KING OF PRUSSIA, Pa., April 26 /PRNewswire-FirstCall/ -- Universal Health Services, Inc. announced today that its reported net income attributable to UHS was $71.8 million, or an increase of 7% to $.73 per diluted share, during the first quarter of 2010 as compared to $67.5 million, or $.68 per diluted share, during the comparable prior year quarter.
Net revenues increased 3% to $1.35 billion during the first quarter of 2010 as compared to $1.31 billion during the first quarter of 2009. The operating margin (net revenues less salaries, wages and benefits, other operating expenses, supplies expense and provision for doubtful accounts) increased to 15.7% during the first quarter of 2010 as compared to 15.6% during the first quarter of 2009.
Acute Care Services:
At our acute care hospitals owned during both periods ("same facility basis"), adjusted admissions (adjusted for outpatient activity) increased 1.8% while adjusted patient days increased 0.6% during the first quarter of 2010, as compared to the first quarter of 2009. Net revenues at these facilities increased 3.1% during the first quarter of 2010 as compared to the comparable quarter of the prior year. At these facilities, net revenue per adjusted admission increased 1.3% while net revenue per adjusted patient day increased 2.5% during the first quarter of 2010 as compared to the comparable quarter of the prior year. On a same facility basis, the operating margin at our acute care hospitals decreased to 16.1% during the first quarter of 2010 as compared to 17.6% during the first quarter of 2009.
We provide care to patients who meet certain financial or economic criteria without charge or at amounts substantially less than our established rates. Because we do not pursue collection of amounts determined to qualify as charity care, they are not reported in net revenues or in accounts receivable, net. Our acute care hospitals provided charity care and uninsured discounts, based on charges at established rates, amounting to $176 million and $158 million during the three-month periods ended March 31, 2010 and 2009, respectively.
Behavioral Health Care Services:
At our behavioral health care facilities, on a same facility basis, adjusted admissions increased 3.8% and adjusted patient days increased 3.9% during the first quarter of 2010 as compared to the first quarter of 2009. Net revenues at these facilities increased 6.7% during the first quarter of 2010 as compared to the comparable quarter in the prior year. At these facilities, net revenue per adjusted admission increased 2.8% while net revenue per adjusted patient day increased 2.7% during the first quarter of 2010 over the comparable prior year quarter. The operating margin at our behavioral health care facilities owned during both periods increased to 26.1% during the first quarter of 2010 as compared to 24.6% during the first quarter of 2009.
Conference Call Information:
We will hold a conference call for investors and analysts at 9:00 a.m. eastern time on April 27, 2010. The dial-in number is 1-877-648-7971. A digital recording of the conference call will be available two hours after the completion of the conference call on April 27, 2010 and will continue through midnight on May 11, 2010. The recording can be accessed by calling 1-800-642-1687 and entering the conference ID number 68231632. This call will also be available live over the internet at our web site at http://www.uhsinc.com/. The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at http://www.earnings.com/, Thomson's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents at http://www.streetevents.com/.
General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures:
Universal Health Services, Inc. ("UHS") is one of the nation's largest hospital companies operating, through its subsidiaries, acute care hospitals, behavioral healthcare facilities and ambulatory centers located throughout the United States and Puerto Rico. UHS acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust . For additional information on the Company, visit our web site: http://www.uhsinc.com/.
This press release contains forward-looking statements based on current management expectations. Numerous factors, including those disclosed herein, those related to healthcare industry trends and those detailed in our filings with the Securities and Exchange Commission (as set forth in Item 1A-Risk Factors and in Item 7-Forward-Looking Statements and Risk Factors in our Form 10-K for the year ended December 31, 2009), may cause the results to differ materially from those anticipated in the forward-looking statements. Many of the factors that will determine our future results are beyond our capability to control or predict. These statements are subject to risks and uncertainties and therefore actual results may differ materially. Readers should not place undue reliance on such forward-looking statements which reflect management's view only as of the date hereof. We undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
We believe that operating income, operating margin, adjusted net income attributable to UHS, adjusted net income attributable to UHS per diluted share and earnings before interest, taxes, depreciation and amortization ("EBITDA"), which are non-GAAP financial measures ("GAAP" is Generally Accepted Accounting Principles in the United States of America), are helpful to our investors as measures of our operating performance. In addition, we believe that, when applicable, comparing and discussing our financial results based on these measures, as calculated, is helpful to our investors since it neutralizes the effect in each year of items that are nonrecurring or non-operational in nature including items such as, but not limited to, gains on sales of assets and businesses, reserves for settlements, legal judgments and lawsuits and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. To obtain a complete understanding of our financial performance these measures should be examined in connection with net income, determined in accordance with GAAP, as presented in the condensed consolidated financial statements and notes thereto in this report or in our other filings with the Securities and Exchange Commission including our Report on Form 10-K for the year ended December 31, 2009. Since the items included or excluded from these measures are significant components in understanding and assessing financial performance under GAAP, these measures should not be considered to be alternatives to net income as a measure of our operating performance or profitability. Since these measures, as presented, are not determined in accordance with GAAP and are thus susceptible to varying calculations, they may not be comparable to other similarly titled measures of other companies. Investors are encouraged to use GAAP measures when evaluating our financial performance.
Universal Health Services, Inc. ------------------------------- Consolidated Statements of Income --------------------------------- (in thousands, except per share amounts) (unaudited) Three months ended March 31, --------------- 2010 2009 ---- ---- Net revenues $1,347,153 $1,312,419 Operating charges: Salaries, wages and benefits 578,926 541,297 Other operating expenses 247,028 273,221 Supplies expense 183,816 173,967 Provision for doubtful accounts 125,390 118,978 Depreciation and amortization 53,511 51,134 Lease and rental expense 17,934 17,072 1,206,605 1,175,669 --------- --------- Income from operations 140,548 136,750 Interest expense, net 12,377 12,638 ------ ------ Income before income taxes 128,171 124,112 Provision for income taxes 45,409 42,078 ------ ------ Net income 82,762 82,034 Less: Net income attributable to noncontrolling interests 10,943 14,493 Net income attributable to UHS $71,819 $67,541 ======= ======= Basic earnings per share attributable to UHS (a) $0.74 $0.68 ===== ===== Diluted earnings per share attributable to UHS (a) $0.73 $0.68 ===== ===== Universal Health Services, Inc. ------------------------------- Footnotes to Consolidated Statements of Income ---------------------------------------------- (in thousands, except per share amounts) (unaudited) Three months ended March 31, --------------- 2010 2009 ---- ---- (a) Earnings per share calculation: ----------------------------------- Basic and diluted: ------------------ Net income attributable to UHS $71,819 $67,541 Less: Net income attributable to unvested restricted share grants (315) (314) ---- ---- Net income attributable to UHS -basic and diluted $71,504 $67,227 ======= ======= Weighted average number of common shares - basic 96,539 98,412 ------ ------ Basic earnings per share attributable to UHS: $0.74 $0.68 ===== ===== Weighted average number of common shares 96,539 98,412 Add: Other share equivalents 911 - Weighted average number of common shares and equiv. -diluted 97,450 98,412 ------ ------ Diluted earnings per share attributable to UHS: $0.73 $0.68 ===== ===== Universal Health Services, Inc. ------------------------------- Schedule of Non-GAAP Supplemental Consolidated Statements of Income Information ("Supplemental Schedule") ------------------------------------------------------------------- For the three months ended March 31, 2010 and 2009 -------------------------------------------------- (in thousands, except per share amounts) (unaudited) Calculation of "EBITDA" ----------------------- Three months ended March 31, 2010 -------------- Calculation of "EBITDA" ----------------------- Net revenues $1,347,153 100.0% Operating charges: Salaries, wages and benefits 578,926 43.0% Other operating expenses 247,028 18.3% Supplies expense 183,816 13.6% Provision for doubtful accounts 125,390 9.3% 1,135,160 84.3% --------- ---- Operating income/margin ("EBITDAR") 211,993 15.7% Lease and rental expense 17,934 Net income attributable to noncontrolling interests 10,943 ------ Earnings before, depreciation and amortization, interest expense, and income taxes ("EBITDA") $183,116 ======== Three months ended March 31, 2009 -------------- Calculation of "EBITDA" ----------------------- Net revenues $1,312,419 100.0% Operating charges: Salaries, wages and benefits 541,297 41.2% Other operating expenses 273,221 20.8% Supplies expense 173,967 13.3% Provision for doubtful accounts 118,978 9.1% 1,107,463 84.4% --------- ---- Operating income/margin ("EBITDAR") 204,956 15.6% Lease and rental expense 17,072 Net income attributable to noncontrolling interests 14,493 ------ Earnings before, depreciation and amortization, interest expense, and income taxes ("EBITDA") $173,391 ======== Universal Health Services, Inc. ------------------------------- Condensed Consolidated Balance Sheets ------------------------------------- (in thousands, unaudited) December March 31, 31, 2010 2009 ---- ---- Assets Current assets: Cash and cash equivalents $6,865 $9,180 Accounts receivable, net 648,831 602,559 Supplies 83,822 84,272 Other current assets 36,863 27,270 Deferred income taxes 39,895 51,336 Current assets held for sale 21,580 21,580 Total current assets 837,856 796,197 ------- ------- Property and equipment 3,771,362 3,738,818 Less: accumulated depreciation (1,467,874) (1,423,580) 2,303,488 2,315,238 --------- --------- Other assets: Goodwill 733,626 732,685 Deferred charges 9,316 8,643 Other 115,025 111,700 $3,999,311 $3,964,463 ========== ========== Liabilities and Stockholders' Equity Current liabilities: Current maturities of long-term debt $1,526 $2,573 Accounts payable and accrued liabilities 583,028 578,617 Federal and state taxes 25,716 1,627 Total current liabilities 610,270 582,817 ------- ------- Other noncurrent liabilities 367,747 375,580 Long-term debt 891,615 956,429 Deferred income taxes 63,125 60,091 UHS common stockholders' equity 1,821,755 1,751,071 Noncontrolling interest 244,799 238,475 ------- ------- Total equity 2,066,554 1,989,546 $3,999,311 $3,964,463 ========== ========== Universal Health Services, Inc. ------------------------------- Consolidated Statements of Cash Flows ------------------------------------- (in thousands) (unaudited) Three months ended March 31, --------------- 2010 2009 ---- ---- Cash Flows from Operating Activities: Net income $82,762 $82,034 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation & amortization 53,511 51,134 Gain on sale of asset (1,848) - Stock-based compensation expense 4,065 3,463 Changes in assets & liabilities, net of effects from acquisitions and dispositions: Accounts receivable (46,499) (44,894) Construction management and other receivable - 17,477 Accrued interest 8,357 10,491 Accrued and deferred income taxes 37,380 28,062 Other working capital accounts (2,389) 6,581 Other assets and deferred charges (4,231) (1,902) Other (4,164) (4,537) Accrued insurance expense, net of commercial premiums paid 18,960 20,014 Payments made in settlement of self- insurance claims (10,187) (15,669) Net cash provided by operating activities 135,717 152,254 ------- ------- Cash Flows from Investing Activities: Property and equipment additions, net of disposals (62,576) (78,219) Proceeds received from sale of asset 2,894 - Net cash used in investing activities (59,682) (78,219) ------- ------- Cash Flows from Financing Activities: Reduction of long-term debt (68,363) (51,800) Repurchase of common shares (2,157) (14,725) Dividends paid (4,834) (3,962) Issuance of common stock 1,627 667 Profit distributions to noncontrolling interests (4,623) (252) Net cash used in financing activities (78,350) (70,072) ------- ------- Increase (decrease) in cash and cash equivalents (2,315) 3,963 Cash and cash equivalents, beginning of period 9,180 5,460 Cash and cash equivalents, end of period $6,865 $9,423 ====== ====== Supplemental Disclosures of Cash Flow Information: Interest paid $5,482 $3,966 ====== ====== Income taxes paid, net of refunds $6,732 $13,784 ====== ======= Universal Health Services, Inc. Supplemental Statistical Information (unaudited) % Change Quarter Ended Same Facility: 3/31/2010 -------------- --------- Acute Care Hospitals -------------------- Revenues 3.1% Adjusted Admissions 1.8% Adjusted Patient Days 0.6% Revenue Per Adjusted Admission 1.3% Revenue Per Adjusted Patient Day 2.5% Behavioral Health Hospitals --------------------------- Revenues 6.7% Adjusted Admissions 3.8% Adjusted Patient Days 3.9% Revenue Per Adjusted Admission 2.8% Revenue Per Adjusted Patient Day 2.7% UHS Consolidated First Quarter Ended ---------------- ------------------- 3/31/2010 3/31/2009 --------- --------- Revenues $1,347,153 $1,312,419 EBITDA (1) $183,116 $173,391 EBITDA Margin (1) 13.6% 13.2% Cash Flow From Operations $135,717 $152,254 Days Sales Outstanding 43 45 Capital Expenditures $62,576 $78,219 Debt 893,141 947,569 UHS common stockholders' equity 1,821,755 1,596,544 Debt / Total Capitalization 32.9% 37.2% Debt / EBITDA (2) 1.29 1.64 Debt / Cash From Operations (2) 1.73 1.84 Acute Care EBITDAR Margin (3) 16.1% 17.6% Behavioral Health EBITDAR Margin (3) 25.5% 24.3% (1) Net of noncontrolling interest (2) Latest 4 quarters (3) Before Corporate overhead allocation and noncontrolling interest UNIVERSAL HEALTH SERVICES, INC. SELECTED HOSPITAL STATISTICS MARCH 31, 2010 AS REPORTED: For the three months ended Acute 03/31/10 03/31/09 -------- -------- Hospitals owned and leased 21 21 Average licensed beds 5,689 5,465 Patient days 305,676 307,278 Average daily census 3,396.4 3,414.2 Occupancy-licensed beds 59.7% 62.5% Admissions 68,638 68,198 Length of stay 4.5 4.5 Inpatient revenue $2,783,431 $2,580,139 Outpatient revenue 1,116,925 995,699 Total patient revenue 3,900,356 3,575,838 Other revenue 15,803 17,810 Gross hospital revenue 3,916,159 3,593,648 Total deductions 2,926,848 2,633,799 Net hospital revenue $989,311 $959,849 AS REPORTED: For the three months ended % --- Hospitals owned and leased 0.0% Average licensed beds 4.1% Patient days -0.5% Average daily census -0.5% Occupancy-licensed beds -4.4% Admissions 0.6% Length of stay -1.2% Inpatient revenue 7.9% Outpatient revenue 12.2% Total patient revenue 9.1% Other revenue -11.3% Gross hospital revenue 9.0% Total deductions 11.1% Net hospital revenue 3.1% AS REPORTED: For the three months ended Behavioral Health 03/31/10 03/31/09 -------- -------- Hospitals owned and leased 82 81 Average licensed beds 7,971 7,794 Patient days 538,750 512,934 Average daily census 5,986.1 5,699.3 Occupancy-licensed beds 75.1% 73.1% Admissions 36,357 33,961 Length of stay 14.8 15.1 Inpatient revenue $544,781 $503,681 Outpatient revenue 77,977 68,128 Total patient revenue 622,758 571,809 Other revenue 8,408 7,909 Gross hospital revenue 631,166 579,718 Total deductions 281,984 257,565 Net hospital revenue $349,182 $322,153 AS REPORTED: For the three months ended % --- Hospitals owned and leased 1.2% Average licensed beds 2.3% Patient days 5.0% Average daily census 5.0% Occupancy-licensed beds 2.7% Admissions 7.1% Length of stay -1.9% Inpatient revenue 8.2% Outpatient revenue 14.5% Total patient revenue 8.9% Other revenue 6.3% Gross hospital revenue 8.9% Total deductions 9.5% Net hospital revenue 8.4% SAME FACILITY: Acute 03/31/10 03/31/09 -------- -------- Hospitals owned and leased 21 21 Average licensed beds 5,689 5,465 Patient days 305,676 307,278 Average daily census 3,396.4 3,414.2 Occupancy-licensed beds 59.7% 62.5% Admissions 68,638 68,198 Length of stay 4.5 4.5 SAME FACILITY: % --- Hospitals owned and leased 0.0% Average licensed beds 4.1% Patient days -0.5% Average daily census -0.5% Occupancy-licensed beds -4.4% Admissions 0.6% Length of stay -1.2% SAME FACILITY: Behavioral Health (1) 03/31/10 03/31/09 -------- -------- Hospitals owned and leased 79 79 Average licensed beds 7,735 7,642 Patient days 530,766 509,661 Average daily census 5,897.4 5,662.9 Occupancy-licensed beds 76.2% 74.1% Admissions 35,295 33,937 Length of stay 15.0 15.0 SAME FACILITY: % --- Hospitals owned and leased 0.0% Average licensed beds 1.2% Patient days 4.1% Average daily census 4.1% Occupancy-licensed beds 2.9% Admissions 4.0% Length of stay 0.1% (1) Ascent, Centennial Peaks, Crescent Pines, The Hope Program and Springwoods Behavioral are excluded in both current and prior years. Coastal Behavioral is included in March 1st thru year to date.
Universal Health Services, Inc.
CONTACT: Steve Filton, Chief Financial Officer, Universal Health
Services, Inc., +1-610-768-3300
Web Site: http://www.uhsinc.com/
