false000035291500003529152024-02-272024-02-27

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 27, 2024

 

UNIVERSAL HEALTH SERVICES, INC.

(Exact name of registrant as specified in its charter)

Delaware		1-10765		23-2077891
(State or other jurisdiction of		(Commission		(I.R.S. Employer
Incorporation or Organization)		File Number)		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)

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 Instructions 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))

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class B Common Stock	UHS	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

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Item 2.02 Results of Operations and Financial Condition

On February 27, 2024, 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 February 27, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

 

Exhibit Index

Exhibit No.		Exhibit
99.1		Universal Health Services, Inc., press release, dated February 27, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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.

Universal Health Services, Inc.
By:		/s/ Steve Filton
Name: Steve Filton
Title: Executive Vice President and             Chief Financial Officer

Date: February 27, 2024

 

 

 

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Exhibit 99.1

FOR IMMEDIATE RELEASE

February 27, 2024

 

CONTACT:	Steve Filton
	Chief Financial Officer
	610-768-3300

 

 

UNIVERSAL HEALTH SERVICES, INC.

ANNOUNCES 2023 FOURTH QUARTER AND FULL YEAR FINANCIAL RESULTS

AND 2024 OPERATING RESULTS FORECAST

Consolidated Results of Operations, As Reported and As Adjusted – Three-month periods ended December 31, 2023 and 2022:

KING OF PRUSSIA, PA – Universal Health Services, Inc. (NYSE: UHS) announced today that its reported net income attributable to UHS was $216.4 million, or $3.16 per diluted share, during the fourth quarter of 2023, as compared to $174.8 million, or $2.43 per diluted share, during the fourth quarter of 2022. Net revenues increased by 7.4% to $3.704 billion during the fourth quarter of 2023, as compared to $3.447 billion during the fourth quarter of 2022.

As reflected on the Schedule of Non-GAAP Supplemental Information (“Supplemental Schedule”), our adjusted net income attributable to UHS during the fourth quarter of 2023 was $214.9 million, or $3.13 per diluted share, as compared to $217.1 million, or $3.02 per diluted share, during the fourth quarter of 2022.

Included in our reported and adjusted net income attributable to UHS during the fourth quarter of 2023, were net incremental reimbursements (net of related provider taxes) of approximately $17.8 million, or $.20 per diluted share, recorded in connection with the recently approved Mississippi Hospital Access Program covering the period of July 1, 2023 through December 31, 2023. Included in our reported and adjusted net income attributable to UHS during the fourth quarter of 2022, was an aggregate favorable after-tax impact of approximately $19.6 million, or $.27 per diluted share, recorded in connection with $26.0 million of commercial insurance proceeds received during the quarter in connection with the following: (i) $15.7 million related to a business interruption and property damage claim at one of our behavioral health care facilities, and; (ii) $10.3 million related to a previously incurred information technology incident.

As reflected on the Supplemental Schedule, included in our reported results were unrealized after-tax gains of $1.5 million, or $.03 per diluted share ($1.9 million pre-tax), during the fourth quarter of 2023, and $1.8 million, or $.02 per diluted share ($2.3 million pre-tax) during the fourth quarter of 2022. These unrealized gains, which are included in “Other (income) expense, net”, resulted from increases in the market value of certain equity securities. In addition, as discussed below, included in our reported results during the fourth quarter of 2022 was an unfavorable after-tax impact of $44.1 million, or $.61 per diluted share, resulting from a provision for asset impairment ($57.6 million pre-tax which is included in other operating expenses) recorded to write-down the asset value of an acute care hospital, as discussed below.

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 $476.9 million during the fourth quarter of 2023, as compared to $419.0 million during the fourth quarter of 2022. Our adjusted earnings before interest, taxes, depreciation & amortization (“Adjusted EBITDA net of NCI”), which excludes the impact of other (income) expense, net, and provision for asset impairment (during the fourth quarter of 2022), was $473.4 million during the fourth quarter of 2023, as compared to $471.7 million during the fourth quarter of 2022.

Consolidated Results of Operations, As Reported and As Adjusted – Twelve-month periods ended December 31, 2023 and 2022:

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Reported net income attributable to UHS was $717.8 million, or $10.23 per diluted share, during the full year 2023, as compared to $675.6 million, or $9.14 per diluted share, during 2022. Net revenues increased by 6.6% to $14.282 billion during the full year of 2023, as compared to $13.399 billion during 2022.

As reflected on the Supplemental Schedule, our adjusted net income attributable to UHS during the twelve-month period ended December 31, 2023, was $739.4 million, or $10.54 per diluted share, as compared to $730.2 million, or $9.88 per diluted share, during the twelve-month period ended December 31, 2022.

As reflected on the Supplemental Schedule, included in our reported results were unrealized after-tax losses of $21.6 million, or $.31 per diluted share ($28.2 million pre-tax), during 2023, and $10.6 million, or $.14 per diluted share ($13.8 million pre-tax) during 2022. These unrealized losses, which are included in “Other (income) expense, net”, resulted from decreases in the market value of certain equity securities. In addition, included in our reported results during the full year of 2022 was an unfavorable after-tax impact of $44.1 million, or $.60 per diluted share, resulting from a provision for asset impairment, ($57.6 million pre-tax which is included in other operating expenses), as discussed below.

As calculated on the attached Supplemental Schedule, our earnings before interest, taxes, depreciation & amortization (“EBITDA net of NCI”), was $1.714 billion during 2023, as compared to $1.594 billion during 2022. Our adjusted earnings before interest, taxes, depreciation & amortization (“Adjusted EBITDA net of NCI”), which excludes the impact of other (income) expense, net, and provision for asset impairment (during 2022), was $1.742 billion during 2023, as compared to $1.662 billion during 2022.

Acute Care Services – Three and twelve-month periods ended December 31, 2023 and 2022:

During the fourth quarter of 2023, at our acute care hospitals owned during both periods (“same facility basis”), adjusted admissions (adjusted for outpatient activity) increased by 5.6% while adjusted patient days increased by 4.3%, as compared to the fourth quarter of 2022. At these facilities, during the fourth quarter of 2023, net revenue per adjusted admission increased by 3.7% while net revenue per adjusted patient day increased by 5.0%, as compared to the fourth quarter of 2022. Net revenues generated from our acute care services, on a same facility basis, increased by 9.7% during the fourth quarter of 2023, as compared to the fourth quarter of 2022.

During the twelve-month period ended December 31, 2023, at our acute care hospitals on a same facility basis, adjusted admissions increased by 7.6% while adjusted patient days increased by 4.7%, as compared to the year ended December 31, 2022. At these facilities, during the full year of 2023, net revenue per adjusted admission decreased by 0.6% while net revenue per adjusted patient day increased by 2.2%, as compared to 2022. Net revenues generated from our acute care services, on a same facility basis, increased by 7.6% during the full year of 2023, as compared to 2022.

Behavioral Health Care Services – Three and twelve-month periods ended December 31, 2023 and 2022:

During the fourth quarter of 2023, at our behavioral health care facilities on a same facility basis, adjusted admissions increased by 1.4% while adjusted patient days increased by 1.1%, as compared to the fourth quarter of 2022. At these facilities, during the fourth quarter of 2023, net revenue per adjusted admission increased by 5.8% and net revenue per adjusted patient day increased by 6.1%, as compared to the fourth quarter of 2022. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 7.2% during the fourth quarter of 2023, as compared to the fourth quarter of 2022.

During the twelve-month period ended December 31, 2023, at our behavioral health care facilities on a same facility basis, adjusted admissions increased by 3.2% while adjusted patient days increased by 2.1%, as compared to the comparable period of 2022. At these facilities, during the full year of 2023, net revenue per adjusted admission increased by 4.7% and net revenue per adjusted patient day increased by 5.9%, as compared to 2022. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 8.0% during 2023, as compared to 2022.

Net Cash Provided by Operating Activities and Liquidity:

Net Cash Provided by Operating Activities:

During the twelve-month period ended December 31, 2023, our net cash provided by operating activities was $1.268 billion as compared to $996 million during the full year of 2022. Included in the $272 million net

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increase in our net cash provided by operating activities was a favorable change of $114 million in other working capital accounts due primarily to the timing of disbursements for accrued compensation and certain other accrued liabilities, as well as a favorable change of $76 million in accounts receivable.

Liquidity:

As of December 31, 2023, we had $701 million of aggregate available borrowing capacity pursuant to our $1.2 billion revolving credit facility, net of outstanding borrowings and letters of credit.

Stock Repurchase Program:

As of January 1, 2023, we had an aggregate remaining repurchase authorization of approximately $947 million pursuant to our stock repurchase program. Pursuant to the terms of our stock repurchase program, shares of our Class B Common Stock may be repurchased, from time to time as conditions allow, on the open market or in negotiated private transactions.

During the fourth quarter of 2023, we have repurchased 1.13 million shares at an aggregate cost of approximately $157.3 million (approximately $139 per share) pursuant to the program. During the full year of 2023, we have repurchased approximately 3.86 million shares at an aggregate cost of approximately $524.5 million (approximately $136 per share) pursuant to the program.

As of December 31, 2023, we had an aggregate available repurchase authorization of approximately $423 million.

 

2024 Operating Results Forecast:

Reflected below is our 2024 forecasted range for consolidated net revenues, earnings before interest, taxes, depreciation & amortization, and the impacts of other income/expense and net income attributable to noncontrolling interests (“Adjusted EBITDA net of NCI”), net income attributable to UHS per diluted share (“EPS-diluted”) and capital expenditures.

Our 2024 forecasted range of net income attributable to UHS, and EPS-diluted, exclude certain items as described below because we do not believe we can forecast those items with sufficient accuracy. Adjusted EBITDA net of NCI, is a non-GAAP financial measure and should not be considered a measure of financial performance under GAAP. We believe Adjusted EBITDA net of NCI is helpful to our investors as a measure of our operating performance. Please see the Supplemental Non-GAAP Disclosures - 2024 Operating Results Forecast schedule as included herein for additional information and a reconciliation of our 2024 forecasted range of net income attributable to UHS to our 2024 forecasted range of Adjusted EBITDA net of NCI.

For the Year Ended

December 31, 2024

	Low	High
Net revenues	$15.411 billion	$15.706 billion
Adjusted EBITDA net of NCI	$1.931 billion	$2.019 billion
EPS-diluted	$13.00 per share	$14.00 per share
Capital expenditures	$850 million	$1.000 billion

Our 2024 operating results forecast contains a number of assumptions including, but not limited to, the following:

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Provision for Asset Impairment (recorded during the fourth quarter of 2022):

Our financial statements for the three and twelve-month periods ended December 31, 2022, included a pre-tax provision for asset impairment of $57.6 million, which is included in other operating expenses on the accompanying consolidated statements of income. In March of 2023, we discontinued all inpatient operations at Desert Springs Hospital Medical Center, an acute care facility located in Las Vegas, Nevada. Since that time, we have continued providing emergency department services within a portion of the existing facility while we construct a new free-standing emergency department on the hospital's campus. The provision for asset impairment recorded during the fourth quarter of 2022 reduced the asset values of the facility's real estate and equipment to their estimated fair values.

Conference call information:

We will hold a conference call for investors and analysts at 9:00 a.m. eastern time on February 28, 2024. A live webcast of the call will be available on our website at www.uhs.com. To participate via telephone, please register in advance at this link. Upon registration, all telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number along with a unique passcode and registrant ID that can be used to access the call. A replay of the call will be available for one full year following the live call.

General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures:

One of the nation’s largest and most respected providers of hospital and healthcare services, Universal Health Services, Inc. has built an impressive record of achievement and performance. Growing steadily since our inception into an esteemed Fortune 500 corporation, our annual revenues during 2023 were $14.282 billion. UHS ranked #311 on the Fortune 500; and #434 on Forbes’ list of America’s Largest Public Companies. UHS was again recognized as one of the World’s Most Admired Companies by Fortune.

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Our operating philosophy is as effective today as it was upon the Company’s founding in 1979, enabling us to provide compassionate care to our patients and their loved ones. Our strategy includes building or acquiring high quality hospitals in rapidly growing markets, investing in the people and equipment needed to allow each facility to thrive, and becoming the leading healthcare provider in each community we serve.

Headquartered in King of Prussia, PA, UHS has approximately 96,700 employees and, through its subsidiaries, operates 27 inpatient acute care hospitals, 333 inpatient behavioral health facilities, 48 outpatient facilities and ambulatory care access points, an insurance offering, a physician network and various related services located in 39 states, Washington, D.C., the United Kingdom and Puerto Rico. It acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust (NYSE:UHT). For additional information visit www.uhs.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 Item 7-Forward-Looking Statements and Risk Factors, in our Form 10-K for the year ended December 31, 2023), may cause the results to differ materially from those anticipated in the forward-looking statements. 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.

Many of the factors that could affect our future results are beyond our control or ability to predict, including, but not limited to:

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 of material items impacting our net income attributable to UHS, such as, changes in the market value of shares of certain equity securities and other potential material items that are nonrecurring or non-operational in nature including, but not limited to, impairments of goodwill, 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, potential impacts of non-ordinary

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acquisitions, divestitures, joint ventures or other strategic transactions, 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 Report on Form 10-K for the year ended December 31, 2023. 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.

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Universal Health Services, Inc.
Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
		Three months								Twelve months
		ended December 31,								ended December 31,
		2023				2022				2023				2022
Net revenues		$	3,703,546				3,446,980			$	14,281,976				13,399,370
Operating charges:
Salaries, wages and benefits			1,799,008				1,701,083				7,107,484				6,762,256
Other operating expenses			998,732				919,673				3,757,216				3,445,733
Supplies expense			393,878				381,936				1,532,828				1,474,339
Depreciation and amortization			145,481				148,353				568,041				581,861
Lease and rental expense			35,251				34,551				141,026				131,626
			3,372,350				3,185,596				13,106,595				12,395,815
Income from operations			331,196				261,384				1,175,381				1,003,555
Interest expense, net			53,589				43,887				206,674				126,889
Other (income) expense, net			(3,516	)			(4,838	)			28,281				10,406
Income before income taxes			281,123				222,335				940,426				866,260
Provision for income taxes			61,501				51,966				221,119				209,278
Net income			219,622				170,369				719,307				656,982
Less: Net income (loss) attributable to noncontrolling interests ("NCI")			3,244				(4,451	)			1,512				(18,627	)
Net income attributable to UHS		$	216,378			$	174,820			$	717,795			$	675,609
Basic earnings per share attributable to UHS (a)		$	3.19			$	2.45			$	10.35			$	9.23
Diluted earnings per share attributable to UHS (a)		$	3.16			$	2.43			$	10.23			$	9.14

 

 

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Universal Health Services, Inc.
Footnotes to Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
		Three months								Twelve months
		ended December 31,								ended December 31,
		2023				2022				2023				2022
(a) Earnings per share calculation:
Basic and diluted:
Net income attributable to UHS		$	216,378			$	174,820			$	717,795			$	675,609
Less: Net income attributable to unvested restricted share grants			(66	)			(156	)			(308	)			(748	)
Net income attributable to UHS - basic and diluted		$	216,312			$	174,664			$	717,487			$	674,861
Weighted average number of common shares - basic			67,809				71,165				69,321				73,118
Basic earnings per share attributable to UHS:		$	3.19			$	2.45			$	10.35			$	9.23
Weighted average number of common shares			67,809				71,165				69,321				73,118
Add: Other share equivalents			741				627				804				714
Weighted average number of common shares and equiv. - diluted			68,550				71,792				70,125				73,832
Diluted earnings per share attributable to UHS:		$	3.16			$	2.43			$	10.23			$	9.14

 

 

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Universal Health Services, Inc.
Schedule of Non-GAAP Supplemental Information ("Supplemental Schedule")
For the Three Months ended December 31, 2023 and 2022
(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
	December 31, 2023				revenues				December 31, 2022				revenues
Net income attributable to UHS	$	216,378							$	174,820
Depreciation and amortization		145,481								148,353
Interest expense, net		53,589								43,887
Provision for income taxes		61,501								51,966
EBITDA net of NCI	$	476,949				12.9	%		$	419,026				12.2	%
Other (income) expense, net		(3,516	)							(4,838	)
Provision for asset impairment		-								57,550
Adjusted EBITDA net of NCI	$	473,433				12.8	%		$	471,738				13.7	%
Net revenues	$	3,703,546							$	3,446,980
Calculation of Adjusted Net Income Attributable to UHS
	Three months ended								Three months ended
	December 31, 2023								December 31, 2022
					Per								Per
	Amount				Diluted Share				Amount				Diluted Share
Net income attributable to UHS	$	216,378			$	3.16			$	174,820			$	2.43
Plus/minus after-tax adjustments:
Unrealized gain on equity securities		(1,470	)			(0.03	)			(1,778	)			(0.02	)
Provision for asset impairment		-				-				44,055				0.61
Subtotal adjustments		(1,470	)			(0.03	)			42,277				0.59
Adjusted net income attributable to UHS	$	214,908			$	3.13			$	217,097			$	3.02

 

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Universal Health Services, Inc.
Schedule of Non-GAAP Supplemental Information ("Supplemental Schedule")
For the Twelve Months ended December 31, 2023 and 2022
(in thousands, except per share amounts)
(unaudited)
Calculation of Earnings/Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA/Adjusted EBITDA net of NCI")
	Twelve months ended				% Net				Twelve months ended				% Net
	December 31, 2023				revenues				December 31, 2022				revenues
Net income attributable to UHS	$	717,795							$	675,609
Depreciation and amortization		568,041								581,861
Interest expense, net		206,674								126,889
Provision for income taxes		221,119								209,278
EBITDA net of NCI	$	1,713,629				12.0	%		$	1,593,637				11.9	%
Other (income) expense, net		28,281								10,406
Provision for asset impairment		-								57,550
Adjusted EBITDA net of NCI	$	1,741,910				12.2	%		$	1,661,593				12.4	%
Net revenues	$	14,281,976							$	13,399,370
Calculation of Adjusted Net Income Attributable to UHS
	Twelve months ended								Twelve months ended
	December 31, 2023								December 31, 2022
					Per								Per
	Amount				Diluted Share				Amount				Diluted Share
Net income attributable to UHS	$	717,795			$	10.23			$	675,609			$	9.14
Plus/minus after-tax adjustments:
Unrealized loss on equity securities	$	21,570				0.31				10,580				0.14
Provision for asset impairment		-				-				44,055				0.60
Subtotal adjustments		21,570				0.31				54,635				0.74
Adjusted net income attributable to UHS	$	739,365			$	10.54			$	730,244			$	9.88

 

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Universal Health Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
		December 31,				December 31,
		2023				2022
Assets
Current assets:
Cash and cash equivalents		$	119,439			$	102,818
Accounts receivable, net			2,238,265				2,017,722
Supplies			216,988				218,517
Other current assets			236,658				198,283
Total current assets			2,811,350				2,537,340
Property and equipment			11,777,047				11,085,852
Less: accumulated depreciation			(5,652,518	)			(5,167,394	)
			6,124,529				5,918,458
Other assets:
Goodwill			3,932,407				3,909,456
Deferred income taxes			85,626				68,397
Right of use assets-operating leases			433,962				454,650
Deferred charges			6,974				6,264
Other			572,754				599,623
Total Assets		$	13,967,602			$	13,494,188
Liabilities and Stockholders' Equity
Current liabilities:
Current maturities of long-term debt		$	126,686			$	81,447
Accounts payable and other liabilities			1,813,015				1,760,588
Operating lease liabilities			71,600				67,776
Federal and state taxes			2,046				4,608
Total current liabilities			2,013,347				1,914,419
Other noncurrent liabilities			584,007				487,669
Operating lease liabilities noncurrent			382,559				395,522
Long-term debt			4,785,783				4,726,533
Redeemable noncontrolling interest			5,191				4,695
UHS common stockholders' equity			6,149,001				5,920,582
Noncontrolling interest			47,714				44,768
Total equity			6,196,715				5,965,350
Total Liabilities and Stockholders' Equity		$	13,967,602			$	13,494,188

 

 

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Universal Health Services, Inc.
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
	Twelve months
	ended December 31,
	2023				2022
Cash Flows from Operating Activities:
Net income	$	719,307			$	656,982
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation & amortization		568,041				581,861
(Gain) loss on sale of assets and businesses		(6,250	)			584
Stock-based compensation expense		87,720				85,378
Provision for asset impairment		0				57,550
Changes in assets & liabilities, net of effects from acquisitions and dispositions:
Accounts receivable		(182,444	)			(258,338	)
Accrued interest		1,193				1,835
Accrued and deferred income taxes		(43,450	)			(29,510	)
Other working capital accounts		(32,321	)			(146,692	)
Medicare accelerated payments and deferred CARES Act and other grants		2,978				2,391
Other assets and deferred charges		48,517				19,918
Other		39,133				(8,676	)
Accrued insurance expense, net of commercial premiums paid		183,462				174,723
Payments made in settlement of self-insurance claims		(118,089	)			(141,983	)
Net cash provided by operating activities		1,267,797				996,023
Cash Flows from Investing Activities:
Property and equipment additions		(743,055	)			(734,001	)
Proceeds received from sales of assets and businesses		24,187				12,001
Acquisition of businesses and property		(3,728	)			(20,309	)
(Outflows) inflows from foreign exchange contracts that hedge our net U.K. investment		(40,695	)			94,913
Decrease in capital reserves of commercial insurance subsidiary		16				100
Net cash used in investing activities		(763,275	)			(647,296	)
Cash Flows from Financing Activities:
Repayments of long-term debt		(85,480	)			(89,367	)
Additional borrowings		185,100				705,321
Financing costs		(308	)			(3,164	)
Repurchase of common shares		(547,363	)			(832,918	)
Dividends paid		(55,480	)			(58,449	)
Issuance of common stock		13,654				14,068
Profit distributions to noncontrolling interests		(6,830	)			(5,391	)
(Purchase) sale of ownership interests by (from) minority members		2,762				(48,500	)
Net cash used in financing activities		(493,945	)			(318,400	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		3,056				(8,424	)
Decrease in cash, cash equivalents and restricted cash		13,633				21,903
Cash, cash equivalents and restricted cash, beginning of period		200,837				178,934
Cash, cash equivalents and restricted cash, end of period	$	214,470			$	200,837
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	200,446			$	120,136
Income taxes paid, net of refunds	$	257,896			$	250,759
Noncash purchases of property and equipment	$	66,899			$	72,064

 

---

Universal Health Services, Inc.
Supplemental Statistical Information
(unaudited)
					% Change		% Change
Same Facility:					3 Months ended		12 Months ended
					12/31/2023		12/31/2023
Acute Care Services
Revenues					9.7%		7.6%
Adjusted Admissions					5.6%		7.6%
Adjusted Patient Days					4.3%		4.7%
Revenue Per Adjusted Admission					3.7%		-0.6%
Revenue Per Adjusted Patient Day					5.0%		2.2%
Behavioral Health Care Services
Revenues					7.2%		8.0%
Adjusted Admissions					1.4%		3.2%
Adjusted Patient Days					1.1%		2.1%
Revenue Per Adjusted Admission					5.8%		4.7%
Revenue Per Adjusted Patient Day					6.1%		5.9%
UHS Consolidated	Fourth quarter ended				Twelve months ended
	12/31/2023		12/31/2022		12/31/2023		12/31/2022
Revenues	$3,703,546		$3,446,980		$14,281,976		$13,399,370
EBITDA net of NCI	$476,949		$419,026		$1,713,629		$1,593,637
EBITDA Margin net of NCI	12.9%		12.2%		12.0%		11.9%
Adjusted EBITDA net of NCI	$473,433		$471,738		$1,741,910		$1,661,593
Adjusted EBITDA Margin net of NCI	12.8%		13.7%		12.2%		12.4%
Cash Flow From Operations	$452,431		$297,304		$1,267,797		$996,023
Capital Expenditures	$206,390		$164,446		$743,055		$734,001
Days Sales Outstanding					57		55
Debt					$4,912,469		$4,807,980
UHS' Shareholders Equity					$6,149,001		$5,920,582
Debt / Total Capitalization					44.4%		44.8%
Debt / EBITDA net of NCI (1)					2.87		3.02
Debt / Adjusted EBITDA net of NCI (1)					2.82		2.89
Debt / Cash From Operations (1)					3.87		4.83
(1) Latest 4 quarters.

 

---

Universal Health Services, Inc.

Acute Care Hospital Services

For the Three and Twelve Months ended

December 31, 2023 and 2022

(in thousands)

 

Same Facility Basis - Acute Care Hospital Services
		Three months ended								Three months ended								Twelve months ended								Twelve months ended
		December 31, 2023								December 31, 2022								December 31, 2023								December 31, 2022
		Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues
Net revenues		$	2,032,535				100.0	%		$	1,852,000				100.0	%		$	7,840,740				100.0	%		$	7,284,868				100.0	%
Operating charges:
Salaries, wages and benefits			869,942				42.8	%			812,340				43.9	%			3,363,213				42.9	%			3,225,039				44.3	%
Other operating expenses			559,282				27.5	%			481,164				26.0	%			2,144,102				27.3	%			1,863,414				25.6	%
Supplies expense			338,790				16.7	%			321,747				17.4	%			1,303,018				16.6	%			1,226,294				16.8	%
Depreciation and amortization			93,287				4.6	%			94,919				5.1	%			358,308				4.6	%			369,493				5.1	%
Lease and rental expense			23,930				1.2	%			23,159				1.3	%			95,565				1.2	%			85,915				1.2	%
Subtotal-operating expenses			1,885,231				92.8	%			1,733,329				93.6	%			7,264,206				92.6	%			6,770,155				92.9	%
Income from operations			147,304				7.2	%			118,671				6.4	%			576,534				7.4	%			514,713				7.1	%
Interest expense, net			(643	)			(0.0	)%			(241	)			(0.0	)%			(2,501	)			(0.0	)%			1,109				0.0	%
Other (income) expense, net			931				0.0	%			687				0.0	%			6,099				0.1	%			1,493				0.0	%
Income before income taxes		$	147,016				7.2	%		$	118,225				6.4	%		$	572,936				7.3	%		$	512,111				7.0	%
All Acute Care Hospital Services
		Three months ended								Three months ended								Twelve months ended								Twelve months ended
		December 31, 2023								December 31, 2022								December 31, 2023								December 31, 2022
		Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues
Net revenues		$	2,087,503				100.0	%		$	1,939,239				100.0	%		$	8,081,402				100.0	%		$	7,646,749				100.0	%
Operating charges:
Salaries, wages and benefits			871,182				41.7	%			834,647				43.0	%			3,406,060				42.1	%			3,332,535				43.6	%
Other operating expenses			615,810				29.5	%			596,152				30.7	%			2,347,560				29.0	%			2,146,196				28.1	%
Supplies expense			338,732				16.2	%			329,129				17.0	%			1,317,917				16.3	%			1,264,688				16.5	%
Depreciation and amortization			93,479				4.5	%			97,557				5.0	%			367,644				4.5	%			383,115				5.0	%
Lease and rental expense			23,960				1.1	%			23,330				1.2	%			96,589				1.2	%			86,654				1.1	%
Subtotal-operating expenses			1,943,163				93.1	%			1,880,815				97.0	%			7,535,770				93.2	%			7,213,188				94.3	%
Income from operations			144,340				6.9	%			58,424				3.0	%			545,632				6.8	%			433,561				5.7	%
Interest expense, net			(643	)			(0.0	)%			(241	)			(0.0	)%			(2,501	)			(0.0	)%			1,109				0.0	%
Other (income) expense, net			867				0.0	%			1,982				0.1	%			7,788				0.1	%			2,788				0.0	%
Income before income taxes		$	144,116				6.9	%		$	56,683				2.9	%		$	540,345				6.7	%		$	429,664				5.6	%

 

---

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 goodwill, 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, 2023.

 

The All Acute Care Hospital Services table 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; (ii) the impact of an asset impairment recorded in the three and twelve months ended December 31, 2022, and; (iv) 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 and Twelve Months ended

December 31, 2023 and 2022

(in thousands)

 

Same Facility - Behavioral Health Care Services
		Three months ended								Three months ended								Twelve months ended								Twelve months ended
		December 31, 2023								December 31, 2022								December 31, 2023								December 31, 2022
		Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues
Net revenues		$	1,558,805				100.0	%		$	1,453,766				100.0	%		$	6,048,883				100.0	%		$	5,598,764				100.0	%
Operating charges:
Salaries, wages and benefits			852,069				54.7	%			794,776				54.7	%			3,343,222				55.3	%			3,088,108				55.2	%
Other operating expenses			296,915				19.0	%			262,606				18.1	%			1,163,365				19.2	%			1,078,918				19.3	%
Supplies expense			55,674				3.6	%			53,446				3.7	%			216,879				3.6	%			210,903				3.8	%
Depreciation and amortization			48,066				3.1	%			47,435				3.3	%			187,105				3.1	%			184,684				3.3	%
Lease and rental expense			11,143				0.7	%			10,689				0.7	%			43,785				0.7	%			41,951				0.7	%
Subtotal-operating expenses			1,263,867				81.1	%			1,168,952				80.4	%			4,954,356				81.9	%			4,604,564				82.2	%
Income from operations			294,938				18.9	%			284,814				19.6	%			1,094,527				18.1	%			994,200				17.8	%
Interest expense, net			1,108				0.1	%			1,212				0.1	%			4,434				0.1	%			5,169				0.1	%
Other (income) expense, net			(1,132	)			(0.1	)%			(4,921	)			(0.3	)%			(3,426	)			(0.1	)%			(6,343	)			(0.1	)%
Income before income taxes		$	294,962				18.9	%		$	288,523				19.8	%		$	1,093,519				18.1	%		$	995,374				17.8	%
All Behavioral Health Care Services
		Three months ended								Three months ended								Twelve months ended								Twelve months ended
		December 31, 2023								December 31, 2022								December 31, 2023								December 31, 2022
		Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues				Amount				% of Net Revenues
Net revenues		$	1,615,543				100.0	%		$	1,494,543				100.0	%		$	6,190,921				100.0	%		$	5,729,758				100.0	%
Operating charges:
Salaries, wages and benefits			854,670				52.9	%			796,455				53.3	%			3,353,008				54.2	%			3,107,216				54.2	%
Other operating expenses			353,353				21.9	%			302,908				20.3	%			1,303,311				21.1	%			1,201,563				21.0	%
Supplies expense			55,713				3.4	%			53,471				3.6	%			217,310				3.5	%			211,786				3.7	%
Depreciation and amortization			49,180				3.0	%			47,752				3.2	%			189,297				3.1	%			186,555				3.3	%
Lease and rental expense			11,194				0.7	%			11,065				0.7	%			44,028				0.7	%			43,868				0.8	%
Subtotal-operating expenses			1,324,110				82.0	%			1,211,651				81.1	%			5,106,954				82.5	%			4,750,988				82.9	%
Income from operations			291,433				18.0	%			282,892				18.9	%			1,083,967				17.5	%			978,770				17.1	%
Interest expense, net			1,102				0.1	%			1,217				0.1	%			4,558				0.1	%			5,323				0.1	%
Other (income) expense, net			(1,132	)			(0.1	)%			(4,921	)			(0.3	)%			(4,271	)			(0.1	)%			(6,843	)			(0.1	)%
Income before income taxes		$	291,463				18.0	%		$	286,596				19.2	%		$	1,083,680				17.5	%		$	980,290				17.1	%

 

---

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, lawsuits and reserves established in connection with the government's investigation of our behavioral health care facilities, cost related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, 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, 2023.

 

The All Behavioral Health Care Services table 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.

 

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Universal Health Services, Inc.
Selected Hospital Statistics
For the Three Months Ended
December 31, 2023 and 2022
AS REPORTED:
		ACUTE												BEHAVIORAL HEALTH
		12/31/23				12/31/22				% change				12/31/23				12/31/22				% change
Hospitals owned and leased			27				28				-3.6	%			333				331				0.6	%
Average licensed beds			6,674				6,987				-4.5	%			24,194				24,228				-0.1	%
Average available beds			6,502				6,815				-4.6	%			24,094				24,128				-0.1	%
Patient days			403,117				401,363				0.4	%			1,600,740				1,560,526				2.6	%
Average daily census			4,381.7				4,362.6				0.4	%			17,399.3				16,962.2				2.6	%
Occupancy-licensed beds			65.7	%			62.4	%			5.1	%			71.9	%			70.0	%			2.7	%
Occupancy-available beds			67.4	%			64.0	%			5.3	%			72.2	%			70.3	%			2.7	%
Admissions			82,918				81,314				2.0	%			118,487				112,272				5.5	%
Length of stay			4.9				4.9				-1.5	%			13.5				13.9				-2.8	%
Inpatient revenue		$	11,408,639			$	10,182,914				12.0	%		$	2,647,158			$	2,536,091				4.4	%
Outpatient revenue			7,566,625				6,452,816				17.3	%			275,128				257,601				6.8	%
Total patient revenue			18,975,264				16,635,730				14.1	%			2,922,286				2,793,692				4.6	%
Other revenue			234,117				203,952				14.8	%			83,153				82,734				0.5	%
Gross revenue			19,209,381				16,839,682				14.1	%			3,005,439				2,876,426				4.5	%
Total deductions			17,121,878				14,900,443				14.9	%			1,389,896				1,381,883				0.6	%
Net revenue		$	2,087,503			$	1,939,239				7.6	%		$	1,615,543			$	1,494,543				8.1	%
SAME FACILITY:
		ACUTE												BEHAVIORAL HEALTH
		12/31/23				12/31/22				% change				12/31/23				12/31/22				% change
Hospitals owned and leased			27				27				0.0	%			331				331				0.0	%
Average licensed beds			6,674				6,705				-0.5	%			24,031				24,102				-0.3	%
Average available beds			6,502				6,533				-0.5	%			23,931				24,002				-0.3	%
Patient days			403,117				387,228				4.1	%			1,563,374				1,549,906				0.9	%
Average daily census			4,381.7				4,209.0				4.1	%			16,993.2				16,846.8				0.9	%
Occupancy-licensed beds			65.7	%			62.8	%			4.6	%			70.7	%			69.9	%			1.2	%
Occupancy-available beds			67.4	%			64.4	%			4.6	%			71.0	%			70.2	%			1.2	%
Admissions			82,918				78,639				5.4	%			112,712				111,427				1.2	%
Length of stay			4.9				4.9				-1.3	%			13.9				13.9				-0.3	%

 

---

Universal Health Services, Inc.
Selected Hospital Statistics
For the Twelve Months Ended
December 31, 2023 and 2022
AS REPORTED:
		ACUTE												BEHAVIORAL HEALTH
		12/31/23				12/31/22				% change				12/31/23				12/31/22				% change
Hospitals owned and leased			27				28				-3.6	%			333				331				0.6	%
Average licensed beds			6,691				6,923				-3.4	%			24,224				24,259				-0.1	%
Average available beds			6,519				6,751				-3.4	%			24,124				24,159				-0.1	%
Patient days			1,576,074				1,569,611				0.4	%			6,336,927				6,230,124				1.7	%
Average daily census			4,318.0				4,300.3				0.4	%			17,361.4				17,068.8				1.7	%
Occupancy-licensed beds			64.5	%			62.1	%			3.9	%			71.7	%			70.4	%			1.9	%
Occupancy-available beds			66.2	%			63.7	%			4.0	%			72.0	%			70.7	%			1.9	%
Admissions			322,218				311,537				3.4	%			472,307				459,245				2.8	%
Length of stay			4.9				5.0				-2.9	%			13.4				13.6				-1.1	%
Inpatient revenue		$	44,687,035			$	40,004,670				11.7	%		$	10,648,996			$	10,116,566				5.3	%
Outpatient revenue			29,858,874				24,813,718				20.3	%			1,087,595				1,031,370				5.5	%
Total patient revenue			74,545,909				64,818,388				15.0	%			11,736,591				11,147,936				5.3	%
Other revenue			948,994				806,587				17.7	%			303,546				292,018				3.9	%
Gross revenue			75,494,903				65,624,975				15.0	%			12,040,137				11,439,954				5.2	%
Total deductions			67,413,501				57,978,226				16.3	%			5,849,216				5,710,196				2.4	%
Net revenue		$	8,081,402			$	7,646,749				5.7	%		$	6,190,921			$	5,729,758				8.0	%
SAME FACILITY:
		ACUTE												BEHAVIORAL HEALTH
		12/31/23				12/31/22				% change				12/31/23				12/31/22				% change
Hospitals owned and leased			27				27				0.0	%			331				331				0.0	%
Average licensed beds			6,604				6,640				-0.5	%			24,016				24,014				0.0	%
Average available beds			6,432				6,468				-0.6	%			23,916				23,914				0.0	%
Patient days			1,564,390				1,512,013				3.5	%			6,289,388				6,175,143				1.9	%
Average daily census			4,286.0				4,142.5				3.5	%			17,231.2				16,918.2				1.9	%
Occupancy-licensed beds			64.9	%			62.4	%			4.0	%			71.7	%			70.5	%			1.8	%
Occupancy-available beds			66.6	%			64.0	%			4.0	%			72.0	%			70.7	%			1.8	%
Admissions			319,829				300,507				6.4	%			468,131				454,441				3.0	%
Length of stay			4.9				5.0				-2.8	%			13.4				13.6				-1.1	%

 

 

---

Universal Health Services, Inc.
Supplemental Non-GAAP Disclosures
2024 Operating Results Forecast
(in thousands, except per share amounts)
			Forecast For The Year Ending December 31, 2024
							% Net								% Net
			Low				revenues				High				revenues
Net revenues			$	15,411,000							$	15,706,000
Net income attributable to UHS (a)			$	865,709							$	932,123
Depreciation and amortization				605,204								605,204
Interest expense				196,338								196,338
Other (income) expense, net				(11,133	)							(11,133	)
Provision for income taxes				274,883								295,971
Adjusted EBITDA net of NCI (b)			$	1,931,001				12.5	%		$	2,018,503				12.9	%
Net income attributable to UHS, per diluted share (a)			$	13.00							$	14.00
Shares used in computing diluted earnings per share				66,594								66,594
(a) Forecasted net income attributable to UHS/per diluted share exclude the following items because we do not believe we can forecast these items with sufficient accuracy. Such items include: the impact of future items, if applicable, that are nonrecurring or non-operational in nature including items such as pre-tax unrealized gains/losses resulting from changes in the market value of shares of certain equity securities, and other potential material items including, but not limited to, reserves for various matters including settlements, legal judgments and lawsuits, potential impacts of non-ordinary course acquisitions, divestitures, joint ventures or other strategic transactions, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, long-lived and intangible assets, other amounts that may be reflected in the current financial statements that relate to prior periods, and the impact of share repurchases that differ from our forecasted assumptions. Forecasted net income attributable to UHS/per diluted share is also subject to certain conditions including those as set forth in General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures.
(b) Adjusted EBITDA net of NCI is a non-GAAP financial measure and should not be considered a measure of financial performance under GAAP. We believe Adjusted EBITDA net of NCI is helpful to our investors as a measure of operating performance.

 

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