Universal Health Services, Inc. Reports 2019 First Quarter Financial Results

04/25/2019
Microphone Webcast - Live
Q1 2019 Universal Health Services Earnings Conference Call
4/26/19 at 9:00 a.m. ET
 
Consolidated Results of Operations, As Reported and As Adjusted - Three-month periods ended March 31, 2019 and 2018:

KING OF PRUSSIA, Pa., April 25, 2019 /PRNewswire/ -- Universal Health Services, Inc. (NYSE: UHS) announced today that its reported net income attributable to UHS was $234.2 million, or $2.57 per diluted share, during the first quarter of 2019 as compared to $223.8 million, or $2.36 per diluted share, during the comparable quarter of 2018.  Net revenues increased 4.3% to $2.804 billion during the first quarter of 2019 as compared to $2.688 billion during the first quarter of 2018.

For the three-month period ended March 31, 2019, our adjusted net income attributable to UHS, as calculated on the attached Schedule of Non-GAAP Supplemental Information ("Supplemental Schedule"), was $223.3 million, or $2.45 per diluted share, as compared to $232.1 million, or $2.45 per diluted share, during the first quarter of 2018. 

Included in our reported and our adjusted net income attributable to UHS during the first quarter of 2019, is a pre-tax unrealized loss of $4.3 million, or $.03 per diluted share (included in "Other (income) expense, net"), resulting from a decrease in the market value of shares of certain marketable securities held for investment and classified as available for sale.  

As reflected on the Supplemental Schedule, included in our reported results during the first quarter of 2019, is a favorable after-tax impact of $10.9 million, or $.12 per diluted share, resulting from our adoption of ASU 2016-09, "Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting" ("ASU 2016-09").

As reflected on the Supplemental Schedule, included in our reported results during the first quarter of 2018, is a net aggregate unfavorable after-tax impact of $8.3 million, or $.09 per diluted share, consisting of: (i) an unfavorable after-tax impact of $9.9 million, or $.11 per diluted share, resulting from a $13.0 million pre-tax increase in the reserve established in connection with the discussions with the Department of Justice ("DOJ"), as discussed below, and; (ii) a favorable after-tax impact of $1.6 million, or $.02 per diluted share, resulting from our adoption of ASU 2016-09.

As calculated on the attached Supplemental Schedule, our earnings before interest, taxes, depreciation & amortization ("EBITDA net of NCI", NCI is net income attributable to noncontrolling interests), was $452.7 million during the first quarter of 2019 as compared to $442.1 million during the first quarter of 2018.  Our adjusted earnings before interest, taxes, depreciation & amortization ("Adjusted EBITDA net of NCI"), which excludes the impacts of our adoption of ASU 2016-09, other (income) expense, net, as well as the unfavorable impact of the above-mentioned $13.0 million pre-tax increase in the DOJ Reserve recorded during the first quarter of 2018, was $457.2 million during the first quarter of 2019 as compared to $455.1 million during the first quarter of 2018.

Acute Care Services – Three-month periods ended March 31, 2019 and 2018:
During the first quarter of 2019, at our acute care hospitals owned during both periods ("same facility basis"), adjusted admissions (adjusted for outpatient activity) increased 4.9% and adjusted patient days increased 4.4%, as compared to the first quarter of 2018. At these facilities, net revenue per adjusted admission decreased 0.4% while net revenue per adjusted patient day was unchanged during the first quarter of 2019 as compared to the comparable quarter of 2018. Net revenues from our acute care services on a same facility basis increased 4.7% during the first quarter of 2019 as compared to the comparable quarter of the prior year.

Behavioral Health Care Services – Three-month periods ended March 31, 2019 and 2018:
During the first quarter of 2019, at our behavioral health care facilities on a same facility basis, adjusted admissions increased 2.9% while adjusted patient days increased 0.9% as compared to the first quarter of 2018. At these facilities, net revenue per adjusted admission increased 0.4% while net revenue per adjusted patient day increased 2.5% during the first quarter of 2019 as compared to the comparable quarter in 2018. On a same facility basis, our behavioral health care services' net revenues increased 3.0% during the first quarter of 2019 as compared to the first quarter of 2018.   

Net Cash Provided by Operating Activities and Share Repurchase Program:
For the three months ended March 31, 2019, our net cash provided by operating activities was $391 million as compared to $410 million generated during the first quarter of 2018. The net decrease of $19 million was due to: (i) an unfavorable change of $29 million in accounts receivable; (ii) $39 million of other combined net unfavorable changes, partially offset by; (iii) a favorable change of $49 million in other working capital accounts resulting primarily from changes in accounts payable due to timing of disbursements.  

In conjunction with our January 1, 2019 adoption of ASU 2017-12, "Targeted Improvements to Accounting for Hedging Activities", we have included the net cash inflows or outflows, which were received or paid in connection with foreign exchange contracts that hedge our investment in the U.K., in investing cash flows on the consolidated statements of cash flows.  Prior to 2019, these net inflows/outflows were included in operating cash flows. Prior period amounts have been reclassified to conform with current year presentation on the consolidated statements of cash flows included herein.       

In December of 2018, our Board of Directors authorized a $500 million increase to our stock repurchase program, which increased the aggregate authorization to $1.7 billion from the previous $1.2 billion authorization approved during 2017, 2016 and 2014.  Pursuant to this program, we may purchase shares of our Class B Common Stock, from time to time as conditions allow, on the open market or in negotiated private transactions. 

In conjunction with this program, during the first quarter of 2019, we have repurchased 840,699 shares at an aggregate cost of approximately $106.3 million, (approximately $126 per share). Since inception of the program in 2014 through March 31, 2019, we have repurchased approximately 11.51 million shares at an aggregate cost of approximately $1.34 billion (approximately $117 per share). 

Conference call information:
We will hold a conference call for investors and analysts at 9:00 a.m. eastern time on April 26, 2019. The dial-in number is 1-877-648-7971. 

A live broadcast of the conference call will be available on our website at www.uhsinc.com.  Also, a replay of the call will be available following the conclusion of the live call and will be available for one full year.

DOJ Reserve:
As previously disclosed, during 2018 and 2017 our financial statements included increases to the reserve established in connection with the civil aspects of the government's investigation of certain of our behavioral health care facilities. The aggregate pre-tax reserve amounted to approximately $123 million as of both March 31, 2019 and December 31, 2018. Changes in the reserve may be required in future periods as discussions with the Department of Justice continue and additional information becomes available.  We cannot predict the ultimate resolution of this matter and therefore can provide no assurance that final amounts paid in settlement or otherwise, if any, or associated costs, as well as the income tax deductibility of payments, will not differ materially from our established reserve and assumptions related to income tax deductibility. Please see Item 3-Legal Proceedings in our Form 10-K for the year ended December 31, 2018 for additional disclosure in connection with this matter.

Adoption of ASU 2016-02, "Leases (Topic 842): Amendments to the FASB Accounting Standards Codification":
Effective January 1, 2019, we adopted ASU 2016-02 which requires companies to, among other things, recognize lease assets and lease liabilities on the balance sheet. As a result of our adoption of ASU 2016-02, our consolidated balance sheet as of March 31, 2019 includes right of use assets-operating leases ($342.0 million) and operating lease liabilities ($56.1 million current and $286.1 million noncurrent).  Prior period financial statements were not adjusted for the effects of this new standard.     

General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures:
One of the nation's largest and most respected hospital companies, Universal Health Services, Inc. ("UHS") has built an impressive record of achievement and performance. Growing steadily since our inception into an esteemed Fortune 500 corporation, our annual revenues were $10.77 billion during 2018. In 2019, UHS was again recognized as one of the World's Most Admired Companies by Fortune; in 2018, ranked #268 on the Fortune 500; and in 2017, listed #275 in Forbes inaugural ranking of America's Top 500 Public Companies.

Our operating philosophy is as effective today as it was 40 years ago, enabling us to provide compassionate care to our patients and their loved ones: Build or acquire high quality hospitals in rapidly growing markets, invest in the people and equipment needed to allow each facility to thrive, and become the leading healthcare provider in each community we serve.

Headquartered in King of Prussia, PA, UHS has more than 87,000 employees and through its subsidiaries operates 350 inpatient acute care hospitals and behavioral health facilities and 37 outpatient and other facilities located in 37 states, Washington, D.C., Puerto Rico and the United Kingdom. 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, 2018), 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 adjusted net income attributable to UHS, adjusted net income attributable to UHS per diluted share, EBITDA net of NCI and adjusted EBITDA net of NCI, 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 material items impacting our net income attributable to UHS, such as, changes in the reserve established in connection with our discussions with the Department of Justice, our adoption of ASU 2016-09 and other potential material items that are nonrecurring or non-operational in nature including, but not limited to, impairments of long-lived and intangible assets, reserves for various matters including settlements, legal judgments and lawsuits, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, 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 attributable to UHS, as determined in accordance with GAAP, and 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 Reports on Form 10-K for the year ended December 31, 2018. 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,

 

2019

 

2018

       

Net revenues

$2,804,391

 

$2,687,516

       

Operating charges:

     

   Salaries, wages and benefits

1,365,546

 

1,300,148

   Other operating expenses

644,780

 

620,819

   Supplies expense

307,463

 

292,929

   Depreciation and amortization

120,040

 

113,103

   Lease and rental expense

26,125

 

26,703

 

2,463,954

 

2,353,702

       

Income from operations

340,437

 

333,814

       

Interest expense, net

39,640

 

37,576

Other (income) expense, net

4,501

 

0

       

Income before income taxes

296,296

 

296,238

       

Provision for income taxes

58,898

 

67,569

       

Net income

237,398

 

228,669

       

Less:  Net income attributable to

     

noncontrolling interests ("NCI")

3,230

 

4,837

       

Net income attributable to UHS

$234,168

 

$223,832

       
       
       
       
       
       

Basic earnings per share attributable to UHS (a)

$2.57

 

$2.37

       

Diluted earnings per share attributable to UHS (a)

$2.57

 

$2.36

 

Universal Health Services, Inc.

Footnotes to Consolidated Statements of Income

(in thousands, except per share amounts)

(unaudited)

       
 

Three months

(a) Earnings per share calculation:

ended March 31,

 

2019

 

2018

Basic and diluted:

     

Net income attributable to UHS

$234,168

 

$223,832

Less: Net income attributable to unvested restricted share grants

(515)

 

(104)

Net income attributable to UHS - basic and diluted

$233,653

 

$223,728

       

Weighted average number of common shares - basic

90,776

 

94,226

       

Basic earnings per share attributable to UHS:

$2.57

 

$2.37

       

Weighted average number of common shares

90,776

 

94,226

Add: Other share equivalents

191

 

457

Weighted average number of common shares and equiv. - diluted

90,967

 

94,683

       

Diluted earnings per share attributable to UHS:

$2.57

 

$2.36

 

Universal Health Services, Inc.

Schedule of Non-GAAP Supplemental Information ("Supplemental Schedule")

For the Three Months ended March 31, 2019 and 2018

(in thousands, except per share amounts)

(unaudited)

               
               
               

Calculation of Earnings/Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA/Adjusted EBITDA net of NCI")

               
 

Three months ended

 

% Net

 

Three months ended

 

% Net

 

March 31, 2019

 

revenues

 

March 31, 2018

 

revenues

               

Net income attributable to UHS

$234,168

     

$223,832

   

   Depreciation and amortization

120,040

     

113,103

   

   Interest expense, net

39,640

     

37,576

   

   Provision for income taxes

58,898

     

67,569

   

EBITDA net of NCI

$452,746

 

16.1%

 

$442,080

 

16.4%

               

Other (income) expense, net

4,501

     

-

   

Increase in DOJ Reserve

-

     

13,000

   

Adjusted EBITDA net of NCI

$457,247

 

16.3%

 

$455,080

 

16.9%

               

Net revenues

$2,804,391

     

$2,687,516

   
               
               
               
               
               

Calculation of Adjusted Net Income Attributable to UHS

               
 

Three months ended

 

Three months ended

 

March 31, 2019

 

March 31, 2018

     

Per

     

Per

 

Amount

 

Diluted Share

 

Amount

 

Diluted Share

               

Net income attributable to UHS

$234,168

 

$2.57

 

$223,832

 

$2.36

Plus/minus after-tax adjustments:

             

Increase in DOJ Reserve, after-tax

-

 

-

 

9,911

 

0.11

Impact of ASU 2016-09

(10,907)

 

(0.12)

 

(1,598)

 

(0.02)

Subtotal adjustments

(10,907)

 

(0.12)

 

8,313

 

0.09

Adjusted net income attributable to UHS

$223,261

 

$2.45

 

$232,145

 

$2.45

 

Universal Health Services, Inc.

Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)

       
 

Three months

 

ended March 31,

 

2019

 

2018

       

Net income

$237,398

 

$228,669

Other comprehensive income (loss):

     

   Unrealized derivative gains (losses) on cash flow hedges

(2,917)

 

2,124

   Foreign currency translation adjustment

(14,262)

 

(4,341)

   Other

0

 

2,367

Other comprehensive income (loss) before tax

(17,179)

 

150

Income tax expense (benefit) related to items of other comprehensive income (loss)

(2,466)

 

1,077

Total other comprehensive income (loss), net of tax

(14,713)

 

(927)

       

Comprehensive income

222,685

 

227,742

Less: Comprehensive income attributable to noncontrolling interests

3,230

 

4,837

Comprehensive income attributable to UHS

$219,455

 

$222,905

 

Universal Health Services, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

             
     

March 31,

   

December 31,

     

2019

   

2018

Assets

           

Current assets:

           

    Cash and cash equivalents

 

$

62,726

 

$

105,220

    Accounts receivable, net

   

1,602,405

   

1,509,909

    Supplies

   

149,928

   

148,206

    Other current assets

   

145,382

   

174,467

          Total current assets

   

1,960,441

   

1,937,802

             

Property and equipment

   

8,733,367

   

8,563,455

Less: accumulated depreciation

   

(3,818,529)

   

(3,715,515)

     

4,914,838

   

4,847,940

             

Other assets:

           

    Goodwill

   

3,856,664

   

3,844,628

    Deferred income taxes

   

5,350

   

5,280

    Right of use assets-operating leases

   

342,032

   

0

    Deferred charges

   

8,207

   

8,772

    Other

   

633,745

   

621,058

Total Assets

 

$

11,721,277

 

$

11,265,480

             

Liabilities and Stockholders' Equity

           

Current liabilities:

           

    Current maturities of long-term debt

 

$

71,991

 

$

63,446

    Accounts payable and accrued liabilities

   

1,355,717

   

1,253,714

    Legal reserves

   

128,294

   

129,150

    Operating lease liabilities

   

56,136

   

0

    Federal and state taxes

   

44,628

   

2,428

          Total current liabilities

   

1,656,766

   

1,448,738

             

Other noncurrent liabilities

   

364,334

   

361,809

Operating lease liabilities noncurrent

   

286,101

   

0

Long-term debt

   

3,821,938

   

3,935,187

Deferred income taxes

   

35,984

   

49,661

             

Redeemable noncontrolling interest

   

3,843

   

4,292

             

UHS common stockholders' equity

   

5,482,415

   

5,389,262

Noncontrolling interest

   

69,896

   

76,531

          Total equity

   

5,552,311

   

5,465,793

             

Total Liabilities and Stockholders' Equity

 

$

11,721,277

 

$

11,265,480

 

Universal Health Services, Inc.

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

Three months

 

ended March 31,

 

2019

 

2018

       

Cash Flows from Operating Activities:

     

  Net income

$237,398

 

$228,669

  Adjustments to reconcile net income to net 

     

cash provided by operating activities:

     

Depreciation & amortization

120,040

 

113,134

Gain on sale of assets and businesses

0

 

(703)

Stock-based compensation expense

17,591

 

19,700

  Changes in assets & liabilities, net of effects from

     

acquisitions and dispositions:

     

   Accounts receivable

(101,619)

 

(72,526)

   Accrued interest

(2,687)

 

(6,209)

   Accrued and deferred income taxes 

52,291

 

61,674

   Other working capital accounts 

107,878

 

59,032

   Other assets and deferred charges

(3,771)

 

(5,438)

   Other 

(38,298)

 

8,211

   Accrued insurance expense, net of commercial premiums paid

24,398

 

23,125

   Payments made in settlement of self-insurance claims

(22,320)

 

(18,765)

          Net cash provided by operating activities

390,901

 

409,904

       

Cash Flows from Investing Activities:

     

   Property and equipment additions, net of disposals

(169,848)

 

(189,041)

   Acquisition of property and businesses

0

 

(20,931)

   Inflows (outflows) from foreign exchange contracts that hedge our net U.K. investment

12,895

 

(45,853)

   Proceeds received from sales of assets and businesses

0

 

839

   Costs incurred for purchase and implementation of information technology applications

(9,678)

 

(8,570)

   Decrease in capital reserves of commercial insurance subsidiary

0

 

100

   Investment in, and advances to,  joint ventures and other

(879)

 

(8,675)

          Net cash used in investing activities

(167,510)

 

(272,131)

       

Cash Flows from Financing Activities:

     

   Reduction of long-term debt

(114,540)

 

(140,676)

   Additional borrowings

8,700

 

20,500

   Repurchase of common shares

(143,785)

 

(9,441)

   Dividends paid

(9,081)

 

(9,422)

   Issuance of common stock

2,726

 

2,545

   Profit distributions to noncontrolling interests

(10,314)

 

(4,217)

          Net cash used in financing activities

(266,294)

 

(140,711)

       

   Effect of exchange rate changes on cash, cash equivalents and restricted cash

794

 

1,857

Decrease in cash, cash equivalents and restricted cash

(42,109)

 

(1,081)

Cash, cash equivalents and restricted cash, beginning of period

199,685

 

167,297

Cash, cash equivalents and restricted cash, end of period

$157,576

 

$166,216

       

Supplemental Disclosures of Cash Flow Information:

     

  Interest paid

$41,050

 

$41,539

       

  Income taxes paid, net of refunds

$5,087

 

$2,749

       

  Noncash purchases of property and equipment

$71,987

 

$84,708

       

  Right-of-use assets obtained in exchange for lease obligations

$355,981

 

$0

 

Universal Health Services, Inc.

Supplemental Statistical Information

(unaudited)

           
           
           
         

 % Change 

         

Quarter ended

Same Facility:

       

3/31/2019

           

Acute Care Hospitals

         

Revenues

       

4.7%

Adjusted Admissions

       

4.9%

Adjusted Patient Days

       

4.4%

Revenue Per Adjusted Admission

     

-0.4%

Revenue Per Adjusted Patient Day

     

0.0%

           
           
           

Behavioral Health Hospitals

         

Revenues

       

3.0%

Adjusted Admissions

       

2.9%

Adjusted Patient Days

       

0.9%

Revenue Per Adjusted Admission

     

0.4%

Revenue Per Adjusted Patient Day

     

2.5%

           
           
           
           

UHS Consolidated

   

First quarter ended

     

3/31/2019

 

3/31/2018

           

Revenues

   

$2,804,391

 

$2,687,516

EBITDA net of NCI

   

$452,746

 

$442,080

EBITDA Margin net of NCI

   

16.1%

 

16.4%

Adjusted EBITDA net of NCI

   

$457,247

 

$455,080

Adjusted EBITDA Margin net of NCI

 

16.3%

 

16.9%

           
           

Cash Flow From Operations

   

$390,901

 

$409,904

Days Sales Outstanding

   

51

 

53

Capital Expenditures  

   

$169,848

 

$189,041

           

Debt 

   

$3,893,929

 

$3,921,335

UHS' Shareholders Equity

   

$5,482,415

 

$5,215,646

Debt / Total Capitalization

   

41.5%

 

42.9%

Debt / EBITDA net of NCI (1)

   

2.38

 

2.32

Debt / Adjusted EBITDA net of NCI (1)

2.21

 

2.30

Debt / Cash From Operations (1)

   

3.10

 

3.36

           

(1)  Latest 4 quarters

         

 

Universal Health Services, Inc.

     

Acute Care Hospital Services

     

For the three months ended

     

March 31, 2019 and 2018

     

(in thousands)

     
                         
                         

Same Facility Basis - Acute Care Hospital Services

                       
                         
   

Three months ended

 

Three months ended

       
   

March 31, 2019

 

March 31, 2018

       
   

Amount

 

% of Net
Revenues 

 

Amount

 

% of Net
Revenues 

       

Net revenues

 

$1,490,862

 

100.0%

 

$1,423,777

 

100.0%

       

Operating charges:

                       

Salaries, wages and benefits

 

618,691

 

41.5%

 

581,768

 

40.9%

       

Other operating expenses

 

331,885

 

22.3%

 

308,181

 

21.6%

       

Supplies expense

 

257,711

 

17.3%

 

243,153

 

17.1%

       

Depreciation and amortization

 

74,228

 

5.0%

 

72,150

 

5.1%

       

Lease and rental expense

 

14,256

 

1.0%

 

14,283

 

1.0%

       

Subtotal-operating expenses

 

1,296,771

 

87.0%

 

1,219,535

 

85.7%

       

Income from operations

 

194,091

 

13.0%

 

204,242

 

14.3%

       

Interest expense, net

 

279

 

0.0%

 

531

 

0.0%

       

Other (income) expense, net

 

-

 

-

 

-

 

-

       

Income before income taxes

 

$193,812

 

13.0%

 

$203,711

 

14.3%

       
                         
                         
                         

All Acute Care Hospital Services

                       
                         
   

Three months ended

 

Three months ended

       
   

March 31, 2019

 

March 31, 2018

       
   

Amount

 

% of Net
Revenues

 

Amount

 

% of Net
Revenues 

       

Net revenues

 

$1,514,844

 

100.0%

 

$1,445,632

 

100.0%

       

Operating charges:

                       

Salaries, wages and benefits

 

619,317

 

40.9%

 

581,768

 

40.2%

       

Other operating expenses

 

356,231

 

23.5%

 

330,036

 

22.8%

       

Supplies expense

 

258,144

 

17.0%

 

243,153

 

16.8%

       

Depreciation and amortization

 

74,361

 

4.9%

 

72,150

 

5.0%

       

Lease and rental expense

 

14,299

 

0.9%

 

14,283

 

1.0%

       

Subtotal-operating expenses

 

1,322,352

 

87.3%

 

1,241,390

 

85.9%

       

Income from operations

 

192,492

 

12.7%

 

204,242

 

14.1%

       

Interest expense, net

 

279

 

0.0%

 

531

 

0.0%

       

Other (income) expense, net

 

-

 

-

 

-

 

-

       

Income before income taxes

 

$192,213

 

12.7%

 

$203,711

 

14.1%

       
                         
                         

We believe that providing our results on a "Same Facility" basis (which is a non-GAAP measure), which includes the operating results for facilities and businesses operated in both the current year and prior year periods, is helpful to our investors as a measure of our operating performance. Our Same Facility results also neutralize (if applicable), the effect of material items that are nonrecurring or non-operational in nature including items such as, but not limited to, reserves for various matters, settlements, legal judgments and lawsuits, cost related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of long-lived and intangible assets and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. Our Same Facility basis results exclude from net revenues and other operating expenses, provider tax assessments incurred in each period. However, these provider tax assessments are included in net revenues and other operating expenses as reflected in the table under All Acute Care Hospital Services. The provider tax assessments had no impact on the income before income taxes as reflected on the above tables since the amounts offset between net revenues and other operating expenses. To obtain a complete understanding of our financial performance, the Same Facility results should be examined in connection with our net income as determined in accordance with GAAP and as presented herein and the condensed consolidated financial statements and notes thereto as contained in our Form 10-K for the year ended December 31, 2018.

                         

The All Acute Care Hospital Servicestable summarizes the results of operations for all our acute care operations during the periods presented. These amounts include: (i) our acute care results on a same facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the last twelve months.

 

Universal Health Services, Inc.

       

Behavioral Health Care Services

       

For the three months ended

       

March 31, 2019 and 2018

       

(in thousands)

       
                         
                         

Same Facility - Behavioral Health Care Services

                       
                         
   

Three months ended

 

Three months ended

       
   

March 31, 2019

 

March 31, 2018

       
   

Amount

 

% of Net
Revenues 

 

Amount

 

% of Net
Revenues 

       

Net revenues

 

$1,241,225

 

100.0%

 

$1,205,048

 

100.0%

       

Operating charges:

                       

Salaries, wages and benefits

 

655,586

 

52.8%

 

630,831

 

52.3%

       

Other operating expenses

 

234,424

 

18.9%

 

230,586

 

19.1%

       

Supplies expense

 

48,618

 

3.9%

 

48,743

 

4.0%

       

Depreciation and amortization

 

39,872

 

3.2%

 

36,738

 

3.0%

       

Lease and rental expense

 

10,917

 

0.9%

 

11,696

 

1.0%

       

Subtotal-operating expenses

 

989,417

 

79.7%

 

958,594

 

79.5%

       

Income from operations

 

251,808

 

20.3%

 

246,454

 

20.5%

       

Interest expense, net

 

375

 

0.0%

 

427

 

0.0%

       

Other (income) expense, net

 

-

 

-

 

-

 

-

       

Income before income taxes

 

$251,433

 

20.3%

 

$246,027

 

20.4%

       
                         
                         
                         

All Behavioral Health Care Services

                       
                         
   

Three months ended

 

Three months ended

       
   

March 31, 2019

 

March 31, 2018

       
   

Amount

 

% of Net
Revenues

 

Amount

 

% of Net
Revenues 

       

Net revenues

 

$1,286,383

 

100.0%

 

$1,237,996

 

100.0%

       

Operating charges:

                       

Salaries, wages and benefits

 

675,699

 

52.5%

 

642,128

 

51.9%

       

Other operating expenses

 

262,137

 

20.4%

 

256,402

 

20.7%

       

Supplies expense

 

49,131

 

3.8%

 

49,536

 

4.0%

       

Depreciation and amortization

 

42,552

 

3.3%

 

38,454

 

3.1%

       

Lease and rental expense

 

11,644

 

0.9%

 

12,301

 

1.0%

       

Subtotal-operating expenses

 

1,041,163

 

80.9%

 

998,821

 

80.7%

       

Income from operations

 

245,220

 

19.1%

 

239,175

 

19.3%

       

Interest expense, net

 

375

 

0.0%

 

427

 

0.0%

       

Other (income) expense, net

 

677

 

0.1%

 

-

 

-

       

Income before income taxes

 

244,168

 

19.0%

 

238,748

 

19.3%

       
                         
                         

We believe that providing our results on a "Same Facility" basis (which is a non-GAAP measure), which includes the operating results for facilities and businesses operated in both the current year and prior year periods, is helpful to our investors as a measure of our operating performance. Our Same Facility results also neutralize (if applicable), the effect of material items that are nonrecurring or non-operational in nature including items such as, but not limited to, reserves for various matters, settlements, legal judgments and lawsuits, cost related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of long-lived and intangible assets and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. Our Same Facility basis results exclude from net revenues and other operating expenses, provider tax assessments incurred in each period.However, these provider tax assessments are included in net revenues and other operating expenses as reflected in the table under All Behavioral Health Care Services. The provider tax assessments had no impact on the income before income taxes as reflected on the above tables since the amounts offset between net revenues and other operating expenses. To obtain a complete understanding of our financial performance, the Same Facility results should be examined in connection with our net income as determined in accordance with GAAP and as presented herein and in the condensed consolidated financial statements and notes thereto as contained in our Form 10-K for the year ended December 31, 2018.

                         

The All Behavioral Health Care Servicestable summarizes the results of operations for all our behavioral health care facilities during the periods presented. These amounts include: (i) our behavioral health results on a same facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the last twelve months as well as the results of certain facilities that were closed or restructured during the past year.

 

 

Universal Health Services, Inc.

Selected Hospital Statistics

For the three months ended

March 31, 2019 and 2018

                         
                         

AS REPORTED:

                       
                         
                         
   

ACUTE

 

BEHAVIORAL HEALTH

   

3/31/19

 

3/31/18

 

%  change

 

3/31/19

 

3/31/18

 

%  change

                         

Hospitals owned and leased

 

26

 

26

 

0.0%

 

327

 

300

 

9.0%

Average licensed beds

 

6,371

 

6,161

 

3.4%

 

23,509

 

23,240

 

1.2%

Average available beds

 

6,195

 

5,985

 

3.5%

 

23,425

 

23,158

 

1.2%

Patient days

 

369,720

 

352,818

 

4.8%

 

6,418,334

 

1,581,996

 

305.7%

Average daily census

 

4,108.0

 

3,920.2

 

4.8%

 

17,584.5

 

17,577.7

 

0.0%

Occupancy-licensed beds

 

64.5%

 

63.6%

 

1.3%

 

74.8%

 

75.6%

 

-1.1%

Occupancy-available beds

 

66.3%

 

65.5%

 

1.2%

 

75.1%

 

75.9%

 

-1.1%

Admissions

 

80,663

 

76,643

 

5.2%

 

482,658

 

119,980

 

302.3%

Length of stay

 

4.6

 

4.6

 

-0.4%

 

13.3

 

13.2

 

0.9%

                         

Inpatient revenue

 

$7,163,714

 

$6,361,766

 

12.6%

 

$2,483,999

 

$2,402,258

 

3.4%

Outpatient revenue

 

4,257,614

 

3,714,661

 

14.6%

 

266,546

 

255,181

 

4.5%

Total patient revenue

 

11,421,328

 

10,076,427

 

13.3%

 

2,750,545

 

2,657,439

 

3.5%

Other revenue

 

109,326

 

98,187

 

11.3%

 

48,599

 

50,033

 

-2.9%

Gross hospital revenue

 

11,530,654

 

10,174,614

 

13.3%

 

2,799,144

 

2,707,472

 

3.4%

Total deductions

 

10,015,810

 

8,728,982

 

14.7%

 

1,512,761

 

1,469,476

 

2.9%

Net hospital revenue 

 

$1,514,844

 

$1,445,632

 

4.8%

 

$1,286,383

 

$1,237,996

 

3.9%

                         
                         

SAME FACILITY:

                       
                         
   

ACUTE

 

BEHAVIORAL HEALTH

   

3/31/19

 

3/31/18

 

%  change

 

3/31/19

 

3/31/18

 

%  change

                         

Hospitals owned and leased

 

26

 

26

 

0.0%

 

289

 

289

 

0.0%

Average licensed beds

 

6,371

 

6,161

 

3.4%

 

22,852

 

22,571

 

1.2%

Average available beds

 

6,195

 

5,985

 

3.5%

 

22,752

 

22,489

 

1.2%

Patient days

 

369,720

 

352,818

 

4.8%

 

1,570,752

 

1,557,954

 

0.8%

Average daily census

 

4,108.0

 

3,920.2

 

4.8%

 

17,452.8

 

17,310.6

 

0.8%

Occupancy-licensed beds

 

64.5%

 

63.6%

 

1.3%

 

76.4%

 

76.7%

 

-0.4%

Occupancy-available beds

 

66.3%

 

65.5%

 

1.2%

 

76.7%

 

77.0%

 

-0.3%

Admissions

 

80,663

 

76,643

 

5.2%

 

122,169

 

118,788

 

2.8%

Length of stay

 

4.6

 

4.6

 

-0.4%

 

12.9

 

13.1

 

-2.0%

 

 

Cision View original content:http://www.prnewswire.com/news-releases/universal-health-services-inc-reports-2019-first-quarter-financial-results-300838634.html

SOURCE Universal Health Services, Inc.

Steve Filton, Chief Financial Officer, 610-768-3300