Tenet Healthcare Corporation · NYSE:THC
Tenet Healthcare — Q4 2011 Earnings Presentation
12 slides from Tenet Healthcare's earnings presentation, Feb 28, 2012
Slide 1: Q4'11 Earnings Call
Q4’11 Earnings Call February 28, 2012
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements contained in this presentation constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are based on management's curre
Slide 3: 2011 Highlights
2011 Highlights • Achieved 7th consecutive year of improvement in key financial metrics • Represents highest same-hospital revenues, Adjusted EBITDA and Adjusted EBITDA margin since 2003 • Revenues increased 4.6% over 2010 • Adjusted EBITDA increased 9% over 2010 • Adjusted EBITDA margin increased b
Slide 4: Q4'11 Highlights
Q4’11 Highlights • 1.3% increase in Q4’11 adjusted admissions marks 5th consecutive quarter of growth • Emergency Department growth was particularly strong • 3.1% increase in ED visits • 3.3% increase in admissions through the ED • Total surgeries increased by 3.2% and were driven by an even stronge
Slide 5: 2012 Outlook Assumptions
2012 Outlook Assumptions Outlook (02/28/12) Admissions - growth (%) 1.5 – 2.5 Adjusted Admissions - growth (%) 2.0 – 3.0 Inpatient Revenue per Admission – growth (%) 1.5 – 3.0 Outpatient Revenue per Visit - growth (%) 1.0 – 2.0 Net operating revenues (net of bad debt expense) ($Bil) 9.4 – 9.7 Bad de
Slide 6: 2011-2012 EBITDA Walk Forward
2011-2012 EBITDA Walk Forward EBITDA Comments ($mm) 2011 1,145 • Base year Earnings Drivers(1) Outpatient 30 • Performance enhancements plus contribution from 2012 acquisitions Conifer 5 • Building on solid 2011 performance MPI 80 • Existing MPI 2012 Outlook • Accounting change defers recognition of
Slide 7: Health IT incentive payments contribute to aggregate EBITDA growth through 2017
Health IT incentive payments contribute to aggregate EBITDA growth through 2017 Health IT clinical systems drive: • Physician alignment and integration • Reduction of medical errors • Standardization of clinical practice • Cost reduction Incentives 2009 2010 2011 2012 2013 2014 2015 2016 2017 Total
Slide 8: Jan 1- Dec 31, 2012 - Cash Walk Forward
Jan 1- Dec 31, 2012 - Cash Walk Forward ($mm) Low High EBITDA Outlook 1,225 1,350 Add Back: Stock Compensation Charges 25 30 Changes in Cash from Operating Assets and Liabilities (165) (115) Interest Payments (360) (380) Net Operating Cash before Taxes, Litigation and Disc. Ops. 725 885 Income Tax (
Slide 9: 2012 - 2013 EBITDA Walk Forward
2012 - 2013 EBITDA Walk Forward EBITDA Comments ($mm) 2012 Range 1,225 - 1,350 • Base year Outpatient 30 • Enhanced 2013 visibility for acquisitions Conifer 10 • Conifer’s ramp-up is ahead of Jan 2011 assumptions MPI 80 • MPI cost efficiency objectives raised • Incentive payments recognition deferre
Slide 10: 2013 – 2015 EBITDA Walk Forward
2013 – 2015 EBITDA Walk Forward Key Drivers 2015 Improvement in capacity utilization from new federal 2015 EBITDA law, demographics and other factors drive operating EBITDA Margin leverage $2,250 17-19% Full impact of Medicare Performance Initiative $2,250 Additional third party revenues and b
Slide 11: 2013 - 2015 EBITDA Walk Forward
2013 - 2015 EBITDA Walk Forward EBITDA Change (1) ($mm) Fav / (Unfav) Comments 1,335- 2013 Range - • Base year 1,535 • Sufficient incremental visibility into 2013 acquisition pipeline, achieving run Outpatient 20 20 rate in 2014 and 2015 Conifer 45 (5) • Conifer’s 2015 EBITDA contribution unchanged
Slide 12: Reconciliation of EBITDA
Reconciliation of EBITDA Adjusted EBITDA, a non-GAAP term, is defined by the Company as net income attributable to Tenet Healthcare Corporation common shareholders before (1) cumulative effect of changes in accounting principle, net of tax, (2) net income attributable to noncontrolling interests, (3