News Details

HCA Holdings, Inc. (NYSE: HCA) today announced financial and operating results for the first quarter ended March 31, 2014.

Key first quarter metrics (all percentage changes compare 1Q 2014 to 1Q 2013 unless noted):

• Revenues increased 4.6 percent to $8.832 billion
• Net income attributable to HCA Holdings, Inc. totaled $347 million, or $0.76 per diluted share
• Adjusted EBITDA increased 4.8 percent to $1.644 billion
• Cash flows from operations declined 40.1 percent to $443 million
• Same facility equivalent admissions declined 0.3 percent while same facility admissions declined 0.6 percent
• Same facility revenue per equivalent admission increased 3.7 percent

“We are pleased with results for the first quarter. As expected, healthcare reform had minimal impact on the Company’s first quarter results, however, we remain optimistic regarding the potential long-term benefits,” said R. Milton Johnson, President and Chief Executive Officer of HCA.

Revenues in the first quarter increased to $8.832 billion, compared to $8.440 billion in the first quarter of 2013. Net income attributable to HCA Holdings, Inc. totaled $347 million, or $0.76 per diluted share, compared to $344 million, or $0.74 per diluted share, in the first quarter of 2013. Adjusted EBITDA totaled $1.644 billion compared to $1.568 billion in the first quarter of 2013. Adjusted EBITDA is a non-GAAP financial measure. A table reconciling net income attributable to HCA Holdings, Inc. to Adjusted EBITDA is included in this release.

First quarter 2014 results include gains on sales of facilities of $21 million, or $0.03 per diluted share, and also include legal claim costs of $78 million, or $0.11 per diluted share, for an increase in the estimate of our legal liability in the previously disclosed lawsuit alleging HCA did not make the full level of capital expenditures and uncompensated care agreed to in connection with the purchase of hospitals from Health Midwest in 2003. Results for the first quarter of 2013 include losses on sales of facilities of $16 million, or $0.02 per diluted share, and a loss on retirement of debt of $17 million, or $0.03 per diluted share.

Same facility revenue per equivalent admission increased 3.7 percent in the first quarter of 2014 compared to the first quarter of 2013, reflecting growth in case mix, or acuity, of 2.2 percent on a same facility basis in the quarter.

Same facility equivalent admissions declined 0.3 percent in the first quarter of 2014 compared to the prior year period. Same facility admissions declined 0.6 percent compared to the prior year period. Same facility emergency room visits declined 0.1 percent in the first quarter of 2014, compared to the prior year period. Same facility inpatient surgeries increased 0.9 percent while same facility outpatient surgeries declined 1.7 percent in the first quarter of 2014 compared to the same period of 2013.

During the first quarter of 2014, salaries and benefits, supplies and other operating expenses totaled $7.227 billion, or 81.8 percent of revenues, compared to $6.919 billion, or 82.0 percent of revenues, in the first quarter of 2013.

As of March 31, 2014, HCA Holdings, Inc.’s balance sheet reflected cash and cash equivalents of $850 million, total debt of $28.924 billion, and total assets of $29.809 billion. During the first quarter of 2014, capital expenditures totaled $400 million, excluding acquisitions. Cash flows provided by operating activities in the quarter totaled $443 million compared to $740 million in the first quarter of 2013. The $297 million decline in cash flows from operating activities related primarily to the combined impact of a $170 million decline from changes in working capital items and a $206 million decline from income taxes in the first quarter of 2014 compared to the first quarter of 2013.

As of March 31, 2014, HCA’s leverage ratio as measured by Total Debt/Adjusted EBITDA was 4.35x, compared to 4.32x as of December 31, 2013. As of March 31, 2014, HCA operated 165 hospitals and 115 freestanding surgery centers.

The Company today is reaffirming its previously issued financial guidance ranges for 2014.

Earnings Conference Call

HCA will host a conference call for investors at 9:00 a.m. Central Daylight Time today. All interested investors are invited to access a live audio broadcast of the call via webcast. The broadcast also will be available on a replay basis beginning this afternoon. The webcast can be accessed at: https://event.webcasts.com/starthere.jsp?ei=1033215.

or through the Company’s Investor Relations web page, www.hcahealthcare.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, which involve risks and uncertainties. Forward-looking statements include statements that do not relate solely to historical facts. Forward-looking statements can be identified by the use of words like “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “initiative” or “continue.” These forward-looking statements are based on our current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond our control, which could significantly affect current plans and expectations and our future financial position and results of operations. These factors include, but are not limited to, (1) the impact of our substantial indebtedness and the ability to refinance such indebtedness on acceptable terms, (2) the effects related to the implementation of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the “Health Reform Law”), possible delays in or complications related to implementation of the Health Reform Law, the possible enactment of additional federal or state health care reforms and possible changes to the Health Reform Law and other federal, state or local laws or regulations affecting the health care industry, (3) the effects related to the continued implementation of the sequestration spending reductions required under the Budget Control Act of 2011 (the “BCA”), and related legislation extending these reductions, and the potential for future deficit reduction legislation that may alter these spending reductions, which include cuts to Medicare payments, or create additional spending reductions, (4) increases in the amount and risk of collectability of uninsured accounts and deductibles and copayment amounts for insured accounts, (5) the ability to achieve operating and financial targets, and attain expected levels of patient volumes and control the costs of providing services, (6) possible changes in the Medicare, Medicaid and other state programs, including Medicaid upper payment limit programs or waiver programs, that may impact reimbursements to health care providers and insurers, (7) the highly competitive nature of the health care business, (8) changes in service mix, revenue mix and surgical volumes, including potential declines in the population covered under managed care agreements, the ability to enter into and renew managed care provider agreements on acceptable terms and the impact of consumer driven health plans and physician utilization trends and practices, (9) the efforts of insurers, health care providers and others to contain health care costs, (10) the outcome of our continuing efforts to monitor, maintain and comply with appropriate laws, regulations, policies and procedures, (11) increases in wages and the ability to attract and retain qualified management and personnel, including affiliated physicians, nurses and medical and technical support personnel, (12) the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities, (13) changes in accounting practices, (14) changes in general economic conditions nationally and regionally in our markets, (15) future divestitures which may result in charges and possible impairments of long-lived assets, (16) changes in business strategy or development plans, (17) delays in receiving payments for services provided, (18) the outcome of pending and any future tax audits, appeals and litigation associated with our tax positions, (19) potential adverse impact of known and unknown government investigations, litigation and other claims that may be made against us, (20) our ongoing ability to demonstrate meaningful use of certified electronic health record technology and recognize income for the related Medicare or Medicaid incentive payments, and (21) other risk factors described in our annual report on Form 10-K for the year ended December 31, 2013 and our other filings with the Securities and Exchange Commission. Many of the factors that will determine our future results are beyond our ability to control or predict. In light of the significant uncertainties inherent in the forward-looking statements contained herein, readers should not place undue reliance on forward-looking statements, which reflect management’s views 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.

All references to “Company” and “HCA” as used throughout this release refer to HCA Holdings, Inc. and its affiliates.

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HCA Holdings, Inc.
Investor Contact:
Mark Kimbrough, 615-344-2688
or
Media Contact:
Ed Fishbough, 615-344-2810