Tenet Healthcare Corporation · NYSE:THC
Tenet Healthcare — UBS Global Healthcare Conference 2020
20 slides from Tenet Healthcare's conference presentation, May 19, 2020
Slide 1: UBS Global Healthcare Conference
UBS Global Healthcare Conference May 19, 2020
Slide 2: Cautionary Statements
Cautionary Statements FORWARD-LOOKING STATEMENTS This presentation includes “forward-looking statements.” These statements relate to future events, including, but not limited to, statements regarding our liquidity, operating results, future earnings, financial position, operational and strategic ini
Slide 3: Pre COVID-19 Status
Pre COVID-19 Status • Hospital Segment Was Ahead of Budget Admissions Up 1.1% Outpatient Visits Up 5.5% ED Visits Up 6% • USPI Service Line Expansions in 2019 Higher Acuity Procedures One of The Highest Performances to Date in Surgical Net Revenue Per Case Growth Effective Ramp Up of A
Slide 4: Pandemic Actions
Pandemic Actions • Mid February Began to Acquire Additional PPE • Developed Ventilator Management System • Established Clear National Rapid Resupply Distribution Plan • Identified Staffing Options to Fill Potential Gaps Used Tenet Resource Staffing Agency Identified Available Nurses to Travel to
Slide 5: Pandemic Actions, continued
Pandemic Actions, continued • Significant Volume Drop Across Hospitals And USPI in April Admissions ~33%; Hospital Surgeries ~55%; USPI ~80% • Furloughed ~10% of workforce including 3% of Hospital Field Ops Maintained Necessary Emergency And COVID Staffing Capabilities in Anticipation of Surge
Slide 6: Pandemic Recovery
Pandemic Recovery • Year-over-Year Volume Decline Trends in May Have Improved since April % of Pre-COVID Levels - Hospital Admissions ~80%; Hospital Surgeries ~80%; USPI ~70% • Coordinating Comprehensive Recovery Effort • Focus on Individual Physicians’ Schedules Methodical OR, Procedure and Dia
Slide 7: Pandemic Recovery, continued
Pandemic Recovery, continued • Plans Being Developed to Address Potential Return of COVID-19 Isolate Patients to a Single Facility, or Wing/Area, Where Possible Provide Limited Access and Designate Access for Potential COVID Patients Transparent in Communications and Reporting Protect Patien
Slide 8: Financial Comments
Financial Comments • Responsibly, but also Rapidly Managed Cost Profile Furlough and Flexing Schedules Across Enterprise Supply, inventory and other purchased services reductions Reduction of CAPEX by ~$300M Issued $700M Secured Notes Increased Revolver by $400M to $1.9B CARES Act Contri
Slide 9: 1Q20 Financial Results – Overview
1Q20 Financial Results – Overview • Through February, we were performing well and producing strong operating results, with Adjusted EBITDA $40 million better than budget. • However, due to the COVID-19 shelter-at-home conditions that went into effect in most geographies in the back half of March and
Slide 10: 1Q20 Financial Results – Summary
1Q20 Financial Results – Summary Net Income and Earnings Per Share • 1Q20 net income from continuing operations of $94 million, or $0.89 per diluted share, compared to a net (loss) of $(20) million, or $(0.19) per diluted share, in 1Q19 1Q20 results included a $91 million favorable tax adjustment,
Slide 11: 1Q20 Financial Results – Summary, continued
1Q20 Financial Results – Summary, continued Patient volumes – QoQ declines due to COVID-19 • Same-hospital admissions decline of (4.5%); admissions declined (25%) in the back half of March • Same-hospital adjusted admissions decline of (4.9%) • Ambulatory Care segment – same-facility, system-wide su
Slide 12: EBITDA and EBITDA less facility-level NCI by Segment
EBITDA and EBITDA less facility-level NCI by Segment Hospital Operations and other EBITDA ($M) Ambulatory EBITDA ($M) $400 $347 $342 $200 $177 $156 $300 $260 $150 Ambulatory less facility-level NCI EBITDA ($M) $129 $200 $100 $150 $100 $82 $50 $112 $27 $100 $100 $81 $0 $0 1Q19 1Q20 QTD March 1Q19 1Q2
Slide 13: Liquidity Update
Liquidity Update • We currently have sufficient cash resources and available liquidity under our line-of-credit facility. As of Monday, May 18th we had approximately $2.440 billion of excess cash on hand and no borrowings outstanding under our $1.9 billion line of credit facility. We amended our l
Slide 14: Liquidity Update, continued
Liquidity Update, continued • Additional liquidity opportunities: The anticipated proceeds from the sale of our Memphis hospitals in 2020 (~$350 million) Relief potentially available to us under the $2 trillion CARES Act and other regulatory relief including: o Disbursements of the remaining $12
Slide 15: Executive Summary
Executive Summary • Pre COVID-19 Performance Continued The Strong Operating Momentum From 2019 • Have Experienced Significant Drop in Volume Across Hospitals and USPI Due to Stay At Home Orders and Decline in Elective Procedures • Acted Swiftly to Protect Employees and Patients • Bolstered Balance S
Slide 16: Questions and Answers
Questions and Answers Ron Rittenmeyer Executive Chairman and CEO Saum Sutaria President and COO Dan Cancelmi EVP and Chief Financial Officer 16
Slide 17: GAAP to non-GAAP Reconciliations
GAAP to non-GAAP Reconciliations NON-GAAP FINANCIAL INFORMATION This presentation contains financial measures that are not in accordance with Generally Accepted Accounting Principles (GAAP). Reconciliations of these non-GAAP measures to the most comparable GAAP measures and management’s reasoning fo
Slide 18: Tenet Healthcare Corporation
Tenet Healthcare Corporation Additional Supplemental Non-GAAP disclosures Reconciliation of Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Adjusted Net Income Available from Continuing Operations to Common Shareholders (Unaudited) (Dollars in millions
Slide 19: Tenet Healthcare Corporation
Tenet Healthcare Corporation Additional Supplemental Non-GAAP disclosures Reconciliation of Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Adjusted EBITDA (Unaudited) (Dollars in millions) 1Q 20 1Q 19 Net income available (loss attributable) to Tenet
Slide 20: Tenet Healthcare Corporation
Tenet Healthcare Corporation Additional Supplemental Non-GAAP disclosures Reconciliations of Net Cash Provided by Operating Activities to Free Cash Flow and Adjusted Free Cash Flow from Continuing Operations (Unaudited) (Dollars in millions) 1Q 20 1Q 19 Net cash provided by operating activities $ 12
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