HCA's first-quarter 2010 revenues increased to $7.544 billion

May 7 2010

HCA Inc. today announced financial and operating results for its first quarter ended March 31, 2010.

First Quarter Summary:

• Revenues increased to $7.544 billion compared to $7.431 billion in the first quarter of 2009.  Charity care and uninsured discounts, which reduce our reported revenues, increased to $1.581 billion in the first quarter compared to $1.108 billion in the prior year's first quarter.
• Net income attributable to HCA Inc. totaled $388 million, compared to $360 million in the prior year's first quarter.
• Adjusted EBITDA totaled $1.574 billion, compared to $1.457 billion in the first quarter of 2009.
• Provision for doubtful accounts declined to $564 million, from $807 million in the prior year.
• Interest expense increased to $516 million, from $471 million in the first quarter of 2009.
• Same facility equivalent admissions increased 1.1 percent, and same facility admissions increased 0.9 percent in the first quarter compared to the first quarter of 2009.
• Revenue per equivalent admission increased 0.6 percent and reflects the impact of the increased charity care and uninsured discounts.  Cash revenue per equivalent admission increased 4.5 percent in the quarter compared to the prior year.
• Total surgeries, on a same facility basis, declined 1.3 percent from the previous year's first quarter.

Revenues in the first quarter of 2010 totaled $7.544 billion, compared to $7.431 billion in the first quarter of 2009.   Cash revenues increased 5.4 percent in the first quarter to $6.980 billion from $6.624 billion in the same period last year.  Cash revenues is a non-GAAP measure and reflects the Company's reported revenues less provision for doubtful accounts (bad debt).   Net income attributable to HCA Inc. for the first quarter of 2010 totaled $388 million, compared to $360 million in the prior year's first quarter.  Adjusted EBITDA in the quarter totaled $1.574 billion, compared to $1.457 billion in the previous year's first quarter.  Tables describing Adjusted EBITDA and cash revenues and reconciling net income attributable to HCA Inc. to Adjusted EBITDA, and reported revenues to cash revenues, for these periods are included in this release.   Results for the first quarter of 2010 include impairments of long-lived assets of $18 million while results for the first quarter of 2009 include losses on sales of facilities of $5 million and impairments of long-lived assets of $9 million.

The Company's provision for doubtful accounts declined to $564 million, or 7.5 percent of revenues, in the first quarter of 2010 from $807 million, or 10.9 percent of revenues, in the first quarter of 2009, primarily due to a $473 million increase in charity care and uninsured discounts in the first quarter of 2010 compared to the prior year.

The sum of the provision for doubtful accounts, uninsured discounts and charity care, as a percentage of the sum of revenues, uninsured discounts and charity care was 23.5 percent for the first quarter of 2010 compared to 22.4 percent for the first quarter of 2009.  Same facility uninsured admissions increased 6.8 percent in the first quarter of 2010 compared to the prior year's first quarter.  Same facility uninsured admissions comprised 6.4 percent of total admissions in the first quarter of 2010 compared to 6.0 percent in the first quarter of 2009.

During the first quarter of 2010, salaries and benefits, supplies and other operating expenses totaled $5.474 billion compared to $5.235 billion in the first quarter of 2009, an increase of 2.1 percent as a percent of revenues.  

Interest expense increased to $516 million in the first quarter of 2010, compared to $471 million in the same period of 2009, due primarily to an increase in the average effective interest rate on our outstanding debt.

Same facility admissions increased 0.9 percent and same facility equivalent admissions increased 1.1 percent in the first quarter of 2010 compared to the prior year's first quarter.  Same facility inpatient surgeries declined 0.4 percent and outpatient surgeries declined 1.8 percent in the first quarter of 2010 compared to the first quarter of 2009.  Revenue per equivalent admission increased 0.6 percent in the first quarter of 2010 compared to the first quarter of 2009 and reflects the impact of the increased uninsured discounts and charity care, which reduce our reported revenues.  Cash revenue per equivalent admission increased 4.5 percent in the first quarter of 2010 compared to the first quarter of 2009.

As of March 31, 2010, HCA's balance sheet reflected cash and cash equivalents of $388 million, total debt of $26.855 billion, and total assets of $24.091 billion.  During the first quarter of 2010, capital expenditures totaled $214 million.  Net cash provided by operating activities totaled $901 million in the first quarter of 2010 compared to $615 million in the prior year. The $286 million increase was due primarily to a $239 million decline in net income taxes paid.

HCA's Board of Directors has declared a distribution to the Company's existing stockholders and holders of vested stock options.   The distribution is $5.00 per share and vested stock option, or approximately $500 million in the aggregate, and will be paid on May 14, 2010 to holders of record on May 6, 2010.  The distribution will be funded using funds available under our existing senior secured revolving credit facilities.

As of March 31, 2010, HCA operated 162 hospitals and 106 freestanding surgery centers (including eight hospitals and eight freestanding surgery centers operated through equity method joint ventures).

SOURCE HCA Inc.