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Universal Health Services, Inc. Announces 30% Increase
In Net Income
Universal Health Services, Inc. has announced today its final results for
the fourth quarter and full year ended December 31, 2001. Net income for
the year was $99.7 million or $1.60 per share (diluted) after recording pretax
non recurring charges of $49 million or $.46 per share (diluted) after tax.
Net income increased for the ninth consecutive year. Excluding the nonrecurring
charges, earnings per share (diluted) for the year ended December 31, 2001
were $2.06, a 30% increase from the earnings recorded in the full year of
2000. Net revenues for the year ended December 31, 2001 were $2.8 billion,
a 27% increase from prior year. Earnings before interest, depreciation and
amortization, nonrecurring charges and income taxes were $370 million,
representing a 25% increase from the prior year. Shareholders' equity at
year-end was $808 million and debt, net of cash balances, was $698 million.
Net income for the quarter ended December 31, 2001 was
$.9 million, or $.02 per share (diluted) including the unfavorable nonrecurring
pretax charges of $49 million or $.46 per share after tax. Earnings before
interest, depreciation and amortization, nonrecurring charges and income
taxes were $90 million, representing a 20% increase from the prior year quarter.
They recorded three unusual charges in the fourth quarter
of 2001. As previously disclosed, the Company took a pretax $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 pretax extraordinary expense of $1.6 million, or $.01 per share
after tax, for the early termination of a $135 million, 83/4% note issued
in 1995. The Company also recorded a pretax 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. Back to TOC.
HCA Shares Fall after Wall St Journal Report
Shares of HCA Inc., the largest U.S. hospital chain, fell more than 5 percent
after the Wall Street Journal reported that the Medicare fraud charges facing
the company may be more serious than previously thought. The paper's "Heard
on the Street" column cited HCA's move to prevent U.S. Justice Department
attorneys and whistleblowers from deposing former and current employees in
the company's remaining civil cases over Medicare fraud.
Whistleblower attorneys told the paper that HCA could
pay damages of $2 billion for the remaining Medicare billing problems, which
include allegations of physician kickbacks. Analysts dispute that figure,
suggesting HCA could settle the case for $200 million to $400 million and
that the company has the financial capabilities to do so.
"If you look at past history, the government has had
difficulty trying to prove Medicare fraud," Dirnagl said. He notes that the
government has been investigating this matter since 1993 and HCA had already
paid $840 million, including $95 million in criminal fines, to settle three
of the charges.
HCA Inc. is negotiating with the U.S. government to
settle two civil charges, Chief Executive Jack Bovender told CNBC Friday.
"We've settled...all of the criminal charges against the company, " he said,
" and three out of five of the civil charges, and (we) are in active negotiations
with the government to resolve all those issues now." Bovender said he would
like to resolve the issues "as soon as its humanly possible to do" through
negotiations and avoid any litigation. The chairman also said there is a
"reasonable (financial) range" in which the healthcare firm believes it can
settle the final issues. Back to TOC.
Health Management Associates, Inc. & Manor Care, Inc.
Own Jointly
Health Management Associates, Inc. and Manor Care, Inc. to operate the two
hospitals located in Mesquite, Texas. The 172-bed Mesquite Community Hospital,
now owned by Manor Care, Inc. and the 176bed Medical Center of Mesquite acquired
by HMA on December 31, 2001. HMA will own 80% of the two hospitals and will
be responsible for the operations of the two facilities. This transaction
is expected to be completed on or before June 1, 2002.
This hospital represents HMA's fifth acquisition of
fiscal year 2002, and these two hospitals represent approximately $130$140
million of net revenue. Mesquite, Texas serves a population of approximately
120,000 and has experienced more than 20% growth since 1990.
HMA is a large, owner operator of general acute care
hospitals, primarily in second tier communities in the Southeast and Southwest.
They will operate 43 hospitals in 14 states with 5,968 licensed beds. HMA
has experienced 13 years of uninterrupted operating earnings growth.
Back to TOC.
Province Shares Take a Hit After Outlook
Shares of rural hospital operator Province Healthcare Co. fell more than
11 percent after the company's forecasts for 2002 earnings and admissions
trends were not as high as investors had hoped, news that also sent other
hospital stocks lower.
The Brentwood, Tennessee-based company is expecting
36 percent earnings per share growth to $1.37 in 2002, compared with the
$32.9 million, or $1.01 a share earned for 2001 that the company last reported.
The 2002 estimate includes an accounting change that reduced goodwill expenses.
Province is also forecasting admissions growth of 1
percent to 3 percent at hospitals open more than a year for 2002 after a
0.2 percent increase in the fourth quarter, the hospital said.
Back to TOC.
Children's Comprehensive Services and
Ameris Acquisition, Inc. Complete Merger
Children's Comprehensive Services, Inc. announced the completion of its
previously announced merger with Ameris Acquisition, Inc. ("Ameris"). As
a result, each outstanding share of CCS common stock has been converted into
the right to receive $6.00 in cash, without interest.
The Company's exchange agent will mail to each CCS
shareholder a letter of transmittal and instructions for surrendering CCS
stock certificates in exchange for cash. CCS shareholders should not submit
stock certificate for exchange until receipt of the letter of transmittal
and the instructions referred to above. CCS's common stock ceased trading
on the NASDAQ at the close of business today.
Children's Comprehensive Services provides education,
treatment and juvenile justice services for at-risk and troubled youth either
directly or through management contracts. It currently offers these services
through the operation and management of nonresidential specialized education
programs and day treatment programs and both open and secured residential
treatment centers to approximately 3,200 youth in 14 states.
Back to TOC.
LifePoint Reports 68.8% and 66.7%
Increase in EPS for Fourth Q and Year, Respectively
Fourth Quarter Highlights
Continuing strong financial performance Quarterly EPS of $0.27 compared with
$0.16 in the prior year EBITDA margin increased to 21.5%, a 60bp increase
over prior year Increase in same-hospital revenues of 8.7% Increase in
same-hospital EBITDA of 13.7% Increase in same-hospital admissions of 3.6%
Increase in same-hospital equivalent admissions of 4.6% Completed acquisitions
of 116bed Ville Platte Medical Center and 118bed Athens Regional Medical
Center
2001 Highlights
Annual EPS of $0.90 compared with $0.54 in the prior year EBITDA margin increased
to 21.2%, a 220bp increase over prior year Raised approximately $100 million
through a secondary offering in March 2001 Fully repaid all outstanding bank
borrowings Completed a $200 million, five-year amended and restated credit
agreement Cont. at Top of Column 2.
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In This Issue--Also See
Archive
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UHS Announces Income Surge
-
Universal Health Services, Inc. has announced today its final results for
the fourth quarter...
-
HCA Stock Falls on Wall St. News
-
Shares of HCA Inc., the largest U.S. hospital chain, fell more than 5 percent...
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HMA & Manor Care Joint Venture
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Health Management Associates, Inc. and Manor Care, Inc. to operate the two
hospitals located in Mesquite...
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Province Shares Dive on Dim Forecast
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Shares of rural hospital operator Province Healthcare Co. fell more than
11 percent after...
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CCS Merges with AAI
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Children's Comprehensive Services, Inc. announced the completion of its
previously announced merger with Ameris...
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LifePoint Posts Lively Q4 & Year
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Continuing strong financial performance Quarterly EPS of $0.27 compared with
$0.16 in the prior year...
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Magellan Stays on Course in Rough Year
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Magellan Health Services, Inc., reported operating results for the first
quarter of fiscal year 2002...
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Trigon Profits Healthy
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Trigon Healthcare Inc., Virginia's largest managed health care company, said
its net profit nearly doubled...
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Tenet Not Tenative in Tender Offer
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Tenet Healthcare Corporation has launched a tender offer for its 8 1/8 %
Senior Subordinated Notes
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US Onclocgy Q4 & Year-End Results
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US Oncology Inc. announced results for the fourth quarter ended Dec. 31,
2001.
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Continued from Bottom Column 1.
LifePoint Hospitals, Inc. operates 23 hospitals in non-urban areas. In most
cases, the LifePoint facility is the only hospital in its community. LifePoint's
non-urban operating strategy offers continued operational improvement by
focusing on its five core values; delivering high quality patient care,
supporting physicians, creating excellent workplaces for its employees, providing
community value, and ensuring fiscal responsibility. Headquartered in Brentwood,
Tennessee, LifePoint Hospitals is affiliated with over 6,000 employees.
Back to TOC.
Magellan Health Services Announces First Quarter 2002 Financial
Results
Magellan Health Services, Inc., reported operating results for the first
quarter of fiscal year 2002. The company reported net revenues for the quarter
of $444.8 million and segment profit (net revenues less cost of care, direct
service costs and other operating expenses plus equity in earnings of
unconsolidated subsidiaries) of $52.9 million. In the prior year quarter,
the company recorded revenues of $445.9 million and segment profit of $71.3
million. As disclosed last year, the prior year quarter included certain
nonrecurring items, including the favorable settlement of a pricing adjustment
under one of the company's TRICARE contracts. Excluding these nonrecurring
items, prior year quarterly revenues were $425.5 million and segment profit
was $56.5 million.
Income from continuing operations was $8.7 million or
$0.21 per share for the quarter on a fully diluted basis. Adjusted income
from continuing operations, which excludes restructuring charges in the current
quarter of approximately $4.5 million pretax, was $11.3 million or $0.27
per share. Adjusted income from continuing operations was positively impacted
by $6.8 million (net of tax) related to the adoption by the company in the
quarter of Statement of Financial Accounting Standards No. 142, under which
goodwill is no longer amortized.
Cash flow from operations for the quarter was $24.1
million compared to $22.3 million in the prior year quarter. The company
ended the quarter with $47.4 million in unrestricted cash, restricted cash
of $132.5 million and approximately $110.9 million of availability, and no
drawings, on its revolving credit facility. Headquartered in Columbia, Md.,
Magellan Health Services, Inc. (NYSEMGL news), is the country's leading
behavioral-managed care organization, serving approximately 70 million
individuals nationwide. Back to TOC.
Trigon 4 Quarter Profits Rise
Trigon Healthcare Inc., Virginia's largest managed health care company, said
its net profit nearly doubled on strong enrollment growth in its benefit
plans, and raised its 2002 profit forecast.
The Richmond, Virginia-based company is among a number
of health insurers that have posted strong fourth-quarter results and now
expect better profit growth in the year ahead. These companies have raised
the premium rates they charge employers to keep ahead of soaring medical
expenses.
Trigon, which provides health benefits to about 2 million
members through Blue Cross and Blue Shield plans, said net income in the
fourth quarter rose $41.4 million, or $1.13 a share, from $21 million, or
54 cents a share, a year ago. Trigon has added 122,606 new members during
2001, a 6.1 percent increase in enrollment. Back to
TOC.
Tenet Launches $841 Million Tender Offer
Tenet Healthcare Corporation has launched a tender offer for its 8 1/8 %
Senior Subordinated Notes due 2008. The company is tendering, with a consent
solicitation, for all $841,080,000 of its 8 1/8 % Senior Subordinated Notes
due Dec. 1, 2008 that are currently outstanding. The purchase price to be
paid for each $1,000 principal amount tendered will be based on a fixed spread
of 50 basis points over the yield of the 4.25% U.S. Treasury Note due May
31, 2003. The tender offer for the senior subordinated notes is expected
to remain open until 5 p.m. EST on April 3, 2002.
Concurrent with the tender offer for the senior subordinated
notes, Tenet is soliciting consents to eliminate or modify substantially
all of the restrictive covenants in the indenture governing the notes so
that they conform to those governing Tenet's other senior debt. Tenet will
pay $20 per $1,000 principal amount to the holders of the notes described
above who tender their notes and deliver their consents at or prior to 500
p.m. EST on March 19, 2002. This payment is included in the amounts cited
above.
The tender offer is contingent upon the holders of a
majority in aggregate principal amount of the series of notes consenting
to the indenture amendments. Tendered notes may be withdrawn at any time
prior to the satisfaction of this consent condition.
Proceeds from the sale of Tenet's 6.5% Senior Notes
and amounts available to Tenet from cash on hand and from the company's borrowing
facilities will be sufficient to pay for all securities purchased pursuant
to the tender offer. Back to TOC.
US Oncology Reports Fourth Quarter and Year-end Results
for 2001
US Oncology Inc. announced results for the fourth quarter ended Dec. 31,
2001.
Net patient revenue for the quarter was $498.0 million,
an increase of 4.6 percent over the third quarter and up 10.2 percent year
over year. The Company's revenue (net patient revenue less amounts retained
by physicians) for the quarter was $385.8 million, an increase of 3.5 percent
over the third quarter and up 8.4 percent year over year.
Net income for the fourth quarter was $12.8 million,
or $0.13 per diluted share, compared to $12.9 million, or $0.13 per diluted
share, in the third quarter and $11.9 million, or $0.12 per diluted share,
for the same period in 2000, excluding unusual charges. Including unusual
charges, net loss for the fourth quarter of 2000 was $123.3 million or ($1.25)
per diluted share.
Additional key results since the third quarter that
contributed to US Oncology's strong financial position included an increase
in operating cash flow to $55.1 million for the fourth quarter, compared
to $53.4 million for the third quarter and $16 million for the same period
in 2000. A decrease in accounts receivable days outstanding to 50 as of Dec.
31, 2001, down from 56 at the end of the third quarter and 67 at the end
of 2000. An increase in field EBITDA to $169.1 million during the fourth
quarter, up from $158.5 million for the third quarter of 2001 and $156.9
million for the fourth quarter of 2000. Relatively flat EBITDA for the fourth
quarter at $44.6 million, compared to $43.4 million sequentially, and $44.8
million for the fourth quarter of 2000. The opening of five cancer centers
and the installation of eight Positron Emission Tomography (PET) imaging
units in 2001. The completion of a private placement of $175 million aggregate
principal amount of unsecured senior subordinated notes in the first quarter
of 2002. Net proceeds of the offering were used to repay existing senior
debt and for general business purposes.
US Oncology, headquartered in Houston, Texas, is affiliated
with over 850 physicians operating in over 450 locations, including 77 outpatient
cancer centers, in 27 states. Back to TOC.
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