HCA Holdings, Inc. (NYSE: HCA) today announced preliminary financial and
operating results for its first quarter ended March 31, 2017. The
financial results are subject to finalization of the Company’s quarterly
financial and accounting procedures.
HCA anticipates revenues for the first quarter of 2017 to approximate
$10.623 billion compared to $10.260 billion in the first quarter of
2016. Net income attributable to HCA Holdings, Inc. for the first
quarter is expected to approximate $659 million, or $1.74 per diluted
share, compared to $694 million, or $1.69 per diluted share, in the
first quarter of 2016. Adjusted EBITDA for the first quarter of 2017 is
expected to approximate $2.005 billion compared to $2.003 billion in the
previous year’s first quarter. Adjusted EBITDA is a non-GAAP financial
measure. A table reconciling expected net income attributable to HCA
Holdings, Inc. to expected Adjusted EBITDA is included in this release.
Same facility admissions for the first quarter of 2017 increased 1.2
percent, while same facility equivalent admissions increased 1.6 percent
when compared to the first quarter of 2016. Same facility emergency room
visits for the first quarter of 2017 increased 1.1 percent from the
prior year’s first quarter.
Results for the first quarter of 2017 were affected by changes in payer
mix and the loss of one day when compared to the first quarter of 2016.
Same facility Medicare admissions comprised 48.1 percent of the first
quarter 2017 admissions, compared to 47.0 percent in the prior year’s
first quarter. In the first quarter of 2017, same facility managed
care/health exchange admissions comprised 27.4 percent of admissions,
compared to 28.6 percent in the prior year’s first quarter.
Same facility revenue per equivalent admission is expected to increase
approximately 1.7 percent in the first quarter of 2017 compared to the
prior year’s first quarter.
The Company’s financial guidance remains unchanged for the year ending
December 31, 2017.
HCA anticipates reporting its complete financial results for the first
quarter of 2017 on, or about, May 2, 2017.
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 the Company’s expected
results for the first quarter of 2017, the Company’s financial guidance
for the year ending December 31, 2017, as well as other statements that
do not relate solely to historical or current facts, and are subject to
finalization of the Company’s first quarter financial and accounting
procedures. 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 impact of the
Patient Protection and Affordable Care Act, as amended by the Health
Care and Education Reconciliation Act (collectively, the “Health Reform
Law”), including the effects of any repeal of, or changes to, the Health
Reform Law, the possible enactment of additional federal or state health
care reforms and possible changes to 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
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) the emergence and effects related to infectious diseases, (16)
future divestitures which may result in charges and possible impairments
of long-lived assets, (17) changes in business strategy or development
plans, (18) delays in receiving payments for services provided, (19) the
outcome of pending and any future tax audits, disputes and litigation
associated with our tax positions, (20) potential adverse impact of
known and unknown government investigations, litigation and other claims
that may be made against us, (21) the impact of potential cybersecurity
incidents or security breaches, (22) our ongoing ability to demonstrate
meaningful use of certified electronic health record technology, and
(23) other risk factors described in our annual report on Form 10-K for
the year ended December 31, 2016 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.
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Supplemental Non-GAAP Disclosures
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Operating Results Summary
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(Dollars in millions, except per share amounts)
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First Quarter
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2017
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2016
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Revenues
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$
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10,623
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$
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10,260
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Net income attributable to HCA Holdings, Inc.
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$
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659
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$
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694
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Losses (gains) on sales of facilities (net of tax)
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(1
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)
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2
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Legal claim costs (net of tax)
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-
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7
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Net income attributable to HCA Holdings, Inc., excluding losses
(gains) on sales of facilities and legal claim costs(a)
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658
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703
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Depreciation and amortization
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521
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479
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Interest expense
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419
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416
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Provision for income taxes
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289
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288
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Net income attributable to noncontrolling interests
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118
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117
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Adjusted EBITDA(a)
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$
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2,005
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$
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2,003
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Diluted earnings per share:
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Net income attributable to HCA Holdings, Inc.
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$
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1.74
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$
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1.69
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Losses (gains) on sales of facilities
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-
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-
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Legal claim costs
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-
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0.02
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Net income attributable to HCA Holdings, Inc., excluding losses
(gains) on sales of facilities and legal claim costs(a)
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$
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1.74
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$
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1.71
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Shares used in computing diluted earnings per share (millions)
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379.980
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410.575
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(a)
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Net income attributable to HCA Holdings, Inc., excluding losses
(gains) on sales of facilities and legal claim costs, and Adjusted
EBITDA should not be considered as measures of financial performance
under generally accepted accounting principles ("GAAP"). We believe
net income attributable to HCA Holdings, Inc., excluding losses
(gains) on sales of facilities and legal claim costs, and Adjusted
EBITDA are important measures that supplement discussions and
analysis of our results of operations. We believe it is useful to
investors to provide disclosures of our results of operations on the
same basis used by management. Management relies upon net income
attributable to HCA Holdings, Inc., excluding losses (gains) on
sales of facilities and legal claim costs, and Adjusted EBITDA as
primary measures to review and assess operating performance of its
health care facilities and their management teams.
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Management and investors review both the overall performance
(including net income attributable to HCA Holdings, Inc., excluding
losses (gains) on sales of facilities and legal claim costs, and
GAAP net income attributable to HCA Holdings, Inc.) and operating
performance (Adjusted EBITDA) of our health care facilities.
Adjusted EBITDA and the Adjusted EBITDA margin (Adjusted EBITDA
divided by revenues) are utilized by management and investors to
compare our current operating results with the corresponding periods
during the previous year and to compare our operating results with
other companies in the health care industry. It is reasonable to
expect that losses (gains) on sales of facilities and legal claim
costs will occur in future periods, but the amounts recognized can
vary significantly from period to period, do not directly relate to
the ongoing operations of our health care facilities and complicate
period comparisons of our results of operations and operations
comparisons with other health care companies.
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Net income attributable to HCA Holdings, Inc., excluding losses
(gains) on sales of facilities and legal claim costs, and Adjusted
EBITDA are not measures of financial performance under GAAP, and
should not be considered as alternatives to net income attributable
to HCA Holdings, Inc. as a measure of operating performance or cash
flows from operating, investing and financing activities as a
measure of liquidity. Because net income attributable to HCA
Holdings, Inc., excluding losses (gains) on sales of facilities and
legal claim costs, and Adjusted EBITDA are not measurements
determined in accordance with GAAP and are susceptible to varying
calculations, net income attributable to HCA Holdings, Inc.,
excluding losses (gains) on sales of facilities and legal claim
costs, and Adjusted EBITDA, as presented, may not be comparable to
other similarly titled measures presented by other companies.
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HCA Holdings, Inc.
Investor Contact:
Mark Kimbrough, 615-344-2688
or
Media Contact:
Ed Fishbough, 615-344-2810