PR Newswire
MECHANICSBURG, Pa., Feb. 25, 2016
MECHANICSBURG, Pa., Feb. 25, 2016 /PRNewswire/ -- Select Medical Holdings Corporation ("Select Medical") (NYSE: SEM) today announced results for its fourth quarter and year ended December 31, 2015.
For the fourth quarter ended December 31, 2015, net operating revenues increased 34.7% to $1,039.2 million, compared to $771.6 million for the same quarter, prior year. Income from operations was $62.3 million for the fourth quarter ended December 31, 2015, compared to $57.8 million for the same quarter, prior year. Net income attributable to Select Medical was $29.3 million for the fourth quarter ended December 31, 2015, compared to $25.7 million for the same quarter, prior year. Net income before interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, Concentra acquisition costs, equity in earnings (losses) of unconsolidated subsidiaries, and gain on sale of equity investment ("Adjusted EBITDA") for the fourth quarter ended December 31, 2015 was $100.8 million, compared to $78.9 million for the same quarter, prior year. A reconciliation of net income to Adjusted EBITDA is presented in table VIII of this release. Income per common share for the fourth quarter ended December 31, 2015 was $0.22 on a fully diluted basis compared to income per common share of $0.20 for the same quarter, prior year.
For the year ended December 31, 2015, net operating revenues increased 22.1% to $3,742.7 million, compared to $3,065.0 million for the prior year. Income from operations was $274.8 million for the year ended December 31, 2015, compared to $284.5 million for the prior year. Net income attributable to Select Medical was $130.7 million for the year ended December 31, 2015, compared to $120.6 million for the prior year. Adjusted EBITDA for the year ended December 31, 2015 was $399.2 million, compared to $363.9 million for the prior year. A reconciliation of net income to Adjusted EBITDA is presented in table VIII of this release. Income per common share for the year ended December 31, 2015 was $0.99 on a fully diluted basis, compared to income per common share of $0.91 for the year ended December 31, 2014.
Specialty Hospitals
For the fourth quarter ended December 31, 2015, net operating revenues for the specialty hospitals segment increased 4.8% to $593.3 million, compared to $566.1 million for the same quarter, prior year. Adjusted EBITDA for the specialty hospitals segment increased 7.6% to $86.0 million for the fourth quarter ended December 31, 2015, compared to $80.0 million for the same quarter, prior year. The Adjusted EBITDA margin for the segment was 14.5% for the fourth quarter ended December 31, 2015, compared to 14.1% for the same quarter, prior year. The Adjusted EBITDA results for the specialty hospitals segment include start-up losses of approximately $4.9 million for the fourth quarter ended December 31, 2015 compared to $5.9 million for the same quarter, prior year. Certain specialty hospitals key statistics for both the fourth quarter ended December 31, 2015 and 2014 are presented in table VI of this release.
For the year ended December 31, 2015, net operating revenues for the specialty hospitals segment increased 4.5% to $2,346.8 million compared to $2,244.9 million for the prior year. Adjusted EBITDA for the specialty hospitals segment for the year ended December 31, 2015 decreased to $327.6 million, compared to $341.8 million for the prior year. The Adjusted EBITDA margin for the segment was 14.0% for the year ended December 31, 2015, compared to 15.2% for the prior year. The Adjusted EBITDA results for the specialty hospitals segment include start-up losses of approximately $16.8 million for the year ended December 31, 2015, compared to $14.5 million for the prior year. Certain specialty hospitals key statistics for both the year ended December 31, 2015 and 2014 are presented in table VII of this release.
Outpatient Rehabilitation
For the fourth quarter ended December 31, 2015, net operating revenues for the outpatient rehabilitation segment increased 0.6% to $206.2 million, compared to $205.0 million for the same quarter, prior year. Adjusted EBITDA for the segment for the fourth quarter ended December 31, 2015 increased 1.8% to $23.6 million, compared to $23.2 million for the same quarter, prior year. The Adjusted EBITDA margin for the segment was 11.4% for the fourth quarter ended December 31, 2015, compared to 11.3% for the same quarter, prior year. Certain outpatient rehabilitation key statistics for both the fourth quarter ended December 31, 2015 and 2014 are presented in table VI of this release.
For the year ended December 31, 2015, net operating revenues for the outpatient rehabilitation segment decreased to $810.0 million, compared to $819.4 million for the prior year. Adjusted EBITDA for the segment for the year ended December 31, 2015 increased 0.7% to $98.2 million, compared to $97.6 million for the prior year. The Adjusted EBITDA margin for the segment was 12.1% for the year ended December 31, 2015, compared to 11.9% for the prior year. Certain outpatient rehabilitation key statistics for both the year ended December 31, 2015 and 2014 are presented in table VII of this release.
Concentra Segment
On June 1, 2015, MJ Acquisition Corporation, a joint venture that Select Medical created with Welsh, Carson, Anderson & Stowe XII, L.P. ("WCAS"), consummated the acquisition of Concentra Inc. ("Concentra"), which provides occupational health, consumer health, physical therapy, and veteran's healthcare services throughout the United States. Select Medical owns 50.1% of the voting interests of Concentra Group Holdings, LLC, the indirect parent of Concentra. Concentra's financial results are consolidated with Select Medical's effective June 1, 2015.
For the fourth quarter ended December 31, 2015, net operating revenues for the Concentra segment were $239.4 million. Adjusted EBITDA for the Concentra segment was $11.5 million for the fourth quarter ended December 31, 2015. The Adjusted EBITDA margin for the Concentra segment was 4.8% for the fourth quarter ended December 31, 2015. Concentra's net operating revenues, Adjusted EBITDA and Adjusted EBITDA margin for the third quarter ended September 30, 2015 were $259.0 million, $25.6 million and 9.9% respectively. The reduction in Adjusted EBITDA and Adjusted EBITDA margin is attributable to a seasonal reduction in the business that occurs in the fourth quarter and additional costs incurred related to integration activities. Certain Concentra key statistics for the fourth quarter ended December 31, 2015 are presented in table VI of this release.
All Concentra financial information and statistics for the year ended December 31, 2015 are for the period beginning June 1, 2015 through December 31, 2015. For the year ended December 31, 2015, net operating revenues for the Concentra segment were $585.2 million. Adjusted EBITDA for the Concentra segment was $48.3 million for the year ended December 31, 2015. The Adjusted EBITDA margin for the Concentra segment was 8.3% for the year ended December 31, 2015. Certain Concentra key statistics for the year ended December 31, 2015 are presented in table VII of this release.
Stock Repurchase Program
Select Medical did not repurchase shares during the fourth quarter ended December 31, 2015 under the authorized $500.0 million stock repurchase program. The program will remain in effect until December 31, 2016, unless extended or earlier terminated by the board of directors. Stock repurchases under this program may be made in the open market or through privately negotiated transactions, and at times and in such amounts as Select Medical deems appropriate. Select Medical is funding this program with cash on hand and borrowings under Select's revolving facility.
During the year ended December 31, 2015, Select Medical repurchased 1,032,334 shares at an aggregate cost of approximately $13.6 million, an average cost per share of $13.20, which includes transaction costs. Since the inception of the program through December 31, 2015, Select Medical has repurchased 35,924,128 shares at an aggregate cost of approximately $314.7 million, or $8.76 per share, which includes transaction costs.
Pending Physiotherapy Acquisition
On January 25, 2016, Select Medical announced that its wholly owned subsidiary, Select Medical Corporation, has entered into a Merger Agreement to acquire Physiotherapy Associates Holdings, Inc. for $400.0 million in cash, subject to certain adjustments in accordance with the terms set forth in the Merger Agreement. The transaction, which is expected to close in the first half of 2016, is subject to a number of closing conditions.
Business Outlook
Select Medical reaffirms its prior business outlook, provided most recently in its January 11, 2016 press release, for net operating revenues, Adjusted EBITDA and fully diluted income per common share. Select Medical continues to expect consolidated net operating revenues for the full year 2016 to be in the range of $4.0 billion to $4.2 billion. Select Medical continues to expect Adjusted EBITDA for the full year 2016 to be in the range of $470 million to $510 million. Select Medical continues to expect fully diluted income per common share for the full year 2016 to be in the range of $0.72 to $0.91.
This business outlook does not take into consideration the pending acquisition of Physiotherapy described above.
Conference Call
Select Medical will host a conference call regarding its fourth quarter and full year ended December 31, 2015 results, as well as its business outlook, on Friday, February 26, 2016, at 9:00am EST. The domestic dial in number for the call is 1-877-703-6105. The international dial in number is 1-857-244-7304. The passcode for the call is 67220955. The conference call will be webcast simultaneously and can be accessed at Select Medical Holdings Corporation's website www.selectmedicalholdings.com.
For those unable to participate in the conference call, a replay will be available until 11:59pm EST, March 4, 2016. The replay number is 1-888-286-8010 (domestic) or 1-617-801-6888 (international). The passcode for the replay will be 63449153. The replay can also be accessed at Select Medical Holdings Corporation's website, www.selectmedicalholdings.com.
Select Medical began operations in 1997 and has grown to be one of the largest operators of specialty hospitals and outpatient rehabilitation clinics in the United States based on number of facilities. As of December 31, 2015, Select Medical operated 109 long term acute care hospitals and 18 acute medical rehabilitation hospitals in 28 states, and 1,038 outpatient rehabilitation clinics in 31 states and the District of Columbia. Select Medical's subsidiary, Concentra, provides occupational health, consumer health, physical therapy, and veteran's healthcare services throughout the United States. As of December 31, 2015, Concentra operated 300 centers in 38 states. Concentra also provides contract services at employer worksites and Department of Veterans Affairs community-based outpatient clinics. Select Medical's contract therapy business provides medical rehabilitation services on a contracted basis to nursing homes, hospitals, assisted living and senior care centers, schools, and work sites. As of December 31, 2015, Select Medical had operations in 46 states and the District of Columbia. Information about Select Medical is available at www.selectmedical.com.
Certain statements contained herein that are not descriptions of historical facts are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements due to factors including the following:
Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we are under no obligation to publicly update or revise any forward-looking statements, whether as a result of any new information, future events or otherwise. You should not place undue reliance on our forward-looking statements. Although we believe that the expectations reflected in forward-looking statements are reasonable, we cannot guarantee future results or performance.
Investor inquiries:
Joel T. Veit
Senior Vice President and Treasurer
717-972-1100
[email protected]
I. Condensed Consolidated Statements of Operations | ||||||
For the Three Months Ended December 31, 2014 and 2015 (In thousands, except per share amounts, unaudited)
| ||||||
2014 |
2015 |
% Change | ||||
Net operating revenues |
$ 771,608 |
$ 1,039,205 |
34.7% | |||
Costs and expenses: |
||||||
Cost of services |
656,303 |
902,328 |
37.5% | |||
General and administrative |
28,028 |
24,135 |
(13.9)% | |||
Bad debt expense |
12,110 |
16,129 |
33.2% | |||
Depreciation and amortization |
17,345 |
34,313 |
97.8% | |||
Income from operations |
57,822 |
62,300 |
7.7% | |||
Equity in earnings of unconsolidated |
2,909 |
4,023 |
38.3% | |||
Interest expense |
(21,414) |
(33,088) |
54.5% | |||
Income before income taxes |
39,317 |
33,235 |
(15.5)% | |||
Income tax expense |
11,799 |
7,388 |
(37.4)% | |||
Net income |
27,518 |
25,847 |
(6.1)% | |||
Less: Net income (loss) attributable to non- controlling interests |
1,806 |
(3,480) |
N/M | |||
Net income attributable to Select Medical Holdings Corporation |
$ 25,712 |
$ 29,327 |
14.1% | |||
Weighted average shares outstanding(1): |
||||||
Basic |
127,007 |
127,292 |
||||
Diluted |
127,358 |
127,464 |
||||
Income per common share(1): |
||||||
Basic |
$0.20 |
$0.22 |
||||
Diluted |
$0.20 |
$0.22 |
||||
Dividends per share |
$0.10 |
- |
||||
N/M – Not Meaningful |
||||||
(1) Under the two-class method for calculating income per common share, unvested restricted stock is a separate, |
II. Condensed Consolidated Statements of Operations | ||||||
For the Years Ended December 31, 2014 and 2015 (In thousands, except per share amounts, unaudited)
| ||||||
2014 |
2015 |
% Change | ||||
Net operating revenues |
$ 3,065,017 |
$ 3,742,736 |
22.1% | |||
Costs and expenses: |
||||||
Cost of services |
2,582,340 |
3,211,541 |
24.4% | |||
General and administrative |
85,247 |
92,052 |
8.0% | |||
Bad debt expense |
44,600 |
59,372 |
33.1% | |||
Depreciation and amortization |
68,354 |
104,981 |
53.6% | |||
Income from operations |
284,476 |
274,790 |
(3.4)% | |||
Loss on early retirement of debt |
(2,277) |
- |
N/M | |||
Equity in earnings of unconsolidated |
7,044 |
16,811 |
138.7% | |||
Gain on sale of equity investment |
- |
29,647 |
N/M | |||
Interest expense |
(85,446) |
(112,816) |
32.0% | |||
Income before income taxes |
203,797 |
208,432 |
2.3% | |||
Income tax expense |
75,622 |
72,436 |
(4.2)% | |||
Net income |
128,175 |
135,996 |
6.1% | |||
Less: Net income attributable to non- controlling interests |
7,548 |
5,260 |
(30.3)% | |||
Net income attributable to Select Medical Holdings Corporation |
$ 120,627 |
$ 130,736 |
8.4% | |||
Weighted average shares outstanding(1): |
||||||
Basic |
129,026 |
127,478 |
||||
Diluted |
129,465 |
127,752 |
||||
Income per common share(1): |
||||||
Basic |
$0.91 |
$1.00 |
||||
Diluted |
$0.91 |
$0.99 |
||||
Dividends per share |
$0.40 |
$0.10 |
||||
N/M = Not Meaningful |
||||||
(1) Under the two-class method for calculating income per common share, unvested restricted stock is a separate, participating class. Income per common share and weighted average common shares outstanding exclude amounts attributed to the unvested restricted class of stockholders. Net income allocated to the unvested restricted stockholders was $3.8 million and $3.3 million for the years ended December 31, 2015 and 2014, respectively. Unvested restricted weighted average shares were 3,847 thousand and 3,671 thousand for the years ended December 31, 2015 and 2014, respectively. |
III. Condensed Consolidated Balance Sheets (In thousands, unaudited) | ||||
December 31, |
December 31, | |||
Assets |
||||
Cash |
$ 3,354 |
$ 14,435 | ||
Accounts receivable, net |
444,269 |
603,558 | ||
Current deferred tax asset |
15,991 |
28,688 | ||
Other current assets |
64,030 |
102,473 | ||
Total Current Assets |
527,644 |
749,154 | ||
Property and equipment, net |
542,310 |
864,124 | ||
Goodwill |
1,642,083 |
2,314,624 | ||
Other identifiable intangibles |
72,519 |
318,675 | ||
Other assets |
140,253 |
180,089 | ||
Total Assets |
$ 2,924,809 |
$ 4,426,666 | ||
Liabilities and Equity |
||||
Payables and accruals |
$ 383,550 |
$ 504,119 | ||
Current portion of long-term debt |
10,874 |
233,570 | ||
Total Current Liabilities |
394,424 |
737,689 | ||
Long-term debt, net of current portion |
1,542,102 |
2,190,314 | ||
Non-current deferred tax liability |
109,203 |
218,705 | ||
Other non-current liabilities |
92,855 |
133,220 | ||
Total Liabilities |
2,138,584 |
3,279,928 | ||
Redeemable non-controlling interests |
10,985 |
238,221 | ||
Total equity |
775,240 |
908,517 | ||
Total Liabilities and Equity |
$ 2,924,809 |
$ 4,426,666 | ||
IV. Condensed Consolidated Statement of Cash Flows |
|||||
For the Three Months Ended December 31, 2014 and 2015 |
|||||
2014 |
2015 | ||||
Operating Activities |
|||||
Net Income |
$ 27,518 |
$ 25,847 | |||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||
Distributions from unconsolidated subsidiaries |
15 |
2,155 | |||
Depreciation and amortization |
17,345 |
34,313 | |||
Provision for bad debts |
12,110 |
16,129 | |||
Equity in earnings of unconsolidated subsidiaries |
(2,909) |
(4,023) | |||
Loss on sale of assets and businesses |
188 |
166 | |||
Stock compensation expense |
3,795 |
5,741 | |||
Amortization of debt discount, premium and issuance costs |
1,902 |
2,797 | |||
Deferred income taxes |
11,467 |
4,867 | |||
Changes in operating assets and liabilities, net of effects from |
|||||
acquisition of businesses: |
|||||
Accounts receivable |
(44,878) |
(43,794) | |||
Other current assets |
(2,220) |
2,077 | |||
Other assets |
2,164 |
173 | |||
Accounts payable |
3,721 |
(702) | |||
Accrued expenses |
(11,819) |
(40,762) | |||
Net cash provided by operating activities |
18,399 |
4,984 | |||
Investing activities |
|||||
Purchases of property and equipment |
(21,896) |
(68,650) | |||
Proceeds from sale of assets |
- |
225 | |||
Investment in businesses |
(1,499) |
(644) | |||
Acquisition of businesses, net of cash acquired |
- |
(11,756) | |||
Net cash used in investing activities |
(23,395) |
(80,825) | |||
Financing activities |
|||||
Borrowings on revolving facilities |
235,000 |
295,000 | |||
Payments on revolving facilities |
(215,000) |
(220,000) | |||
Payments on term loans |
- |
(1,125) | |||
Borrowings of other debt |
2,040 |
2,333 | |||
Principal payments on other debt |
(2,977) |
(6,094) | |||
Proceeds from (repayment of) bank overdrafts |
(1,064) |
4,516 | |||
Dividends paid to common stockholders |
(13,109) |
- | |||
Repurchase of common stock |
(1,677) |
(2,205) | |||
Proceeds from issuance of common stock |
1,810 |
45 | |||
Tax benefit from stock based awards |
3,119 |
1,463 | |||
Purchase of non-controlling interests |
(9,961) |
(1,095) | |||
Distributions to non-controlling interests |
(860) |
(5,197) | |||
Net cash provided by (used in) financing activities |
(2,679) |
67,641 | |||
Net decrease in cash and cash equivalents |
(7,675) |
(8,200) | |||
Cash and cash equivalents at beginning of period |
11,029 |
22,635 | |||
Cash and cash equivalents at end of period |
$ 3,354 |
$ 14,435 | |||
Supplemental Cash Flow Information |
|||||
Cash paid for interest |
$ 31,030 |
$ 43,229 | |||
Cash paid for taxes |
$ 12,587 |
$ 23,515 | |||
V. Condensed Consolidated Statement of Cash Flows |
|||||
For the Years Ended December 31, 2014 and 2015 |
|||||
2014 |
2015 | ||||
Operating Activities |
|||||
Net Income |
$ 128,175 |
$ 135,996 | |||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||
Distributions from unconsolidated subsidiaries |
11,954 |
13,969 | |||
Depreciation and amortization |
68,354 |
104,981 | |||
Provision for bad debts |
44,600 |
59,372 | |||
Equity in earnings of unconsolidated subsidiaries |
(7,044) |
(16,811) | |||
Gain on sale of assets and businesses |
(1,048) |
(1,098) | |||
Gain on sale of equity investment |
- |
(29,647) | |||
Loss on early retirement of debt |
2,277 |
- | |||
Stock compensation expense |
11,186 |
14,985 | |||
Amortization of debt discount, premium, and issuance costs |
7,553 |
9,543 | |||
Deferred income taxes |
14,311 |
(2,058) | |||
Changes in operating assets and liabilities, net of effects from |
|||||
acquisition of businesses: |
|||||
Accounts receivable |
(97,802) |
(92,572) | |||
Other current assets |
(1,729) |
(2,503) | |||
Other assets |
(103) |
4,713 | |||
Accounts payable |
5,997 |
2,345 | |||
Accrued expenses |
(16,039) |
7,200 | |||
Net cash provided by operating activities |
170,642 |
208,415 | |||
Investing activities |
|||||
Purchases of property and equipment |
(95,246) |
(182,642) | |||
Proceeds from sale of assets |
- |
1,767 | |||
Investment in businesses |
(4,634) |
(2,347) | |||
Proceeds from sale of equity investment |
- |
33,096 | |||
Acquisition of businesses, net of cash acquired |
(1,211) |
(1,061,628) | |||
Net cash used in investing activities |
(101,091) |
(1,211,754) | |||
Financing activities |
|||||
Borrowings on revolving facilities |
910,000 |
1,135,000 | |||
Payments on revolving facilities |
(870,000) |
(895,000) | |||
Proceeds from term loans, net of discounts |
- |
646,875 | |||
Payments on term loans |
(33,994) |
(29,134) | |||
Issuance of 6.375% senior notes, includes premium |
111,650 |
- | |||
Borrowings of other debt |
9,076 |
13,374 | |||
Principal payments on other debt |
(14,673) |
(18,136) | |||
Proceeds from bank overdrafts |
9,240 |
6,869 | |||
Debt issuance costs |
(4,434) |
(23,300) | |||
Dividends paid to common stockholders |
(53,366) |
(13,129) | |||
Repurchase of common stock |
(130,734) |
(15,827) | |||
Proceeds from issuance of common stock |
7,355 |
1,649 | |||
Tax benefit from stock based awards |
3,119 |
1,846 | |||
Purchase of non-controlling interests |
(9,961) |
(1,095) | |||
Proceeds from issuance of non-controlling interests |
185 |
217,065 | |||
Distributions to non-controlling interests |
(3,979) |
(12,637) | |||
Net cash provided by (used in) financing activities |
(70,516) |
1,014,420 | |||
Net increase (decrease) in cash and cash equivalents |
(965) |
11,081 | |||
Cash and cash equivalents at beginning of period |
4,319 |
3,354 | |||
Cash and cash equivalents at end of period |
$ 3,354 |
$ 14,435 | |||
Supplemental Cash Flow Information |
|||||
Cash paid for interest |
$ 78,812 |
$ 103,166 | |||
Cash paid for taxes |
$ 77,771 |
$ 79,420 | |||
VI. Key Statistics For the Three Months Ended December 31, 2014 and 2015 |
|||||||
(unaudited) | |||||||
2014 |
2015 |
% Change | |||||
Specialty Hospitals |
|||||||
Number of hospitals – end of period: |
|||||||
Long term acute care hospitals (a) |
113 |
109 |
|||||
Rehabilitation hospitals (a) |
16 |
18 |
|||||
Total specialty hospitals |
129 |
127 |
|||||
Net operating revenues (,000) |
$ 566,106 |
$ 593,336 |
4.8% | ||||
Number of patient days (b) |
336,457 |
339,614 |
0.9% | ||||
Number of admissions (b) |
14,057 |
14,218 |
1.1% | ||||
Net revenue per patient day (b)(c) |
$ 1,546 |
$ 1,588 |
2.7% | ||||
Adjusted EBITDA (,000) |
$ 79,999 |
$ 86,048 |
7.6% | ||||
Adjusted EBITDA margin |
14.1% |
14.5% |
|||||
Outpatient Rehabilitation |
|||||||
Number of clinics – end of period (d) |
1,023 |
1,038 |
|||||
Net operating revenues (,000) |
$ 205,029 |
$ 206,178 |
0.6% | ||||
Number of visits (e) |
1,266,220 |
1,339,123 |
5.8% | ||||
Revenue per visit (e)(f) |
$ 103 |
$ 103 |
- | ||||
Adjusted EBITDA (,000) |
$ 23,151 |
$ 23,558 |
1.8% | ||||
Adjusted EBITDA margin |
11.3% |
11.4% |
|||||
Concentra |
|||||||
Number of centers – end of period (g) |
300 |
||||||
Net operating revenues (,000) |
$ 239,424 |
||||||
Number of visits (g) |
1,782,647 |
||||||
Revenue per visit (g)(h) |
$ 115 |
||||||
Adjusted EBITDA (,000) |
$ 11,518 |
||||||
Adjusted EBITDA margin |
4.8% |
||||||
(a) Includes managed hospitals. | |||||||
(b) Excludes managed hospitals. | |||||||
(c) Net revenue per patient day is calculated by dividing specialty hospital direct patient service revenue by the | |||||||
(d) Includes managed clinics. | |||||||
(e) Excludes managed clinics. | |||||||
(f) Net revenue per visit is calculated by dividing outpatient rehabilitation clinic direct patient service revenue by | |||||||
(g) Excludes onsite clinics and community-based outpatient clinics. | |||||||
(h) Net revenue per visit is calculated by dividing center direct patient service revenue by the total number of | |||||||
VII. Key Statistics For the Years Ended December 31, 2014 and 2015 |
|||||||
(unaudited) | |||||||
2014 |
2015 |
% Change | |||||
Specialty Hospitals |
|||||||
Number of hospitals – end of period: |
|||||||
Long term acute care hospitals (a) |
113 |
109 |
|||||
Rehabilitation hospitals (a) |
16 |
18 |
|||||
Total specialty hospitals |
129 |
127 |
|||||
Net operating revenues (,000) |
$ 2,244,899 |
$ 2,346,781 |
4.5% | ||||
Number of patient days (b) |
1,340,506 |
1,373,780 |
2.5% | ||||
Number of admissions (b) |
55,581 |
56,570 |
1.8% | ||||
Net revenue per patient day (b)(c) |
$ 1,546 |
$ 1,569 |
1.5% | ||||
Adjusted EBITDA (,000) |
$ 341,787 |
$ 327,623 |
(4.1)% | ||||
Adjusted EBITDA margin |
15.2% |
14.0% |
|||||
Outpatient Rehabilitation |
|||||||
Number of clinics – end of period: (d) |
1,023 |
1,038 |
|||||
Net operating revenues (,000) |
$ 819,397 |
$ 810,009 |
(1.1)% | ||||
Number of visits (e) |
4,970,724 |
5,218,532 |
5.0% | ||||
Revenue per visit (e)(f) |
$ 103 |
$ 103 |
- | ||||
Adjusted EBITDA (,000) |
$ 97,584 |
$ 98,220 |
0.7% | ||||
Adjusted EBITDA margin |
11.9% |
12.1% |
|||||
Concentra |
|||||||
Number of centers – end of period (g) |
300 |
||||||
Net operating revenues (,000) |
$ 585,222 |
||||||
Number of visits (g) |
4,436,977 |
||||||
Revenue per visit (g)(h) |
$ 114 |
||||||
Adjusted EBITDA (,000) |
$ 48,301 |
||||||
Adjusted EBITDA margin |
8.3% |
||||||
(a) Includes managed hospitals. | |||||||
(b) Excludes managed hospitals. | |||||||
(c) Net revenue per patient day is calculated by dividing specialty hospital direct patient service revenue by the | |||||||
(d) Includes managed clinics. | |||||||
(e) Excludes managed clinics. | |||||||
(f) Net revenue per visit is calculated by dividing outpatient rehabilitation clinic direct patient service revenue by | |||||||
(g) Excludes onsite clinics and community-based outpatient clinics. | |||||||
(h) Net revenue per visit is calculated by dividing center direct patient service revenue by the total number of | |||||||
VIII. Net Income to Adjusted EBITDA Reconciliation
For the Three Months and Years Ended December 31, 2014 and 2015
(In thousands, unaudited)
The following table reconciles net income to Adjusted EBITDA for Select Medical. Adjusted EBITDA is used by Select Medical to report its segment performance. Adjusted EBITDA is defined as net income before interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, Concentra acquisition costs, equity in earnings (losses) of unconsolidated subsidiaries, and gain on sale of equity investment. The Company believes that the presentation of Adjusted EBITDA is important to investors because Adjusted EBITDA is commonly used as an analytical indicator of performance by investors within the healthcare industry. Adjusted EBITDA is used by management to evaluate financial performance and determine resource allocation for each of its operating units.
Adjusted EBITDA is not a measure of financial performance under generally accepted accounting principles. 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, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Because Adjusted EBITDA is not a measurement determined in accordance with generally accepted accounting principles and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies.
Three Months Ended December 31, |
Year Ended December 31, | |||||||
2014 |
2015 |
2014 |
2015 | |||||
Net income |
$ 27,518 |
$ 25,847 |
$ 128,175 |
$ 135,996 | ||||
Income tax expense |
11,799 |
7,388 |
75,622 |
72,436 | ||||
Loss on early retirement of debt |
- |
- |
2,277 |
- | ||||
Interest expense |
21,414 |
33,088 |
85,446 |
112,816 | ||||
Equity in earnings of unconsolidated |
(2,909) |
(4,023) |
(7,044) |
(16,811) | ||||
Gain on sale of equity investment |
- |
- |
- |
(29,647) | ||||
Stock compensation expense: |
||||||||
Included in general and administrative |
3,187 |
3,560 |
9,027 |
11,633 | ||||
Included in cost of services |
536 |
644 |
2,015 |
3,046 | ||||
Depreciation and amortization |
17,345 |
34,313 |
68,354 |
104,981 | ||||
Concentra acquisition costs |
- |
- |
- |
4,715 | ||||
Adjusted EBITDA |
$ 78,890 |
$ 100,817 |
$ 363,872 |
$ 399,165 | ||||
Specialty hospitals |
$ 79,999 |
$ 86,048 |
$ 341,787 |
$ 327,623 | ||||
Outpatient rehabilitation |
23,151 |
23,558 |
97,584 |
98,220 | ||||
Concentra |
- |
11,518 |
- |
48,301 | ||||
Other (a) |
(24,260) |
(20,307) |
(75,499) |
(74,979) | ||||
Adjusted EBITDA |
$ 78,890 |
$ 100,817 |
$ 363,872 |
$ 399,165 | ||||
(a) Other primarily includes general and administrative costs. |
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/select-medical-holdings-corporation-announces-results-for-fourth-quarter-and-year-ended-december-31-2015-300226555.html
SOURCE Select Medical Holdings Corporation
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