FRANKLIN, Tenn.– IASIS Healthcare® LLC (“IASIS” or the “Company”) today announced financial and operating results for the fiscal first quarter ended December 31, 2014. The Company’s discontinued operations in the accompanying consolidated financial statements have been excluded from Consolidated Financial and Operating Data and Supplemental Consolidated Statements of Operations Information for the fiscal first quarters ended December 31, 2014 and 2013.
Key Financial & Operating Results
First Quarter Fiscal 2015
Total revenue for the first quarter totaled $686.7 million, an increase of 15.2% compared to $595.9 million in the prior year quarter. Adjusted EBITDA for the first quarter totaled $73.9 million, an increase of 15.3% compared to $64.1 million in the prior year quarter. Net earnings from continuing operations for the first quarter totaled $8.9 million, compared to $1.9 million in the prior year quarter.
Acute care revenue for the first quarter increased 4.6% compared to the prior year quarter. In the first quarter, admissions increased 3.1% and adjusted admissions increased 4.0%, each compared to the prior year quarter. Net patient revenue per adjusted admission in the first quarter increased 1.2% compared to the prior year quarter.
Premium and service revenues in our managed care risk platform for the first quarter, excluding the effect of $2.9 million of revenue associated with the federal health insurer fee, increased 44.5% compared to the prior year quarter. Total lives served across all managed care product lines increased 75.4% to 337,700, compared to 192,500 in the prior year quarter, while health plan lives increased 19.7% compared to the prior year quarter.
Cash Flow Analysis
Cash flows used in continuing operations for the first quarter ended December 31, 2014, totaled $11.2 million, compared to cash flows used in continuing operations of $61.2 million in the prior year quarter. Cash flows used in continuing operations for the quarter ended December 31, 2013, were affected by the payment of $22.3 million in income taxes and other transaction costs associated with the sale-leaseback of certain hospital real estate, along with delays in certain Texas and Arizona supplemental reimbursement.
“We are pleased with our first quarter results, which included improvements in volumes, revenue and EBITDA. Our results were driven by growth in our managed care services, as well as continued improvements in payor mix and local economic factors in our acute care markets,” said IASIS Healthcare President and Chief Executive Officer Carl Whitmer.
A listen-only simulcast of IASIS’ first quarter 2015 conference call will be available by clicking the “For Investors” link on the Company’s Web site at www.iasishealthcare.com beginning at 11:00 a.m. Eastern Time on February 10, 2015. A copy of this press release will also be available on the Company’s Web site.
IASIS Healthcare is a healthcare services company that seeks to deliver high-quality, cost-effective healthcare through a broad and differentiated set of capabilities and assets that include acute care hospitals with related patient access points and a diversified managed care risk platform. With total annual revenue of approximately $2.5 billion, IASIS, headquartered in Franklin, Tennessee, owns and operates 15 acute care hospitals, one behavioral hospital and multiple other access points, including 136 physician clinics, multiple outpatient surgical units, imaging centers, and investments in urgent care centers and on-site employer-based clinics. Health Choice, the Company’s managed care risk platform, delivers services to more than 337,000 covered lives through its multiple health plans, accountable care networks and agreements to serve as a management services organization (“MSO”) with third party insurers. For more information on IASIS, please visit the Company’s Web site at www.iasishealthcare.com.
Some of the statements we make in this press release are forward-looking within the meaning of the federal securities laws, which are intended to be covered by the safe harbors created thereby. Those forward-looking statements include all statements that are not historical statements of fact and those regarding our intent, belief or expectations including, but not limited to, future financial and operating results, the Company’s plans, objectives, expectations and other statements that are not historical facts. Forward-looking statements involve known and unknown risks and uncertainties that may cause actual results in future periods to differ materially from those anticipated in the forward-looking statements. These risk factors and uncertainties are more fully described in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2014, and other filings with the Securities and Exchange Commission.
Although we believe that the assumptions underlying the forward-looking statements contained in this press release are reasonable, any of these assumptions could prove to be inaccurate, and, therefore, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, you should not regard the inclusion of such information as a representation by the Company or any other person that our objectives and plans will be achieved. We undertake no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.
Adjusted EBITDA represents net earnings from continuing operations before net interest expense, income tax expense, depreciation and amortization, stock-based compensation, net gain (loss) on disposal of assets, and management fees. Management fees represent monitoring and advisory fees paid to management companies affiliated with TPG and JLL. Management routinely calculates and communicates adjusted EBITDA and believes that it is useful to investors because it is commonly used as an analytical indicator within the healthcare industry to evaluate performance, allocate resources and measure leverage capacity and debt service ability. In addition, the Company uses adjusted EBITDA as a measure of performance for its business segments and for incentive compensation purposes. Adjusted EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from adjusted EBITDA are significant components in understanding and assessing financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to net earnings, cash flows generated by operating, investing, or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. Adjusted EBITDA, as presented, differs from “adjusted EBITDA” as defined under the Company’s Senior Secured Credit Facilities and may not be comparable to similarly titled measures of other companies. A table describing adjusted EBITDA and reconciling net earnings from continuing operations to adjusted EBITDA is included in this press release in the attached Supplemental Consolidated Statements of Operations Information.
IASIS Healthcare LLC
W. Carl Whitmer, 615-844-2747
President and Chief Executive Officer
John M. Doyle, 615-844-2747
Chief Financial Officer
Cara Jackson, 615-467-1255
VP, Corporate Communications