First Quarter EPS of $0.80 Per Share, Up 8.1% Over Prior Year Period
BRENTWOOD, Tenn.--(BUSINESS WIRE)-- LifePoint Hospitals, Inc. (NASDAQ: LPNT) today announced results for the first quarter ended March 31, 2010.
For the first quarter ended March 31, 2010, revenues from continuing operations were $786.2 million, up 6.9% from $735.5 million for the same period a year ago. Income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders for the first quarter ended March 31, 2010, increased 9.7% to $43.3 million, or $0.80 per diluted share, compared with income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders of $39.5 million, or $0.74 per diluted share, for the same period last year. Net income attributable to LifePoint Hospitals, Inc. stockholders for the first quarter ended March 31, 2010, was $42.9 million, or $0.79 per diluted share, compared with $38.4 million, or $0.72 per diluted share, for the same period last year.
In commenting on the results, William F. Carpenter III, president and chief executive officer of LifePoint Hospitals, said, “We are pleased with the strong first quarter results. Our performance reflects the successful execution of our strategic focus on quality care, organic growth and growth through acquisitions, operations excellence and talent development. We believe we are well positioned for the rest of 2010.”
The Company’s results for the first quarter include three months of financial performance at Rockdale Medical Center versus two months in the first quarter of 2009. The Company has elected to include Rockdale in its same store numbers for 2010. The Company’s reported admissions declined by 0.5% and adjusted admissions increased by 2.3% over the prior year quarter. After adjusting for the one additional month of Rockdale operations in 2010, the Company’s volume metrics for the first quarter would reflect a decrease in admissions of 1.9% and an increase in adjusted admissions of 0.9%.
The Company stated that its recently announced acquisition of Clark Regional Medical Center is expected to close later today.
A listen-only simulcast, as well as a 30-day replay, of LifePoint Hospitals’ first quarter 2010 conference call will be available on line at www.LifePointHospitals.com and www.earnings.com today, Friday, April 30, 2010, beginning at 10:00 a.m. Eastern Time.
LifePoint Hospitals, Inc. is a leading hospital company focused on providing quality healthcare services close to home. Through its subsidiaries, LifePoint operates 47 hospital campuses in 17 states. With a mission of “Making Communities Healthier®,” LifePoint is the sole community hospital provider in the majority of the communities it serves. More information about the Company, which is headquartered in Brentwood, Tennessee, can be found on its website, www.LifePointHospitals.com. All references to “LifePoint,” "LifePoint Hospitals," or the “Company” used in this release refer to LifePoint Hospitals, Inc. or its affiliates.
Important Legal Information. Certain statements contained in this release are based on current management expectations and are “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, and are intended to qualify for the safe harbor protections from liability provided by the Private Securities Litigation Reform Act of 1995. Numerous factors exist which may cause results to differ from these expectations. Many of the factors that will determine LifePoint’s future results are beyond LifePoint’s ability to control or predict with accuracy. Such forward-looking statements reflect the current expectations and beliefs of the management of LifePoint, are not guarantees of performance and are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results to differ from those described in the forward-looking statements. These forward-looking statements may also be subject to other risk factors and uncertainties, including without limitation: (i) the failure of certain employers, or the closure of certain manufacturing and other facilities, in markets where LifePoint’s hospitals depend on a small number of local employers; (ii) the growth of uninsured and “patient due” accounts, and deterioration in the collectability of these accounts; (iii) continuing fallout from the recent economic recession, particularly if conditions in the capital and credit markets deteriorate or there is a prolonged period of recovery; (iv) reduction in Medicare or Medicaid payments by federal or state programs, or reduction in reimbursement amounts from managed care companies; (v) deterioration in the financial condition of payors, or increased healthcare cost containment initiatives; (vi) LifePoint’s ability to attract, recruit and retain qualified physicians, nurses, medical technicians and other healthcare professionals; (vii) the loss of certain physicians in markets where such a loss can have a disproportionate impact on LifePoint’s hospitals; (viii) the effect of recently enacted health care reform legislation and other changes in government programs intended to decrease the number of uninsured Americans and reduce overall healthcare costs; (ix) increasingly stringent governmental scrutiny that may subject LifePoint to allegations that LifePoint has failed to comply with governmental regulations; (x) competition from other hospitals and outpatient facilities providing services similar to those LifePoint offers and from physicians providing services in their offices that could be provided in LifePoint’s hospitals; (xi) regulatory and economic changes in the small number of states in which LifePoint’s revenues are concentrated; (xii) interruption of or restriction in LifePoint’s access to licensed information or failure in LifePoint’s ability to integrate changes to LifePoint’s existing information systems or information systems of acquired hospitals; (xiii) LifePoint’s substantial indebtedness and any incurrence of significant amounts of additional indebtedness; (xiv) liabilities resulting from potential malpractice and related legal claims brought against LifePoint’s hospitals; (xv) LifePoint’s ability to acquire hospitals and not-for-profit entities on favorable terms; (xvi) business risks associated with acquiring additional hospitals and the difficulty in operating and integrating such hospitals; (xvii) LifePoint’s ability to enhance LifePoint’s hospitals with the most recent technological advances in diagnostic and surgical equipment; and (xviii) those other risks and uncertainties described from time to time in LifePoint’s filings with the Securities and Exchange Commission. Therefore, LifePoint’s future results may differ materially from those described in this release. LifePoint undertakes no obligation to update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
All references to “LifePoint,” “LifePoint Hospitals” and the “Company” as used throughout this release refer to LifePoint Hospitals, Inc. and its subsidiaries.
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
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Dollars in millions, except per share amounts |
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| For the Three Months Ended March 31, | ||||||||||||||
| 2010 | 2009 | |||||||||||||
| Amount |
% of Revenues |
Amount |
% of Revenues |
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| Revenues | $ | 786.2 | 100.0 | % | $ | 735.5 | 100.0 | % | ||||||
| Salaries and benefits | 303.3 | 38.6 | 286.5 | 38.9 | ||||||||||
| Supplies | 108.4 | 13.8 | 99.6 | 13.5 | ||||||||||
| Other operating expenses | 140.4 | 17.8 | 132.7 | 18.1 | ||||||||||
| Provision for doubtful accounts | 102.1 | 13.0 | 90.2 | 12.3 | ||||||||||
| Depreciation and amortization | 36.1 | 4.6 | 35.1 | 4.8 | ||||||||||
| Interest expense, net | 25.1 | 3.2 | 25.8 | 3.5 | ||||||||||
| 715.4 | 91.0 | 669.9 | 91.1 | |||||||||||
| Income from continuing operations before income taxes | 70.8 | 9.0 | 65.6 | 8.9 | ||||||||||
| Provision for income taxes | 26.6 | 3.4 | 25.5 | 3.4 | ||||||||||
| Income from continuing operations | 44.2 | 5.6 | 40.1 | 5.5 | ||||||||||
| Loss from discontinued operations, net of income taxes | (0.4 | ) | - | (1.1 | ) | (0.2 | ) | |||||||
| Net income | 43.8 | 5.6 | 39.0 | 5.3 | ||||||||||
| Less: Net income attributable to noncontrolling interests | (0.9 | ) | (0.1 | ) | (0.6 | ) | (0.1 | ) | ||||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 42.9 | 5.5 | % | $ | 38.4 | 5.2 | % | ||||||
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Basic earnings (loss) per share attributable to LifePoint Hospitals, Inc. stockholders: |
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| Continuing operations | $ | 0.82 | $ | 0.76 | ||||||||||
| Discontinued operations | (0.01 | ) | (0.02 | ) | ||||||||||
| Net income | $ | 0.81 | $ | 0.74 | ||||||||||
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Diluted earnings (loss) per share attributable to LifePoint Hospitals, Inc. stockholders: |
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| Continuing operations | $ | 0.80 | $ | 0.74 | ||||||||||
| Discontinued operations | (0.01 | ) | (0.02 | ) | ||||||||||
| Net income | $ | 0.79 | $ | 0.72 | ||||||||||
| Amounts attributable to LifePoint Hospitals, Inc. stockholders: | ||||||||||||||
| Income from continuing operations, net of income taxes | $ | 43.3 | $ | 39.5 | ||||||||||
| Loss from discontinued operations, net of income taxes | (0.4 | ) | (1.1 | ) | ||||||||||
| Net income | $ | 42.9 | $ | 38.4 | ||||||||||
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED EARNINGS (LOSS) PER SHARE CALCULATION |
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In millions, except per share amounts |
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Three Months Ended March 31, |
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| 2010 | 2009 | |||||||
| Income from continuing operations | $ | 44.2 | $ | 40.1 | ||||
| Less: Net income attributable to noncontrolling interests | (0.9 | ) | (0.6 | ) | ||||
| Income from continuing operations attributable to LifePoint Hospitals, Inc. stockholders | 43.3 | 39.5 | ||||||
| Loss from discontinued operations, net of income taxes | (0.4 | ) | (1.1 | ) | ||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 42.9 | $ | 38.4 | ||||
| Weighted average shares outstanding – basic | 53.2 | 52.2 | ||||||
| Effect of dilutive securities: stock options and other stock-based awards | 1.3 | 0.9 | ||||||
| Weighted average shares outstanding – diluted | 54.5 | 53.1 | ||||||
| Basic earnings (loss) per share attributable to LifePoint Hospitals, Inc. stockholders: | ||||||||
| Continuing operations | $ | 0.82 | $ | 0.76 | ||||
| Discontinued operations | (0.01 | ) | (0.02 | ) | ||||
| Net income | $ | 0.81 | $ | 0.74 | ||||
| Diluted earnings (loss) per share attributable to LifePoint Hospitals, Inc. stockholders: | ||||||||
| Continuing operations | $ | 0.80 | $ | 0.74 | ||||
| Discontinued operations | (0.01 | ) | (0.02 | ) | ||||
| Net income | $ | 0.79 | $ | 0.72 | ||||
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
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Dollars in millions |
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| March 31,
2010 |
Dec. 31, 2009(A) |
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| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 219.4 | $ | 187.2 | ||||
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Accounts receivable, less allowances for doubtful accounts of $446.1 and $433.2 at March 31, 2010 and December 31, 2009, respectively |
349.4 | 325.2 | ||||||
| Inventories | 75.3 | 75.3 | ||||||
| Prepaid expenses | 13.7 | 12.0 | ||||||
| Income taxes receivable | – | 10.0 | ||||||
| Deferred tax assets | 126.8 | 121.3 | ||||||
| Other current assets | 23.2 | 23.1 | ||||||
| 807.8 | 754.1 | |||||||
| Property and equipment: | ||||||||
| Land | 76.4 | 75.5 | ||||||
| Buildings and improvements | 1,394.6 | 1,377.0 | ||||||
| Equipment | 852.0 | 840.9 | ||||||
| Construction in progress | 26.9 | 19.9 | ||||||
| 2,349.9 | 2,313.3 | |||||||
| Accumulated depreciation | (847.5 | ) | (813.9 | ) | ||||
| 1,502.4 | 1,499.4 | |||||||
| Deferred loan costs, net | 25.0 | 23.0 | ||||||
| Intangible assets, net | 75.1 | 68.6 | ||||||
| Other | 5.0 | 5.2 | ||||||
| Goodwill | 1,524.3 | 1,523.0 | ||||||
| Total assets | $ | 3,939.6 | $ | 3,873.3 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 78.6 | $ | 77.3 | ||||
| Accrued salaries | 68.7 | 81.8 | ||||||
| Other current liabilities | 119.7 | 108.1 | ||||||
| Current maturities of long-term debt | 1.0 | 1.0 | ||||||
| 268.0 | 268.2 | |||||||
| Long-term debt | 1,404.0 | 1,398.8 | ||||||
| Deferred income tax liabilities | 175.3 | 176.9 | ||||||
| Reserves for self-insurance claims and other liabilities | 137.4 | 135.3 | ||||||
| Long-term income tax liability | 55.7 | 51.3 | ||||||
| Total liabilities | 2,040.4 | 2,030.5 | ||||||
| Redeemable noncontrolling interests | 16.7 | 12.0 | ||||||
| Equity: | ||||||||
| LifePoint Hospitals, Inc. stockholders’ equity: | ||||||||
| Preferred stock | – | – | ||||||
| Common stock | 0.6 | 0.6 | ||||||
| Capital in excess of par value | 1,261.3 | 1,246.4 | ||||||
| Accumulated other comprehensive loss | (14.9 | ) | (17.4 | ) | ||||
| Retained earnings | 791.4 | 748.5 | ||||||
| Common stock in treasury, at cost | (159.4 | ) | (150.4 | ) | ||||
| Total LifePoint Hospitals, Inc. stockholders’ equity | 1,879.0 | 1,827.7 | ||||||
| Noncontrolling interests | 3.5 | 3.1 | ||||||
| Total equity | 1,882.5 | 1,830.8 | ||||||
| Total liabilities and equity | $ | 3,939.6 | $ | 3,873.3 | ||||
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(A) Derived from audited consolidated financial statements. |
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
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Dollars in millions |
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Three Months Ended March 31, |
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| 2010 | 2009 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 43.8 | $ | 39.0 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Loss from discontinued operations | 0.4 | 1.1 | ||||||
| Stock-based compensation | 5.8 | 5.9 | ||||||
| Depreciation and amortization | 36.1 | 35.1 | ||||||
| Amortization of physician minimum revenue guarantees | 3.9 | 3.1 | ||||||
| Amortization of convertible debt discounts | 5.5 | 5.1 | ||||||
| Amortization of deferred loan costs | 2.4 | 1.9 | ||||||
| Deferred income tax benefit | (4.1 | ) | (6.0 | ) | ||||
| Reserves for self-insurance claims, net of payments | 4.1 | 5.6 | ||||||
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Increase (decrease) in cash from operating assets and liabilities, net of effects from acquisitions and divestitures: |
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| Accounts receivable | (24.7 | ) | (21.4 | ) | ||||
| Inventories and other current assets | (0.4 | ) | 0.3 | |||||
| Accounts payable and accrued expenses | (19.0 | ) | (8.8 | ) | ||||
| Income taxes payable/receivable | 29.6 | 31.2 | ||||||
| Other | 0.1 | (0.2 | ) | |||||
| Net cash provided by operating activities – continuing operations | 83.5 | 91.9 | ||||||
| Net cash used in operating activities – discontinued operations | (0.2 | ) | (1.5 | ) | ||||
| Net cash provided by operating activities | 83.3 | 90.4 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchase of property and equipment | (34.0 | ) | (43.1 | ) | ||||
| Acquisitions, net of cash acquired | (16.9 | ) | (78.2 | ) | ||||
| Net cash used in investing activities | (50.9 | ) | (121.3 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Repurchases of common stock | (9.0 | ) | (1.6 | ) | ||||
| Payment of debt refinance costs | (4.4 | ) | – | |||||
| Proceeds from exercise of stock options | 9.2 | 1.7 | ||||||
| Proceeds from employee stock purchase plans | 0.6 | 0.4 | ||||||
| Distributions to noncontrolling interests | (0.5 | ) | (0.4 | ) | ||||
| Proceeds from redeemable noncontrolling interests | 4.2 | – | ||||||
| Capital lease payments and other | (0.3 | ) | (0.4 | ) | ||||
| Net cash used in financing activities | (0.2 | ) | (0.3 | ) | ||||
| Change in cash and cash equivalents | 32.2 | (31.2 | ) | |||||
| Cash and cash equivalents at beginning of period | 187.2 | 75.7 | ||||||
| Cash and cash equivalents at end of period | $ | 219.4 | $ | 44.5 | ||||
| Supplemental disclosure of cash flow information: | ||||||||
| Interest payments | $ | 13.3 | $ | 16.2 | ||||
| Capitalized interest | $ | 0.1 | $ | 0.3 | ||||
| Income taxes paid, net | $ | 1.1 | $ | 0.5 | ||||
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED STATISTICS |
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| Three Months Ended March 31, | |||||||||
| % | |||||||||
| 2010 | 2009 | Change | |||||||
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Continuing Operations:(1) |
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| Number of hospitals at end of period | 47 | 47 | – | % | |||||
| Admissions | 49,292 | 49,519 | (0.5 | ) | |||||
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Equivalent admissions(2) |
100,704 | 98,394 | 2.3 | ||||||
| Revenues per equivalent admission | $ | 7,807 | $ | 7,475 | 4.4 | ||||
| Medicare case mix index | 1.32 | 1.29 | 2.3 | ||||||
| Average length of stay | 4.4 | 4.4 | – | ||||||
| Inpatient surgeries | 13,542 | 13,818 | (2.0 | ) | |||||
| Outpatient surgeries | 36,956 | 36,559 | 1.1 | ||||||
| Emergency room visits | 222,032 | 226,688 | (2.1 | ) | |||||
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Outpatient factor(2) |
2.04 | 1.99 | 2.5 | ||||||
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(1) Continuing operations information excludes the results of our hospitals that have been disposed. |
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(2) Management and investors use equivalent admissions as a general measure of combined inpatient and outpatient volume. We compute equivalent admissions by multiplying admissions (inpatient volumes) by the outpatient factor (the sum of gross inpatient revenue and gross outpatient revenue and then dividing the resulting amount by gross inpatient revenue). The equivalent admissions computation “equates” outpatient revenue to the volume measure (admissions) used to measure inpatient volume resulting in a general measure of combined inpatient and outpatient volume. |
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LIFEPOINT HOSPITALS, INC. |
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UNAUDITED SUPPLEMENTAL INFORMATION |
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Dollars in millions |
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Adjusted EBITDA is defined by the Company as earnings before depreciation and amortization; interest expense, net; provision for income taxes; loss from discontinued operations and net income attributable to noncontrolling interests. LifePoint’s management and Board of Directors use Adjusted EBITDA to evaluate the Company’s operating performance and as a measure of performance for incentive compensation purposes. LifePoint’s credit facilities use Adjusted EBITDA for certain financial covenants. The Company believes Adjusted EBITDA is a measure of performance used by some investors, equity analysts and others to make informed investment decisions. In addition, multiples of current or projected Adjusted EBITDA are used to estimate current or prospective enterprise value. Adjusted EBITDA should not be considered as a measure of financial performance under U.S. generally accepted accounting principles, and the items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to net income, cash flows generated by operating, investing or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. Because Adjusted EBITDA is not a measurement determined in accordance with U.S. generally accepted accounting principles and is susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. |
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| Three Months Ended March 31, | |||||||||||||
| 2010 | 2009 | ||||||||||||
| Amount |
% of Revenues |
Amount |
% of Revenues |
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| Revenues | $ | 786.2 | 100.0 | % | $ | 735.5 | 100.0 | % | |||||
| Salaries and benefits | 303.3 | 38.6 | 286.5 | 38.9 | |||||||||
| Supplies | 108.4 | 13.8 | 99.6 | 13.5 | |||||||||
| Other operating expenses | 140.4 | 17.8 | 132.7 | 18.1 | |||||||||
| Provision for doubtful accounts | 102.1 | 13.0 | 90.2 | 12.3 | |||||||||
| 654.2 | 83.2 | 609.0 | 82.8 | ||||||||||
| Adjusted EBITDA | $ | 132.0 | 16.8 | % | $ | 126.5 | 17.2 | % | |||||
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The following table reconciles Adjusted EBITDA as presented above to net income attributable to LifePoint Hospitals, Inc. as reflected in the unaudited condensed consolidated statements of operations: |
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Three Months Ended March 31, |
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| 2010 | 2009 | ||||||||||||
| Adjusted EBITDA | $ | 132.0 | $ | 126.5 | |||||||||
| Less: | |||||||||||||
| Depreciation and amortization | 36.1 | 35.1 | |||||||||||
| Interest expense, net | 25.1 | 25.8 | |||||||||||
| Provision for income taxes | 26.6 | 25.5 | |||||||||||
| Loss from discontinued operations | 0.4 | 1.1 | |||||||||||
| Net income attributable to noncontrolling interests | 0.9 | 0.6 | |||||||||||
| Net income attributable to LifePoint Hospitals, Inc. | $ | 42.9 | $ | 38.4 | |||||||||
CONTACT:
LifePoint Hospitals, Inc.
Jeff Sherman
Executive Vice President and Chief Financial Officer
615-372-8501
KEYWORDS: United States North America Tennessee
INDUSTRY KEYWORDS: Health Hospitals Other Health General Health
MEDIA:
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