Tenet Healthcare Corporation · NYSE:THC
Tenet Healthcare — Q3 2015 Earnings Presentation
16 slides from Tenet Healthcare's earnings presentation, Nov 2, 2015
Slide 1: Q3'15 Review
Q3’15 Review November 2, 2015
Slide 2: Forward Looking Statements; Non-GAAP Financial Information
FORWARD LOOKING STATEMENTS Certain statements in this presentation constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements are based on management’s current expectations and involve known and unknown risks,
Slide 3: Financial Highlights – Q3'15
Financial Highlights – Q3’15 Adjusted EBITDA of $566 million, up 23.3% compared to $459 million in Q3’14 Same-Hospital Net Patient Revenue Growth of 6.5% − Admissions declined 0.6% due to a decline in lower acuity admissions − Adjusted admissions increased 0.7% − Revenue per adjusted admission i
Slide 4: Strategic Highlights – Q3'15
Strategic Highlights – Q3’15 Continued Growth of Industry-Leading Ambulatory Services Platform − Strengthened relationships with existing not-for-profit health system partners − Since completing the joint venture with USPI, we have acquired or built additional centers in partnership with Baylor Sc
Slide 5: Capital Deployment and Leverage
Capital Deployment and Leverage Board approved a new $500 million share repurchase authorization − To be funded with proceeds from asset sales; no incremental borrowing will be required − Approval for open market transactions, privately negotiated transactions, or otherwise − Authorization expires
Slide 6: Hospital Operations & Other Segment
Hospital Operations & Other Segment <---------------------------- Restated (1) ----------------------------> <--- As Reported ---> Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Admissions -0.9% 2.8% 3.9% 4.0% 4.9% 1.7% -0.6% Adjusted Admissions 0.1% 3.9% 4.8% 4.3% 5.9% 2.3% 0.7% Revenue Per Adjusted Adm
Slide 7: Uncompensated Care Trends
Uncompensated Care Trends $ in millions Q1'13 Q2'13 Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Bad Debt Expense $359 $391 $415 $348 $380 $320 $249 $356 $363 $352 $371 % of revenue before bad debt 8.5% 9.0% 9.5% 8.2% 8.8% 7.3% 5.6% 7.4% 7.6% 7.3% 7.3% % of adjusted revenue (1) 7.0
Slide 8: Ambulatory Care Segment Volumes
Ambulatory Care Segment Volumes (2) (3) <---------------------- USPI only ----------------------> <-- Pro forma --> (1) Same-facility system-wide growth Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Revenue -0.3% 3.1% 5.1% 8.9% 8.8% 6.9% 10.1% Cases -3.1% -0.4% 2.9% 2.7% 4.7% 6.8% 6.3% Revenue pe
Slide 9: Ambulatory Segment Pro Forma Results
Ambulatory Segment Pro Forma Results $ in millions Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Net operating revenues $259 $286 $287 $308 $295 $322 $329 Equity in earnings of unconsolidated affiliates $18 $28 $27 $43 $21 $28 $31 EBITDA $79 $110 $104 $134 $94 $115 $122 EBITDA margin 30.5% 38.5% 36.2% 4
Slide 10: Conifer
Conifer Delivered 47% EBITDA growth year-to-date 2015 − Conifer remains on track to meet or slightly exceed $260 million of EBITDA in 2015 − Start-up activities related to the new Dartmouth-Hitchcock contract and other customer implementations, as well as ICD-10 roll-out activities are placing modes
Slide 11: Updated Outlook for 2015
Updated Outlook for 2015 Outlook on Outlook on Outlook on $ in millions, except EPS 2/23/2015 8/3/2015 11/2/2015 Net Revenue $17,400 - $17,700 $18,100 - $18,500 $18,350 - $18,550 (1) Adjusted EBITDA $2,050 - $2,150 $2,225 - $2,325 $2,250 - $2,300 EBITDA Margin 11.8% - 12.1% 12.3% - 12.6% 12.3% - 12.
Slide 12: Pro Forma Outlook for 2015
Pro Forma Outlook for 2015 Our pro forma Outlook for 2015 is intended to be a helpful reference point for analysts and investors when projecting Tenet’s financial results in 2016 and beyond. This pro forma Outlook assumes all announced Pro Forma Outlook acquisitions and divestitures occurred on fo
Slide 13: Summary
Summary Drove solid EBITDA and exceptionally strong Adjusted Free Cash Flow in Q3’15 despite slightly lower-than-anticipated volume growth Conifer and USPI continue to drive strong growth, in-line with our expectations Making progress on previously announced acquisitions and divestitures Ann
Slide 14: Appendix
Appendix oe 2)
Slide 15: Items Impacting Q3'15 Results
Items Impacting Q3’15 Results Adjusted EBITDA was negatively impacted by two unanticipated items: − $10 million impact from a water pipe break at Desert Regional Medical Center − $7 million of additional expense from a decrease in the interest rate primarily related to discounted malpractice reser
Slide 16: Vary
Vary fenet