Tenet Healthcare Corporation · NYSE:THC
Tenet Healthcare — Q4 2022 Earnings Presentation
25 slides from Tenet Healthcare's earnings presentation, Feb 9, 2023
Slide 1: 4th Quarter 2022 Earnings Release Presentation
th 4 Quarter 2022 Earnings Release Presentation February 9, 2023
Slide 2: Cautionary Statements
Cautionary Statements This presentation includes “forward looking statements.” These NON-GAAP FINANCIAL INFORMATION statements relate to future events, including, but not limited to, statements regarding our liquidity, operating results, future earnings, financial This presentation contains financia
Slide 3: Fourth Quarter 2022 Highlights
Fourth Quarter 2022 Highlights Fourth Quarter 2022 Achievements ▪ Consolidated Adjusted EBITDA of $897 million, above the midpoint of our fourth quarter Outlook range of $853 million ▪ Fourth quarter 2022 included $40 million of grant income ▪ Ambulatory – Achieved 18.7% Adjusted EBITDA growth exclu
Slide 4: FY 2023 Financial Outlook ($ in millions)
FY 2023 Financial Outlook ($ in millions) Income Available Consolidated Adjusted EBITDA (Loss Attributable) to Tenet Common Shareholders from Continuing Operations $3,469 $3,160 to $3,500 $900 $3,360 $420 to $200 $585 $600 $410 $3,000 $3,032 $2,730 $300 (226) $2,500 $0 ($300) 2019 2022 2023E $2,000
Slide 5: Financial Profile Continues to Improve
Financial Profile Continues to Improve ADJUSTED ADJUSTED ADJUSTED FREE CASH LEVERAGE NET REVENUE EBITDA EBITDA FLOW RATIO $19.9B (a) $3.260B (a) MARGIN 16.4% $1.200B 5.9x 34% (1.8)x 4% $2.440B 360 12.8% 143% bps 4.1x $19.1B $0.493B 2017 2023E 2017 2023E 2017 2023E 2017 2023E 2017 Q4'22 Note: 2023E i
Slide 6: Adjusted EBITDA With and Without Grant Income ($ in millions)
Adjusted EBITDA With and Without Grant Income ($ in millions) $ In millions Q1'21 Q2'21 Q3'21 Q4'21 FY 2021 Q1'22 Q2'22 Q3'22 Q4'22 FY 2022 Adjusted EBITDA Excluding Grant Income Hospital Segment $410 $445 $494 $440 $1,789 $510 $339 $378 $360 $1,587 Ambulatory Segment $244 $275 $272 $343 $1,134 $280
Slide 7: FY 2023 Adjusted EBITDA Outlook Bridge from 2022 ($ in millions)
FY 2023 Adjusted EBITDA Outlook Bridge from 2022 ($ in millions) AMBULATORY HOSPITALS CONIFER CONSOLIDATED 2022 Adjusted EBITDA $1,327 $1,777 $365 $3,469 Grant Income 2022 ($4) ($190) - ($194) Gains on Asset Sales in 2022 - ($114) - ($114) Government Funding Reductions (a) ($21) ($177) - ($198) 2021
Slide 8: USPI
USPI
Slide 9: Track Record of Double-Digit Growth and Strong Margins
Track Record of Double-Digit Growth and Strong Margins Net Revenue ($M) Adjusted EBITDA ($M) $3,600 $1,445 $3,248 $1,327 CAGR CAGR 10.9% 12.9% $1,197 $2,718 $895 $868 $2,085 $2,158 $2,072 $1,940 $792 $699 2017 2018 2019 2020 2021 2022 2023E 2017 2018 2019 2020 2021 2022 2023E Midpoint* Midpoint* Adj
Slide 10: Organic Growth Driven By Best-In-Class Execution
Organic Growth Driven By Best-In-Class Execution 5.3% Same-facility System-wide Organic Growth Rates Driven by Revenue CAGR from 2015-2022 USPI Leadership in Strategy & Execution Established Expertise in 14.5% Starting New Service Lines 9.7% 102 Service Line Additions 6% in 2022 4.4% 4.9% 4.6% Expan
Slide 11: Case Mix / Clinical Quality
Case Mix / Clinical Quality 2022 Case Mix Commitment to Quality Drives Strong Patient Experience Opthalmology 11% All Other Specialties 19% Gastrointestinal 34% Musculoskeletal 96.4 36% Overall Patient Experience Score 11
Slide 12: Acquisitions and De Novos Deliver Significant Returns on Invested Capital
Acquisitions and De Novos Deliver Significant Returns on Invested Capital Total Number of Facilities Achievement of Attractive Returns 2017 – 2022 466 8.0x <5.0x <2.0x Initial Acquisition Exceeded Exceeded Multiple Targeted Acquisition Targeted De Novo Effective Multiple Effective Multiple 267 Dedic
Slide 13: Cash Flow and Capital
Cash Flow and Capital
Slide 14: 2022 Cash Flows Continue to Support Growth
2022 Cash Flows Continue to Support Growth ▪ Our cash flow and balance sheet position us to drive growth and interest savings: ▪ Ample liquidity and access to capital markets to pursue our growth strategy while returning capital to shareholders $1.33B(a) FY2022 Free Cash Flow ▪ Acquisitions: ▪ 7 add
Slide 15: Fourth Quarter 2022 Cash Flow
Fourth Quarter 2022 Cash Flow Net Cash generated (used) by the business in Q4’22 was $106m excluding cash used for transactions as listed in the graph below. 15
Slide 16: Capital Deployment Priorities
Capital Deployment Priorities We prioritize the deployment of the free cash flow generated by our businesses to the following areas: M&A and de novo investments – baseline intention is Investments in our ASC platform $250 million per year Continued investment in technology, robotics, and Investments
Slide 17: Debt Maturity Profile – No Significant Maturities Until Third Quarter 2024
Debt Maturity Profile – No Significant Maturities Until Third Quarter 2024 Maturity Profile as of December 31, 2022 $4,000 $3,450 $3,500 $3,100 $3,000 $3,000 $2,500 $2,100 $2,000 $1,400 $1,500 $1,345 $1,000 $362 $500 $0 2023 2024 2025 2026 2027 2028 2029 2030 2031 $ in millions First Lien Notes Seco
Slide 18: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations NON-GAAP FINANCIAL INFORMATION This presentation contains financial measures that are not in accordance accounting principles generally accepted in the United States of America (GAAP). Reconciliations of these non-GAAP measures to the most comparable GAAP measures an
Slide 19: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #1 – Reconciliations of Net Income Available to Tenet Healthcare Corporation Common Shareholders to Adjusted Net Income Available from Continuing Operations to Common Shareholders (Unaudited) (Dollars in millions, except per share amounts) Three Months Ended T
Slide 20: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #2 – Reconciliations of Net Income Available to Tenet Healthcare Corporation Common Shareholders to Adjusted EBITDA (Unaudited) (Dollars in millions) Three Months Ended Twelve Months Ended December 31, December 31, 2022 2021 2022 2021 Net income available to T
Slide 21: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #3 – Reconciliations of Net Cash Provided by Operating Activities to Free Cash Flow and Adjusted Free Cash Flow from Continuing Operations (Unaudited) (Dollars in millions) 2022 (Dollars in millions) 2021 Q4 Full Year Q4 Full Year Net cash provided by operatin
Slide 22: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #4 – Reconciliations of Outlook Net Income Available to Tenet Healthcare Corporation Common Shareholders to Outlook Adjusted Net Income Available from Continuing Operations to Common Shareholders (Unaudited) (1) The figures shown represent the Company's estima
Slide 23: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #5 – Reconciliations of Outlook Net Income Available to Tenet Healthcare Corporation Common Shareholders to Outlook Adjusted EBITDA (Unaudited) (1) The figures shown represent the Company's estimate for restructuring charges. The Company does not generally for
Slide 24: Supplemental Non-GAAP disclosures
Supplemental Non-GAAP disclosures Table #6 – Reconciliations of Outlook Net Cash Provided by Operating Activities to Outlook Free Cash Flow – Continuing Operations and Outlook Adjusted Free Cash Flow – Continuing Operations (Unaudited) (1) The figures shown represent the Company's estimate for restr
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