MenuSearch

News Release

Printer Friendly Version 
<< Back To Press Releases
Universal Health Services, Inc. Reports 2010 First Quarter Financial Results
Consolidated Results of Operations

KING OF PRUSSIA, Pa., April 26, 2010 /PRNewswire via COMTEX/ --Universal Health Services, Inc. (NYSE: UHS) 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 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, 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 (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, 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.



SOURCE Universal Health Services, Inc.

<< Back To Press Releases