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): July 21, 2003
UNIVERSAL HEALTH SERVICES, INC.
(Exact name of registrant as specified in its charter)
| DELAWARE | 1-10765 | 23-2077891 | ||
| (State or other jurisdiction of Incorporation or Organization) |
(Commission File Number) | (I.R.S. Employer Identification No.) |
| UNIVERSAL CORPORATE CENTER 367 SOUTH GULPH ROAD KING OF PRUSSIA, PENNSYLVANIA |
19406 | |
| (Address of principal executive office) | (Zip Code) |
Registrant’s telephone number, including area code (610) 768-3300
Not Applicable
(Former name or former address, if changed since last report)
| Item 7. | Financial Statements and Exhibits. |
(c) Exhibits. 99.1 Universal Health Services, Inc. Press Release dated July 21, 2003
| Item 9. | Regulation FD Disclosure |
On July 21, 2003, Universal Health Services, Inc. (the “Company”) issued its 2003 second quarter earnings release. A copy of the Company’s press release is furnished as an exhibit to this Form 8-K and is incorporated herein by reference. The information contained in this report on Form 8-K is being furnished pursuant to Item 12 under Item 9 of Form 8-K as directed by the U.S. Securities and Exchange Commission in Release No. 34-47583.
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/ ALAN B. MILLER | |
| Name: | Alan B. Miller | |
| Title: | President and Chief Executive Officer | |
| By: |
/s/ STEVE FILTON | |
| Name: | Steve Filton | |
| Title: | Vice President, Chief Financial Officer and Controller | |
Date: July 22, 2003
Exhibit Index
| Exhibit No. |
Exhibit | |
| 99.1 | Press release, dated July 21, 2003 | |
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
| CONTACT: |
Steve Filton | July 21, 2003 | ||
| Chief Financial Officer | ||||
| 610-768-3300 |
UNIVERSAL HEALTH SERVICES, INC. REPORTS
SECOND QUARTER EPS GROWTH OF 19%
KING OF PRUSSIA, PA—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 9:00AM 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.
(more)
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, 2003 |
December 31, 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)
| Same Store: | % Change Quarter Ended 06/30/2003 |
% Change 6 mos. ended 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 | % | ||
| Second Quarter Ended |
Six months Ended |
|||||||||||||||
| UHS Consolidated | 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 hosoital 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 hosoital and Residential Center are excluded in both current and prior years. |