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Universal Health Services, Inc. Reports 17% Increase in 2009 First Quarter Earnings from Continuing Operations Per Diluted Share

Consolidated Results of Operations:

KING OF PRUSSIA, Pa., April 27 /PRNewswire-FirstCall/ -- Universal Health Services, Inc. (NYSE: UHS) announced today that its net income was $67.5 million, or an increase of 14% to $1.37 per diluted share, during the first quarter of 2009 as compared to $61.7 million, or $1.20 per diluted share, during the comparable prior year quarter. Income from continuing operations was $67.5 million, or an increase of 17% to $1.37 per diluted share, during the first quarter of 2009 as compared to $60.1 million, or $1.17 per diluted share, during the comparable prior year quarter.

Net revenues increased 3% to $1.31 billion during the first quarter of 2009 as compared to $1.28 billion during the first quarter of 2008. Our consolidated operating margin, as calculated on the attached Supplemental Schedule, was 15.6% and 14.8% during the three-month periods ended March 31, 2009 and 2008, respectively.

Acute Care Services:

At our acute care hospitals owned during both periods ("same facility basis"), inpatient admissions decreased 1.1% and patients days decreased 2.2% during the first quarter of 2009, as compared to the first quarter of 2008. On a same facility basis, net revenues at our acute care facilities increased 0.9% during the first quarter of 2009 as compared to the comparable prior year quarter. Net revenue per adjusted admission and adjusted patient day at these facilities increased 0.9% and 2.0%, respectively, during the first quarter of 2009 over the comparable prior year quarter. The operating margin at our acute care hospitals owned during both periods increased to 17.5% during the first quarter of 2009 as compared to 16.2% during the first quarter of 2008.

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 $158 million and $154 million during the three-month periods ended March 31, 2009 and 2008, respectively.

Behavioral Health Care Services:

At our behavioral health facilities, on a same facility basis, inpatient admissions increased 1.1% and patient days decreased 1.4% during the first quarter of 2009 as compared to the first quarter of 2008. On a same facility basis, net revenues at our behavioral health facilities increased 2.8% during the first quarter of 2009 as compared to the comparable prior year quarter. Net revenue per adjusted patient day at these facilities increased 4.8% during the first quarter of 2009 over the comparable prior year quarter. The operating margin at our behavioral health facilities owned during both periods was 25.0% during the first quarter of 2009 as compared to 23.7% during the first quarter of 2008.

Conference Call Information:

We will hold a conference call for investors and analysts at 9:00 a.m. eastern time on April 28, 2009. 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 28, 2009 and will continue through midnight on May 12, 2009. The recording can be accessed by calling 1-800-642-1687 and entering the conference ID number 92651699. This call will also be available live over the internet at our web site at www.uhsinc.com. The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at www.earnings.com, Thomson's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents at 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 acute care and behavioral health hospitals and ambulatory centers nationwide and in Puerto Rico. It acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust (NYSE: UHT). 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, 2008), may cause 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 income from continuing operations, adjusted income from continuing operations per diluted share, adjusted net income, adjusted net income 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, 2008. 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,
                                                          ---------------
                                                          2009       2008
                                                          ----       ----

    Net revenues                                    $1,312,419 $1,277,976

    Operating charges:
       Salaries, wages and benefits                    541,297    541,575
       Other operating expenses                        273,221    248,645
       Supplies expense                                173,967    179,239
       Provision for doubtful accounts                 118,978    119,797
       Depreciation and amortization                    51,134     46,743
       Lease and rental expense                         17,072     17,555
                                                        ------     ------
                                                     1,175,669  1,153,554
                                                     ---------  ---------

    Income from continuing operations before interest
     expense and income taxes                          136,750    124,422

    Interest expense, net                               12,638     13,479
                                                        ------     ------

    Income from continuing operations before
     income taxes                                      124,112    110,943

    Provision for income taxes                          42,078     37,611
                                                        ------     ------

    Income from continuing operations                   82,034     73,332

    Income from continuing operations attributable to
     minority interests                                 14,493     13,279
                                                        ------     ------

    Income from continuing operations attributable
     to UHS                                             67,541     60,053

    Income from discontinued operations, net of
     income tax expense (a)                                  -      1,610

                                                       -------    -------
    Net income attributable to UHS                     $67,541    $61,663
                                                       =======    =======


    Basic earnings per share attributable to UHS (b)
         From continuing operations                      $1.37      $1.17
         From discontinued operations                        -       0.03
                                                         -----       ----
              Total basic earnings per share             $1.37      $1.20
                                                         =====      =====

    Diluted earnings per share attributable to UHS (b)
         From continuing operations                      $1.37      $1.17
         From discontinued operations                        -       0.03
                                                         -----       ----
              Total diluted earnings per share           $1.37      $1.20
                                                         =====      =====



                            Universal Health Services, Inc.
                            -------------------------------
                    Footnotes to Consolidated Statements of Income
                    ----------------------------------------------
                       (in thousands, except per share amounts)
                                      (unaudited)

                                                       Three months
                                                      ended March 31,
                                                       2009     2008
                                                       ----     ----

    (a) Calculation of income from discontinued
         operations, net of income tax:
    Income from discontinued operations, pre-tax          -   $2,609
    Income tax                                            -     (999)
    Income from discontinued operations, net of taxes     -   $1,610
                                                     ======   ======


    (b) Earnings per share calculation:

    Basic:
    ------
    Income from continuing operations attributable
     to UHS                                         $67,541  $60,053
    Less: Net income attributable to unvested
     restricted share grants                           (314)    (259)
                                                       ----     ----
    Income from continuing operations - basic        67,227   59,794
    Income from discontinued operations                   -    1,610
                                                     ------    -----
    Net income attributable to UHS - basic          $67,227  $61,404
                                                    =======  =======

    Weighted average number of common shares -
     basic                                           49,206   51,263
                                                     ------   ------

    Basic earnings per share attributable to UHS:
         From continuing operations                   $1.37    $1.17
         From discontinued operations                     -     0.03
                                                       ----     ----
              Total basic earnings per share          $1.37    $1.20
                                                      =====    =====

    Diluted:
    --------
    Income from continuing operations attributable
     to UHS                                          $67,541  $60,053
    Less: Net income attributable to unvested
     restricted share grants                            (314)    (259)
                                                        ----     ----
    Income from continuing operations - diluted       67,227   59,794
    Income from discontinued operations                    -    1,610
                                                       -----    -----
    Net income attributable to UHS - diluted         $67,227  $61,404
                                                     =======  =======

    Weighted average number of common shares          49,206   51,263
    Add: Other share equivalents                           -       17
                                                      ------   ------
    Weighted average number of common shares and
     equiv. - diluted                                 49,206   51,280
                                                      ------   ------

    Diluted earnings per share attributable to UHS:
         From continuing operations                    $1.37    $1.17
         From discontinued operations                      -     0.03
                                                        ----     ----
              Total diluted earnings per share         $1.37    $1.20
                                                       =====    =====



                      Universal Health Services, Inc.
                      -------------------------------
       Schedule of Non-GAAP Supplemental Consolidated Statements of
                Income Information ("Supplemental Schedule")
       -------------------------------------------------------------
             For the three months ended March 31, 2009 and 2008
             --------------------------------------------------
                  (in thousands, except per share amounts)
                                (unaudited)

                                       Three months      Three months
                                           ended             ended
                                      March 31, 2009    March 31, 2008
                                      --------------    --------------


    Net revenues                    $1,312,419 100.0% $1,277,976 100.0%

    Operating charges:
       Salaries, wages and benefits    541,297  41.2%    541,575  42.4%
       Other operating expenses        273,221  20.8%    248,645  19.5%
       Supplies expense                173,967  13.3%    179,239  14.0%
       Provision for doubtful
        accounts                       118,978   9.1%    119,797   9.4%
                                       -------   ---     -------   ---
                                     1,107,463  84.4%  1,089,256  85.2%
                                     ---------  ----   ---------  ----

    Operating income/margin            204,956  15.6%    188,720  14.8%

       Lease and rental expense         17,072            17,555
       Income from continuing
        operations attributable to
        minority interests              14,493            13,279
                                        ------            ------

    Earnings before, depreciation
     and amortization, interest
     expense, and income taxes
     ("EBITDA")                        173,391           157,886

       Depreciation and
        amortization                    51,134            46,743
       Interest expense, net            12,638            13,479
                                        ------            ------

    Income before income taxes         109,619            97,664

    Provision for income taxes          42,078            37,611
                                        ------            ------

    Income from continuing
     operations attributable to UHS     67,541            60,053

    Income from discontinued
     operations, net of income
     taxes                                   -             1,610

                                       -------           -------
    Net income attributable to UHS     $67,541           $61,663
                                       =======           =======



                        Universal Health Services, Inc.
                        -------------------------------
                     Condensed Consolidated Balance Sheets
                     -------------------------------------
                                 (in thousands)

                                                  (unaudited)
                                                   March 31,   December 31,
                                                       2009           2008
                                                       ----           ----
    Assets
    Current assets:
        Cash and cash equivalents                    $9,423         $5,460
        Accounts receivable, net                    652,854        625,437
        Supplies                                     77,022         76,043
        Other current assets                         32,392         26,375
        Deferred income taxes                        39,249         34,522
        Current assets held for sale                 21,580         21,580
                                                     ------         ------
              Total current assets                  832,520        789,417
                                                    -------        -------

    Property and equipment                        3,446,127      3,355,974
    Less: accumulated depreciation               (1,300,845)    (1,255,682)
                                                 ----------     ----------
                                                  2,145,282      2,100,292
                                                  ---------      ---------

    Other assets:
        Goodwill                                    733,882        732,937
        Deferred charges                             11,440         10,428
        Other                                       112,193        109,388
                                                    -------        -------
                                                 $3,835,317     $3,742,462
                                                 ==========     ==========

    Liabilities and Stockholders' Equity
    Current liabilities:
        Current maturities of long-term debt         $8,725         $8,708
        Accounts payable and accrued liabilities    591,427        542,008
        Federal and state taxes                      44,211         10,409
                                                     ------         ------
              Total current liabilities             644,363        561,125
                                                    -------        -------

    Other noncurrent liabilities                    403,325        407,652
    Long-term debt                                  938,844        990,661
    Deferred income taxes                            11,267         12,439


    UHS common stockholders' equity               1,596,544      1,543,850
    Minority interest                               240,974        226,735
                                                    -------        -------
              Total equity                        1,837,518      1,770,585

                                                 ----------     ----------
                                                 $3,835,317     $3,742,462
                                                 ==========     ==========



                  Universal Health Services, Inc.
                  -------------------------------
               Consolidated Statements of Cash Flows
               -------------------------------------
                          (in thousands)
                            (unaudited)
                                                                Three months
                                                               ended March 31,
                                                               --------------
                                                                2009     2008
                                                                ----     ----

    Cash Flows from Operating Activities:
      Net income                                             $67,541  $61,663
      Adjustments to reconcile net income to net cash
       provided by operating activities:
        Depreciation & amortization                           51,135   47,370
      Changes in assets & liabilities, net of effects from
       acquisitions and dispositions:
        Accounts receivable                                  (44,894) (63,970)
        Construction management and other receivable          17,477      383
        Accrued interest                                      10,491    8,999
        Accrued and deferred income taxes                     28,062   31,301
        Other working capital accounts                         6,581   27,777
        Other assets and deferred charges                     (1,902)   1,351
        Other                                                 (1,073)  (1,714)
        Minority interest in earnings of consolidated
         entities, net of distributions                       14,239   12,906
        Accrued insurance expense, net of commercial
         premiums paid                                        20,014   19,376
        Payments made in settlement of self-insurance claims (15,669) (13,766)
                                                             -------  -------
              Net cash provided by operating activities      152,002  131,676
                                                             -------  -------

    Cash Flows from Investing Activities:
      Property and equipment additions, net of disposals     (78,219) (81,751)
      Proceeds received from sale of assets                        -    2,235
                                                               -----    -----
              Net cash used in investing activities          (78,219) (79,516)
                                                             -------  -------

    Cash Flows from Financing Activities:
      Reduction of long-term debt                            (51,800)       -
      Additional borrowings                                        -   33,180
      Repurchase of common shares                            (14,725) (89,799)
      Dividends paid                                          (3,962)  (4,072)
      Issuance of common stock                                   667    1,093
                                                                 ---    -----
              Net cash used in financing activities          (69,820) (59,598)
                                                             -------  -------

    Increase (decrease) in cash and cash equivalents           3,963   (7,438)
    Cash and cash equivalents, beginning of period             5,460   16,354
                                                               -----   ------
    Cash and cash equivalents, end of period                  $9,423   $8,916
                                                              ======   ======

    Supplemental Disclosures of Cash Flow Information:
      Interest paid                                           $3,966   $6,407
                                                              ======   ======

      Income taxes paid, net of refunds                      $13,784   $7,642
                                                             =======   ======



                       Universal Health Services, Inc.
                   Supplemental Statistical Information
                                (unaudited)

                                                                 % Change
                                                              Quarter Ended
    Same Facility:                                                3/31/2009
    --------------                                                ---------

    Acute Care Hospitals
    --------------------
    Revenues                                                           0.9%
    Adjusted Admissions                                                0.0%
    Adjusted Patient Days                                             -1.1%
    Revenue Per Adjusted Admission                                     0.9%
    Revenue Per Adjusted Patient Day                                   2.0%


    Behavioral Health Hospitals
    ---------------------------

    Revenues                                                           2.8%
    Adjusted Admissions                                                0.5%
    Adjusted Patient Days                                             -1.9%
    Revenue Per Adjusted Admission                                     2.3%
    Revenue Per Adjusted Patient Day                                   4.8%


    UHS Consolidated                                 First Quarter Ended
    ----------------                                 -------------------
                                                  3/31/2009      3/31/2008
                                                  ---------      ---------

    Revenues                                     $1,312,419     $1,277,976
    EBITDA   (1)                                   $173,391       $157,886
    EBITDA Margin (1)                                  13.2%          12.4%

    Cash Flow From Operations                      $152,002       $131,676
    Days Sales Outstanding                               45             48
    Capital Expenditures                            $78,219        $81,751

    Debt                                            947,569      1,045,082
    Shareholders Equity                           1,596,544      1,487,212
    Debt / Total Capitalization                        37.2%          41.3%
    Debt / EBITDA (2)                                  1.64           1.98
    Debt / Cash From Operations (2)                    1.96           2.74


    Acute Care EBITDAR Margin (3)                      17.5%          16.2%
    Behavioral Health EBITDAR Margin (3)               24.3%          23.1%


    (1)  Net of Minority Interest
    (2)  Latest 4 quarters
    (3)  Before Corporate overhead allocation and minority interest



                         UNIVERSAL HEALTH SERVICES, INC.
                           SELECTED HOSPITAL STATISTICS
                                MARCH 31, 2009

    AS REPORTED:
                                   For the three months ended

                                  Acute (1)           Behavioral Health
                           03/31/09  03/31/08    %   03/31/09  03/31/08    %
                           --------  --------    -   --------  --------    -

    Hospitals owned and
     leased                     21         23 -8.7%        82       83  -1.2%
    Average licensed beds    5,465      5,453  0.2%     7,794    7,596   2.6%
    Patient days           307,278    314,241 -2.2%   512,934  529,955  -3.2%
    Average daily census   3,414.2    3,453.2 -1.1%   5,699.3  5,823.7  -2.1%
    Occupancy-licensed
     beds                    62.5%      63.3% -1.3%     73.1%    76.7%  -4.6%
    Admissions              68,198     68,956 -1.1%    33,961   32,882   3.3%
    Length of stay             4.5        4.6 -1.1%      15.1     16.1  -6.3%

    Inpatient revenue   $2,580,139 $2,439,285  5.8%  $503,681 $488,733   3.1%
    Outpatient revenue     995,699    905,416 10.0%    68,128   66,588   2.3%
    Total patient
     revenue             3,575,838  3,344,701  6.9%   571,809  555,321   3.0%
    Other revenue           17,675     18,173 -2.7%     7,909    8,158  -3.1%
    Gross hospital
     revenue             3,593,513  3,362,874  6.9%   579,718  563,479   2.9%

    Total deductions     2,633,799  2,411,605  9.2%   257,565  250,621   2.8%

    Net hospital revenue  $959,714   $951,269  0.9%  $322,153 $312,858   3.0%

    SAME FACILITY:
                                 Acute  (2)          Behavioral Health (3)
                          03/31/09  03/31/08    %   03/31/09  03/31/08    %
                          --------  --------    -   --------  --------    -

    Hospitals owned and
       leased                   21         21  0.0%        79       79  0.0%
    Average licensed beds    5,465      5,453  0.2%     7,581    7,405  2.4%
    Patient days           307,278    314,241 -2.2%   507,195  514,159 -1.4%
    Average daily census   3,414.2    3,453.2 -1.1%   5,635.5  5,650.1 -0.3%
    Occupancy-licensed
     beds                    62.5%      63.3% -1.3%     74.3%    76.3% -2.6%
    Admissions              68,198     68,956 -1.1%    33,153   32,785  1.1%
    Length of stay             4.5        4.6 -1.1%      15.3     15.7 -2.4%

    (1) Our three acute care hospitals located in New Orleans and
        Discontinued operations are excluded in current and prior years.
    (2) Central Montgomery is excluded in both current and prior years.
    (3) Central Florida, Coastal Behavioral, Summit Ridge and Shenandoah
        Valley are excluded in both current and prior years. Broad Horizons,
        Highlander RTC, Midwest Youth and Vista Group Homes are excluded in
        both current and prior years.

SOURCE Universal Health Services, Inc.
04/27/2009 CONTACT:
Steve Filton, Chief Financial Officer of Universal Health Services, Inc., 1-610-768-3300
/Web Site: http://www.uhsinc.com.
(UHS UHT)

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