Universal Health Services, Inc. Reports Second Quarter EPS Growth of 19%
KING OF PRUSSIA, Pa., Jul 21, 2003 /PRNewswire-FirstCall via COMTEX/ -- Universal Health Services, Inc. (NYSE: UHS) announced today that its net income and earnings per share (diluted) were $51.0 million and $.82 for the three-month period ended June 30, 2003, and $103.7 million and $1.66 for the six-month period ended June 30, 2003, respectively. These results represent a 19% increase in earnings per share (diluted) both for the three-month and six-month periods ended June 30, 2003 over the comparable prior year periods. Revenues increased 12% to $903 million in the three-month period and also by 12% to $1.80 billion in the six-month period ended June 30, 2003. At June 30, 2003, the Company's balance sheet debt, net of cash, was $675 million and its shareholders' equity was $976 million.
On a same facility basis, patient admissions to the Company's acute care hospitals located in the U.S. and Puerto Rico remained relatively unchanged during the quarter ended June 30, 2003, as compared to the comparable prior year quarter while patient admissions to the Company's behavioral health care facilities owned in both periods increased approximately 3%. For the Company's acute care hospitals owned in both periods located in the U.S. and Puerto Rico, revenues increased 9.4% and revenue per adjusted patient day increased 7.8% during the 2003 second quarter as compared to the prior year quarter. For the Company's behavioral health hospitals owned in both periods, revenues increased 5.7% and revenue per adjusted patient day increased 3.7%.
Managed care pricing remained strong in the quarter. Operating margins for the Company's acute care hospitals located in the U.S. and Puerto Rico owned in both the three-month periods ended June 30, 2003 and June 30, 2002, increased to 18.3% from 17.6%. Operating margins for the Company's behavioral health hospitals owned in both periods increased to 23.8% during the second quarter of 2003 from 21.2% during the prior year quarter. The Company's operating margin (as calculated on the attached schedules of Supplemental Consolidated Income Statement Information), increased to 16.7% in the three- month period ended June 30, 2003 as compared to 16.0% in the same period of the prior year.
During the quarter, the Company announced its intent to acquire the assets of three acute care hospitals in California from Vista Health System. The Company also expects to complete construction of its new 176-bed hospital in Las Vegas and a 90-bed addition to its Northwest Texas Hospital in Amarillo, Texas later in 2003.
There will be a conference call for investors at 9:00 A.M. ET on Tuesday, July 22, 2003. The dial-in number is 1-877-648-7971.
Universal Health Services, Inc. is one of the nation's largest hospital companies, operating acute care and behavioral health hospitals, ambulatory surgery and radiation centers nationwide, in Puerto Rico, and in France. It acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust (NYSE: UHT).
Certain statements in this release may constitute forward-looking statements and are subject to various risks and uncertainties as discussed in the Company's filings with the Securities and Exchange Commission. The Company is not obligated to update these forward-looking statements even if the Company's assessment of these risks and uncertainties changes. The Company uses operating income and/or operating margin, which are commonly used indicators within the health care industry, as analytical indicators for purposes of assessing operating performance of its facilities. Operating income and operating margin should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from operating income and operating margin are significant components in understanding and assessing financial performance. Because operating income and operating margin are not measurements determined in accordance with generally accepted accounting principles and are thus susceptible to varying calculations, operating income and operating margin as presented may not be comparable to other similarly titled measures of other companies.
For additional information on the Company, visit our web site: http://www.uhsinc.com.
Universal Health Services, Inc.
Consolidated Statements of Income
(in thousands, except per share amounts)
Unaudited
Three months Six months
ended June 30, ended June 30,
2003 2002 2003 2002
Net revenues $902,954 $805,945 $1,797,762 $1,610,316
Operating charges:
Salaries, wages and
benefits 357,448 321,595 713,230 641,302
Other operating expenses 211,616 198,296 415,526 390,192
Supplies expense 121,556 103,857 242,293 207,365
Provision for doubtful
accounts 61,702 52,845 127,122 110,739
Depreciation and
amortization 35,513 30,900 70,050 60,308
Lease and rental expense 15,861 15,290 31,682 30,480
Interest expense, net 9,375 8,402 19,224 17,132
813,071 731,185 1,619,127 1,457,518
Income before minority
interests and income taxes 89,883 74,760 178,635 152,798
Minority interests in earnings
of consolidated entities 8,530 4,688 13,560 10,561
Income before income taxes 81,353 70,072 165,075 142,237
Provision for income taxes 30,403 25,725 61,335 52,217
Net income $50,950 $44,347 $103,740 $90,020
Earnings per common share -
basic $0.88 $0.74 $1.79 $1.50
Earnings per common share -
diluted $0.82 $0.69 $1.66 $1.40
Weighted average number of
common shares - basic 57,655 59,934 57,966 59,898
Weighted average number of
common share equivalents 7,287 7,320 7,303 7,253
Weighted average number of
common shares and equiv. -
diluted 64,942 67,254 65,269 67,151
EARNINGS PER SHARE CALCULATION
Net income $50,950 $44,347 $103,740 $90,020
Add: Debenture interest, net
of taxes 2,178 2,091 4,355 4,183
Adjusted net income $53,128 $46,438 $108,095 $94,203
Weighted average number of
common shares - basic 57,655 59,934 57,966 59,898
Add: Shares for conversion of
convertible debentures 6,577 6,577 6,577 6,577
Other share
equivalents 710 743 726 676
Weighted average number of
common shares and equiv. -
diluted 64,942 67,254 65,269 67,151
Earnings per common share -
diluted $0.82 $0.69 $1.66 $1.40
Universal Health Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
Unaudited
June 30, December 31,
2003 2002
Assets:
Cash and cash equivalents $26,704 $17,750
Accounts receivable, net 472,829 474,763
Other current assets 111,343 114,063
Property, plant and equipment, net 1,250,786 1,167,287
Other assets 562,014 549,366
$2,423,676 $2,323,229
Liabilities and Stockholders'
Equity:
Current portion of long-term debt $11,935 $8,253
Other current liabilities 360,500 362,160
Other noncurrent liabilities 226,347 206,238
Minority interest 145,398 134,339
Long-term debt 690,184 680,514
Deferred income taxes 12,880 14,266
Stockholders' equity 976,432 917,459
$2,423,676 $2,323,229
Universal Health Services, Inc.
Supplemental Consolidated Income Statement Information
(in thousands)
unaudited
Three months ended Three months ended
June 30, 2003 June 30, 2002
Net revenues $902,954 100.0% $805,945 100.0%
Operating charges:
Salaries, wages and benefits 357,448 39.6% 321,595 39.9%
Other operating expenses 211,616 23.4% 198,296 24.6%
Supplies expense 121,556 13.5% 103,857 12.9%
Provision for doubtful accounts 61,702 6.8% 52,845 6.6%
752,322 83.3% 676,593 84.0%
Operating income/margin 150,632 16.7% 129,352 16.0%
Depreciation and amortization 35,513 30,900
Lease and rental expense 15,861 15,290
Interest expense, net 9,375 8,402
Minority interests in earnings of
consolidated entities 8,530 4,688
Income before income taxes 81,353 70,072
Provision for income taxes 30,403 25,725
Net income $50,950 $44,347
Universal Health Services, Inc.
Supplemental Consolidated Income Statement Information
(in thousands)
unaudited
Six months ended Six months ended
June 30, 2003 June 30, 2002
Net revenues $1,797,762 100.0% $1,610,316 100.0%
Operating charges:
Salaries, wages and benefits 713,230 39.7% 641,302 39.8%
Other operating expenses 415,526 23.1% 390,192 24.2%
Supplies expense 242,293 13.5% 207,365 12.9%
Provision for doubtful accounts 127,122 7.1% 110,739 6.9%
1,498,171 83.3% 1,349,598 83.8%
Operating income/margin 299,591 16.7% 260,718 16.2%
Depreciation and amortization 70,050 60,308
Lease and rental expense 31,682 30,480
Interest expense, net 19,224 17,132
Minority interests in earnings
of consolidated entities 13,560 10,561
Income before income taxes 165,075 142,237
Provision for income taxes 61,335 52,217
Net income $103,740 $90,020
Universal Health Services, Inc.
Supplemental Statistical Information
(unaudited)
% Change % Change
Quarter Ended 6 mos. ended
Same Store: 06/30/2003 06/30/2003
Acute Care Hospitals
Revenues 9.4% 9.1%
Adjusted Admissions 0.0% 1.3%
Adjusted Patient Days 1.4% 0.7%
Revenue Per Adjusted Admission 9.4% 7.7%
Revenue Per Adjusted Patient Day 7.8% 8.3%
Behavioral Health Hospitals
Revenues 5.7% 5.3%
Adjusted Admissions 2.4% 1.9%
Adjusted Patient Days 1.9% 2.5%
Revenue Per Adjusted Admission 3.2% 3.3%
Revenue Per Adjusted Patient Day 3.7% 2.7%
UHS Consolidated Second Quarter Ended Six months Ended
06/30/2003 06/30/2002 06/30/2003 06/30/2002
Revenues $902,954 $805,945 $1,797,762 $1,610,316
EBITDA (1) $126,241 $109,374 $254,349 $219,677
EBITDA Margin (1) 14.0% 13.6% 14.1% 13.6%
Cash Flow From Operations $129,412 $77,193 $210,178 $134,066
Days Sales Outstanding 48 53 48 52
Capital Expenditures $58,077 $56,441 $98,419 $97,152
Debt (net of cash) - - $675,415 $675,839
Shareholders Equity - - $976,432 $899,408
Debt / Total Capitalization - - 40.9% 42.9%
Debt / EBITDA (2) - - 1.44 1.69
Debt / Cash From Operations
(2) - - 1.66 2.42
Acute Care EBITDAR Margin (3) 18.3% 17.6% 18.5% 17.7%
Behavioral Health EBITDAR
Margin (3) 24.0% 21.2% 23.0% 20.9%
(1) Net of Minority Interest
(2) Latest 4 quarters
(3) Before Corporate overhead allocation and minority interest
UNIVERSAL HEALTH SERVICES, INC.
SELECTED HOSPITAL STATISTICS
JUNE 30, 2003
AS REPORTED: FOR THE THREE MONTHS ENDED
ACUTE (1) BEHAVIORAL HEALTH
6/30/03 6/30/02 % 6/30/03 6/30/02 %
Hospitals owned
and leased 25 26 -3.8% 39 37 5.4%
Average licensed
beds 5,735 5,846 -1.9% 3,902 3,749 4.1%
Patient days 305,669 300,761 1.6% 269,451 255,016 5.7%
Average daily
census 3,359.0 3,305.1 1.6% 2,961.0 2,802.4 5.7%
Occupancy-licensed
beds 58.6% 56.5% 3.6% 75.9% 74.7% 1.5%
Admissions 65,474 65,605 -0.2% 22,029 21,176 4.0%
Length of stay 4.7 4.6 1.8% 12.2 12.0 1.6%
Inpatient
revenue $1,458,645 $1,242,178 17.4% $274,367 $248,255 10.5%
Outpatient
revenue 535,742 456,875 17.3% 41,178 39,450 4.4%
Total patient
revenue 1,994,387 1,699,053 17.4% 315,545 287,705 9.7%
Other revenue 13,821 16,187 -14.6% 8,974 9,495 -5.5%
Gross hospital
revenue 2,008,208 1,715,240 17.1% 324,519 297,200 9.2%
Total
deductions 1,329,714 1,094,852 21.5% 169,682 153,777 10.3%
Net hospital
revenue $678,494 $620,388 9.4% $154,837 $143,423 8.0%
SAME STORE: FOR THE THREE MONTHS ENDED
ACUTE (1) (2) BEHAVIORAL HEALTH (3)
6/30/03 6/30/02 % 6/30/03 6/30/02 %
Hospitals owned
and leased 25 26 -3.8% 37 37 0.0%
Average licensed
beds 5,735 5,846 -1.9% 3,785 3,749 1.0%
Patient days 305,669 300,782 1.6% 260,906 255,018 2.3%
Average daily
census 3,359.0 3,305.3 1.6% 2,867.1 2,802.4 2.3%
Occupancy-licensed
beds 58.6% 56.5% 3.6% 75.7% 74.8% 1.3%
Admissions 65,474 65,605 -0.2% 21,789 21,176 2.9%
Length of stay 4.7 4.6 1.8% 12.0 12.0 -0.6%
(1) Does not include hospitals located in France.
(2) Inland Valley and Rancho Springs combined on July 1, 2002.
(3) North Star Hospital and Residential Center are excluded in both
current and prior years.
UNIVERSAL HEALTH SERVICES, INC.
SELECTED HOSPITAL STATISTICS
JUNE 30, 2003
AS REPORTED: FOR THE SIX MONTHS ENDED
ACUTE (1) BEHAVIORAL HEALTH
6/30/03 6/30/02 % 6/30/03 6/30/02 %
Hospitals owned
and leased 25 26 -3.8% 39 37 5.4%
Average licensed
beds 5,735 5,846 -1.9% 3,887 3,749 3.7%
Patient days 626,561 624,065 0.4% 537,541 503,984 6.7%
Average daily
census 3,461.7 3,447.9 0.4% 2,969.8 2,784.4 6.7%
Occupancy-licensed
beds 60.4% 59.0% 2.3% 76.4% 74.3% 2.9%
Admissions 133,589 132,465 0.8% 43,983 42,427 3.7%
Length of stay 4.7 4.7 -0.4% 12.2 11.9 2.9%
Inpatient
revenue $2,968,097 $2,528,504 17.4% $547,644 $490,634 11.6%
Outpatient
revenue 1,046,485 881,418 18.7% 79,751 77,750 2.6%
Total patient
revenue 4,014,582 3,409,922 17.7% 627,395 568,384 10.4%
Other revenue 27,419 31,403 -12.7% 17,575 19,237 -8.6%
Gross hospital
revenue 4,042,001 3,441,325 17.5% 644,970 587,621 9.8%
Total
deductions 2,684,677 2,197,009 22.2% 337,386 302,077 11.7%
Net hospital
revenue $1,357,324 $1,244,316 9.1% $307,584 $285,544 7.7%
SAME STORE: FOR THE SIX MONTHS ENDED
ACUTE (1) (2) BEHAVIORAL HEALTH (3)
6/30/03 6/30/02 % 6/30/03 6/30/02 %
Hospitals owned
and leased 25 26 -3.8% 37 37 0.0%
Average licensed
beds 5,735 5,846 -1.9% 3,770 3,749 0.6%
Patient days 626,568 624,070 0.4% 519,941 503,976 3.2%
Average daily
census 3,461.7 3,447.9 0.4% 2,872.6 2,784.4 3.2%
Occupancy-licensed
beds 60.4% 59.0% 2.3% 76.2% 74.3% 2.6%
Admissions 133,589 132,465 0.8% 43,533 42,427 2.6%
Length of stay 4.7 4.7 -0.4% 11.9 11.9 0.5%
(1) Does not include hospitals located in France.
(2) Inland Valley and Rancho Springs combined on July 1, 2002.
(3) North Star Hospital and Residential Center are excluded in both
current and prior years.
SOURCE Universal Health Services, Inc.
Steve Filton, Chief Financial Officer, Universal Health Services, +1-610-768-3300 /Company News On-Call: http://www.prnewswire.com/gh/cnoc/comp/916225.html
http://www.uhsinc.com