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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