Universal Health Services, Inc. Announces 30% Increase In Net Income Before Non-Recurring Charges, Its Ninth Consecutive Annual Net Income Increase
02/14/2002
Net income for the quarter ended December 31, 2001 was $.9 million, or $.02 per share (diluted) including the unfavorable non-recurring pre-tax charges of $49 million or $.46 per share after tax. Earnings before interest, depreciation and amortization, non-recurring charges and income taxes were $90 million, representing a 20% increase from the prior year quarter.
The Company recorded three unusual charges in the fourth quarter of 2001. As previously disclosed, the Company took a pre-tax $40 million, or $.38 per share after tax, charge to earnings to reserve for malpractice expenses that may result because the Company's malpractice insurance company, PHICO, was placed in liquidation on February 1, 2002. As a result of the Company's successful refinancing activities in the fourth quarter, the Company recorded a pre-tax extraordinary expense of $1.6 million, or $.01 per share after tax, for the early termination of a $135 million, 8-3/4% note issued in 1995. The Company also recorded a pre-tax loss on derivative transactions of $7.4 million, or $.07 per share after tax, resulting from the early termination of interest rate swaps. The earnings per share for the 2001 year have been adjusted to reflect the assumed conversion of the Company's convertible debentures, however, the earnings per share for the fourth quarter have not been adjusted to assume the conversion of the debentures because the effect would have been anti-dilutive.
Alan B. Miller, Chairman and CEO commented, "The core strengths of UHS were clearly evident in 2001. Admissions to our acute care hospitals and behavioral health facilities grew rapidly at 4.8% and 6.7% rates compared to the prior year. We continue to achieve substantial price increases from HMOs and insurance companies, and we are expanding our services in the many growing communities served by our hospitals. We acquired seven hospitals domestically and a leading hospital company in France during 2001. UHS remains one of the most financially stable organizations in health care and is well positioned to grow both from existing operations as well as through acquisitions of community hospitals and medical centers."
Universal Health Services, Inc. is one of the nation's largest hospital companies, operating acute care and behavioral health hospitals and 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 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.
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)
Three months Twelve months
ended December 31, ended December 31,
2001 2000 2001 2000
Net revenues $724,162 $614,822 $2,840,491 $2,242,444
Operating charges:
Salaries, wages and
benefits 289,643 240,845 1,122,428 873,747
Other operating expenses 179,286 145,415 668,026 515,084
Supplies expense 91,469 80,368 368,091 301,663
Provision for doubtful
accounts 53,438 56,541 240,025 192,625
Depreciation and
amortization 32,893 28,531 127,523 112,809
Lease and rental expense 13,951 12,688 53,945 49,039
Interest expense, net 7,368 8,427 36,176 29,941
Provision for insurance
settlements / nonrecurring
charges 40,000 7,747 40,000 7,747
708,048 580,562 2,656,214 2,082,655
Income before minority
interests, effect of foreign
exchange and derivative
transactions and income
taxes 16,114 34,260 184,277 159,789
Minority interests in earnings
of consolidated entities 6,194 3,995 17,518 13,681
Losses on foreign exchange and
derivative transactions 7,353 0 8,862 0
Income before income taxes 2,567 30,265 157,897 146,108
Provision for income taxes 632 11,176 57,147 52,746
Net income before
extraordinary charge 1,935 19,089 100,750 93,362
Extraordinary charge from
early extinguishment
of debt, net of taxes 1,008 0 1,008 0
Net income $927 $19,089 $99,742 $93,362
Earnings per common share -
basic $0.02 $0.32 $1.67 $1.55
Earnings per common share -
diluted $0.02 $0.31 $1.60 $1.50
Weighted average number of
common shares - basic 59,829 59,674 59,874 60,220
Weighted average number of
common share equivalents 688 7,492 7,346 4,600
Weighted average number of
common shares and equiv. -
diluted 60,517 67,166 67,220 64,820
EARNINGS PER SHARE CALCULATION
Net income $927 $19,089 $99,742 $93,362
Add: Debenture interest, net
of taxes 0 1,884 8,120 4,092
Adjusted net income $927 $20,973 $107,862 $97,454
Weighted average number of
common shares - basic 59,829 59,674 59,874 60,220
Add: Shares for conversion of
convertible debentures 0 6,577 6,577 3,504
Other share
equivalents 688 913 769 1,096
Weighted average number of
common shares and equiv. -
diluted 60,517 67,164 67,220 64,820
Earnings per common share -
diluted $0.02 $0.31 $1.60 $1.50
Universal Health Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
December 31, December 31,
2001 2000
Assets:
Cash and cash equivalents $22,848 $10,545
Accounts receivable, net 418,083 376,601
Other current assets 107,331 89,309
Property, plant and equipment, net 1,031,009 838,246
Funds restricted for construction 196 37,381
Other assets 535,117 390,295
$2,114,584 $1,742,377
Liabilities and Stockholders' Equity:
Current portion of long-term debt $2,436 $689
Other current liabilities 320,280 248,151
Other noncurrent liabilities 110,385 71,730
Minority interest 125,914 120,788
Long-term debt 718,830 548,064
Deferred income taxes 28,839 36,381
Stockholders' equity 807,900 716,574
$2,114,584 $1,742,377
UNIVERSAL HEALTH SERVICES, INC.
SELECTED HOSPITAL STATISTICS
DECEMBER 31, 2001
AS REPORTED:
FOR THE THREE MONTHS ENDED
ACUTE BEHAVIORAL HEALTH
12/31/01 12/31/00 % 12/31/01 12/31/00 %
Hospitals owned
and leased 33 23 43.5% 37 34 8.8%
Average licensed
beds 6,616 5,197 27.3% 3,749 3,394 10.5%
Patient days 355,252 261,808 35.7% 231,907 202,246 14.7%
Average daily
census 3,861.4 2,845.7 35.7% 2,520.7 2,198.3 14.7%
Occupancy-
licensed beds 58.4% 54.8% 6.6% 67.2% 64.8% 3.8%
Admissions 76,426 55,620 37.4% 18,929 15,779 20.0%
Length of stay 4.6 4.7 -1.2% 12.3 12.8 -4.4%
Inpatient
revenue $1,054,884 $842,789 25.2% $218,163 $193,890 12.5%
Outpatient
revenue 372,664 293,150 27.1% 35,985 31,077 15.8%
Total patient
revenue 1,427,548 1,135,939 25.7% 254,148 224,967 13.0%
Other revenue 17,171 13,954 23.1% 10,411 10,152 2.6%
Gross hospital
revenue 1,444,719 1,149,893 25.6% 264,559 235,119 12.5%
Total deductions 870,787 668,092 30.3% 132,626 119,524 11.0%
Net hospital
revenue $573,932 $481,801 19.1% $131,933 $115,595 14.1%
AS REPORTED:
FOR THE TWELVE MONTHS ENDED
ACUTE BEHAVIORAL HEALTH
12/31/01 12/31/00 % 12/31/01 12/31/00 %
Hospitals owned
and leased 33 23 43.5% 37 34 8.8%
Average licensed
beds 6,234 4,980 25.2% 3,732 2,612 42.9%
Patient days 1,328,609 1,017,646 30.6% 950,236 608,423 56.2%
Average daily
census 3,640.0 2,780.5 30.9% 2,603.4 1,662.4 56.6%
Occupancy-licensed
beds 58.4% 55.8% 4.6% 69.8% 63.6% 9.6%
Admissions 285,222 214,771 32.8% 78,688 49,971 57.5%
Length of stay 4.7 4.7 -1.7% 12.1 12.2 -0.8%
Inpatient
revenue $4,075,726 $3,152,132 29.3% $908,424 $584,030 55.5%
Outpatient
revenue 1,437,610 1,104,264 30.2% 143,907 103,015 39.7%
Total patient
revenue 5,513,336 4,256,396 29.5% 1,052,331 687,045 53.2%
Other revenue 61,015 52,856 15.4% 40,094 35,105 14.2%
Gross hospital
revenue 5,574,351 4,309,252 29.4% 1,092,425 722,150 51.3%
Total
deductions 3,340,466 2,492,899 34.0% 553,982 365,810 51.4%
Net hospital
revenue $2,233,885 $1,816,353 23.0% $538,443 $356,340 51.1%
SAME STORE:
FOR THE THREE MONTHS ENDED
ACUTE (A) BEHAVIORAL HEALTH (B)
12/31/01 12/31/00 % 12/31/01 12/31/00 %
Hospitals owned
and leased 23 23 0.0% 34 34 0.0%
Average licensed
beds 5,500 5,197 5.8% 3,408 3,394 0.4%
Patient days 276,478 261,804 5.6% 209,300 202,244 3.5%
Average daily
census 3,005.2 2,845.7 5.6% 2,275.0 2,198.3 3.5%
Occupancy-licensed
beds 54.6% 54.8% -0.2% 66.8% 64.8% 3.1%
Admissions 58,237 55,620 4.7% 16,912 15,779 7.2%
Length of stay 4.7 4.7 0.9% 12.4 12.8 -3.4%
SAME STORE:
FOR THE TWELVE MONTHS ENDED
ACUTE (A) BEHAVIORAL HEALTH (B)
12/31/01 12/31/00 % 12/31/01 12/31/00 %
Hospitals owned
and leased 23 23 0.0% 34 34 0.0%
Average licensed
beds 5,202 4,976 4.5% 2,551 2,549 0.1%
Patient days 1,073,275 1,017,700 5.5% 633,560 608,438 4.1%
Average daily
census 2,940.5 2,780.6 5.7% 1,735.8 1,662.4 4.4%
Occupancy-licensed
beds 56.5% 55.9% 1.2% 68.0% 65.2% 4.3%
Admissions 225,042 214,771 4.8% 53,324 49,971 6.7%
Length of stay 4.8 4.7 0.6% 11.9 12.2 -2.4%
(A) St. Mary's is included in the current and prior year totals beginning
August 1st and Ft. Duncan is included in the current and prior year
totals beginning September 16.
Rancho Springs and nine French hospitals are excluded in both
current and prior years.
(B) Pembroke, San Juan Capistrano and Westwood lodge are excluded in both
current and prior year.
The facilities acquired from Charter are included beginning August
18 in both current and prior years.
Universal Health Services, Inc.
Supplemental Statistical Information
(unaudited)
% Change % Change
Quarter Ended Year Ended
Same Store Basis 12/31/2001 12/31/2001
Acute Care Hospitals
Revenues 11.4% 13.8%
Adjusted Admissions 5.2% 5.0%
Adjusted Patient Days 6.1% 6.0%
Revenue Per Adjusted Admission 5.8% 8.4%
Revenue Per Adjusted Patient Day 4.9% 7.4%
Behavioral Health Hospitals
Revenues 3.5% 7.1%
Adjusted Admissions 7.9% 5.3%
Adjusted Patient Days 4.2% 2.7%
Revenue Per Adjusted Admission -4.1% 1.7%
Revenue Per Adjusted Patient Day -0.7% 4.2%
UHS Consolidated Fourth Quarter Ended Twelve Months Ended
12/31/2001 12/31/2000 12/31/2001 12/31/2000
Revenues $724,162 $614,822 $2,840,491 $2,242,444
EBITDA (net of minority
interest) * $90,181 $74,970 $370,458 $296,605
Cash Flow From Operations $49,398 $25,333 $312,187 $182,454
Days Sales Outstanding 53 56 53 56
Capital Expenditures $41,393 $42,317 $152,938 $113,900
Debt (net of cash) $698,418 $538,208 $698,418 $538,208
Shareholders Equity $807,900 $716,574 $807,900 $716,574
Debt/Total
Capitalization 46.4% 42.9% 46.4% 42.9%
Debt / EBITDA ----- ----- 1.89 1.81
Debt / Cash From
Operations ----- ----- 2.24 2.95
EBITDA Margin ** 13.3% 12.8% 13.7% 13.8%
Acute Care EBITDA Margin *** 15.6% 16.0% 16.0% 16.6%
Behavioral Health EBITDA
Margin *** 16.1% 14.8% 17.4% 16.1%
* Excluding Non-Recurring Charges
** Excluding Non-Recurring Charges and minority interest
*** Before Corporate overhead allocation and minority interest
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SOURCE Universal Health Services, Inc.
CONTACT: Kirk E. Gorman, Chief Financial Officer of Universal Health
Services, +1-610-768-3300
/Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/916225.html
URL: http://www.uhsinc.com
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