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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

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FORM 8-K

 

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CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 30, 2007 (October 29, 2007)

 

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UNIVERSAL HEALTH SERVICES, INC.

(Exact name of registrant as specified in its charter)

 

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DELAWARE		1-10765		23-2077891
(State or other jurisdiction of Incorporation or Organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

UNIVERSAL CORPORATE CENTER

367 SOUTH GULPH ROAD

KING OF PRUSSIA, PENNSYLVANIA 19406

(Address of principal executive office) (Zip Code)

Registrant’s telephone number, including area code (610) 768-3300

Not Applicable

(Former name or former address, if changed since last report)

 

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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Item 2.02

Results of Operations and Financial Condition

On October 29, 2007, Universal Health Services, Inc. issued the press release attached hereto as Exhibit 99.1.

 

Item 9.01

Financial Statements and Exhibits

(d) Exhibits. 99.1 Universal Health Services, Inc., press release, dated October 29, 2007.

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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

Date: October 30, 2007

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Exhibit Index

 

Exhibit No.		Exhibit
99.1		Universal Health Services, Inc., press release, dated October 29, 2007.

Exhibit 99.1

FOR IMMEDIATE RELEASE

 

CONTACT:		Steve Filton
		Chief Financial Officer						October 29, 2007
		610-768-3300

UNIVERSAL HEALTH SERVICES, INC. REPORTS

2007 THIRD QUARTER EARNINGS

Consolidated Results of Operations:

KING OF PRUSSIA, PA – Universal Health Services, Inc. (NYSE: UHS) announced today that its reported net income was $28.9 million, or $.54 per diluted share, during the third quarter of 2007 as compared to $113.9 million, or $2.00 per diluted share, during the comparable prior year quarter. For the nine months ended September 30, 2007, reported net income was $130.4 million, or $2.43 per diluted share, as compared to $225.3 million, or $3.89 per diluted share, during the comparable nine-month period in the prior year.

As indicated on the attached Schedules of Non-GAAP Supplemental Consolidated Statements of Income Information (“Supplemental Schedules”), our income from continuing operations and net income for the three and nine-month periods ended September 30, 2007 and 2006 include various items such as: (i) hurricane related expenses, net of recoveries, minority interests and income taxes; (ii) prior period effect of the recording or reserving of Texas Medicaid supplemental payments and cost reports settlements, net of income taxes; (iii) reserve for legal judgments, the write-down of the carrying-value of investment in a joint-venture and gain on sale of real property, net of income taxes; (iv) favorable income tax adjustments to reduce reserves due to the expiration of statute of limitations in various tax jurisdictions; (v) prior period effect of a favorable after-tax adjustment to reduce our professional and general liability self-insurance reserves based upon the results of a third-party actuarial analysis, and; (vi) a charge incurred during the third quarter of 2006 to record the aggregate present value of the future funding of a portion of a gift from our Chairman of the Board of Directors, Chief Executive Officer and President to The College of William & Mary (“W&M Funding”).

After adjusting for the items discussed above applicable to each period presented, as indicated on the attached Supplemental Schedules, our adjusted net income during the three-month period ended September 30, 2007 was $34.1 million, or $.64 per diluted share, as compared to $30.6 million, or $.54 per diluted share, during the third quarter of 2006. Our adjusted net income during the nine-month period ended September 30, 2007 was $124.7 million, or $2.32 per diluted share, as compared to $119.4 million, or $2.10 per diluted share, during the comparable prior year nine-month period.

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Net revenues increased 13% to $1.18 billion during the third quarter of 2007 as compared to $1.04 billion during the third quarter of 2006. Net revenues increased 14% to $3.56 billion during the first nine months of 2007 as compared to $3.13 billion during the comparable nine-month period of 2006. Our consolidated operating margin, as calculated on the attached Supplemental Schedules (without adjusting for the various items mentioned above), was 11.1% and 12.2% during the three-month periods ended September 30, 2007 and 2006, respectively, and 13.2% and 13.4% during the nine-month periods ended September 30, 2007 and 2006, respectively.

Acute Care Services:

At our acute care hospitals owned during both periods (“same facility basis”), inpatient admissions increased 2.5% and patient days increased 2.9% during the third quarter of 2007 as compared to the third quarter of 2006. On a same facility basis, net revenues at our acute care facilities increased 7.6% during the third quarter of 2007 as compared to the comparable prior year quarter. Net revenue per adjusted admission at these facilities increased 3.0% during the third quarter of 2007 over the comparable prior year quarter. The operating margin at our acute care hospitals owned during both periods increased to 12.6% during the third quarter of 2007 as compared to 11.8% during the third quarter of 2006.

At our acute care hospitals, on a same facility basis, inpatient admissions increased 3.1% and patient days increased 3.3% during the nine months ended September 30, 2007 as compared to the comparable prior year period. Net revenues at these facilities increased 8.0% during the first nine months of 2007 as compared to the comparable prior year nine-month period. Net revenue per adjusted admission at these facilities increased 3.1% during the nine months ended September 30, 2007 over the comparable prior year nine-month period. The operating margin at our acute care hospitals owned during both periods increased to 13.7% during the first nine months of 2007 as compared to 13.5% during the comparable prior year nine-month period.

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 $149 million and $99 million during the three-month periods ended September 30, 2007 and 2006, respectively, and $418 million and $326 million during the nine-month periods ended September 30, 2007 and 2006, respectively.

Behavioral Health Care Services:

At our behavioral health facilities, on a same facility basis, inpatient admissions increased 3.4% and patient days increased 4.7% during the third quarter of 2007 as compared to the third quarter of 2006. On a same facility basis, net revenues at our behavioral health facilities increased 7.9% during the third quarter of 2007 as compared to the comparable prior year quarter. Net revenue per adjusted admission at these facilities increased 5.1% during the third quarter of 2007 over the comparable prior year quarter. The operating margin at our behavioral health facilities owned during both

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periods was 22.4% during the third quarter of 2007 as compared to 22.6% during the third quarter of 2006.

At our behavioral health facilities, on a same facility basis, inpatient admissions increased 3.4% and patient days increased 4.7% during the nine months ended September 30, 2007 as compared to the comparable prior year period. On a same facility basis, net revenues at our behavioral health facilities increased 6.7% during the nine months ended September 30, 2007 as compared to the comparable prior year nine-month period. Net revenue per adjusted admission at these facilities increased 3.3% during the first nine months of 2007 over the comparable prior year nine-month period. The operating margin at our behavioral health facilities owned during both periods was 23.7% during each of the nine-month periods ended September 30, 2007 and 2006.

Other Matters:

Over the last several weeks, at our request, our legal representatives have met with representatives of the United States Attorney’s Office for the Southern District of Texas to discuss the status of the previously disclosed investigations of our South Texas Health System affiliates. Our representatives have been advised that the investigations remain active and ongoing and that the government is focused on payments to physicians and certain others that they believe may have been improper or illegal. We believe that the government is also focusing its investigation to determine whether the South Texas Health System affiliates and certain individuals illegally failed to fully comply with the original government subpoena. We are in the process of investigating these matters and are cooperating with the investigations and intend to respond to the matters raised with us. We are unable to evaluate the existence or extent of any potential financial exposure in connection with this matter at this time.

Conference Call Information:

We will hold a conference call for investors and analysts at 9:00 a.m. Eastern Time on October 30, 2007. 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 October 30, 2007 and will continue through midnight on November 12, 2007. The recording can be accessed by calling 1-800-642-1687 and entering the conference ID number 19454560. This call will also be available live over the internet at our web site at www.uhsinc.com. It will also be distributed over CCBN’s Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN’s individual investor center at http://www.companyboardroom.com or by visiting any of the investor sites in CCBN’s Individual Investor Network. Institutional investors can access the call via CCBN’s password-protected event management site, StreetEvents (www.streetevents.com).

General Information and Forward-Looking Statements and Risk Factors:

Universal Health Services, Inc. is one of the nation’s largest hospital companies, operating acute care and behavioral health hospitals and ambulatory centers nationwide and in Puerto Rico. It acts as the advisor to Universal Health Realty Income Trust, a real

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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, 2006), may cause results to differ materially from those anticipated in the forward-looking statements. Many of the factors that will determine our future results are beyond our capability to control or predict. These statements are subject to risks and uncertainties and therefore actual results may differ materially. Readers should not place undue reliance on such forward-looking statements which reflect management’s view only as of the date hereof. We undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

We believe that operating income, operating margin, adjusted income from continuing operations, adjusted income from continuing operations per diluted share, adjusted net income, adjusted net income per diluted share and earnings before interest, taxes, depreciation and amortization (“EBITDA”), which are non-GAAP financial measures (“GAAP” is Generally Accepted Accounting Principles in the United States of America), are helpful to our investors as measures of our operating performance. In addition, we believe that 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, hurricane-related expenses and insurance recoveries 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-Q for the quarter ended June 30, 2007 and our Report on Form 10-K for the year ended December 31, 2006. 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.

(more)

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Universal Health Services, Inc.

Consolidated Statements of Income

(in thousands, except per share amounts)

(unaudited)

 

		Three months ended September 30,								Nine months ended September 30,
		2007				2006				2007				2006
Net revenues		$	1,180,217			$	1,043,457			$	3,556,794			$	3,125,419
Operating charges:
Salaries, wages and benefits			510,917				459,099				1,520,489				1,336,087
Other operating expenses			265,534				211,875				748,979				708,932
Supplies expense			162,342				146,944				506,946				400,271
Provision for doubtful accounts			110,451				97,901				312,583				260,090
Depreciation and amortization			46,548				40,961				135,417				120,360
Lease and rental expense			17,920				16,184				50,701				48,247
Hurricane related expenses, net			82				4,172				707				14,432
Hurricane insurance recoveries			—				(4,172	)			—				(14,432	)
			1,113,794				972,964				3,275,822				2,873,987
Income before interest expense, hurricane insurance recoveries in excess of expenses, minority interests and income taxes			66,423				70,493				280,972				251,432
Interest expense, net			12,881				6,140				38,643				23,362
Hurricane insurance recoveries in excess of expenses			—				(130,328	)			—				(167,359	)
Minority interests in earnings of consolidated entities			9,784				14,948				32,651				37,617
Income before income taxes			43,758				179,733				209,678				357,812
Provision for income taxes			14,756				65,704				79,062				132,420
Income from continuing operations			29,002				114,029				130,616				225,392
Loss from discontinued operations, net of income tax benefit (a)			(148	)			(84	)			(183	)			(104	)
Net income		$	28,854			$	113,945			$	130,433			$	225,288
Basic earnings per share: (b)
From continuing operations		$	0.54			$	2.01			$	2.44			$	4.11
From discontinued operations			0.00				0.00				0.00				0.00
Total basic earnings per share		$	0.54			$	2.01			$	2.44			$	4.11
Diluted earnings per share: (b)
From continuing operations		$	0.54			$	2.00			$	2.43			$	3.89
From discontinued operations			0.00				0.00				0.00				0.00
Total diluted earnings per share		$	0.54			$	2.00			$	2.43			$	3.89

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Universal Health Services, Inc.

Footnotes to Consolidated Statements of Income

(in thousands, except per share amounts)

(unaudited)

 

		Three months ended September 30,								Nine months ended September 30,
		2007				2006				2007				2006
(a) Calculation of income from discontinued operations, net of income tax:
Loss from operations		$	(240	)		$	(133	)		$	(296	)		$	(165	)
Income tax benefit			92				49				113				61
Loss from discontinued operations, net of taxes		$	(148	)		$	(84	)		$	(183	)		$	(104	)
(b) Earnings per share calculation:
Basic:
Income from continuing operations		$	29,002			$	114,029			$	130,616			$	225,392
Less: Dividends on unvested restricted stock, net of taxes			(18	)			(20	)			(62	)			(63	)
Income from continuing operations—basic		$	28,984			$	114,009			$	130,554			$	225,329
Loss from discontinued operations			(148	)			(84	)			(183	)			(104	)
Net income—basic		$	28,836			$	113,925			$	130,371			$	225,225
Weighted average number of common shares—basic			53,481				56,794				53,491				54,764
Basic earnings (loss) per share:
From continuing operations		$	0.54			$	2.01			$	2.44			$	4.11
From discontinued operations			0.00				0.00				0.00				0.00
Total basic earnings per share		$	0.54			$	2.01			$	2.44			$	4.11
Diluted:
Income from continuing operations		$	29,002			$	114,029			$	130,616			$	225,392
Less: Dividends on unvested restricted stock, net of taxes			(18	)			(20	)			(62	)			(63	)
Add: Debenture interest, net of taxes			—				—				—				4,902
Income from continuing operations—diluted		$	28,984			$	114,009			$	130,554			$	230,231
Loss from discontinued operations			(148	)			(84	)			(183	)			(104	)
Net income—diluted		$	28,836			$	113,925			$	130,371			$	230,127
Weighted average number of common shares			53,481				56,794				53,491				54,764
Add: Shares for conversion of convertible debentures			—				—				—				4,168
Other share equivalents			148				207				190				227
Weighted average number of common shares and equiv.—diluted			53,629				57,001				53,681				59,159
Diluted earnings per share:
From continuing operations		$	0.54			$	2.00			$	2.43			$	3.89
From discontinued operations			0.00				0.00				0.00				0.00
Total diluted earnings per share		$	0.54			$	2.00			$	2.43			$	3.89

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Universal Health Services, Inc.

Schedule of Non-GAAP Supplemental Consolidated Statements of Income Information (“Supplemental Schedule”)

For the three months ended September 30, 2007 and 2006

(in thousands, except per share amounts)

(unaudited)

 

		Three months ended September 30, 2007							Three months ended September 30, 2006
Net revenues		$	1,180,217			100.0	%		$	1,043,457			100.0	%
Operating charges:
Salaries, wages and benefits			510,917			43.3	%			459,099			44.0	%
Other operating expenses			265,534			22.5	%			211,875			20.3	%
Supplies expense			162,342			13.8	%			146,944			14.1	%
Provision for doubtful accounts			110,451			9.4	%			97,901			9.4	%
			1,049,244			88.9	%			915,819			87.8	%
Operating income/margin			130,973			11.1	%			127,638			12.2	%
Lease and rental expense			17,920							16,184
Minority interests in earnings of consolidated entities			9,784							14,948
Earnings before hurricane related expenses, hurricane insurance recoveries, depreciation and amortization, interest expense, and income taxes (“EBITDA”)			103,269							96,506
Hurricane related expenses, net of insurance recoveries			82							(130,328	)
Depreciation and amortization			46,548							40,961
Interest expense, net			12,881							6,140
Income before income taxes			43,758							179,733
Provision for income taxes			14,756							65,704
Income from continuing operations			29,002							114,029
Loss from discontinued operations, net of income taxes			(148	)						(84	)
Net income		$	28,854						$	113,945

 

		Three months ended September 30, 2007								Three months ended September 30, 2006
		Amount				Per Diluted Share				Amount				Per Diluted Share
Calculation of Adjusted Income from Continuing Operations
Income from continuing operations		$	29,002			$	0.54			$	114,029			$	2.00
Plus/minus adjustments:
Hurricane related expenses, net of recoveries, minority interests and income taxes			50				—				(77,877	)			(1.37	)
Unfavorable (favorable) prior period effect of Texas Medicaid supplemental payments and cost report settlements, net of income taxes			3,399				0.07				(7,025	)			(0.12	)
Favorable tax reserve adjustment			(2,079	)			(0.04	)			(2,900	)			(0.05	)
Reserve for legal judgment, net of income taxes			2,292				0.04				—				—
Write-down of investment in joint-venture, net of income taxes			1,603				0.03				—				—
W&M Funding			—				—				4,466				0.08
Subtotal after-tax adjustments to income from continuing operations			5,265				0.10				(83,336	)			(1.46	)
Adjusted income from continuing operations		$	34,267			$	0.64			$	30,693			$	0.54
Calculation of Adjusted Net Income
Net income		$	28,854			$	0.54			$	113,945			$	2.00
After-tax adjustments to income from continuing operations, as indicated above			5,265				0.10				(83,336	)			(1.46	)
Adjusted net income		$	34,119			$	0.64			$	30,609			$	0.54

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Universal Health Services, Inc.

Schedule of Non-GAAP Supplemental Consolidated Statements of Income Information (“Supplemental Schedule”)

For the nine months ended September 30, 2007 and 2006

(in thousands, except per share amounts)

(unaudited)

 

		Nine months ended September 30, 2007							Nine months ended September 30, 2006
Net revenues		$	3,556,794			100.0	%		$	3,125,419			100.0	%
Operating charges:
Salaries, wages and benefits			1,520,489			42.7	%			1,336,087			42.7	%
Other operating expenses			748,979			21.1	%			708,932			22.7	%
Supplies expense			506,946			14.3	%			400,271			12.8	%
Provision for doubtful accounts			312,583			8.8	%			260,090			8.3	%
			3,088,997			86.8	%			2,705,380			86.6	%
Operating income/margin			467,797			13.2	%			420,039			13.4	%
Lease and rental expense			50,701							48,247
Minority interests in earnings of consolidated entities			32,651							37,617
Earnings before hurricane related expenses, hurricane insurance recoveries, depreciation and amortization, interest expense, and income taxes (“EBITDA”)			384,445							334,175
Hurricane insurance recoveries in excess of expenses			707							(167,359	)
Depreciation and amortization			135,417							120,360
Interest expense, net			38,643							23,362
Income before income taxes			209,678							357,812
Provision for income taxes			79,062							132,420
Income from continuing operations			130,616							225,392
Loss from discontinued operations, net of income taxes			(183	)						(104	)
Net income		$	130,433						$	225,288

 

		Nine months ended September 30, 2007								Nine months ended September 30, 2006
		Amount				Per Diluted Share				Amount				Per Diluted Share
Calculation of Adjusted Income from Continuing Operations
Income from continuing operations		$	130,616			$	2.43			$	225,392			$	3.89
Plus/minus adjustments:
Hurricane related expenses, net of recoveries, minority interests and income taxes			436				—				(99,675	)			(1.69	)
Gain on sale of real property, net of income taxes			(1,356	)			(0.02	)			—				—
Reduction of reserve for professional and general liability self-insured claims, net of minority interests and income taxes			(10,045	)			(0.19	)			—				—
Unfavorable (favorable) prior period effect of Texas Medicaid supplemental payments and cost report settlements, net of income taxes			3,399				0.07				(7,818	)			(0.13	)
Favorable tax reserve adjustment			(2,079	)			(0.04	)			(2,900	)			(0.05	)
Reserve for legal judgment, net of income taxes			2,292				0.04				—				—
Write-down of investment in joint-venture, net of income taxes			1,603				0.03				—				—
W&M Funding			—				—				4,466				0.08
Subtotal after-tax adjustments to income from continuing operations			(5,750	)			(0.11	)			(105,927	)			(1.79	)
Adjusted income from continuing operations		$	124,866			$	2.32			$	119,465			$	2.10
Calculation of Adjusted Net Income
Net income		$	130,433			$	2.43			$	225,288			$	3.89
After-tax adjustments to income from continuing operations, as indicated above			(5,750	)			(0.11	)			(105,927	)			(1.79	)
Adjusted net income		$	124,683			$	2.32			$	119,361			$	2.10

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Universal Health Services, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

 

		September 30, 2007			December 31, 2006
Assets:
Cash and cash equivalents		$	13,574		$	14,939
Accounts receivable, net			631,527			595,009
Other current assets			161,779			118,558
Property, plant and equipment, net			1,894,507			1,685,085
Other assets			895,217			863,451
Total Assets		$	3,596,604		$	3,277,042
Liabilities and Stockholders’ Equity:
Current portion of long-term debt		$	3,329		$	1,938
Other current liabilities			552,258			500,513
Other noncurrent liabilities			353,328			340,815
Long-term debt			900,628			821,363
Deferred income taxes			48,810			35,888
Minority interest			203,412			174,061
Stockholders’ equity			1,534,839			1,402,464
Total Liabilities and Stockholders’ Equity		$	3,596,604		$	3,277,042

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Universal Health Services, Inc.

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

		Nine months ended September 30,
		2007				2006
Cash Flows from Operating Activities:
Net income		$	130,433			$	225,288
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation & amortization			135,417				120,360
Accretion of discount on convertible debentures			—				6,364
Gain on sale of assets and businesses			(2,200	)			—
Hurricane insurance recoveries			—				(137,862	)
Hurricane related expenses			—				4,894
Changes in assets & liabilities, net of effects from acquisitions and dispositions:
Accounts receivable			(17,359	)			(85,132	)
Accrued interest			9,055				7,519
Accrued and deferred income taxes			(6,374	)			36,745
Other working capital accounts			47,558				8,157
Other assets and deferred charges			37				6,943
Other			4,923				11,413
Minority interest in earnings of consolidated entities, net of distributions			9,041				15,223
Accrued insurance expense, net of commercial premiums paid			45,275				61,378
Payments made in settlement of self-insurance claims			(33,025	)			(31,270	)
Net cash provided by operating activities			322,781				250,020
Cash Flows from Investing Activities:
Property and equipment additions, net of disposals			(263,366	)			(233,008	)
Proceeds received from sale of assets			5,268				—
Acquisition of assets and businesses			(103,159	)			(45,654	)
Hurricane insurance recoveries received			—				144,571
Purchase of minority ownership interest in majority owned business			(14,762	)			—
Net cash used in investing activities			(376,019	)			(134,091	)
Cash Flows from Financing Activities:
Additional borrowings			170,000				248,645
Reduction of long-term debt			(103,846	)			(141,804	)
Repurchase of common shares			(14,386	)			(220,343	)
Dividends paid			(12,917	)			(13,090	)
Issuance of common stock			1,041				4,205
Financing costs			(148	)			(2,020	)
Net cash received for termination of derivatives			—				3,393
Capital contributions from minority member			12,129				11,939
Net cash provided by (used in) financing activities			51,873				(109,075	)
(Decrease) Increase in cash and cash equivalents			(1,365	)			6,854
Cash and cash equivalents, beginning of period			14,939				7,963
Cash and cash equivalents, end of period		$	13,574			$	14,817
Supplemental Disclosures of Cash Flow Information:
Interest paid		$	35,991			$	18,073
Income taxes paid, net of refunds		$	83,894			$	95,412

---

Universal Health Services, Inc.

Supplemental Statistical Information

(un-audited)

Same Facility:

 

		% Change Quarter Ended 9/30/2007			% Change 9 months ended 9/30/2007
Acute Care Hospitals
Revenues		7.6	%		8.0	%
Adjusted Admissions		4.5	%		4.8	%
Adjusted Patient Days		4.9	%		5.0	%
Revenue Per Adjusted Admission		3.0	%		3.1	%
Revenue Per Adjusted Patient Day		2.6	%		2.9	%
Behavioral Health Hospitals
Revenues		7.9	%		6.7	%
Adjusted Admissions		2.8	%		3.3	%
Adjusted Patient Days		4.1	%		4.6	%
Revenue Per Adjusted Admission		5.1	%		3.3	%
Revenue Per Adjusted Patient Day		3.7	%		2.0	%

UHS Consolidated

 

		Third Quarter Ended								Nine months Ended
		9/30/2007				9/30/2006				9/30/2007				9/30/2006
Revenues		$	1,180,217			$	1,043,457			$	3,556,794			$	3,125,419
EBITDA (1)			103,269				96,506				384,445				334,175
EBITDA Margin (1)			8.8	%			9.2	%			10.8	%			10.7	%
Cash Flow From Operations			163,805				60,948				322,781				250,020
Days Sales Outstanding			49				52				48				51
Capital Expenditures			78,779				80,335				263,366				233,008
Debt											903,957				453,126
Shareholders Equity											1,534,839				1,496,445
Debt / Total Capitalization											37.1	%			23.2	%
Debt / EBITDA (2)											1.84				0.58
Debt / Cash From Operations (2)											3.74				0.67
Acute Care EBITDAR Margin (3) (4)			11.4	%			13.0	%			13.7	%			14.0	%
Behavioral Health EBITDAR Margin (3) (4)			21.4	%			22.5	%			23.0	%			23.6	%

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(1)	Net of Minority Interest

(2)	Latest 4 quarters

(3)	Before Corporate overhead allocation and minority interest

(4)	Excluding discontinued operations

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UNIVERSAL HEALTH SERVICES, INC.

SELECTED HOSPITAL STATISTICS

FOR THE THREE MONTHS ENDED

SEPTEMBER 30, 2007

AS REPORTED:

 

		ACUTE (1)											BEHAVIORAL HEALTH
		09/30/07				09/30/06				% change			09/30/07				09/30/06				% change
Hospitals owned and leased			22				21			4.8	%			85				81			4.9	%
Average licensed beds			5,417				5,139			5.4	%			7,485				6,640			12.7	%
Patient days			290,968				268,537			8.4	%			506,466				467,860			8.3	%
Average daily census			3,162.7				2,918.9			8.4	%			5,505.1				5,085.4			8.3	%
Occupancy-licensed beds			58.4	%			56.8	%		2.8	%			73.5	%			76.6	%		-4.0	%
Admissions			64,817				60,656			6.9	%			30,156				28,100			7.3	%
Length of stay			4.5				4.4			1.4	%			16.8				16.6			0.9	%
Inpatient revenue		$	2,095,327			$	1,813,162			15.6	%		$	452,223			$	416,515			8.6	%
Outpatient revenue			900,787				717,752			25.5	%			54,470				47,809			13.9	%
Total patient revenue			2,996,114				2,530,914			18.4	%			506,693				464,324			9.1	%
Other revenue			15,807				11,014			43.5	%			7,476				7,546			-0.9	%
Gross hospital revenue			3,011,921				2,541,928			18.5	%			514,169				471,870			9.0	%
Total deductions			2,148,715				1,764,266			21.8	%			229,156				217,700			5.3	%
Net hospital revenue		$	863,206			$	777,662			11.0	%		$	285,013			$	254,170			12.1	%

SAME FACILITY:

 

		ACUTE (2)									BEHAVIORAL HEALTH (3)
		09/30/07			09/30/06			% change			09/30/07			09/30/06			% change
Hospitals owned and leased		21			21			0.0	%		78			78			0.0	%
Average licensed beds		5,183			5,139			0.9	%		7,000			6,588			6.3	%
Patient days		276,423			268,557			2.9	%		484,996			463,312			4.7	%
Average daily census		3,004.6			2,919.1			2.9	%		5,271.7			5,036.0			4.7	%
Occupancy-licensed beds		58.0	%		56.8	%		2.1	%		75.3	%		76.4	%		-1.5	%
Admissions		62,193			60,656			2.5	%		28,830			27,894			3.4	%
Length of stay		4.4			4.4			0.4	%		16.8			16.6			1.3	%

---

(1)	Licensed beds from our Acute care hospitals located in New Orleans are excluded in 2006 and 2007.

(2)	Acute care hospitals located in New Orleans and Texoma are excluded in current and prior years.

(3)

Cottonwood, Dover Behavioral, Foundations Behavioral, Highlands Behavioral, Lincoln Trail, Shenandoah Valley and Spring Mountain Sahara are excluded in both current and prior years. Cedar Ridge RTC is included in both current and prior years from July 1st through year to date. Academy at Canyon Creek and Casa de Lago are included in both current and prior years from August 1st through year to date. Cedar Ridge Hospital is included in both current and prior years from September 1st through year to date. Tennessee Valley, Tuscaloosa Juvenile Detention Center and Triple L Group homes are excluded in current and prior years.

---

UNIVERSAL HEALTH SERVICES, INC.

SELECTED HOSPITAL STATISTICS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2007

AS REPORTED:

 

		ACUTE (1)											BEHAVIORAL HEALTH
		09/30/07				09/30/06				% change			09/30/07				09/30/06				% change
Hospitals owned and leased			22				21			4.8	%			85				81			4.9	%
Average licensed beds			5,417				5,047			7.3	%			7,269				6,492			12.0	%
Patient days			886,844				819,711			8.2	%			1,489,301				1,386,299			7.4	%
Average daily census			3,248.5				3,002.6			8.2	%			5,455.3				5,078.0			7.4	%
Occupancy-licensed beds			60.0	%			59.5	%		0.8	%			75.0	%			78.2	%		-4.1	%
Admissions			197,722				184,374			7.2	%			89,182				84,100			6.0	%
Length of stay			4.5				4.4			0.9	%			16.7				16.5			1.3	%
Inpatient revenue		$	6,458,535			$	5,607,700			15.2	%		$	1,339,098			$	1,244,739			7.6	%
Outpatient revenue			2,666,277				2,147,156			24.2	%			173,558				154,605			12.3	%
Total patient revenue			9,124,812				7,754,856			17.7	%			1,512,656				1,399,344			8.1	%
Other revenue			45,368				38,690			17.3	%			21,938				24,092			-8.9	%
Gross hospital revenue			9,170,180				7,793,546			17.7	%			1,534,594				1,423,436			7.8	%
Total deductions			6,560,437				5,469,986			19.9	%			687,016				656,020			4.7	%
Net hospital revenue		$	2,609,743			$	2,323,560			12.3	%		$	847,578			$	767,416			10.4	%

SAME FACILITY:

 

		ACUTE (2)									BEHAVIORAL HEALTH (3)
		09/30/07			09/30/06			% change			09/30/07			09/30/06			% change
Hospitals owned and leased		21			21			0.0	%		78			78			0.0	%
Average licensed beds		5,183			5,047			2.7	%		6,818			6,424			6.1	%
Patient days		846,710			819,710			3.3	%		1,434,670			1,370,870			4.7	%
Average daily census		3,101.5			3,002.6			3.3	%		5,255.2			5,021.5			4.7	%
Occupancy-licensed beds		59.8	%		59.5	%		0.6	%		77.1	%		78.2	%		-1.4	%
Admissions		190,147			184,374			3.1	%		86,030			83,207			3.4	%
Length of stay		4.5			4.4			0.2	%		16.7			16.5			1.2	%

---

(1)	Licensed beds from our Acute care hospitals located in New Orleans are excluded in 2006 and 2007.

(2)	Acute care hospitals located in New Orleans and Texoma are excluded in current and prior years.

(3)

Cottonwood, Dover Behavioral, Foundations Behavioral, Highlands Behavioral, Lincoln Trail, Shenandoah Valley and Spring Mountain Sahara are excluded in both current and prior years. Cedar Ridge RTC is included in both current and prior years from July 1st through year to date. Academy at Canyon Creek and Casa de Lago are included in both current and prior years from August 1st through year to date. Cedar Ridge Hospital is included in both current and prior years from September 1st through year to date. Tennessee Valley, Tuscaloosa Juvenile Detention Center and Triple L Group homes are excluded in current and prior years.