TMCnet News
IASIS Healthcare Announces Third Quarter 2015 ResultsIASIS Healthcare® LLC ("IASIS" or the "Company") today announced financial and operating results for the fiscal third quarter and nine months ended June 30, 2015. The Company's discontinued operations in the accompanying consolidated financial statements have been excluded from Consolidated Financial and Operating Data and Supplemental Consolidated Statements of Operations Information for the fiscal third quarters and nine month periods ended June 30, 2015 and 2014. Key Financial & Operating Results Third Quarter Fiscal 2015 Revenue for the third quarter totaled $686.3 million, an increase of 8.5% compared to $632.7 million in the prior year quarter. Adjusted EBITDA for the third quarter totaled $63.0 million, an increase of 25.2% compared to $50.3 million in the prior year quarter. Net earnings from continuing operations for the third quarter totaled $1.4 million, compared to a net loss from continuing operations of $11.3 million in the prior year quarter. Included in the Company's operating results for the third quarter were $3.1 million in pre-opening and start-up losses related to the opening of a new hospital campus and $5.9 million in legal settlement and other non-recurring costs. Acute care revenue for the third quarter totaled $474.9 million, an increase of 4.6% compared to the prior year quarter. In the third quarter, admissions increased 0.1% and adjusted admissions increased 2.3%, each compared to the prior year quarter. Adjusting for certain service line closures, in the third quarter, admissions increased 0.9% and adjusted admissions increased 3.1%, each compared to the prior year quarter. Net patient revenue per adjusted admission in the third quarter increased 2.4% compared to the prior year quarter. Premium, service and other revenue in the Company's managed care risk platform for the third quarter totaled $211.4 million, an increase of 18.4% compared to the prior year quarter. Total lives served across all managed care division product lines increased 83.1% to 389,900 at June 30, 2015, which included a 22.2% increase in lives served by the Company's managed Medicaid, Medicare and health insurance exchange plans. For the third quarter, the medical loss ratio ("MLR") associated with premium revenue across all health plans in the Company's managed care risk platform was 87.4%, compared to 97.4% in the prior year quarter. The MLR for the third quarter of fiscal 2014 included increased medical costs associated with newly enrolled childless adult members resulting from the expansion of Arizona's Medicaid program effective January 1, 2014. This newly enrolled childless adult population typically experiences more frequent medical utilization and higher acuity levels prior to effective management of their care. The reduced MLR for the third quarter of fiscal 2015 reflects the financial impact of effectively managing the care of these new members subsequent to their enrollment. Year-to-Date Fiscal 2015 Revenue for the first nine months of fiscal 2015 totaled $2.05 billion, an increase of 10.6% compared to $1.86 billion in the prior year period. Adjusted EBITDA for the first nine months of fiscal 2015 totaled $193.6 million, an increase of 6.9% compared to $181.1 million in the prior year period. Net earnings from continuing operations for the first nine months of fiscal 2015 totaled $9.7 million, compared to a net loss from continuing operations of $6.2 million in the prior year period. Included in the Company's operating results for the first nine months of fiscal 2015 were $3.7 million in pre-opening and start-up losses related to the opening of a new hospital campus and $8.5 million in legal settlement and other non-recurring costs. Acute care revenue for the first nine months of fiscal 2015 totaled $1.41 billion, an increase of 4.2% compared to the prior year period. In the first nine months of fiscal 2015, admissions increased 1.4% and adjusted admissions increased 3.5%, each compared to the prior year period. Net patient revenue per adjusted admission in the first nine months of fiscal 2015 increased 1.0% compared to the prior year period. Premium, service and other revenue in the Company's managed care risk platform for the first nine months of fiscal 2015 totaled $642.3 million, an increase of 27.6% compared to the prior year period. For the first nine months of fiscal 2015, the MLR associated with premium revenue across all health plans in the Company's managed care risk platform was 87.4%, compared to 89.4% in the prior year period. The MLR for the first nine months of fiscal 2015, benefited from reduced medical costs resulting from the care management of childless adult members, who were newly enrolled as a result of the expansion of Arizona's Medicaid program effective January 1, 2014. Cash Flow Analysis Cash flows provided by operating activities for the first nine months of fiscal 2015 totaled $60.0 million, compared to cash flows used in operating activities of $10.5 million in the prior year period. The prior year period was affected by the payment of $22.3 million in income taxes and other transaction costs associated with the Company's sale-leaseback transaction at the end of fiscal 2013. During the first nine months of fiscal 2015, the Company collected $79.8 million in fiscal 2014 receivables related to the Texas Medicaid supplemental reimbursement programs. Cash flows used in investing activities for the first nine months of fiscal 2015 totaled $76.4 million, compared to cash flows used in investing activities of $84.1 million in the prior year period. Included in the first nine months of fiscal 2015 were $42.6 million in proceeds received from the sale of the Company's Nevada operations. Additionally, the Company has spent $28.0 million in the first nine months of fiscal 2015 related to the construction of a new hospital campus, which opened in June 2015. Conference Call A listen-only simulcast of IASIS' third quarter 2015 conference call will be available by clicking the "Investors" link on the Company's Web site at www.iasishealthcare.com beginning at 11:00 a.m. Eastern Time on August 13, 2015. A copy of this press release will also be available on the Company's Web site. IASIS Healthcare is a healthcare services company that seeks to deliver high-quality, cost-effective healthcare through a broad and differentiated set of capabilities and assets that include acute care hospitals with related patient access points and a diversified managed care risk platform. With total annual revenue of approximately $2.6 billion, IASIS, headquartered in Franklin, Tennessee, owns and operates 16 acute care hospitals, one behavioral hospital and multiple other access points, including 144 physician clinics, multiple outpatient surgical units, imaging centers, and investments in urgent care centers and on-site employer-based clinics. Health Choice, the Company's managed care risk platform, delivers services to 389,900 covered lives through its multiple health plans, accountable care networks and agreements to serve as a management services organization ("MSO") with third party insurers. For more information on IASIS, please visit the Company's Web site at www.iasishealthcare.com. Some of the statements we make in this press release are forward-looking within the meaning of the federal securities laws, which are intended to be covered by the safe harbors created thereby. Those forward-looking statements include all statements that are not historical statements of fact and those regarding the Company's intent, belief or expectations including, but not limited to, future financial and operating results, the Company's plans, objectives, expectations and other statements that are not historical facts. Forward-looking statements involve known and unknown risks and uncertainties that may cause actual results in future periods to differ materially from those anticipated in the forward-looking statements. These risk factors and uncertainties are more fully described in Part I, Item 1A. "Risk Factors" of the Company's Annual Report on Form 10-K/A for the fiscal year ended September 30, 2014, and as amended and restated in Part II, Item 1A. "Risk Factors" in the Company's Quarterly Report on Form 10-Q/A for the quarter ended December 31, 2014, filed with the Securities and Exchange Commission ("SEC"), and other filings with the SEC. Although we believe that the assumptions underlying the forward-looking statements contained in this press release are reasonable, any of these assumptions could prove to be inaccurate, and, therefore, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, you should not regard the inclusion of such information as a representation by the Company or any other person that the Company's objectives and plans will be achieved. We undertake no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Adjusted EBITDA represents net earnings (loss) from continuing operations before net interest expense, income tax expense, depreciation and amortization, stock-based compensation, net gain (loss) on disposal of assets, and management fees. Management fees represent monitoring and advisory fees paid to management companies affiliated with TPG and JLL. Management routinely calculates and communicates adjusted EBITDA and believes that it is useful to investors because it is commonly used as an analytical indicator within the healthcare industry to evaluate performance, allocate resources and measure leverage capacity and debt service ability. In addition, the Company uses adjusted EBITDA as a measure of performance for its business segments and for incentive compensation purposes. Adjusted EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from adjusted EBITDA are significant components in understanding and assessing financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to net earnings, cash flows generated by operating, investing, or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. Adjusted EBITDA, as presented, differs from "adjusted EBITDA" as defined under the Company's Senior Secured Credit Facilities and may not be comparable to similarly titled measures of other companies. A table describing adjusted EBITDA and reconciling net earnings (loss) from continuing operations to adjusted EBITDA is included in this press release in the attached Supplemental Consolidated Statements of Operations Information.
(1) Excludes the impact of the Company's Nevada operations, which are reflected in discontinued operations. (2) Represents medical claims expense as a percentage of premium revenue, including claims paid to the Company's hospitals.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150813005311/en/ |