | 62,922 | 58,631 | 57,321 | 241,115 | (3.3 | ) | ||||||||||||||||||||||||||||||||
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| 377,387 | 368,165 | 357,630 | 371,557 | 1,474,739 | 389,848 | 376,285 | 356,665 | 355,406 | 1,478,204 | (4.3 | ) | |||||||||||||||||||||||||||||||||
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| Average length of stay: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
25.5 | 25.7 | 25.2 | 25.9 | 25.6 | 26.0 | 26.4 | 26.4 | 25.8 | 26.2 | (0.4 | ) | ||||||||||||||||||||||||||||||||
| Medicaid |
39.9 | 36.4 | 37.9 | 40.6 | 38.6 | 47.0 | 41.3 | 41.7 | 41.9 | 43.0 | 3.2 | |||||||||||||||||||||||||||||||||
| Medicare Advantage |
30.7 | 31.0 | 32.0 | 30.4 | 31.0 | 31.2 | 33.1 | 32.7 | 31.5 | 32.1 | 3.6 | |||||||||||||||||||||||||||||||||
| Medicaid Managed |
33.9 | 34.6 | 32.4 | 35.0 | 34.0 | 34.2 | 36.8 | 37.8 | 40.5 | 37.3 | 15.7 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
31.1 | 31.5 | 33.8 | 35.0 | 32.7 | 33.3 | 34.7 | 33.3 | 33.7 | 33.7 | (3.7 | ) | ||||||||||||||||||||||||||||||||
| Weighted average |
27.9 | 28.1 | 28.1 | 28.8 | 28.2 | 29.0 | 29.6 | 29.3 | 28.9 | 29.2 | 0.3 | |||||||||||||||||||||||||||||||||
| Revenues per admission: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
$ | 41,492 | $ | 41,670 | $ | 39,828 | $ | 41,425 | $ | 41,112 | $ | 41,483 | $ | 41,892 | $ | 41,451 | $ | 41,656 | $ | 41,620 | 0.6 | |||||||||||||||||||||||
| Medicaid |
50,894 | 46,106 | 50,344 | 49,760 | 49,186 | 57,594 | 54,795 | 55,415 | 57,724 | 56,352 | 16.0 | |||||||||||||||||||||||||||||||||
| Medicare Advantage |
49,666 | 49,352 | 49,814 | 47,756 | 49,142 | 48,908 | 53,578 | 51,495 | 50,680 | 51,077 | 6.1 | |||||||||||||||||||||||||||||||||
| Medicaid Managed |
47,803 | 48,814 | 44,321 | 48,691 | 47,305 | 46,740 | 51,950 | 54,976 | 60,263 | 53,383 | 23.8 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
64,858 | 67,679 | 75,591 | 80,167 | 71,743 | 72,395 | 77,110 | 68,151 | 70,735 | 72,150 | (11.8 | ) | ||||||||||||||||||||||||||||||||
| Weighted average |
46,384 | 46,736 | 46,439 | 47,991 | 46,882 | 47,616 | 49,312 | 47,683 | 48,236 | 48,209 | 0.5 | |||||||||||||||||||||||||||||||||
| Revenues per patient day: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
$ | 1,628 | $ | 1,620 | $ | 1,581 | $ | 1,601 | $ | 1,608 | $ | 1,593 | $ | 1,584 | $ | 1,568 | $ | 1,617 | $ | 1,591 | 1.0 | |||||||||||||||||||||||
| Medicaid |
1,274 | 1,266 | 1,330 | 1,225 | 1,274 | 1,226 | 1,326 | 1,330 | 1,377 | 1,309 | 12.4 | |||||||||||||||||||||||||||||||||
| Medicare Advantage |
1,619 | 1,593 | 1,559 | 1,573 | 1,587 | 1,570 | 1,619 | 1,577 | 1,609 | 1,593 | 2.3 | |||||||||||||||||||||||||||||||||
| Medicaid Managed |
1,412 | 1,410 | 1,368 | 1,393 | 1,393 | 1,365 | 1,412 | 1,455 | 1,487 | 1,432 | 6.7 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
2,084 | 2,152 | 2,239 | 2,293 | 2,192 | 2,173 | 2,224 | 2,049 | 2,099 | 2,139 | (8.5 | ) | ||||||||||||||||||||||||||||||||
| Weighted average |
1,662 | 1,664 | 1,653 | 1,666 | 1,661 | 1,643 | 1,667 | 1,625 | 1,670 | 1,651 | 0.2 | |||||||||||||||||||||||||||||||||
| Medicare case mix index (discharged patients only) |
1.173 | 1.182 | 1.157 | 1.139 | 1.163 | 1.166 | 1.163 | 1.150 | 1.164 | 1.162 | 2.2 | |||||||||||||||||||||||||||||||||
| Average daily census |
4,193 | 4,046 | 3,887 | 4,039 | 4,040 | 4,332 | 4,135 | 3,877 | 3,863 | 4,050 | (4.4 | ) | ||||||||||||||||||||||||||||||||
| Occupancy % |
67.3 | 64.6 | 62.1 | 64.5 | 64.6 | 69.2 | 66.1 | 62.2 | 62.2 | 64.9 | (3.6 | ) | ||||||||||||||||||||||||||||||||
| Same-hospital data: |
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| Revenues (a) |
$ | 620,866 | $ | 606,408 | $ | 585,553 | $ | 614,207 | $ | 2,427,034 | $ | 634,975 | $ | 622,018 | $ | 577,337 | $ | 594,091 | $ | 2,428,421 | (3.3 | ) | ||||||||||||||||||||||
| Admissions: |
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| Medicare |
8,910 | 8,423 | 8,342 | 8,403 | 34,078 | 8,652 | 8,172 | 7,932 | 8,169 | 32,925 | (2.8 | ) | ||||||||||||||||||||||||||||||||
| Medicaid |
812 | 885 | 794 | 739 | 3,230 | 602 | 608 | 556 | 520 | 2,286 | (29.6 | ) | ||||||||||||||||||||||||||||||||
| Medicare Advantage |
1,429 | 1,376 | 1,244 | 1,351 | 5,400 | 1,546 | 1,348 | 1,212 | 1,304 | 5,410 | (3.5 | ) | ||||||||||||||||||||||||||||||||
| Medicaid Managed |
315 | 377 | 511 | 568 | 1,771 | 640 | 670 | 644 | 612 | 2,566 | 7.7 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
1,895 | 1,863 | 1,688 | 1,669 | 7,115 | 1,840 | 1,797 | 1,762 | 1,701 | 7,100 | 1.9 | |||||||||||||||||||||||||||||||||
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| 13,361 | 12,924 | 12,579 | 12,730 | 51,594 | 13,280 | 12,595 | 12,106 | 12,306 | 50,287 | (3.3 | ) | |||||||||||||||||||||||||||||||||
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| Patient days: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
227,635 | 217,074 | 210,386 | 218,127 | 873,222 | 225,992 | 216,230 | 209,662 | 210,466 | 862,350 | (3.5 | ) | ||||||||||||||||||||||||||||||||
| Medicaid |
32,303 | 32,260 | 30,254 | 30,207 | 125,024 | 28,458 | 25,060 | 23,141 | 21,795 | 98,454 | (27.8 | ) | ||||||||||||||||||||||||||||||||
| Medicare Advantage |
43,906 | 42,802 | 39,859 | 41,153 | 167,720 | 48,276 | 44,548 | 39,585 | 41,079 | 173,488 | (0.2 | ) | ||||||||||||||||||||||||||||||||
| Medicaid Managed |
10,714 | 13,143 | 16,515 | 19,906 | 60,278 | 21,933 | 24,673 | 24,280 | 24,783 | 95,669 | 24.5 | |||||||||||||||||||||||||||||||||
| Commercial insurance and other |
59,059 | 58,968 | 57,185 | 58,833 | 234,045 | 61,715 | 62,462 | 58,625 | 57,325 | 240,127 | (2.6 | ) | ||||||||||||||||||||||||||||||||
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| 373,617 | 364,247 | 354,199 | 368,226 | 1,460,289 | 386,374 | 372,973 | 355,293 | 355,448 | 1,470,088 | (3.5 | ) | |||||||||||||||||||||||||||||||||
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| Total average length of stay |
28.0 | 28.2 | 28.2 | 28.9 | 28.3 | 29.1 | 29.6 | 29.3 | 28.9 | 29.2 | — | |||||||||||||||||||||||||||||||||
| Total revenues per patient day |
$ | 1,662 | $ | 1,665 | $ | 1,653 | $ | 1,668 | $ | 1,662 | $ | 1,643 | $ | 1,668 | $ | 1,625 | $ | 1,671 | $ | 1,652 | 0.2 | |||||||||||||||||||||||
| (a) | See reconciliation of same-hospital revenues to reported revenues for the Hospital Division on page 14. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 10
February 25, 2016
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data (Continued)
(Unaudited)
(In thousands, except statistics)
| 2014 Quarters | 2015 Quarters | Fourth quarter % change v. prior year |
||||||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | |||||||||||||||||||||||||||||||||||
| Kindred at Home (data combined to include Kindred and Gentiva for each historical period): |
||||||||||||||||||||||||||||||||||||||||||||
| Home Health: |
||||||||||||||||||||||||||||||||||||||||||||
| Sites of service (at end of period) |
447 | 440 | 439 | 427 | 415 | 411 | 388 | 373 | ||||||||||||||||||||||||||||||||||||
| Revenue mix %: |
||||||||||||||||||||||||||||||||||||||||||||
| Medicare |
81.8 | 81.5 | 80.7 | 80.7 | 81.2 | 80.9 | 80.4 | 80.0 | 80.0 | 80.3 | ||||||||||||||||||||||||||||||||||
| Medicaid |
2.7 | 2.6 | 2.4 | 2.2 | 2.5 | 2.1 | 2.1 | 2.1 | 2.1 | 2.1 | ||||||||||||||||||||||||||||||||||
| Commercial and other |
9.1 | 9.0 | 8.9 | 6.7 | 8.4 | 7.3 | 7.9 | 8.2 | 8.5 | 8.1 | ||||||||||||||||||||||||||||||||||
| Commercial paid at episodic rates |
6.4 | 6.9 | 8.0 | 10.4 | 7.9 | 9.7 | 9.6 | 9.7 | 9.4 | 9.5 | ||||||||||||||||||||||||||||||||||
| Episodic revenues ($000s) |
$ | 281,226 | $ | 294,208 | $ | 292,675 | $ | 305,668 | $ | 1,173,777 | $ | 308,317 | $ | 324,027 | $ | 319,820 | $ | 320,698 | $ | 1,272,862 | 4.9 | |||||||||||||||||||||||
| Total episodic admissions |
65,077 | 63,676 | 65,049 | 65,183 | 258,985 | 69,936 | 67,808 | 66,753 | 66,157 | 270,654 | 1.5 | |||||||||||||||||||||||||||||||||
| Medicare episodic admissions |
59,248 | 58,140 | 57,921 | 57,372 | 232,681 | 61,186 | 59,394 | 58,479 | 57,804 | 236,863 | 0.8 | |||||||||||||||||||||||||||||||||
| Total episodes |
103,758 | 103,689 | 105,906 | 106,708 | 420,061 | 110,980 | 109,599 | 108,519 | 108,300 | 437,398 | 1.5 | |||||||||||||||||||||||||||||||||
| Episodes per admission |
1.59 | 1.63 | 1.63 | 1.64 | 1.62 | 1.59 | 1.62 | 1.63 | 1.64 | 1.62 | — | |||||||||||||||||||||||||||||||||
| Revenue per episode |
$ | 2,710 | $ | 2,837 | $ | 2,764 | $ | 2,865 | $ | 2,794 | $ | 2,778 | $ | 2,956 | $ | 2,947 | $ | 2,961 | $ | 2,910 | 3.4 | |||||||||||||||||||||||
| Hospice: |
||||||||||||||||||||||||||||||||||||||||||||
| Sites of service (at end of period) |
216 | 200 | 199 | 193 | 190 | 185 | 181 | 175 | ||||||||||||||||||||||||||||||||||||
| Admissions |
13,807 | 12,751 | 12,088 | 12,151 | 50,797 | 13,164 | 12,574 | 12,091 | 12,129 | 49,958 | (0.2 | ) | ||||||||||||||||||||||||||||||||
| Average length of stay |
103 | 106 | 103 | 103 | 104 | 95 | 93 | 101 | 100 | 97 | (2.9 | ) | ||||||||||||||||||||||||||||||||
| Patient days |
1,252,787 | 1,251,301 | 1,236,792 | 1,215,209 | 4,956,089 | 1,150,841 | 1,190,604 | 1,211,291 | 1,185,330 | 4,738,066 | (2.5 | ) | ||||||||||||||||||||||||||||||||
| Revenue per patient day |
$ | 150 | $ | 148 | $ | 149 | $ | 154 | $ | 150 | $ | 151 | $ | 150 | $ | 150 | $ | 150 | $ | 150 | (2.6 | ) | ||||||||||||||||||||||
| Average daily census |
13,920 | 13,751 | 13,443 | 13,209 | 13,578 | 12,787 | 13,084 | 13,166 | 12,884 | 12,981 | (2.5 | ) | ||||||||||||||||||||||||||||||||
| Community Care and other revenues (included in Home Health business segment) |
$ | 66,732 | $ | 66,372 | $ | 67,390 | $ | 67,621 | $ | 268,115 | $ | 65,530 | $ | 67,647 | $ | 67,338 | $ | 67,684 | $ | 268,199 | 0.1 | |||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Freestanding IRFs: |
||||||||||||||||||||||||||||||||||||||||||||
| End of period data: |
||||||||||||||||||||||||||||||||||||||||||||
| Number of IRFs |
5 | 5 | 5 | 5 | 16 | 16 | 18 | 18 | ||||||||||||||||||||||||||||||||||||
| Number of licensed beds |
215 | 215 | 215 | 215 | 829 | 829 | 919 | 919 | ||||||||||||||||||||||||||||||||||||
| Discharges (a) |
1,053 | 1,121 | 1,004 | 1,046 | 4,224 | 3,806 | 3,927 | 3,941 | 4,317 | 15,991 | 312.7 | |||||||||||||||||||||||||||||||||
| Occupancy % (a) |
71.6 | 71.6 | 68.5 | 69.6 | 70.3 | 73.2 | 71.5 | 68.7 | 68.0 | 70.2 | (2.3 | ) | ||||||||||||||||||||||||||||||||
| Average length of stay (a) |
13.2 | 12.5 | 13.5 | 13.2 | 13.1 | 13.7 | 13.1 | 13.2 | 12.7 | 13.2 | (3.8 | ) | ||||||||||||||||||||||||||||||||
| Revenue per discharge (a) |
$ | 18,246 | $ | 17,519 | $ | 18,259 | $ | 17,039 | $ | 17,757 | $ | 19,517 | $ | 19,325 | $ | 18,992 | $ | 18,640 | $ | 19,104 | 9.4 | |||||||||||||||||||||||
| Contract services: |
||||||||||||||||||||||||||||||||||||||||||||
| Sites of service (at end of period): |
||||||||||||||||||||||||||||||||||||||||||||
| Inpatient rehabilitation units |
105 | 104 | 102 | 100 | 100 | 99 | 101 | 100 | ||||||||||||||||||||||||||||||||||||
| LTAC hospitals |
121 | 118 | 117 | 117 | 120 | 120 | 119 | 119 | ||||||||||||||||||||||||||||||||||||
| Sub-acute units |
10 | 9 | 10 | 10 | 8 | 8 | 7 | 7 | ||||||||||||||||||||||||||||||||||||
| Outpatient units |
143 | 143 | 139 | 138 | 138 | 139 | 135 | 130 | ||||||||||||||||||||||||||||||||||||
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| 379 | 374 | 368 | 365 | 366 | 366 | 362 | 356 | |||||||||||||||||||||||||||||||||||||
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| Revenue per site |
$ | 195,157 | $ | 201,400 | $ | 203,284 | $ | 205,749 | $ | 805,590 | $ | 211,151 | $ | 209,436 | $ | 206,041 | $ | 210,978 | $ | 837,606 | 2.5 | |||||||||||||||||||||||
| RehabCare: |
||||||||||||||||||||||||||||||||||||||||||||
| Sites of service (at end of period) |
1,851 | 1,863 | 1,896 | 1,935 | 1,829 | 1,789 | 1,821 | 1,798 | ||||||||||||||||||||||||||||||||||||
| Revenue per site |
$ | 137,193 | $ | 136,175 | $ | 130,133 | $ | 130,576 | $ | 534,077 | $ | 138,106 | $ | 132,359 | $ | 120,548 | $ | 114,896 | $ | 505,909 | (12.0 | ) | ||||||||||||||||||||||
| Nursing center division: |
||||||||||||||||||||||||||||||||||||||||||||
| End of period data: |
||||||||||||||||||||||||||||||||||||||||||||
| Number of nursing centers |
89 | 89 | 90 | 90 | 90 | 90 | 90 | 90 | ||||||||||||||||||||||||||||||||||||
| Number of licensed beds |
11,503 | 11,491 | 11,575 | 11,535 | 11,535 | 11,535 | 11,535 | 11,535 | ||||||||||||||||||||||||||||||||||||
| Admissions (b) |
9,789 | 9,621 | 9,746 | 9,616 | 38,772 | 10,376 | 9,831 | 9,558 | 9,237 | 39,002 | (3.9 | ) | ||||||||||||||||||||||||||||||||
| Medicare average length of stay (b) |
29.6 | 29.8 | 29.9 | 29.0 | 29.6 | 28.9 | 28.9 | 28.5 | 28.4 | 28.7 | (2.1 | ) | ||||||||||||||||||||||||||||||||
| Patient days (b) |
861,340 | 858,772 | 865,415 | 871,976 | 3,457,503 | 861,278 | 852,691 | 851,332 | 845,924 | 3,411,225 | (3.0 | ) | ||||||||||||||||||||||||||||||||
| Revenues per patient day (b) |
$ | 305 | $ | 308 | $ | 305 | $ | 312 | $ | 307 | $ | 319 | $ | 321 | $ | 318 | $ | 323 | $ | 320 | 3.5 | |||||||||||||||||||||||
| Average daily census (b) |
9,570 | 9,437 | 9,407 | 9,478 | 9,473 | 9,570 | 9,370 | 9,254 | 9,195 | 9,346 | (3.0 | ) | ||||||||||||||||||||||||||||||||
| Occupancy % (b) |
81.7 | 80.7 | 80.1 | 80.5 | 80.7 | 81.3 | 79.6 | 78.6 | 78.1 | 79.4 | (3.0 | ) | ||||||||||||||||||||||||||||||||
| (a) | Excludes non-consolidating IRF. |
| (b) | Excludes managed facilities. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 11
February 25, 2016
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, all statements regarding the Company’s expected future financial position, results of operations, cash flows, dividends, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management, government investigations, regulatory matters, and statements containing the words such as “anticipate,” “approximate,” “believe,” “plan,” “estimate,” “expect,” “project,” “could,” “would,” “should,” “will,” “intend,” “may,” “potential,” “upside,” and other similar expressions. Statements in this press release concerning the Company’s business outlook or future economic performance, anticipated profitability, revenues, expenses, dividends or other financial items, product or services line growth, and expected outcome of government investigations and other regulatory matters, together with other statements that are not historical facts, are forward-looking statements that are estimates reflecting the best judgment of the Company based upon currently available information.
Such forward-looking statements are inherently uncertain, and stockholders and other potential investors must recognize that actual results may differ materially from the Company’s expectations as a result of a variety of factors. Such forward-looking statements are based upon management’s current expectations and include known and unknown risks, uncertainties and other factors, many of which the Company is unable to predict or control, that may cause the Company’s actual results, performance or plans to differ materially from any future results, performance or plans expressed or implied by such forward-looking statements. These statements involve risks, uncertainties and other factors detailed from time to time in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K with the Securities and Exchange Commission.
Many of these factors are beyond the Company’s control. The Company cautions investors that any forward-looking statements made by the Company are not guarantees of future performance. The Company disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 12
February 25, 2016
Non-GAAP Measurements
In addition to the results provided in accordance with GAAP, the Company has provided information in this release to compute certain non-GAAP measurements for the four quarters in 2015 and 2014 and for the years ended December 31, 2015 and 2014 before certain charges or on a core and adjusted core basis, and on a same-hospital basis. The use of these non-GAAP measures are not intended to replace the presentation of the Company’s financial results in accordance with GAAP. The Company believes that the presentation of core operating results provides additional information to investors to facilitate the comparison between periods by excluding certain charges that are not representative of its ongoing operations due to the materiality and nature of the charges. The Company believes the presentation of adjusted core operating results, which excludes non-cash expenses related to amortization of intangible assets, stock-based compensation and deferred financing costs from core operating results, is a useful performance measure used by some investors, equity analysts and others to make informed investment decisions and for comparability to other companies that use similar measures. The Company believes the presentation of same-hospital revenues, which excludes the results from two hospitals that closed during 2015, provides investors, equity analysts and others with useful information regarding the performance of the Company’s hospital operations that are comparable for the periods presented. The Company believes that reported hospital segment revenues is the most comparable GAAP measure. Readers of the Company’s financial information should consider reported hospital segment revenues as an important measure of the Company’s Hospital Division financial performance because it provides the most complete measure of its revenues. The Company’s earnings release also includes financial measures referred to as operating income, or EBITDAR or core EBITDAR, and core earnings before interest, income taxes, depreciation and amortization (“core EBITDA”). The Company’s management uses core EBITDAR or core EBITDA as meaningful measures of operational performance in addition to other measures. The Company uses core EBITDAR or core EBITDA to assess the relative performance of its operating divisions as well as the employees that operate these businesses. In addition, the Company believes these measurements are important because securities analysts and investors use these measurements to compare the Company’s performance to other companies in the healthcare industry. The Company believes that income (loss) from continuing operations is the most comparable GAAP measure. Readers of the Company’s financial information should consider income (loss) from continuing operations as an important measure of the Company’s financial performance because it provides the most complete measure of its performance. Operating results presented on a core and adjusted core basis and core EBITDAR or core EBITDA, as well as a same-hospital basis, should be considered in addition to, not as a substitute for, or superior to, financial measures based upon GAAP as an indicator of operating performance. Reconciliations of the non-GAAP measurements to the GAAP measurements are included in the following pages of this press release.
Also in this press release, the Company provides the financial measures of operating cash flows and free cash flows excluding certain items, which the Company refers to as core operating cash flows and core free cash flows. The Company recognizes that core operating cash flows and core free cash flows are non-GAAP measurements and are not intended to replace the presentation of the Company’s cash flows in accordance with GAAP. The Company believes that these non-GAAP measurements provide important information to investors for comparability to other companies that use similar measures. In addition, management uses core operating cash flows and core free cash flows in making decisions related to acquisitions, development capital expenditures, dividends, long-term debt repayments and other uses. The Company believes net cash flows provided by operating activities is the most comparable GAAP measure. Readers of the Company’s financial information should consider net cash flows provided by operating activities as an important measure of the Company’s financial performance because it provides the most complete measure of its performance. Core operating cash flows and core free cash flows should be considered in addition to, not as a substitute for, or superior to, financial measures based upon GAAP as an indicator of operating performance. Reconciliations of net cash flows provided by operating activities to core operating cash flows and core free cash flows are included in this press release.
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 13
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results
(Unaudited)
(In thousands, except per share amounts and statistics)
In addition to the results provided in accordance with GAAP, the Company has provided information in this release to compute certain non-GAAP measurements for the three months and years ended December 31, 2015 and 2014 before certain charges or on a core basis. The charges that were excluded from core operating results are denoted in the tables below.
The income tax benefit associated with the excluded charges was calculated using an effective income tax rate of 129.2% and 33.1% for the three months ended December 31, 2015 and 2014, respectively, and 36.8% and 35.4% for the years ended December 31, 2015 and 2014, respectively. The difference in the effective income tax rate for both periods compared to the same prior year periods is attributable to the composition of charges that are non-deductible for income tax purposes. For the three months ended December 31, 2015, the Company recorded an income tax benefit of $47.1 million based upon the final settlement terms of an investigation of RehabCare Group, Inc. by the United States Department of Justice, which was completed in January 2016. The investigation was settled for $126.3 million, including interest, and $125 million of the settlement cost was recorded during the nine months ended September 30, 2015.
| Three months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Detail of charges: |
||||||||||||||||
| Litigation contingency expense |
($ | 8,261 | ) | $ | — | ($ | 138,648 | ) | ($ | 4,600 | ) | |||||
| Retirement and severance costs |
(2,125 | ) | (11,745 | ) | (7,752 | ) | (18,381 | ) | ||||||||
| Hospital and home health/hospice closings |
(3,338 | ) | (200 | ) | (11,127 | ) | (200 | ) | ||||||||
| RehabCare customer contract litigation |
(12,864 | ) | — | (12,864 | ) | — | ||||||||||
| Development project cancellation and other restructuring costs |
— | — | (1,259 | ) | — | |||||||||||
| RehabCare trade name impairment |
(18,031 | ) | — | (18,031 | ) | — | ||||||||||
| Customer bankruptcy |
— | — | — | (1,857 | ) | |||||||||||
| Consulting fees related to new LTAC criteria rule |
— | (2,460 | ) | — | (2,460 | ) | ||||||||||
| Gentiva transaction and integration costs: |
||||||||||||||||
| Professional and consulting fees |
(2,662 | ) | (5,545 | ) | (37,840 | ) | (10,824 | ) | ||||||||
| Severance and retention |
(1,527 | ) | — | (60,358 | ) | — | ||||||||||
| Lease termination (charged to rent expense) |
— | — | (792 | ) | — | |||||||||||
| Pre-closing financing charges (charged to general and administrative expenses) |
— | — | (6,005 | ) | — | |||||||||||
| Pre-closing financing charges (charged to interest expense) |
— | (17,041 | ) | (17,431 | ) | (17,041 | ) | |||||||||
| Trade name impairment charges |
— | — | (6,726 | ) | — | |||||||||||
| Lease termination (charged to rent expense) |
(889 | ) | — | (2,720 | ) | (247 | ) | |||||||||
| Debt refinancing costs (charged to interest expense) |
— | — | — | (56,643 | ) | |||||||||||
| Other transaction costs |
(1,178 | ) | (3,145 | ) | (4,928 | ) | (7,159 | ) | ||||||||
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| (50,875 | ) | (40,136 | ) | (326,481 | ) | (119,412 | ) | |||||||||
| Income tax benefit |
65,738 | 13,298 | 120,040 | 42,234 | ||||||||||||
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| Charges net of income taxes |
14,863 | (26,838 | ) | (206,441 | ) | (77,178 | ) | |||||||||
| Allocation to participating unvested restricted stockholders |
(204 | ) | — | — | — | |||||||||||
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| Available to common stockholders |
$ | 14,659 | ($ | 26,838 | ) | ($ | 206,441 | ) | ($ | 77,178 | ) | |||||
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| Weighted average diluted shares outstanding |
87,232 | 65,135 | 84,558 | 58,634 | ||||||||||||
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| Diluted earnings (loss) per common share related to charges |
$ | 0.17 | ($ | 0.41 | ) | ($ | 2.44 | ) | ($ | 1.32 | ) | |||||
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| Reconciliation of income from continuing operations before charges: |
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| Amounts attributable to Kindred stockholders: |
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| Income from continuing operations before charges |
$ | 29,039 | $ | 16,892 | $ | 112,014 | $ | 63,202 | ||||||||
| Charges net of income taxes |
14,863 | (26,838 | ) | (206,441 | ) | (77,178 | ) | |||||||||
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| Reported income (loss) from continuing operations |
$ | 43,902 | ($ | 9,946 | ) | ($ | 94,427 | ) | ($ | 13,976 | ) | |||||
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| Reconciliation of core diluted EPS from continuing operations: |
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| Diluted core EPS (a) |
$ | 0.33 | $ | 0.26 | $ | 1.28 | $ | 1.06 | ||||||||
| Charges net of income taxes |
0.17 | (0.41 | ) | (2.44 | ) | (1.32 | ) | |||||||||
| Other |
— | — | 0.04 | 0.02 | ||||||||||||
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| Reported diluted earnings (loss) per common share from continuing operations |
$ | 0.50 | ($ | 0.15 | ) | ($ | 1.12 | ) | ($ | 0.24 | ) | |||||
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| Weighted average diluted shares used to compute earnings per common share from continuing operations before charges (b) |
87,232 | 63,163 | 86,098 | 58,210 | ||||||||||||
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| Reconciliation of effective income tax rate before charges: |
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| Effective income tax rate before charges |
25.1 | % | 27.8 | % | 33.3 | % | 34.2 | % | ||||||||
| Impact of charges on effective income tax rate |
1273.1 | % | 22.3 | % | 11.9 | % | -25.6 | % | ||||||||
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| Reported effective income tax rate |
1298.2 | % | 50.1 | % | 45.2 | % | 8.6 | % | ||||||||
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| (a) | For purposes of computing diluted earnings per common share before charges, income from continuing operations before charges was reduced by $0.4 million for both the three months ended December 31, 2015 and 2014, and by $1.8 million and $1.7 million for the years ended December 31, 2015 and 2014, respectively, for the allocation of income to participating unvested restricted stockholders. |
| (b) | Excludes share dilution from the fourth quarter 2014 common equity and tangible equity units offerings, both pre-closing financing activities of the Gentiva acquisition. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 14
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts and statistics)
A reconciliation of adjusted core earnings follows:
| 2014 Quarters | 2015 Quarters | |||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | |||||||||||||||||||||||||||||||
| Reconciliation of adjusted core earnings: |
||||||||||||||||||||||||||||||||||||||||
| Income from continuing operations before charges (as calculated and reconciled to GAAP measurement on the following pages) |
$ | 18,831 | $ | 19,363 | $ | 8,116 | $ | 16,892 | $ | 63,202 | $ | 28,418 | $ | 34,051 | $ | 20,506 | $ | 29,039 | $ | 112,014 | ||||||||||||||||||||
| Add back non-cash expenses: |
||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets |
5,560 | 5,513 | 5,378 | 5,215 | 21,666 | 6,932 | 7,536 | 7,728 | 7,645 | 29,841 | ||||||||||||||||||||||||||||||
| Amortization of stock-based compensation costs |
2,585 | 5,924 | 748 | 5,073 | 14,330 | 3,141 | 6,687 | 3,194 | 4,778 | 17,800 | ||||||||||||||||||||||||||||||
| Amortization of deferred financing costs |
2,397 | 1,950 | 1,982 | 2,044 | 8,373 | 3,062 | 3,539 | 3,554 | 3,566 | 13,721 | ||||||||||||||||||||||||||||||
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| 10,542 | 13,387 | 8,108 | 12,332 | 44,369 | 13,135 | 17,762 | 14,476 | 15,989 | 61,362 | |||||||||||||||||||||||||||||||
| Income tax benefit related to non-cash expenses |
4,148 | 5,268 | 3,190 | 4,853 | 17,459 | 5,169 | 6,989 | 5,696 | 6,292 | 24,146 | ||||||||||||||||||||||||||||||
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| Non-cash expenses, net of income taxes |
6,394 | 8,119 | 4,918 | 7,479 | 26,910 | 7,966 | 10,773 | 8,780 | 9,697 | 37,216 | ||||||||||||||||||||||||||||||
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| Adjusted core earnings |
$ | 25,225 | $ | 27,482 | $ | 13,034 | $ | 24,371 | $ | 90,112 | $ | 36,384 | $ | 44,824 | $ | 29,286 | $ | 38,736 | $ | 149,230 | ||||||||||||||||||||
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| Reconciliation of diluted adjusted core earnings from continuing operations: |
||||||||||||||||||||||||||||||||||||||||
| Diluted income per common share before charges (as calculated on the following pages) |
$ | 0.35 | $ | 0.35 | $ | 0.13 | $ | 0.26 | $ | 1.06 | $ | 0.34 | $ | 0.39 | $ | 0.23 | $ | 0.33 | $ | 1.28 | ||||||||||||||||||||
| Non-cash expenses, net of income taxes |
0.11 | 0.15 | 0.07 | 0.12 | 0.45 | 0.09 | 0.12 | 0.10 | 0.11 | 0.42 | ||||||||||||||||||||||||||||||
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| Adjusted diluted core EPS from continuing operations |
$ | 0.46 | $ | 0.50 | $ | 0.20 | $ | 0.38 | $ | 1.51 | $ | 0.43 | $ | 0.51 | $ | 0.33 | $ | 0.44 | $ | 1.70 | ||||||||||||||||||||
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| Weighted average diluted shares used to compute adjusted core EPS |
52,711 | 53,792 | 62,902 | 63,163 | 58,210 | 82,422 | 86,402 | 86,892 | 87,232 | 86,098 | ||||||||||||||||||||||||||||||
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A reconciliation of combined Kindred and Gentiva home health revenues (excluding community care) for each historical period follows:
| 2014 Quarters | 2015 Quarters | Fourth quarter % change v. prior year |
||||||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | |||||||||||||||||||||||||||||||||||
| Kindred |
$ | 67,266 | $ | 67,830 | $ | 65,954 | $ | 66,491 | $ | 267,541 | $ | 254,965 | $ | 360,173 | $ | 356,716 | $ | 358,075 | $ | 1,329,929 | ||||||||||||||||||||||||
| Gentiva |
253,895 | 267,018 | 266,340 | 275,342 | 1,062,595 | 87,520 | — | — | — | 87,520 | ||||||||||||||||||||||||||||||||||
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| $ | 321,161 | $ | 334,848 | $ | 332,294 | $ | 341,833 | $ | 1,330,136 | $ | 342,485 | $ | 360,173 | $ | 356,716 | $ | 358,075 | $ | 1,417,449 | 4.8 | ||||||||||||||||||||||||
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A reconciliation of same-hospital revenues to reported revenues for the Hospital Division for each historical period follows:
| 2014 Quarters | 2015 Quarters | Fourth quarter % change v. prior year |
||||||||||||||||||||||||||||||||||||||||||
| First | Second | Third | Fourth | Year | First | Second | Third | Fourth | Year | |||||||||||||||||||||||||||||||||||
| Same-hospital revenues |
$ | 620,866 | $ | 606,408 | $ | 585,553 | $ | 614,207 | $ | 2,427,034 | $ | 634,975 | $ | 622,018 | $ | 577,337 | $ | 594,091 | $ | 2,428,421 | (3.3 | ) | ||||||||||||||||||||||
| Two hospitals that closed during 2015 (a) |
6,379 | 6,109 | 5,568 | 4,978 | 23,034 | 5,508 | 5,188 | 2,160 | (498 | ) | 12,358 | |||||||||||||||||||||||||||||||||
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| Reported revenues |
$ | 627,245 | $ | 612,517 | $ | 591,121 | $ | 619,185 | $ | 2,450,068 | $ | 640,483 | $ | 627,206 | $ | 579,497 | $ | 593,593 | $ | 2,440,779 | (4.1 | ) | ||||||||||||||||||||||
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| (a) | One hospital closed during the second quarter of 2015 and one hospital closed during the third quarter of 2015. |
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 15
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts)
| Three months ended December 31, 2015 | ||||||||||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||||||||||
| Hospital | RehabCare | Gentiva | ||||||||||||||||||||||||||||||||||||||
| Before | Retirement | and home | customer | transaction | ||||||||||||||||||||||||||||||||||||
| charges | and | health/hospice | contract | Litigation | Impairment | and | Other | As | ||||||||||||||||||||||||||||||||
| (“core”) | severance | closings | litigation | contingency | charges | integration | transaction | Total | reported | |||||||||||||||||||||||||||||||
| Income from continuing operations: |
||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 117,675 | $ | (1,221 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (1,221 | ) | $ | 116,454 | ||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||
| Home health |
68,826 | — | (1,794 | ) | — | — | — | — | — | (1,794 | ) | 67,032 | ||||||||||||||||||||||||||||
| Hospice |
30,212 | — | (1,544 | ) | — | — | — | — | — | (1,544 | ) | 28,668 | ||||||||||||||||||||||||||||
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| 99,038 | — | (3,338 | ) | — | — | — | — | — | (3,338 | ) | 95,700 | |||||||||||||||||||||||||||||
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| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
45,098 | (207 | ) | — | — | — | — | — | — | (207 | ) | 44,891 | ||||||||||||||||||||||||||||
| RehabCare |
11,858 | (112 | ) | — | (12,864 | ) | — | — | — | — | (12,976 | ) | (1,118 | ) | ||||||||||||||||||||||||||
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| 56,956 | (319 | ) | — | (12,864 | ) | — | — | — | — | (13,183 | ) | 43,773 | ||||||||||||||||||||||||||||
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| Nursing center division |
36,601 | — | — | — | — | — | — | — | — | 36,601 | ||||||||||||||||||||||||||||||
| Support center |
(62,431 | ) | (585 | ) | — | — | — | — | — | — | (585 | ) | (63,016 | ) | ||||||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | — | (8,261 | ) | — | — | (8,261 | ) | (8,261 | ) | ||||||||||||||||||||||||||||
| Impairment charges |
— | — | — | — | — | (18,031 | ) | — | — | (18,031 | ) | (18,031 | ) | |||||||||||||||||||||||||||
| Transaction costs |
— | — | — | — | — | — | (4,189 | ) | (1,178 | ) | (5,367 | ) | (5,367 | ) | ||||||||||||||||||||||||||
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| Operating income (EBITDAR) |
247,839 | (2,125 | ) | (3,338 | ) | (12,864 | ) | (8,261 | ) | (18,031 | ) | (4,189 | ) | (1,178 | ) | (49,986 | ) | 197,853 | ||||||||||||||||||||||
| Rent |
(96,934 | ) | — | (889 | ) | — | — | — | — | — | (889 | ) | (97,823 | ) | ||||||||||||||||||||||||||
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| EBITDA |
150,905 | (2,125 | ) | (4,227 | ) | (12,864 | ) | (8,261 | ) | (18,031 | ) | (4,189 | ) | (1,178 | ) | (50,875 | ) | 100,030 | ||||||||||||||||||||||
| Depreciation and amortization |
(40,362 | ) | — | — | — | — | — | — | — | — | (40,362 | ) | ||||||||||||||||||||||||||||
| Interest, net |
(55,664 | ) | — | — | — | — | — | — | — | — | (55,664 | ) | ||||||||||||||||||||||||||||
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|||||||||||||||||||||
| Income from continuing operations before income taxes |
54,879 | (2,125 | ) | (4,227 | ) | (12,864 | ) | (8,261 | ) | (18,031 | ) | (4,189 | ) | (1,178 | ) | (50,875 | ) | 4,004 | ||||||||||||||||||||||
| Provision (benefit) for income taxes |
13,758 | (836 | ) | (1,663 | ) | (5,062 | ) | (50,329 | ) | (6,205 | ) | (1,487 | ) | (156 | ) | (65,738 | ) | (51,980 | ) | |||||||||||||||||||||
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| 41,121 | $ | (1,289 | ) | $ | (2,564 | ) | $ | (7,802 | ) | $ | 42,068 | $ | (11,826 | ) | $ | (2,702 | ) | $ | (1,022 | ) | $ | 14,863 | 55,984 | |||||||||||||||||
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|||||||||||||||||||||||||
| Noncontrolling interests |
(12,082 | ) | (12,082 | ) | ||||||||||||||||||||||||||||||||||||
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|
|
|||||||||||||||||||||||||||||||||||||
| Income attributable to Kindred |
$ | 29,039 | $ | 43,902 | ||||||||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||||||||||
| Diluted earnings per common share |
$ | 0.33 | $ | 0.50 | ||||||||||||||||||||||||||||||||||||
| Diluted shares used in computing earnings per common share |
87,232 | 87,232 | ||||||||||||||||||||||||||||||||||||||
| Three months ended December 31, 2014 | ||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||
| Before | Severance | LTAC | Gentiva | |||||||||||||||||||||||||||||
| charges | and other | criteria | pre-closing | Gentiva | Other | As | ||||||||||||||||||||||||||
| (“core”) | restructuring | consulting | financing | transaction | transaction | Total | reported | |||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||
| Hospital division |
$ | 134,791 | $ | (318 | ) | $ | — | $ | — | $ | — | $ | — | $ | (318 | ) | $ | 134,473 | ||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||
| Home health |
7,398 | (828 | ) | — | — | — | — | (828 | ) | 6,570 | ||||||||||||||||||||||
| Hospice |
524 | (106 | ) | — | — | — | — | (106 | ) | 418 | ||||||||||||||||||||||
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| 7,922 | (934 | ) | — | — | — | — | (934 | ) | 6,988 | |||||||||||||||||||||||
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| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
23,884 | — | — | — | — | — | — | 23,884 | ||||||||||||||||||||||||
| RehabCare |
16,029 | — | — | — | — | — | — | 16,029 | ||||||||||||||||||||||||
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| 39,913 | — | — | — | — | — | — | 39,913 | |||||||||||||||||||||||||
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| Nursing center division |
38,810 | (500 | ) | — | — | — | — | (500 | ) | 38,310 | ||||||||||||||||||||||
| Support center |
(51,348 | ) | (10,193 | ) | (2,460 | ) | — | — | — | (12,653 | ) | (64,001 | ) | |||||||||||||||||||
| Transaction costs |
— | — | — | — | (5,545 | ) | (3,145 | ) | (8,690 | ) | (8,690 | ) | ||||||||||||||||||||
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|||||||||||||||||
| Operating income (EBITDAR) |
170,088 | (11,945 | ) | (2,460 | ) | — | (5,545 | ) | (3,145 | ) | (23,095 | ) | 146,993 | |||||||||||||||||||
| Rent |
(79,167 | ) | — | — | — | — | — | — | (79,167 | ) | ||||||||||||||||||||||
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| EBITDA |
90,921 | (11,945 | ) | (2,460 | ) | — | (5,545 | ) | (3,145 | ) | (23,095 | ) | 67,826 | |||||||||||||||||||
| Depreciation and amortization |
(38,558 | ) | — | — | — | — | — | — | (38,558 | ) | ||||||||||||||||||||||
| Interest, net |
(21,857 | ) | — | — | (17,041 | ) | — | — | (17,041 | ) | (38,898 | ) | ||||||||||||||||||||
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| Income (loss) from continuing operations before income taxes |
30,506 | (11,945 | ) | (2,460 | ) | (17,041 | ) | (5,545 | ) | (3,145 | ) | (40,136 | ) | (9,630 | ) | |||||||||||||||||
| Provision (benefit) for income taxes |
8,471 | (4,251 | ) | (875 | ) | (5,975 | ) | (1,514 | ) | (683 | ) | (13,298 | ) | (4,827 | ) | |||||||||||||||||
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| 22,035 | $ | (7,694 | ) | $ | (1,585 | ) | $ | (11,066 | ) | $ | (4,031 | ) | $ | (2,462 | ) | $ | (26,838 | ) | (4,803 | ) | ||||||||||||
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| Noncontrolling interests |
(5,143 | ) | (5,143 | ) | ||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||
| Income (loss) attributable to Kindred |
$ | 16,892 | $ | (9,946 | ) | |||||||||||||||||||||||||||
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|
|||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
$ | 0.26 | $ | (0.15 | ) | |||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
63,163 | 65,135 | ||||||||||||||||||||||||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 16
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts)
| Year ended December 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||||||||||||||||||
| Hospital | Development | RehabCare | Gentiva | Gentiva | ||||||||||||||||||||||||||||||||||||||||||||
| Before | Retirement | and home | project | customer | pre-closing | transaction | ||||||||||||||||||||||||||||||||||||||||||
| charges | and | health/hospice | cancellation | contract | Litigation | Impairment | financing | and | Other | As | ||||||||||||||||||||||||||||||||||||||
| (“core”) | severance | closings | and other | litigation | contingency | charges | costs | integration | transaction | Total | reported | |||||||||||||||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 481,121 | $ | (1,887 | ) | $ | (1,044 | ) | $ | (675 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (3,606 | ) | $ | 477,515 | ||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||||||
| Home health |
256,696 | — | (6,055 | ) | — | — | — | — | — | — | — | (6,055 | ) | 250,641 | ||||||||||||||||||||||||||||||||||
| Hospice |
109,120 | — | (4,028 | ) | — | — | — | — | — | — | — | (4,028 | ) | 105,092 | ||||||||||||||||||||||||||||||||||
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| 365,816 | — | (10,083 | ) | — | — | — | — | — | — | — | (10,083 | ) | 355,733 | |||||||||||||||||||||||||||||||||||
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| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
176,334 | (207 | ) | — | — | — | — | — | — | — | — | (207 | ) | 176,127 | ||||||||||||||||||||||||||||||||||
| RehabCare |
57,576 | (897 | ) | — | — | (12,864 | ) | — | — | — | — | — | (13,761 | ) | 43,815 | |||||||||||||||||||||||||||||||||
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| 233,910 | (1,104 | ) | — | — | (12,864 | ) | — | — | — | — | — | (13,968 | ) | 219,942 | ||||||||||||||||||||||||||||||||||
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| Nursing center division |
149,948 | — | — | (584 | ) | — | — | — | — | — | — | (584 | ) | 149,364 | ||||||||||||||||||||||||||||||||||
| Support center |
(250,468 | ) | (4,761 | ) | — | — | — | — | — | — | — | — | (4,761 | ) | (255,229 | ) | ||||||||||||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | — | — | (138,648 | ) | — | — | — | — | (138,648 | ) | (138,648 | ) | |||||||||||||||||||||||||||||||||
| Impairment charges |
— | — | — | — | — | — | (24,757 | ) | — | — | — | (24,757 | ) | (24,757 | ) | |||||||||||||||||||||||||||||||||
| Transaction costs |
— | — | — | — | — | — | — | (6,005 | ) | (98,198 | ) | (4,928 | ) | (109,131 | ) | (109,131 | ) | |||||||||||||||||||||||||||||||
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| Operating income (EBITDAR) |
980,327 | (7,752 | ) | (11,127 | ) | (1,259 | ) | (12,864 | ) | (138,648 | ) | (24,757 | ) | (6,005 | ) | (98,198 | ) | (4,928 | ) | (305,538 | ) | 674,789 | ||||||||||||||||||||||||||
| Rent |
(379,097 | ) | — | (2,368 | ) | (352 | ) | — | — | — | — | (792 | ) | — | (3,512 | ) | (382,609 | ) | ||||||||||||||||||||||||||||||
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| EBITDA |
601,230 | (7,752 | ) | (13,495 | ) | (1,611 | ) | (12,864 | ) | (138,648 | ) | (24,757 | ) | (6,005 | ) | (98,990 | ) | (4,928 | ) | (309,050 | ) | 292,180 | ||||||||||||||||||||||||||
| Depreciation and amortization |
(157,251 | ) | — | — | — | — | — | — | — | — | — | — | (157,251 | ) | ||||||||||||||||||||||||||||||||||
| Interest, net |
(212,158 | ) | — | — | — | — | — | — | (17,431 | ) | — | — | (17,431 | ) | (229,589 | ) | ||||||||||||||||||||||||||||||||
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| Income (loss) from continuing operations before income taxes |
231,821 | (7,752 | ) | (13,495 | ) | (1,611 | ) | (12,864 | ) | (138,648 | ) | (24,757 | ) | (23,436 | ) | (98,990 | ) | (4,928 | ) | (326,481 | ) | (94,660 | ) | |||||||||||||||||||||||||
| Provision for income taxes |
77,243 | (3,063 | ) | (5,333 | ) | (637 | ) | (5,084 | ) | (51,965 | ) | (8,890 | ) | (9,261 | ) | (34,266 | ) | (1,541 | ) | (120,040 | ) | (42,797 | ) | |||||||||||||||||||||||||
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| 154,578 | $ | (4,689 | ) | $ | (8,162 | ) | $ | (974 | ) | $ | (7,780 | ) | $ | (86,683 | ) | $ | (15,867 | ) | $ | (14,175 | ) | $ | (64,724 | ) | $ | (3,387 | ) | $ | (206,441 | ) | (51,863 | ) | ||||||||||||||||
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|||||||||||||||||||||||||||||
| Noncontrolling interests |
(42,564 | ) | (42,564 | ) | ||||||||||||||||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||||||||||||||||||||||||
| Income (loss) attributable to Kindred |
$ | 112,014 | $ | (94,427 | ) | |||||||||||||||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
$ | 1.28 | $ | (1.12 | ) | |||||||||||||||||||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
86,098 | 84,558 | ||||||||||||||||||||||||||||||||||||||||||||||
| Year ended December 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||||||||||||||
| Before | Severance | LTAC | Gentiva | |||||||||||||||||||||||||||||||||||||||||
| charges | and other | criteria | Customer | Litigation | Debt | pre-closing | Gentiva | Other | As | |||||||||||||||||||||||||||||||||||
| (“core”) | restructuring | consulting | bankruptcy | contingency | refinancing | financing | transaction | transaction | Total | reported | ||||||||||||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 523,890 | $ | (935 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (935 | ) | $ | 522,955 | ||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||
| Home health |
21,973 | (1,824 | ) | — | — | — | — | — | — | — | (1,824 | ) | 20,149 | |||||||||||||||||||||||||||||||
| Hospice |
5,664 | (274 | ) | — | — | — | — | — | — | — | (274 | ) | 5,390 | |||||||||||||||||||||||||||||||
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| 27,637 | (2,098 | ) | — | — | — | — | — | — | — | (2,098 | ) | 25,539 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
100,223 | (170 | ) | — | (1,857 | ) | — | — | — | — | — | (2,027 | ) | 98,196 | ||||||||||||||||||||||||||||||
| RehabCare |
70,988 | (14 | ) | — | — | — | — | — | — | — | (14 | ) | 70,974 | |||||||||||||||||||||||||||||||
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| 171,211 | (184 | ) | — | (1,857 | ) | — | — | — | — | — | (2,041 | ) | 169,170 | |||||||||||||||||||||||||||||||
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| Nursing center division |
150,916 | (4,188 | ) | — | — | — | — | — | — | — | (4,188 | ) | 146,728 | |||||||||||||||||||||||||||||||
| Support center |
(189,439 | ) | (11,176 | ) | (2,460 | ) | — | — | — | — | — | — | (13,636 | ) | (203,075 | ) | ||||||||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | (4,600 | ) | (4,600 | ) | (4,600 | ) | |||||||||||||||||||||||||||||||||||
| Transaction costs |
— | — | — | — | — | — | — | (10,824 | ) | (7,159 | ) | (17,983 | ) | (17,983 | ) | |||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| Operating income (EBITDAR) |
684,215 | (18,581 | ) | (2,460 | ) | (1,857 | ) | (4,600 | ) | — | — | (10,824 | ) | (7,159 | ) | (45,481 | ) | 638,734 | ||||||||||||||||||||||||||
| Rent |
(312,792 | ) | (247 | ) | — | — | — | — | — | — | — | (247 | ) | (313,039 | ) | |||||||||||||||||||||||||||||
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| EBITDA |
371,423 | (18,828 | ) | (2,460 | ) | (1,857 | ) | (4,600 | ) | — | — | (10,824 | ) | (7,159 | ) | (45,728 | ) | 325,695 | ||||||||||||||||||||||||||
| Depreciation and amortization |
(155,570 | ) | — | — | — | — | — | — | — | — | — | (155,570 | ) | |||||||||||||||||||||||||||||||
| Interest, net |
(91,083 | ) | — | — | — | — | (56,643 | ) | (17,041 | ) | — | — | (73,684 | ) | (164,767 | ) | ||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| Income from continuing operations before income taxes |
124,770 | (18,828 | ) | (2,460 | ) | (1,857 | ) | (4,600 | ) | (56,643 | ) | (17,041 | ) | (10,824 | ) | (7,159 | ) | (119,412 | ) | 5,358 | ||||||||||||||||||||||||
| Provision for income taxes |
42,696 | (7,156 | ) | (935 | ) | (706 | ) | (1,748 | ) | (21,528 | ) | (6,381 | ) | (1,665 | ) | (2,115 | ) | (42,234 | ) | 462 | ||||||||||||||||||||||||
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| 82,074 | $ | (11,672 | ) | $ | (1,525 | ) | $ | (1,151 | ) | $ | (2,852 | ) | $ | (35,115 | ) | $ | (10,660 | ) | $ | (9,159 | ) | $ | (5,044 | ) | $ | (77,178 | ) | 4,896 | ||||||||||||||||
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|||||||||||||||||||||||||||
| Noncontrolling interests |
(18,872 | ) | (18,872 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||
| Income (loss) attributable to Kindred |
$ | 63,202 | $ | (13,976 | ) | |||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
$ | 1.06 | $ | (0.24 | ) | |||||||||||||||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
58,210 | 58,634 | ||||||||||||||||||||||||||||||||||||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 17
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts)
| Three months ended March 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||||||||||||||
| Home health | Development | Gentiva | Gentiva | |||||||||||||||||||||||||||||||||||||||||
| Before | Retirement | and | project | pre-closing | transaction | |||||||||||||||||||||||||||||||||||||||
| charges | and | hospice | cancellation | Litigation | Impairment | financing | and | Other | As | |||||||||||||||||||||||||||||||||||
| (“core”) | severance | closings | and other | contingency | charges | costs | integration | transaction | Total | reported | ||||||||||||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||||||||||||||
| Hospital division |
$ | 134,786 | $ | — | $ | — | $ | (675 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (675 | ) | $ | 134,111 | ||||||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||||||||||||||
| Home health |
46,798 | — | (1,102 | ) | — | — | — | — | — | — | (1,102 | ) | 45,696 | |||||||||||||||||||||||||||||||
| Hospice |
16,996 | — | (517 | ) | — | — | — | — | — | — | (517 | ) | 16,479 | |||||||||||||||||||||||||||||||
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| 63,794 | — | (1,619 | ) | — | — | — | — | — | — | (1,619 | ) | 62,175 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
44,564 | — | — | — | — | — | — | — | — | — | 44,564 | |||||||||||||||||||||||||||||||||
| RehabCare |
16,493 | (785 | ) | — | — | — | — | — | — | — | (785 | ) | 15,708 | |||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| 61,057 | (785 | ) | — | — | — | — | — | — | — | (785 | ) | 60,272 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
| Nursing center division |
36,963 | — | — | — | — | — | — | — | — | — | 36,963 | |||||||||||||||||||||||||||||||||
| Support center |
(62,389 | ) | (4,176 | ) | — | — | — | — | — | — | — | (4,176 | ) | (66,565 | ) | |||||||||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | — | (95,000 | ) | — | — | — | — | (95,000 | ) | (95,000 | ) | ||||||||||||||||||||||||||||||
| Impairment charges |
— | — | — | — | — | (6,726 | ) | — | — | — | (6,726 | ) | (6,726 | ) | ||||||||||||||||||||||||||||||
| Transaction costs |
— | — | — | — | — | — | (6,005 | ) | (86,598 | ) | (2,099 | ) | (94,702 | ) | (94,702 | ) | ||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||
| Operating income (EBITDAR) |
234,211 | (4,961 | ) | (1,619 | ) | (675 | ) | (95,000 | ) | (6,726 | ) | (6,005 | ) | (86,598 | ) | (2,099 | ) | (203,683 | ) | 30,528 | ||||||||||||||||||||||||
| Rent |
(91,199 | ) | — | — | (352 | ) | — | — | — | (589 | ) | — | (941 | ) | (92,140 | ) | ||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||
| EBITDA |
143,012 | (4,961 | ) | (1,619 | ) | (1,027 | ) | (95,000 | ) | (6,726 | ) | (6,005 | ) | (87,187 | ) | (2,099 | ) | (204,624 | ) | (61,612 | ) | |||||||||||||||||||||||
| Depreciation and amortization |
(38,935 | ) | — | — | — | — | — | — | — | — | — | (38,935 | ) | |||||||||||||||||||||||||||||||
| Interest, net |
(44,346 | ) | — | — | — | — | — | (17,431 | ) | — | — | (17,431 | ) | (61,777 | ) | |||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||
| Income (loss) from continuing operations before income taxes |
59,731 | (4,961 | ) | (1,619 | ) | (1,027 | ) | (95,000 | ) | (6,726 | ) | (23,436 | ) | (87,187 | ) | (2,099 | ) | (222,055 | ) | (162,324 | ) | |||||||||||||||||||||||
| Provision (benefit) for income taxes |
22,466 | (2,133 | ) | (696 | ) | (442 | ) | — | (2,891 | ) | (10,075 | ) | (33,063 | ) | (902 | ) | (50,202 | ) | (27,736 | ) | ||||||||||||||||||||||||
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|||||||||||||||||||||||
| 37,265 | $ | (2,828 | ) | $ | (923 | ) | $ | (585 | ) | $ | (95,000 | ) | $ | (3,835 | ) | $ | (13,361 | ) | $ | (54,124 | ) | $ | (1,197 | ) | $ | (171,853 | ) | (134,588 | ) | |||||||||||||||
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|
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|
|||||||||||||||||||||||||||
| Noncontrolling interests |
(8,847 | ) | (8,847 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||
| Income (loss) attributable to Kindred |
$ | 28,418 | $ | (143,435 | ) | |||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
$ | 0.34 | $ | (1.80 | ) | |||||||||||||||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
82,422 | 79,575 | ||||||||||||||||||||||||||||||||||||||||||
| Three months ended March 31, 2014 | ||||||||||||
| Before | Charges | |||||||||||
| charges | Transaction | As | ||||||||||
| (“core”) | costs | reported | ||||||||||
| Income from continuing operations: |
||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||
| Hospital division |
$ | 139,505 | $ | — | $ | 139,505 | ||||||
| Kindred at Home: |
||||||||||||
| Home health |
2,845 | — | 2,845 | |||||||||
| Hospice |
1,852 | — | 1,852 | |||||||||
|
|
|
|
|
|
|
|||||||
| 4,697 | — | 4,697 | ||||||||||
|
|
|
|
|
|
|
|||||||
| Kindred Rehabilitation Services: |
||||||||||||
| Kindred Hospital Rehabilitation Services |
25,710 | — | 25,710 | |||||||||
| RehabCare |
18,016 | — | 18,016 | |||||||||
|
|
|
|
|
|
|
|||||||
| 43,726 | — | 43,726 | ||||||||||
|
|
|
|
|
|
|
|||||||
| Nursing center division |
37,572 | — | 37,572 | |||||||||
| Support center |
(44,456 | ) | — | (44,456 | ) | |||||||
| Transaction costs |
— | (683 | ) | (683 | ) | |||||||
|
|
|
|
|
|
|
|||||||
| Operating income (EBITDAR) |
181,044 | (683 | ) | 180,361 | ||||||||
| Rent |
(78,530 | ) | — | (78,530 | ) | |||||||
|
|
|
|
|
|
|
|||||||
| EBITDA |
102,514 | (683 | ) | 101,831 | ||||||||
| Depreciation and amortization |
(39,092 | ) | — | (39,092 | ) | |||||||
| Interest, net |
(25,617 | ) | — | (25,617 | ) | |||||||
|
|
|
|
|
|
|
|||||||
| Income from continuing operations before income taxes |
37,805 | (683 | ) | 37,122 | ||||||||
| Provision for income taxes |
14,445 | (250 | ) | 14,195 | ||||||||
|
|
|
|
|
|
|
|||||||
| 23,360 | $ | (433 | ) | 22,927 | ||||||||
|
|
|
|||||||||||
| Noncontrolling interests |
(4,529 | ) | (4,529 | ) | ||||||||
|
|
|
|
|
|||||||||
| Income attributable to Kindred |
$ | 18,831 | $ | 18,398 | ||||||||
|
|
|
|
|
|||||||||
| Diluted earnings per common share |
$ | 0.35 | $ | 0.34 | ||||||||
| Diluted shares used in computing earnings per common share |
52,711 | 52,711 | ||||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 18
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts)
| Three months ended June 30, 2015 | ||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||
| Before charges (“core”) |
Hospital and home health/hospice closings |
Development project cancellation and other |
Litigation contingency |
Gentiva transaction and integration |
Other transaction |
Total | As reported |
|||||||||||||||||||||||||
| Income from continuing operations: |
||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||
| Hospital division |
$ | 131,532 | $ | (565 | ) | $ | — | $ | — | $ | — | $ | — | $ | (565 | ) | $ | 130,967 | ||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||
| Home health |
72,917 | (588 | ) | — | — | — | — | (588 | ) | 72,329 | ||||||||||||||||||||||
| Hospice |
27,887 | (1,649 | ) | — | — | — | — | (1,649 | ) | 26,238 | ||||||||||||||||||||||
|
|
|
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|
|||||||||||||||||
| 100,804 | (2,237 | ) | — | — | — | — | (2,237 | ) | 98,567 | |||||||||||||||||||||||
|
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|
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|
|||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
44,531 | — | — | — | — | — | — | 44,531 | ||||||||||||||||||||||||
| RehabCare |
14,681 | — | — | — | — | — | — | 14,681 | ||||||||||||||||||||||||
|
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|
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|
|||||||||||||||||
| 59,212 | — | — | — | — | — | — | 59,212 | |||||||||||||||||||||||||
|
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|
|||||||||||||||||
| Nursing center division |
40,461 | — | (584 | ) | — | — | — | (584 | ) | 39,877 | ||||||||||||||||||||||
| Support center |
(70,209 | ) | — | — | — | — | — | — | (70,209 | ) | ||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | (3,925 | ) | — | — | (3,925 | ) | (3,925 | ) | |||||||||||||||||||||
| Transaction costs |
— | — | — | — | (4,342 | ) | (874 | ) | (5,216 | ) | (5,216 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Operating income (EBITDAR) |
261,800 | (2,802 | ) | (584 | ) | (3,925 | ) | (4,342 | ) | (874 | ) | (12,527 | ) | 249,273 | ||||||||||||||||||
| Rent |
(95,528 | ) | (671 | ) | — | — | (203 | ) | — | (874 | ) | (96,402 | ) | |||||||||||||||||||
|
|
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|
|
|
|
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|
|
|
|
|
|
|||||||||||||||||
| EBITDA |
166,272 | (3,473 | ) | (584 | ) | (3,925 | ) | (4,545 | ) | (874 | ) | (13,401 | ) | 152,871 | ||||||||||||||||||
| Depreciation and amortization |
(38,625 | ) | — | — | — | — | — | — | (38,625 | ) | ||||||||||||||||||||||
| Interest, net |
(56,140 | ) | — | — | — | — | — | — | (56,140 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Income from continuing operations before income taxes |
71,507 | (3,473 | ) | (584 | ) | (3,925 | ) | (4,545 | ) | (874 | ) | (13,401 | ) | 58,106 | ||||||||||||||||||
| Provision for income taxes |
25,721 | (368 | ) | (62 | ) | (416 | ) | (386 | ) | (93 | ) | (1,325 | ) | 24,396 | ||||||||||||||||||
|
|
|
|
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|
|
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|
|
|
|
|
|||||||||||||||||
| 45,786 | $ | (3,105 | ) | $ | (522 | ) | $ | (3,509 | ) | $ | (4,159 | ) | $ | (781 | ) | $ | (12,076 | ) | 33,710 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| Noncontrolling interests |
(11,735 | ) | (11,735 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Income attributable to Kindred |
$ | 34,051 | $ | 21,975 | ||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Diluted earnings per common share |
$ | 0.39 | $ | 0.25 | ||||||||||||||||||||||||||||
| Diluted shares used in computing earnings per common share |
86,402 | 86,402 | ||||||||||||||||||||||||||||||
| Three months ended June 30, 2014 | ||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||
| Before charges (“core”) |
Severance and other restructuring |
Litigation contingency |
Debt refinancing |
Gentiva transaction |
Other transaction |
Total | As reported |
|||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||
| Hospital division |
$ | 131,990 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 131,990 | ||||||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||
| Home health |
5,769 | (721 | ) | — | — | — | — | (721 | ) | 5,048 | ||||||||||||||||||||||
| Hospice |
2,139 | (122 | ) | — | — | — | — | (122 | ) | 2,017 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| 7,908 | (843 | ) | — | — | — | — | (843 | ) | 7,065 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Kindred Rehabilitation Services: |
||||||||||||||||||||||||||||||||
| Kindred Hospital Rehabilitation Services |
25,742 | (170 | ) | — | — | — | — | (170 | ) | 25,572 | ||||||||||||||||||||||
| RehabCare |
19,863 | (176 | ) | — | — | — | — | (176 | ) | 19,687 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| 45,605 | (346 | ) | — | — | — | — | (346 | ) | 45,259 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Nursing center division |
38,614 | (3,205 | ) | — | — | — | — | (3,205 | ) | 35,409 | ||||||||||||||||||||||
| Support center |
(48,252 | ) | (556 | ) | — | — | — | — | (556 | ) | (48,808 | ) | ||||||||||||||||||||
| Litigation contingency expense |
— | — | (4,600 | ) | — | — | — | (4,600 | ) | (4,600 | ) | |||||||||||||||||||||
| Transaction costs |
— | — | — | — | (2,079 | ) | (2,417 | ) | (4,496 | ) | (4,496 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Operating income (EBITDAR) |
175,865 | (4,950 | ) | (4,600 | ) | — | (2,079 | ) | (2,417 | ) | (14,046 | ) | 161,819 | |||||||||||||||||||
| Rent |
(77,452 | ) | (247 | ) | — | — | — | — | (247 | ) | (77,699 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| EBITDA |
98,413 | (5,197 | ) | (4,600 | ) | — | (2,079 | ) | (2,417 | ) | (14,293 | ) | 84,120 | |||||||||||||||||||
| Depreciation and amortization |
(39,172 | ) | — | — | — | — | — | — | (39,172 | ) | ||||||||||||||||||||||
| Interest, net |
(21,438 | ) | — | — | (56,643 | ) | — | — | (56,643 | ) | (78,081 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Income (loss) from continuing operations before income taxes |
37,803 | (5,197 | ) | (4,600 | ) | (56,643 | ) | (2,079 | ) | (2,417 | ) | (70,936 | ) | (33,133 | ) | |||||||||||||||||
| Provision (benefit) for income taxes |
13,612 | (1,985 | ) | (1,757 | ) | (21,639 | ) | — | (914 | ) | (26,295 | ) | (12,683 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| 24,191 | $ | (3,212 | ) | $ | (2,843 | ) | $ | (35,004 | ) | $ | (2,079 | ) | $ | (1,503 | ) | $ | (44,641 | ) | (20,450 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| Noncontrolling interests |
(4,828 | ) | (4,828 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Income (loss) attributable to Kindred |
$ | 19,363 | $ | (25,278 | ) | |||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
$ | 0.35 | $ | (0.47 | ) | |||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
53,792 | 53,714 | ||||||||||||||||||||||||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 19
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands, except per share amounts)
| Three months ended September 30, 2015 | ||||||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||||||
| Before charges (“core”) |
Retirement and severance |
Hospital and home health/hospice closings |
Litigation contingency |
Gentiva transaction and integration |
Other transaction |
Total | As reported |
|||||||||||||||||||||||||
| Income (loss) from continuing operations: |
||||||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||||||
| Hospital division |
$ | 97,128 | $ | (666 | ) | $ | (479 | ) | $ | — | $ | — | $ | — | $ | (1,145 | ) | $ | 95,983 | |||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||||||
| Home health |
68,155 | — | (2,571 | ) | — | — | — | (2,571 | ) | 65,584 | ||||||||||||||||||||||
| Hospice |
34,025 | — | (318 | ) | — | — | — | (318 | ) | 33,707 | ||||||||||||||||||||||
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| 102,180 | — | (2,889 | ) | — | — | — | (2,889 | ) | 99,291 | |||||||||||||||||||||||
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| Kindred Rehabilitation Services: |
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| Kindred Hospital Rehabilitation Services |
42,141 | — | — | — | — | — | — | 42,141 | ||||||||||||||||||||||||
| RehabCare |
14,544 | — | — | — | — | — | — | 14,544 | ||||||||||||||||||||||||
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| 56,685 | — | — | — | — | — | — | 56,685 | |||||||||||||||||||||||||
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| Nursing center division |
35,923 | — | — | — | — | — | — | 35,923 | ||||||||||||||||||||||||
| Support center |
(55,439 | ) | — | — | — | — | — | — | (55,439 | ) | ||||||||||||||||||||||
| Litigation contingency expense |
— | — | — | (31,462 | ) | — | — | (31,462 | ) | (31,462 | ) | |||||||||||||||||||||
| Transaction costs |
— | — | — | — | (3,069 | ) | (777 | ) | (3,846 | ) | (3,846 | ) | ||||||||||||||||||||
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| Operating income (EBITDAR) |
236,477 | (666 | ) | (3,368 | ) | (31,462 | ) | (3,069 | ) | (777 | ) | (39,342 | ) | 197,135 | ||||||||||||||||||
| Rent |
(95,436 | ) | — | (808 | ) | — | — | — | (808 | ) | (96,244 | ) | ||||||||||||||||||||
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| EBITDA |
141,041 | (666 | ) | (4,176 | ) | (31,462 | ) | (3,069 | ) | (777 | ) | (40,150 | ) | 100,891 | ||||||||||||||||||
| Depreciation and amortization |
(39,329 | ) | — | — | — | — | — | — | (39,329 | ) | ||||||||||||||||||||||
| Interest, net |
(56,008 | ) | — | — | — | — | — | — | (56,008 | ) | ||||||||||||||||||||||
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| Income from continuing operations before income taxes |
45,704 | (666 | ) | (4,176 | ) | (31,462 | ) | (3,069 | ) | (777 | ) | (40,150 | ) | 5,554 | ||||||||||||||||||
| Provision for income taxes |
15,298 | (196 | ) | (1,225 | ) | (429 | ) | (697 | ) | (228 | ) | (2,775 | ) | 12,523 | ||||||||||||||||||
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| 30,406 | $ | (470 | ) | $ | (2,951 | ) | $ | (31,033 | ) | $ | (2,372 | ) | $ | (549 | ) | $ | (37,375 | ) | (6,969 | ) | ||||||||||||
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| Noncontrolling interests |
(9,900 | ) | (9,900 | ) | ||||||||||||||||||||||||||||
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| Income (loss) attributable to Kindred |
$ | 20,506 | $ | (16,869 | ) | |||||||||||||||||||||||||||
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| Diluted earnings (loss) per common share |
$ | 0.23 | $ | (0.20 | ) | |||||||||||||||||||||||||||
| Diluted shares used in computing earnings (loss) per common share |
86,892 | 86,184 | ||||||||||||||||||||||||||||||
| Three months ended September 30, 2014 | ||||||||||||||||||||||||||||
| Charges | ||||||||||||||||||||||||||||
| Before | Severance | |||||||||||||||||||||||||||
| charges | and other | Customer | Gentiva | Other | As | |||||||||||||||||||||||
| (“core”) | restructuring | bankruptcy | transaction | transaction | Total | reported | ||||||||||||||||||||||
| Income from continuing operations: |
||||||||||||||||||||||||||||
| Operating income (loss) (EBITDAR): |
||||||||||||||||||||||||||||
| Hospital division |
$ | 117,604 | $ | (617 | ) | $ | — | $ | — | $ | — | $ | (617 | ) | $ | 116,987 | ||||||||||||
| Kindred at Home: |
||||||||||||||||||||||||||||
| Home health |
5,961 | (275 | ) | — | — | — | (275 | ) | 5,686 | |||||||||||||||||||
| Hospice |
1,149 | (46 | ) | — | — | — | (46 | ) | 1,103 | |||||||||||||||||||
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| 7,110 | (321 | ) | — | — | — | (321 | ) | 6,789 | ||||||||||||||||||||
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| Kindred Rehabilitation Services: |
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| Kindred Hospital Rehabilitation Services |
24,887 | — | (1,857 | ) | — | — | (1,857 | ) | 23,030 | |||||||||||||||||||
| RehabCare |
17,080 | 162 | — | — | — | 162 | 17,242 | |||||||||||||||||||||
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| 41,967 | 162 | (1,857 | ) | — | — | (1,695 | ) | 40,272 | ||||||||||||||||||||
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| Nursing center division |
35,920 | (483 | ) | — | — | — | (483 | ) | 35,437 | |||||||||||||||||||
| Support center |
(45,383 | ) | (427 | ) | — | — | — | (427 | ) | (45,810 | ) | |||||||||||||||||
| Transaction costs |
— | — | — | (3,200 | ) | (914 | ) | (4,114 | ) | (4,114 | ) | |||||||||||||||||
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| Operating income (EBITDAR) |
157,218 | (1,686 | ) | (1,857 | ) | (3,200 | ) | (914 | ) | (7,657 | ) | 149,561 | ||||||||||||||||
| Rent |
(77,643 | ) | — | — | — | — | — | (77,643 | ) | |||||||||||||||||||
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|||||||||||||||
| EBITDA |
79,575 | (1,686 | ) | (1,857 | ) | (3,200 | ) | (914 | ) | (7,657 | ) | 71,918 | ||||||||||||||||
| Depreciation and amortization |
(38,748 | ) | — | — | — | — | — | (38,748 | ) | |||||||||||||||||||
| Interest, net |
(22,171 | ) | — | — | — | — | — | (22,171 | ) | |||||||||||||||||||
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| Income from continuing operations before income taxes |
18,656 | (1,686 | ) | (1,857 | ) | (3,200 | ) | (914 | ) | (7,657 | ) | 10,999 | ||||||||||||||||
| Provision for income taxes |
6,168 | (923 | ) | (1,017 | ) | (69 | ) | (382 | ) | (2,391 | ) | 3,777 | ||||||||||||||||
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| 12,488 | $ | (763 | ) | $ | (840 | ) | $ | (3,131 | ) | $ | (532 | ) | $ | (5,266 | ) | 7,222 | ||||||||||||
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| Noncontrolling interests |
(4,372 | ) | (4,372 | ) | ||||||||||||||||||||||||
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| Income attributable to Kindred |
$ | 8,116 | $ | 2,850 | ||||||||||||||||||||||||
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|||||||||||||||||||||||||
| Diluted earnings per common share |
$ | 0.13 | $ | 0.04 | ||||||||||||||||||||||||
| Diluted shares used in computing earnings per common share |
62,902 | 62,902 | ||||||||||||||||||||||||||
- MORE -
Kindred Healthcare Reports Fourth Quarter 2015 Results
Page 20
February 25, 2016
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands)
| Three months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Reconciliation of net cash flows provided by operating activities to free cash flows: |
||||||||||||||||
| Net cash flows provided by operating activities |
$ | 70,195 | $ | 81,149 | $ | 163,262 | $ | 105,471 | ||||||||
| Adjustments to remove certain payments (including payments made for discontinued operations) included in net cash flows provided by operating activities: |
||||||||||||||||
| Transaction, severance, retirement and retention |
4,548 | 10,516 | 106,648 | 25,906 | ||||||||||||
| Ventas, Inc. lease termination fee |
— | — | 40,000 | — | ||||||||||||
| Ventas, Inc. lease maintenance payment |
— | 2,500 | — | 2,500 | ||||||||||||
| Capitalized lender fees related to debt refinancing |
— | 3,527 | 28,012 | 22,652 | ||||||||||||
| Other debt refinancing costs (expensed) |
— | — | 40,439 | 40,373 | ||||||||||||
| Other lease termination fees |
— | — | 353 | — | ||||||||||||
| Litigation |
— | — | 16,575 | 25,850 | ||||||||||||
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| 4,548 | 16,543 | 232,027 | 117,281 | |||||||||||||
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| Net cash flows provided by operating activities excluding certain items before income tax benefit of certain payments |
74,743 | 97,692 | 395,289 | 222,752 | ||||||||||||
| Benefit of reduced income tax payments resulting from certain payments |
(20,861 | ) | (12,055 | ) | (77,156 | ) | (34,912 | ) | ||||||||
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| Net cash flows provided by operating activities excluding certain items (core operating cash flows) (a) |
53,882 | 85,637 | 318,133 | 187,840 | ||||||||||||
| Less routine capital expenditures |
(41,240 | ) | (23,656 | ) | (121,931 | ) | (91,081 | ) | ||||||||
| Less distributions to noncontrolling interests |
(10,635 | ) | (4,088 | ) | (42,458 | ) | (13,692 | ) | ||||||||
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|||||||||
| Free cash flows excluding certain items (core free cash flows) |
$ | 2,007 | $ | 57,893 | $ | 153,744 | $ | 83,067 | ||||||||
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| (a) | Includes federal income tax refunds of $29 million and $35 million received for the years ended December 31, 2015 and 2014, respectively. The Company made no federal income tax payments for the years ended December 31, 2015 or 2014. |
- END -