HCA, Designated Buyer of Memorial Health, Reports Q1 Numbers
Thursday, May 4th, 2017
HCA Holdings, Inc. announced financial and operating results for the first quarter ended March 31, 2017.
Key first quarter metrics (all percentage changes compare 1Q 2017 to 1Q 2016 unless noted):
Revenues increased 3.5 percent to $10.623 billion
Net income attributable to HCA Holdings, Inc. totaled $659 million, or $1.74 per diluted share
Adjusted EBITDA totaled $2.005 billion
Cash flows from operations totaled $1.280 billion
Same facility equivalent admissions increased 1.6 percent, while same facility admissions increased 1.2 percent
Same facility revenue per equivalent admission increased 1.7 percent
Revenues in the first quarter increased to $10.623 billion, compared to $10.260 billion in the first quarter of 2016. Net income attributable to HCA Holdings, Inc. totaled $659 million, or $1.74 per diluted share, compared to $694 million, or $1.69 per diluted share, in the first quarter of 2016. First quarter 2016 results included legal claim costs of $12 million, or $0.02 per diluted share. Adjusted EBITDA totaled $2.005 billion compared to $2.003 billion in the first quarter of 2016. Adjusted EBITDA is a non-GAAP financial measure. A table reconciling net income attributable to HCA Holdings, Inc. to Adjusted EBITDA is included in this release.
Same facility equivalent admissions and admissions increased 1.6 and 1.2 percent, respectively, in the first quarter of 2017, compared to the prior year period. Same facility emergency room visits increased 1.1 percent in the first quarter of 2017, compared to the prior year period. Inpatient surgeries increased 0.9 percent, while outpatient surgeries declined 0.5 percent in the first quarter of 2017 compared to the same period of 2016, on a same facility basis. Same facility revenue per equivalent admission increased 1.7 percent in the first quarter of 2017 compared to the first quarter of 2016.
During the first quarter of 2017, salaries and benefits, supplies and other operating expenses totaled $8.628 billion, or 81.2 percent of revenues, compared to $8.269 billion, or 80.6 percent of revenues, in the first quarter of 2016.
Balance Sheet and Cash Flow
As of March 31, 2017, HCA Holdings, Inc.’s balance sheet reflected cash and cash equivalents of $753 million, total debt of $31.514 billion, and total assets of $33.795 billion. During the first quarter of 2017, capital expenditures totaled $571 million, excluding acquisitions. Cash flows provided by operating activities in the first quarter totaled $1.280 billion compared to $1.399 billion in the prior year’s first quarter. Cash flows for the first quarter of 2017 were negatively impacted by a $188 million settlement payment related to the Health Midwest contractual dispute. As of March 31, 2017, HCA’s leverage ratio as measured by Total Debt/Adjusted EBITDA was 3.83x, compared to 3.82x as of December 31, 2016.
The Company repurchased 5.1 million shares of its common stock at a cost of $424 million during the first quarter of 2017. At March 31, 2017, the Company had $1.429 billion remaining under the existing $2 billion authorization. The Company had 368.7 million shares outstanding as of March 31, 2017.
As of March 31, 2017, HCA operated 171 hospitals and 118 freestanding surgery centers.
The 2017 guidance ranges for the year remain unchanged from our fourth quarter release and are as follows:
2017 Guidance Range
|Revenues||$43.0 to $44.0 billion|
|Adjusted EBITDA||$8.40 to $8.70 billion|
|EPS (diluted)||$ 7.20 to $7.60 per diluted share|
|Capital Expenditures||Approximately $2.9 billion|
The Company’s 2017 guidance contains a number of assumptions, including:
2017 guidance includes full-year earnings for the Company’s Oklahoma facilities which are under agreement to be sold. The Company cannot at this time estimate a closing date.
2017 guidance excludes the impact of items such as, but not limited to, gains or losses on sales of facilities, losses on retirement of debt, legal claim costs and impairments of long-lived assets.
2017 guidance for EPS (diluted) includes an estimated $150 million income tax benefit, or $0.40 per diluted share, related to the accounting standard adopted during 2016 which requires the recording of excess tax benefits related to employee equity award settlements as a component of the provision for income taxes. The timing and amounts related to employee equity award settlements are difficult to project and may vary from this estimate.
Adjusted EBITDA is a non-GAAP financial measure. A table reconciling net income attributable to HCA Holdings, Inc. to Adjusted EBITDA is included in this release.
The Company’s guidance is based on current plans and expectations and is subject to a number of known and unknown uncertainties and risks, including those set forth below in the Company’s “Forward-Looking Statements.”