|
R
|
QUARTERLY REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
|
£
|
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
20-1538254
|
(State
or Other Jurisdiction of
|
(I.R.S.
Employer
|
Incorporation
or Organization)
|
Identification
No.)
|
103
Powell Court
|
|
Brentwood,
Tennessee
|
37027
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
Large
accelerated filer R
|
Accelerated
filer £
|
Non-accelerated
filer £
|
Smaller
reporting company £
|
(Do
not check if a smaller reporting
company)
|
PART
I — FINANCIAL INFORMATION
|
|
|
Item
1.
|
Financial
Statements
|
3
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
22
|
Item
3.
|
Quantitative
and Qualitative Disclosures about Market Risk
|
47
|
Item
4.
|
Controls
and Procedures
|
48
|
|
||
PART
II — OTHER INFORMATION
|
||
Item
1.
|
Legal
Proceedings
|
49
|
Item 1A.
|
Risk
Factors
|
49
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
49
|
Item
6.
|
Exhibits
|
51
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Revenues
|
$ | 832.3 | $ | 745.0 | $ | 2,409.1 | $ | 2,215.8 | ||||||||
Salaries
and benefits
|
324.8 | 295.8 | 935.1 | 875.0 | ||||||||||||
Supplies
|
112.9 | 102.3 | 330.5 | 304.2 | ||||||||||||
Other
operating expenses
|
158.5 | 134.4 | 444.2 | 405.7 | ||||||||||||
Provision
for doubtful accounts
|
116.3 | 98.7 | 323.4 | 281.1 | ||||||||||||
Depreciation
and amortization
|
36.4 | 35.1 | 109.2 | 106.1 | ||||||||||||
Interest
expense, net
|
26.2 | 25.5 | 77.2 | 77.2 | ||||||||||||
Debt
extinguishment costs
|
2.4 | — | 2.4 | — | ||||||||||||
777.5 | 691.8 | 2,222.0 | 2,049.3 | |||||||||||||
Income
from continuing operations before income taxes
|
54.8 | 53.2 | 187.1 | 166.5 | ||||||||||||
Provision
for income taxes
|
15.6 | 20.5 | 65.5 | 64.2 | ||||||||||||
Income
from continuing operations
|
39.2 | 32.7 | 121.6 | 102.3 | ||||||||||||
Discontinued
operations, net of income taxes:
|
||||||||||||||||
Income
(loss) from discontinued operations
|
0.3 | (0.7 | ) | — | (3.9 | ) | ||||||||||
Loss
on sale of hospital
|
— | — | — | (0.6 | ) | |||||||||||
Income
(loss) from discontinued operations
|
0.3 | (0.7 | ) | — | (4.5 | ) | ||||||||||
Net
income
|
39.5 | 32.0 | 121.6 | 97.8 | ||||||||||||
Less:
Net income attributable to noncontrolling interests
|
(0.7 | ) | (0.6 | ) | (2.3 | ) | (1.7 | ) | ||||||||
Net
income attributable to LifePoint Hospitals, Inc.
|
$ | 38.8 | $ | 31.4 | $ | 119.3 | $ | 96.1 | ||||||||
Basic
earnings (loss) per share attributable to LifePoint Hospitals, Inc.
stockholders (a):
|
||||||||||||||||
Continuing
operations
|
$ | 0.74 | $ | 0.60 | $ | 2.26 | $ | 1.91 | ||||||||
Discontinued
operations
|
— | (0.01 | ) | — | (0.08 | ) | ||||||||||
Net
income
|
$ | 0.74 | $ | 0.59 | $ | 2.26 | $ | 1.83 | ||||||||
Diluted
earnings (loss) per share attributable to LifePoint Hospitals, Inc.
stockholders (a):
|
||||||||||||||||
Continuing
operations
|
$ | 0.72 | $ | 0.59 | $ | 2.21 | $ | 1.88 | ||||||||
Discontinued
operations
|
— | (0.01 | ) | — | (0.08 | ) | ||||||||||
Net
income
|
$ | 0.73 | $ | 0.58 | $ | 2.21 | $ | 1.80 | ||||||||
Weighted
average shares and dilutive securities outstanding:
|
||||||||||||||||
Basic
|
52.0 | 53.0 | 52.8 | 52.7 | ||||||||||||
Diluted
|
53.1 | 53.9 | 54.0 | 53.5 | ||||||||||||
Amounts
attributable to LifePoint Hospitals, Inc. stockholders:
|
||||||||||||||||
Income
from continuing operations, net of income taxes
|
$ | 38.5 | $ | 32.1 | $ | 119.3 | $ | 100.6 | ||||||||
Income
(loss) from discontinued operations, net of income taxes
|
0.3 | (0.7 | ) | — | (4.5 | ) | ||||||||||
Net
income
|
$ | 38.8 | $ | 31.4 | $ | 119.3 | $ | 96.1 |
September 30,
|
December 31,
|
|||||||
2010
|
2009(a)
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 211.3 | $ | 187.2 | ||||
Accounts
receivable, less allowances for doubtful accounts of $481.2 and $433.2 at
September 30, 2010 and December 31, 2009,
respectively
|
372.4 | 325.2 | ||||||
Inventories
|
82.0 | 75.3 | ||||||
Prepaid
expenses
|
14.6 | 12.0 | ||||||
Income
taxes receivable
|
2.2 | 10.0 | ||||||
Deferred
tax assets
|
98.1 | 121.3 | ||||||
Other
current assets
|
26.9 | 23.1 | ||||||
807.5 | 754.1 | |||||||
Property
and equipment:
|
||||||||
Land
|
88.9 | 75.5 | ||||||
Buildings
and improvements
|
1,521.8 | 1,377.0 | ||||||
Equipment
|
927.4 | 840.9 | ||||||
Construction
in progress (estimated cost to complete and equip after September 30, 2010
is $53.3)
|
39.9 | 19.9 | ||||||
2,578.0 | 2,313.3 | |||||||
Accumulated
depreciation
|
(912.2 | ) | (813.9 | ) | ||||
1,665.8 | 1,499.4 | |||||||
Deferred
loan costs, net
|
28.1 | 23.0 | ||||||
Intangible
assets, net
|
74.9 | 68.6 | ||||||
Other
|
6.0 | 5.2 | ||||||
Goodwill
|
1,525.6 | 1,523.0 | ||||||
Total
assets
|
$ | 4,107.9 | $ | 3,873.3 | ||||
LIABILITIES
AND EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 78.2 | $ | 77.3 | ||||
Accrued
salaries
|
90.4 | 81.8 | ||||||
Interest
rate swap
|
13.7 | — | ||||||
Other
current liabilities
|
113.0 | 108.1 | ||||||
Current
maturities of long-term debt
|
1.3 | 1.0 | ||||||
296.6 | 268.2 | |||||||
Long-term
debt
|
1,560.5 | 1,398.8 | ||||||
Deferred
income tax liabilities
|
207.1 | 176.9 | ||||||
Reserves
for self-insurance claims and other liabilities
|
113.8 | 135.3 | ||||||
Long-term
income tax liability
|
19.8 | 51.3 | ||||||
Total
liabilities
|
2,197.8 | 2,030.5 | ||||||
Redeemable
noncontrolling interests
|
15.3 | 12.0 | ||||||
Equity:
|
||||||||
LifePoint
Hospitals, Inc. stockholders’ equity:
|
||||||||
Preferred
stock, $0.01 par value; 10,000,000 shares authorized; no shares
issued
|
— | — | ||||||
Common
stock, $0.01 par value; 90,000,000 shares authorized; 61,218,574 and
60,262,399 shares issued at September 30, 2010 and December 31, 2009,
respectively
|
0.6 | 0.6 | ||||||
Capital
in excess of par value
|
1,278.2 | 1,246.4 | ||||||
Accumulated
other comprehensive loss
|
(7.8 | ) | (17.4 | ) | ||||
Retained
earnings
|
867.8 | 748.5 | ||||||
Common
stock in treasury, at cost, 8,425,243 and 5,476,930 shares at September
30, 2010 and December 31, 2009, respectively
|
(247.8 | ) | (150.4 | ) | ||||
Total
LifePoint Hospitals, Inc. stockholders’ equity
|
1,891.0 | 1,827.7 | ||||||
Noncontrolling
interests
|
3.8 | 3.1 | ||||||
Total
equity
|
1,894.8 | 1,830.8 | ||||||
Total
liabilities and equity
|
$ | 4,107.9 | $ | 3,873.3 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||
Net
income
|
$ | 39.5 | $ | 32.0 | $ | 121.6 | $ | 97.8 | ||||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||||||
(Income)
loss from discontinued operations
|
(0.3 | ) | 0.7 | — | 4.5 | |||||||||||
Stock-based
compensation
|
5.7 | 5.9 | 16.8 | 16.5 | ||||||||||||
Depreciation
and amortization
|
36.4 | 35.1 | 109.2 | 106.1 | ||||||||||||
Amortization
of physician minimum revenue guarantees
|
4.4 | 3.5 | 12.4 | 9.7 | ||||||||||||
Amortization
of convertible debt discounts
|
5.7 | 5.3 | 16.7 | 15.6 | ||||||||||||
Amortization
of deferred loan costs
|
1.6 | 2.1 | 5.6 | 5.8 | ||||||||||||
Debt
extinguishment costs
|
2.4 | — | 2.4 | — | ||||||||||||
Deferred
income tax benefits
|
(9.6 | ) | (14.2 | ) | (26.3 | ) | (24.9 | ) | ||||||||
Long-term
income tax liability benefits
|
(8.3 | ) | — | (8.3 | ) | — | ||||||||||
Reserves
for self-insurance claims, net of payments
|
5.0 | 0.7 | 9.3 | 11.8 | ||||||||||||
Increase
(decrease) in cash from operating assets and liabilities, net of effects
from acquisitions and divestitures:
|
||||||||||||||||
Accounts
receivable
|
(1.8 | ) | 5.3 | (28.2 | ) | (10.1 | ) | |||||||||
Inventories
and other current assets
|
0.1 | (0.5 | ) | (2.4 | ) | (3.4 | ) | |||||||||
Accounts
payable and accrued expenses
|
15.8 | (13.4 | ) | (3.9 | ) | (19.1 | ) | |||||||||
Income
taxes payable/receivable
|
17.6 | 6.3 | 57.3 | 17.3 | ||||||||||||
Other
|
(0.6 | ) | 1.5 | (0.5 | ) | 1.7 | ||||||||||
Net
cash provided by operating activities — continuing
operations
|
113.6 | 70.3 | 281.7 | 229.3 | ||||||||||||
Net
cash (used in) provided by operating activities — discontinued
operations
|
(0.5 | ) | 3.9 | (1.2 | ) | 1.0 | ||||||||||
Net
cash provided by operating activities
|
113.1 | 74.2 | 280.5 | 230.3 | ||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||
Purchase
of property and equipment
|
(48.4 | ) | (33.7 | ) | (122.0 | ) | (118.8 | ) | ||||||||
Acquisitions,
net of cash acquired
|
(142.2 | ) | — | (184.9 | ) | (79.7 | ) | |||||||||
Proceeds
from sale of business
|
— | — | — | 3.9 | ||||||||||||
Net
cash used in investing activities – continuing operations
|
(190.6 | ) | (33.7 | ) | (306.9 | ) | (194.6 | ) | ||||||||
Net
cash provided by investing activities – discontinued
operations
|
— | 9.1 | — | 19.5 | ||||||||||||
Net
cash used in investing activities
|
(190.6 | ) | (24.6 | ) | (306.9 | ) | (175.1 | ) | ||||||||
Cash
flows from financing activities:
|
||||||||||||||||
Proceeds
from borrowings
|
400.0 | — | 400.0 | — | ||||||||||||
Payments
on borrowings
|
(255.2 | ) | — | (255.2 | ) | (13.5 | ) | |||||||||
Repurchases
of common stock
|
(46.9 | ) | (0.4 | ) | (97.4 | ) | (3.0 | ) | ||||||||
Payment
of debt financing costs
|
(8.7 | ) | — | (13.1 | ) | — | ||||||||||
Proceeds
from exercise of stock options
|
1.2 | 0.3 | 14.7 | 9.9 | ||||||||||||
Proceeds
from employee stock purchase plans
|
0.4 | 0.6 | 1.0 | 1.0 | ||||||||||||
Distributions
to noncontrolling interests
|
(0.7 | ) | (0.7 | ) | (1.6 | ) | (1.4 | ) | ||||||||
(Purchase
of) proceeds from redeemable noncontrolling interests
|
(0.8 | ) | — | 3.1 | (0.8 | ) | ||||||||||
Capital
lease payments and other
|
(0.2 | ) | (1.9 | ) | (1.0 | ) | (3.6 | ) | ||||||||
Net
cash provided by (used in) financing activities
|
89.1 | (2.1 | ) | 50.5 | (11.4 | ) | ||||||||||
Change
in cash and cash equivalents
|
11.6 | 47.5 | 24.1 | 43.8 | ||||||||||||
Cash
and cash equivalents at beginning of period
|
199.7 | 72.0 | 187.2 | 75.7 | ||||||||||||
Cash
and cash equivalents at end of period
|
$ | 211.3 | $ | 119.5 | $ | 211.3 | $ | 119.5 | ||||||||
Supplemental
disclosure of cash flow information:
|
||||||||||||||||
Interest
payments
|
$ | 16.0 | $ | 15.7 | $ | 50.7 | $ | 54.4 | ||||||||
Capitalized
interest
|
$ | 0.3 | $ | 0.2 | $ | 0.6 | $ | 0.8 | ||||||||
Income
taxes paid, net
|
$ | 16.0 | $ | 24.9 | $ | 42.8 | $ | 68.5 |
LifePoint Hospitals, Inc. Stockholders
|
||||||||||||||||||||||||||||||||
Common Stock
|
Capital in
Excess of
|
Accumulated
Other
Comprehensive
|
Retained
|
Treasury
|
Noncontrolling
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Par Value
|
Income (loss)
|
Earnings
|
Stock
|
Interests
|
Total
|
|||||||||||||||||||||||||
Balance
at December 31, 2009 (a)
|
54.8 | $ | 0.6 | $ | 1,246.4 | $ | (17.4 | ) | $ | 748.5 | $ | (150.4 | ) | $ | 3.1 | $ | 1,830.8 | |||||||||||||||
Comprehensive
income:
|
||||||||||||||||||||||||||||||||
Net
income
|
— | — | — | — | 119.3 | — | 2.3 | 121.6 | ||||||||||||||||||||||||
Net
change in fair value of interest rate swap, net of tax provision of
$5.0
|
— | — | — | 9.6 | — | — | — | 9.6 | ||||||||||||||||||||||||
Total
comprehensive income
|
131.2 | |||||||||||||||||||||||||||||||
Exercise
of stock options, including tax benefits of stock-based awards and
other
|
0.5 | — | 14.1 | — | — | — | — | 14.1 | ||||||||||||||||||||||||
Stock
activity in connection with employee stock purchase plan
|
— | — | 1.0 | — | — | — | — | 1.0 | ||||||||||||||||||||||||
Stock-based
compensation
|
0.4 | — | 16.8 | — | — | — | — | 16.8 | ||||||||||||||||||||||||
Repurchases
of common stock, at cost
|
(2.9 | ) | — | — | — | — | (97.4 | ) | — | (97.4 | ) | |||||||||||||||||||||
Cash
distributions to noncontrolling interests
|
— | — | (0.1 | ) | — | — | — | (1.6 | ) | (1.7 | ) | |||||||||||||||||||||
Balance
at September 30, 2010
|
52.8 | $ | 0.6 | $ | 1,278.2 | $ | (7.8 | ) | $ | 867.8 | $ | (247.8 | ) | $ | 3.8 | $ | 1,894.8 |
Total
assets acquired
|
$ | 166.5 | ||
Total
liabilities assumed
|
(8.9 | ) | ||
Net
assets acquired
|
$ | 157.6 |
2009 Repurchase Plan
|
2010 Repurchase Plan
|
|||||||||||||||||||||||
Amount
(In millions)
|
Total Number
Of Shares
Repurchased
(In millions)
|
Weighted
Average
Price Paid
per Share
|
Amount
(In millions)
|
Total Number
Of Shares
Repurchased
(In millions)
|
Weighted
Average
Price Paid
per Share
|
|||||||||||||||||||
Amount
authorized to repurchase
|
$ | 100.0 | N/A | N/A | $ | 150.0 | N/A | N/A | ||||||||||||||||
Less: Amount
repurchased through September 30, 2010
|
87.6 | 2.7 | $ | 33.03 | 4.3 | 0.1 | $ | 34.00 | ||||||||||||||||
Remaining
amount authorized to repurchase as of September 30, 2010
|
$ | 12.4 | N/A | N/A | $ | 145.7 | N/A | N/A |
October
1, 2015 to September 30, 2016
|
103.313 | % | ||
October
1, 2016 to September 30, 2017
|
102.208 | % | ||
October
1, 2017 to September 30, 2018
|
101.104 | % | ||
October
1, 2018 and thereafter
|
100.000 | % |
Date Range
|
Notional Amount
(In millions)
|
|||
November
28, 2008 to November 30, 2009
|
$ | 600.0 | ||
November
30, 2009 to November 30, 2010
|
450.0 | |||
November
30, 2010 to May 30, 2011
|
300.0 |
Balance Sheet Location
|
September 30, 2010
|
December 31, 2009
|
||||||||
Derivative
designated as a hedging instrument under ASC 815-10:
|
||||||||||
Interest
rate swap
|
Interest
rate swap
|
$ | 13.7 | $ | — | |||||
Reserves
for self-insurance claims and other liabilities
|
$ | — | $ | 28.3 |
Amount of gain (loss)
recognized in OCI on
Derivative (Effective
Portion)
|
Location of gain (loss)
recognized in Income on
Derivative (Ineffective
Portion and Amount
Excluded from
Effectiveness Testing)
|
Amount of gain (loss)
recognized in Income on
Derivative (Ineffective
Portion and Amount
Excluded from
Effectiveness Testing)
|
|||||||||||||||||||||||||||||||
For the Three
Months Ended
September 30,
|
For the Nine
Months Ended
September 30,
|
For the Three
Months Ended
September 30,
|
For the Nine
Months Ended
September 30,
|
||||||||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
2010
|
2009
|
2010
|
2009
|
||||||||||||||||||||||||||
Derivative
in ASC 815-10 cash flow hedging relationships:
|
|||||||||||||||||||||||||||||||||
Interest
rate swap
|
$ | 4.8 | $ | 3.2 | $ | 14.6 | $ | 10.1 |
Interest
expense, net
|
$ | (0.1 | ) | $ | — | $ | (0.1 | ) | $ | — |
Settlement Date
|
Three-month LIBOR
Forward Interest Rates
|
|||
November
30, 2010
|
0.29938 | % | ||
February
28, 2011
|
0.34491 | |||
May
30, 2011
|
0.39813 |
September 30,
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
Amortized
intangible assets:
|
||||||||
Contract-based
physician minimum revenue guarantees
|
||||||||
Gross
carrying amount
|
$ | 85.7 | $ | 77.5 | ||||
Accumulated
amortization
|
(35.7 | ) | (26.4 | ) | ||||
Net
total
|
50.0 | 51.1 | ||||||
Non-competition
agreements
|
||||||||
Gross
carrying amount
|
29.3 | 20.4 | ||||||
Accumulated
amortization
|
(11.3 | ) | (9.4 | ) | ||||
Net
total
|
18.0 | 11.0 | ||||||
Total
amortized intangible assets
|
||||||||
Gross
carrying amount
|
115.0 | 97.9 | ||||||
Accumulated
amortization
|
(47.0 | ) | (35.8 | ) | ||||
Net
total
|
68.0 | 62.1 | ||||||
Indefinite-lived
intangible assets:
|
||||||||
Certificates
of need
|
6.9 | 6.5 | ||||||
Total
intangible assets:
|
||||||||
Gross
carrying amount
|
121.9 | 104.4 | ||||||
Accumulated
amortization
|
(47.0 | ) | (35.8 | ) | ||||
Net
total
|
$ | 74.9 | $ | 68.6 |
Income
Taxes
|
Deferred
Income
|
Long-Term
Income Tax
|
||||||||||
Receivable
|
Taxes, Net
|
Liability
|
||||||||||
Balance
at December 31, 2009
|
$ | 10.0 | $ | (55.6 | ) | $ | (51.3 | ) | ||||
Adjustments
resulting from tax accounting method change related to worthless accounts
receivable
|
— | (29.2 | ) | 29.2 | ||||||||
Reversal
of interest accrued as a result of tax accounting method change related to
worthless accounts receivable
|
— | (2.2 | ) | 6.7 | ||||||||
Federal
income tax impact of the income tax provision to income tax return
reconciliation
|
51.0 | (51.0 | ) | — | ||||||||
Reversal
of interest accrued as a result of the expiration of statutes of
limitations on various income tax returns
|
— | (0.4 | ) | 1.1 | ||||||||
Other
|
(0.6 | ) | 0.6 | (5.9 | ) | |||||||
Year
to date (provision for) benefit from income taxes
|
(100.3 | ) | 28.5 | — | ||||||||
Year
to date income taxes paid, net
|
42.1 | 0.3 | 0.4 | |||||||||
Balance
at September 30, 2010
|
$ | 2.2 | $ | (109.0 | ) | $ | (19.8 | ) |
Three Months Ended
September 30,
|
Three Months Ended
September 30,
|
|||||||||||||||||||||||
Increase
|
Increase
|
|||||||||||||||||||||||
2010
|
2009
|
(Decrease)
|
2010
|
2009
|
(Decrease)
|
|||||||||||||||||||
Federal
income taxes
|
$ | 18.9 | $ | 18.4 | $ | 0.5 | 35.0 | % | 35.0 | % |
—
|
bps | ||||||||||||
State
income taxes, net of federal income tax benefit
|
1.5 | 1.4 | 0.1 | 2.7 | 2.7 | — | ||||||||||||||||||
Net
(reversal) accrual of interest on the long-term income tax
liability
|
(5.2 | ) | 0.6 | (5.8 | ) | (9.6 | ) | 1.1 | (1,070 | ) | ||||||||||||||
Other
items, net
|
0.4 | 0.1 | 0.3 | 0.7 | 0.3 | 40 | ||||||||||||||||||
Effective
income taxes/rate
|
$ | 15.6 | $ | 20.5 | $ | (4.9 | ) | 28.8 | % | 39.1 | % |
(1,030
|
)bps |
Nine Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||||||||||
Increase
|
Increase
|
|||||||||||||||||||||||
2010
|
2009
|
(Decrease)
|
2010
|
2009
|
(Decrease)
|
|||||||||||||||||||
Federal
income taxes
|
$ | 64.6 | $ | 57.7 | $ | 6.9 | 35.0 | % | 35.0 | % |
—
|
bps | ||||||||||||
State
income taxes, net of federal income tax benefit
|
5.1 | 4.5 | 0.6 | 2.8 | 2.8 | — | ||||||||||||||||||
Net
(reversal) accrual of interest on the long-term income tax
liability
|
(4.5 | ) | 1.8 | (6.3 | ) | (2.4 | ) | 1.2 | (360 | ) | ||||||||||||||
Other
items, net
|
0.3 | 0.2 | 0.1 | — | — | — | ||||||||||||||||||
Effective
income taxes/rate
|
$ | 65.5 | $ | 64.2 | $ | 1.3 | 35.4 | % | 39.0 | % |
(360
|
)bps |
Three Months Ended
September 30, 2010
|
Nine Months Ended
September 30, 2010
|
|||||||
Income
from continuing operations
|
$ | 4.5 | $ | 4.5 | ||||
Net
income attributable to LifePoint Hospitals, Inc.
|
$ | 4.5 | $ | 4.5 | ||||
Basic
earnings per share attributable to LifePoint Hospitals, Inc. stockholders,
continuing operations
|
$ | 0.09 | $ | 0.09 | ||||
Diluted
earnings per share attributable to LifePoint Hospitals, Inc. stockholders,
continuing operations
|
$ | 0.08 | $ | 0.08 |
Nine Months Ended
September 30,
|
||||||||
2010
|
2009
|
|||||||
Expected
volatility
|
40.0 | % | 40.3 | % | ||||
Risk
free interest rate (range)
|
0.06% - 3.69 | % | 0.10% - 3.58 | % | ||||
Expected
dividends
|
— | — | ||||||
Average
expected term (years)
|
5.4 | 5.4 | ||||||
Fair
value per share of stock options granted
|
$ | 10.95 | $ | 8.01 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Other
stock-based awards
|
$ | 3.5 | $ | 4.2 | $ | 10.4 | $ | 11.4 | ||||||||
Stock
options
|
2.2 | 1.7 | 6.4 | 5.1 | ||||||||||||
Total
stock-based compensation expense
|
$ | 5.7 | $ | 5.9 | $ | 16.8 | $ | 16.5 | ||||||||
Tax
benefit on stock-based compensation expense
|
$ | 2.3 | $ | 2.5 | $ | 6.7 | $ | 7.1 |
Carrying Amount
|
Fair Value
|
|||||||||||||||
September 30,
2010
|
December 31,
2009
|
September 30,
2010
|
December 31,
2009
|
|||||||||||||
Term
B Loans
|
$ | 443.7 | $ | 692.9 | $ | 441.5 | $ | 673.8 | ||||||||
6.625%
Senior Notes
|
$ | 400.0 | N/A | $ | 406.0 | N/A | ||||||||||
3½%
Notes, excluding unamortized discount
|
$ | 575.0 | $ | 575.0 | $ | 572.8 | $ | 536.2 | ||||||||
3¼%
Debentures, excluding unamortized discount
|
$ | 225.0 | $ | 225.0 | $ | 220.5 | $ | 206.2 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Revenues
(revenue deductions)
|
$ | — | $ | 0.2 | $ | (0.5 | ) | $ | 16.3 | |||||||
Income
(loss) before income tax benefits
|
$ | 0.4 | $ | (1.1 | ) | $ | — | $ | (6.8 | ) | ||||||
Net
income (loss)
|
$ | 0.3 | $ | (0.7 | ) | $ | — | $ | (3.9 | ) |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Numerator
for basic and diluted earnings per share attributable to LifePoint
Hospitals,
Inc.:
|
||||||||||||||||
Income
from continuing operations
|
$ | 39.2 | $ | 32.7 | $ | 121.6 | $ | 102.3 | ||||||||
Less:
Net income attributable to noncontrolling interests
|
(0.7 | ) | (0.6 | ) | (2.3 | ) | (1.7 | ) | ||||||||
Income
from continuing operations attributable to LifePoint Hospitals, Inc.
stockholders
|
38.5 | 32.1 | 119.3 | 100.6 | ||||||||||||
Income
(loss) from discontinued operations, net of income taxes
|
0.3 | (0.7 | ) | — | (4.5 | ) | ||||||||||
Net
income attributable to LifePoint Hospitals, Inc.
|
$ | 38.8 | $ | 31.4 | $ | 119.3 | $ | 96.1 | ||||||||
Denominator:
|
||||||||||||||||
Weighted
average shares outstanding — basic
|
52.0 | 53.0 | 52.8 | 52.7 | ||||||||||||
Effect
of dilutive securities: stock options and other stock-based
awards
|
1.1 | 0.9 | 1.2 | 0.8 | ||||||||||||
Weighted
average shares outstanding — diluted
|
53.1 | 53.9 | 54.0 | 53.5 | ||||||||||||
Basic
earnings (loss) per share attributable to LifePoint Hospitals, Inc.
stockholders (a):
|
||||||||||||||||
Continuing
operations
|
$ | 0.74 | $ | 0.60 | $ | 2.26 | $ | 1.91 | ||||||||
Discontinued
operations
|
— | (0.01 | ) | — | (0.08 | ) | ||||||||||
Net
income
|
$ | 0.74 | $ | 0.59 | $ | 2.26 | $ | 1.83 | ||||||||
Diluted
earnings (loss) per share attributable to LifePoint Hospitals, Inc.
stockholders (a):
|
||||||||||||||||
Continuing
operations
|
$ | 0.72 | $ | 0.59 | $ | 2.21 | $ | 1.88 | ||||||||
Discontinued
operations
|
— | (0.01 | ) | — | (0.08 | ) | ||||||||||
Net
income
|
$ | 0.73 | $ | 0.58 | $ | 2.21 | $ | 1.80 |
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||||||||||||||||||
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
|||||||||||||||||||||||||
Revenues
|
$ | 832.3 | 100.0 | % | $ | 745.0 | 100.0 | % | $ | 2,409.1 | 100.0 | % | $ | 2,215.8 | 100.0 | % | ||||||||||||||||
Salaries
and benefits
|
324.8 | 39.0 | 295.8 | 39.7 | 935.1 | 38.8 | 875.0 | 39.5 | ||||||||||||||||||||||||
Supplies
|
112.9 | 13.6 | 102.3 | 13.7 | 330.5 | 13.7 | 304.2 | 13.7 | ||||||||||||||||||||||||
Other
operating expenses
|
158.5 | 19.0 | 134.4 | 18.0 | 444.2 | 18.5 | 405.7 | 18.3 | ||||||||||||||||||||||||
Provision
for doubtful accounts
|
116.3 | 14.0 | 98.7 | 13.3 | 323.4 | 13.4 | 281.1 | 12.7 | ||||||||||||||||||||||||
Depreciation
and amortization
|
36.4 | 4.4 | 35.1 | 4.8 | 109.2 | 4.5 | 106.1 | 4.8 | ||||||||||||||||||||||||
Interest
expense, net
|
26.2 | 3.1 | 25.5 | 3.4 | 77.2 | 3.2 | 77.2 | 3.5 | ||||||||||||||||||||||||
Debt
extinguishment costs
|
2.4 | 0.3 | — | — | 2.4 | 0.1 | — | — | ||||||||||||||||||||||||
777.5 | 93.4 | 691.8 | 92.9 | 2,222.0 | 92.2 | 2,049.3 | 92.5 | |||||||||||||||||||||||||
Income
from continuing operations before income taxes
|
54.8 | 6.6 | 53.2 | 7.1 | 187.1 | 7.8 | 166.5 | 7.5 | ||||||||||||||||||||||||
Provision
for income taxes
|
15.6 | 1.9 | 20.5 | 2.7 | 65.5 | 2.8 | 64.2 | 2.9 | ||||||||||||||||||||||||
Income
from continuing operations
|
39.2 | 4.7 | 32.7 | 4.4 | 121.6 | 5.0 | 102.3 | 4.6 | ||||||||||||||||||||||||
Less:
Net income attributable to noncontrolling interests
|
(0.7 | ) | (0.1 | ) | (0.6 | ) | (0.1 | ) | (2.3 | ) | — | (1.7 | ) | (0.1 | ) | |||||||||||||||||
Income
from continuing operations attributable to LifePoint Hospitals,
Inc.
|
$ | 38.5 | 4.6 | % | $ | 32.1 | 4.3 | % | $ | 119.3 | 5.0 | % | $ | 100.6 | 4.5 | % |
Three Months Ended
September 30,
|
Increase
|
% Increase
|
||||||||||||||
2010
|
2009
|
(Decrease)
|
(Decrease)
|
|||||||||||||
Continuing
operations:
|
||||||||||||||||
Revenues
(dollars in millions)
|
$ | 832.3 | $ | 745.0 | $ | 87.3 | 11.7 | % | ||||||||
Admissions
|
46,159 | 46,354 | (195 | ) | (0.4 | ) | ||||||||||
Equivalent
admissions
|
102,613 | 99,693 | 2,920 | 2.9 | ||||||||||||
Revenues
per equivalent admission
|
$ | 8,111 | $ | 7,474 | $ | 637 | 8.5 | |||||||||
Medicare
case mix index
|
1.29 | 1.29 | - | - | ||||||||||||
Average
length of stay (days)
|
4.3 | 4.2 | 0.1 | 2.4 | ||||||||||||
Inpatient
surgeries
|
13,733 | 14,036 | (303 | ) | (2.2 | ) | ||||||||||
Outpatient
surgeries
|
39,506 | 38,406 | 1,100 | 2.9 | ||||||||||||
Emergency
room visits
|
248,957 | 242,878 | 6,079 | 2.5 | ||||||||||||
Outpatient
factor
|
2.22 | 2.15 | 0.07 | 3.3 | ||||||||||||
Same-hospital:
|
||||||||||||||||
Revenues
(dollars in millions)
|
$ | 803.2 | $ | 745.0 | $ | 58.2 | 7.8 | % | ||||||||
Admissions
|
44,645 | 46,354 | (1,709 | ) | (3.7 | ) | ||||||||||
Equivalent
admissions
|
98,562 | 99,693 | (1,131 | ) | (1.1 | ) | ||||||||||
Revenues
per equivalent admission
|
$ | 8,148 | $ | 7,474 | $ | 674 | 9.0 | |||||||||
Medicare
case mix index
|
1.30 | 1.30 | - | - | ||||||||||||
Average
length of stay (days)
|
4.3 | 4.2 | 0.01 | 2.4 | ||||||||||||
Inpatient
surgeries
|
13,355 | 14,036 | (681 | ) | (4.9 | ) | ||||||||||
Outpatient
surgeries
|
38,123 | 38,406 | (283 | ) | (0.7 | ) | ||||||||||
Emergency
room visits
|
238,430 | 242,878 | (4,448 | ) | (1.8 | ) | ||||||||||
Outpatient
factor
|
2.21 | 2.15 | 0.06 | 2.8 |
Continuing
Operations
|
Same-Hospital
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Medicare
|
28.2 | % | 28.9 | % | 28.4 | % | 28.9 | % | ||||||||
Medicaid
|
13.1 | 10.5 | 13.1 | 10.5 | ||||||||||||
HMOs,
PPOs and other private insurers
|
39.3 | 44.5 | 39.1 | 44.5 | ||||||||||||
Self-Pay
|
15.2 | 13.2 | 15.3 | 13.2 | ||||||||||||
Other
|
4.2 | 2.9 | 4.1 | 2.9 | ||||||||||||
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
Three Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
|
% Increase
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Salaries
and benefits (dollars in millions)
|
$ | 324.8 | 39.0 | % | $ | 295.8 | 39.7 | % | $ | 29.0 | 9.7 | % | ||||||||||||
Man-hours
per equivalent admission
|
97.4 | N/A | 92.6 | N/A | 4.8 | 5.2 | % | |||||||||||||||||
Salaries
and benefits per equivalent admission
|
$ | 3,140 | N/A | $ | 2,924 | N/A | $ | 216 | 7.4 | % | ||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Salaries
and benefits (dollars in millions)
|
$ | 312.1 | 38.9 | % | $ | 295.8 | 39.7 | % | $ | 16.3 | 5.5 | % | ||||||||||||
Man-hours
per equivalent admission
|
96.3 | N/A | 92.6 | N/A | 3.7 | 4.0 | % | |||||||||||||||||
Salaries
and benefits per equivalent admission
|
$ | 3,141 | N/A | $ | 2,924 | N/A | $ | 217 | 7.4 | % |
Three Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
|
% Increase
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Supplies
(dollars in millions)
|
$ | 112.9 | 13.6 | % | $ | 102.3 | 13.7 | % | $ | 10.6 | 10.3 | % | ||||||||||||
Supplies
per equivalent admission
|
$ | 1,100 | N/A | $ | 1,022 | N/A | $ | 78 | 7.6 | % | ||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Supplies
(dollars in millions)
|
$ | 109.1 | 13.6 | % | $ | 102.3 | 13.7 | % | $ | 6.8 | 6.6 | % | ||||||||||||
Supplies
per equivalent admission
|
$ | 1,107 | N/A | $ | 1,022 | N/A | $ | 85 | 8.3 | % |
Three Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
(Decrease)
|
%
Increase
(Decrease)
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Professional
fees
|
$ | 20.9 | 2.5 | % | $ | 18.9 | 2.5 | % | $ | 2.0 | 10.7 | % | ||||||||||||
Utilities
|
14.9 | 1.8 | 13.3 | 1.8 | 1.6 | 12.7 | ||||||||||||||||||
Repairs
and maintenance
|
18.1 | 2.2 | 16.0 | 2.2 | 2.1 | 13.0 | ||||||||||||||||||
Rents
and leases
|
7.2 | 0.9 | 7.1 | 1.0 | 0.1 | 1.3 | ||||||||||||||||||
Insurance
|
9.7 | 1.2 | 9.7 | 1.3 | — | (0.7 | ) | |||||||||||||||||
Physician
recruiting
|
5.4 | 0.6 | 6.7 | 0.9 | (1.3 | ) | (18.6 | ) | ||||||||||||||||
Contract
services
|
39.7 | 4.8 | 36.2 | 4.9 | 3.5 | 9.8 | ||||||||||||||||||
Non-income
taxes
|
23.4 | 2.8 | 10.5 | 1.4 | 12.9 | 123.3 | ||||||||||||||||||
Other
|
19.2 | 2.2 | 16.0 | 2.0 | 3.2 | 20.6 | ||||||||||||||||||
$ | 158.5 | 19.0 | % | $ | 134.4 | 18.0 | % | $ | 24.1 | 18.1 | % |
Three Months Ended September 30,
|
||||||||||||||||||||||||
2010
|
% of
Revenues
|
2009
|
% of
Revenues
|
Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Professional
fees
|
$ | 19.6 | 2.4 | % | $ | 18.9 | 2.5 | % | $ | 0.7 | 3.7 | % | ||||||||||||
Utilities
|
14.4 | 1.8 | 13.3 | 1.8 | 1.1 | 8.8 | ||||||||||||||||||
Repairs
and maintenance
|
17.5 | 2.2 | 16.0 | 2.2 | 1.5 | 8.7 | ||||||||||||||||||
Rents
and leases
|
6.4 | 0.8 | 7.1 | 1.0 | (0.7 | ) | (10.1 | ) | ||||||||||||||||
Insurance
|
9.5 | 1.2 | 9.7 | 1.3 | (0.2 | ) | (2.9 | ) | ||||||||||||||||
Physician
recruiting
|
5.3 | 0.7 | 6.7 | 0.9 | (1.4 | ) | (19.0 | ) | ||||||||||||||||
Contract
services
|
38.7 | 4.8 | 36.2 | 4.9 | 2.5 | 7.1 | ||||||||||||||||||
Non-income
taxes
|
21.8 | 2.7 | 10.5 | 1.4 | 11.3 | 108.8 | ||||||||||||||||||
Other
|
19.0 | 2.3 | 16.0 | 2.0 | 3.0 | 19.2 | ||||||||||||||||||
$ | 152.2 | 18.9 | % | $ | 134.4 | 18.0 | % | $ | 17.8 | 13.4 | % |
Three Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
(Decrease)
|
%
Increase
(Decrease)
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Provision
for doubtful accounts (dollars in millions)
|
$ | 116.3 | 14.0 | % | $ | 98.7 | 13.3 | % | $ | 17.6 | 17.7 | % | ||||||||||||
Related
key indicators:
|
||||||||||||||||||||||||
Charity
care write-offs (dollars in millions)
|
$ | 17.3 | 2.1 | % | $ | 16.4 | 2.2 | % | $ | 0.9 | 6.3 | % | ||||||||||||
Self-pay
revenues, net of charity care write-offs and uninsured discounts (dollars
in millions)
|
$ | 126.3 | 15.2 | % | $ | 98.4 | 13.2 | % | $ | 27.9 | 28.4 | % | ||||||||||||
Net
revenue days outstanding (at end of period)
|
40.3 | N/A | 41.0 | N/A | (0.7 | ) | (1.7 | )% | ||||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Provision
for doubtful accounts (dollars in millions)
|
$ | 111.4 | 13.9 | % | $ | 98.7 | 13.3 | % | $ | 12.7 | 12.8 | % | ||||||||||||
Related
key indicators:
|
||||||||||||||||||||||||
Charity
care write-offs (dollars in millions)
|
$ | 17.1 | 2.1 | % | $ | 16.4 | 2.2 | % | $ | 0.7 | 4.6 | % | ||||||||||||
Self-pay
revenues, net of charity care write-offs and uninsured discounts (dollars
in millions)
|
$ | 122.9 | 15.3 | % | $ | 98.4 | 13.2 | % | $ | 24.5 | 24.9 | % | ||||||||||||
Net
revenue days outstanding (at end of period)
|
39.7 | N/A | 41.0 | N/A | (1.3 | ) | (3.2 | )% |
Three
Months Ended
September
30,
|
Three
Months Ended
September
30,
|
|||||||||||||||||||||||
Increase
|
Increase
|
|||||||||||||||||||||||
2010
|
2009
|
(Decrease)
|
2010
|
2009
|
(Decrease)
|
|||||||||||||||||||
Federal
income taxes
|
$ | 18.9 | $ | 18.4 | $ | 0.5 | 35.0 | % | 35.0 | % |
—
|
bps | ||||||||||||
State
income taxes, net of federal income tax benefit
|
1.5 | 1.4 | 0.1 | 2.7 | 2.7 | — | ||||||||||||||||||
Net
(reversal) accrual of interest on the long-term income tax
liability
|
(5.2 | ) | 0.6 | (5.8 | ) | (9.6 | ) | 1.1 | (1,070 | ) | ||||||||||||||
Other
items, net
|
0.4 | 0.1 | 0.3 | 0.7 | 0.3 | 40 | ||||||||||||||||||
Effective
income taxes/rate
|
$ | 15.6 | $ | 20.5 | $ | (4.9 | ) | 28.8 | % | 39.1 | % |
(1,030
|
)bps |
Nine
Months Ended
September 30,
|
Increase
|
%
Increase
|
||||||||||||||
2010
|
2009
|
(Decrease)
|
(Decrease)
|
|||||||||||||
Continuing
operations:
|
||||||||||||||||
Revenues
(dollars in millions)
|
$ | 2,409.1 | $ | 2,215.8 | $ | 193.3 | 8.7 | % | ||||||||
Admissions
|
141,174 | 141,587 | (413 | ) | (0.3 | ) | ||||||||||
Equivalent
admissions
|
303,665 | 295,492 | 8,173 | 2.8 | ||||||||||||
Revenues
per equivalent admission
|
$ | 7,933 | $ | 7,499 | $ | 434 | 5.8 | |||||||||
Medicare
case mix index
|
1.30 | 1.30 | - | - | ||||||||||||
Average
length of stay (days)
|
4.4 | 4.3 | 0.1 | 2.3 | ||||||||||||
Inpatient
surgeries
|
40,539 | 41,245 | (706 | ) | (1.7 | ) | ||||||||||
Outpatient
surgeries
|
115,798 | 113,697 | 2,101 | 1.8 | ||||||||||||
Emergency
room visits
|
708,435 | 703,122 | 5,313 | 0.8 | ||||||||||||
Outpatient
factor
|
2.15 | 2.09 | 0.06 | 2.9 | ||||||||||||
Same-hospital:
|
||||||||||||||||
Revenues
(dollars in millions)
|
$ | 2,370.9 | $ | 2,215.8 | $ | 155.1 | 7.0 | % | ||||||||
Admissions
|
139,224 | 141,587 | (2,363 | ) | (1.7 | ) | ||||||||||
Equivalent
admissions
|
298,218 | 295,492 | 2,726 | 0.9 | ||||||||||||
Revenues
per equivalent admission
|
$ | 7,950 | $ | 7,499 | $ | 451 | 6.0 | |||||||||
Medicare
case mix index
|
1.30 | 1.30 | - | - | ||||||||||||
Average
length of stay (days)
|
4.4 | 4.3 | 0.1 | 2.3 | ||||||||||||
Inpatient
surgeries
|
40,047 | 41,245 | (1,198 | ) | (2.9 | ) | ||||||||||
Outpatient
surgeries
|
113,662 | 113,697 | (35 | ) | - | |||||||||||
Emergency
room visits
|
693,657 | 703,122 | (9,465 | ) | (1.3 | ) | ||||||||||
Outpatient
factor
|
2.14 | 2.09 | 0.05 | 2.4 |
Continuing
Operations
|
Same-Hospital
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Medicare
|
29.3 | % | 29.8 | % | 29.4 | % | 29.8 | % | ||||||||
Medicaid
|
11.5 | 10.3 | 11.5 | 10.3 | ||||||||||||
HMOs,
PPOs and other private insurers
|
41.1 | 44.3 | 41.0 | 44.3 | ||||||||||||
Self-Pay
|
14.5 | 12.9 | 14.5 | 12.9 | ||||||||||||
Other
|
3.6 | 2.7 | 3.6 | 2.7 | ||||||||||||
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
Nine Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
|
% Increase
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Salaries
and benefits (dollars in millions)
|
$ | 935.1 | 38.8 | % | $ | 875.0 | 39.5 | % | $ | 60.1 | 6.9 | % | ||||||||||||
Man-hours
per equivalent admission
|
95.2 | N/A | 92.0 | N/A | 3.2 | 3.5 | % | |||||||||||||||||
Salaries
and benefits per equivalent admission
|
$ | 3,070 | N/A | $ | 2,944 | N/A | $ | 126 | 4.3 | % | ||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Salaries
and benefits (dollars in millions)
|
$ | 917.7 | 38.7 | % | $ | 875.0 | 39.5 | % | $ | 42.7 | 4.9 | % | ||||||||||||
Man-hours
per equivalent admission
|
94.8 | N/A | 92.0 | N/A | 2.8 | 3.0 | % | |||||||||||||||||
Salaries
and benefits per equivalent admission
|
$ | 3,068 | N/A | $ | 2,944 | N/A | $ | 124 | 4.2 | % |
Nine Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
|
% Increase
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Supplies
(dollars in millions)
|
$ | 330.5 | 13.7 | % | $ | 304.2 | 13.7 | % | $ | 26.3 | 8.6 | % | ||||||||||||
Supplies
per equivalent admission
|
$ | 1,088 | N/A | $ | 1,026 | N/A | $ | 62 | 6.0 | % | ||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Supplies
(dollars in millions)
|
$ | 325.6 | 13.7 | % | $ | 304.2 | 13.7 | % | $ | 21.4 | 7.0 | % | ||||||||||||
Supplies
per equivalent admission
|
$ | 1,092 | N/A | $ | 1,026 | N/A | $ | 66 | 6.4 | % |
Nine Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
(Decrease)
|
%
Increase
(Decrease)
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Professional
fees
|
$ | 59.9 | 2.5 | % | $ | 54.1 | 2.4 | % | $ | 5.8 | 10.7 | % | ||||||||||||
Utilities
|
40.1 | 1.7 | 38.4 | 1.7 | 1.7 | 4.6 | ||||||||||||||||||
Repairs
and maintenance
|
52.3 | 2.2 | 48.5 | 2.2 | 3.8 | 7.8 | ||||||||||||||||||
Rents
and leases
|
20.0 | 0.8 | 21.3 | 1.0 | (1.3 | ) | (6.4 | ) | ||||||||||||||||
Insurance
|
33.3 | 1.4 | 35.1 | 1.6 | (1.8 | ) | (5.2 | ) | ||||||||||||||||
Physician
recruiting
|
17.6 | 0.7 | 18.2 | 0.8 | (0.6 | ) | (3.3 | ) | ||||||||||||||||
Contract
services
|
115.1 | 4.8 | 108.7 | 4.9 | 6.4 | 5.9 | ||||||||||||||||||
Non-income
taxes
|
48.2 | 2.0 | 31.0 | 1.4 | 17.2 | 55.6 | ||||||||||||||||||
Other
|
57.7 | 2.4 | 50.4 | 2.3 | 7.3 | 14.7 | ||||||||||||||||||
$ | 444.2 | 18.5 | % | $ | 405.7 | 18.3 | % | $ | 38.5 | 9.5 | % | |||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Professional
fees
|
$ | 58.0 | 2.4 | % | $ | 54.1 | 2.4 | % | $ | 3.9 | 7.1 | % | ||||||||||||
Utilities
|
39.5 | 1.7 | 38.4 | 1.7 | 1.1 | 3.0 | ||||||||||||||||||
Repairs
and maintenance
|
51.4 | 2.2 | 48.5 | 2.2 | 2.9 | 5.9 | ||||||||||||||||||
Rents
and leases
|
18.8 | 0.8 | 21.3 | 1.0 | (2.5 | ) | (11.7 | ) | ||||||||||||||||
Insurance
|
33.0 | 1.4 | 35.1 | 1.6 | (2.1 | ) | (6.1 | ) | ||||||||||||||||
Physician
recruiting
|
17.5 | 0.7 | 18.2 | 0.8 | (0.7 | ) | (3.5 | ) | ||||||||||||||||
Contract
services
|
113.8 | 4.8 | 108.7 | 4.9 | 5.1 | 4.8 | ||||||||||||||||||
Non-income
taxes
|
46.4 | 2.0 | 31.0 | 1.4 | 15.4 | 49.9 | ||||||||||||||||||
Other
|
57.5 | 2.4 | 50.4 | 2.3 | 7.1 | 14.1 | ||||||||||||||||||
$ | 435.9 | 18.4 | % | $ | 405.7 | 18.3 | % | $ | 30.2 | 7.5 | % |
Nine Months Ended September
30,
|
||||||||||||||||||||||||
2010
|
%
of
Revenues
|
2009
|
%
of
Revenues
|
Increase
(Decrease)
|
%
Increase
(Decrease)
|
|||||||||||||||||||
Continuing
operations:
|
||||||||||||||||||||||||
Provision
for doubtful accounts (dollars in millions)
|
$ | 323.4 | 13.4 | % | $ | 281.1 | 12.7 | % | $ | 42.3 | 15.1 | % | ||||||||||||
Related
key indicators:
|
||||||||||||||||||||||||
Charity
care write-offs (dollars in millions)
|
$ | 44.3 | 1.8 | % | $ | 44.9 | 2.0 | % | $ | (0.6 | ) | (1.2 | )% | |||||||||||
Self-pay
revenues, net of charity care write-offs and uninsured discounts (dollars
in millions)
|
$ | 348.1 | 14.5 | % | $ | 285.0 | 12.9 | % | $ | 63.1 | 22.1 | % | ||||||||||||
Net
revenue days outstanding (at end of period)
|
40.3 | N/A | 41.0 | N/A | (0.7 | ) | (1.7 | )% | ||||||||||||||||
Same-hospital:
|
||||||||||||||||||||||||
Provision
for doubtful accounts (dollars in millions)
|
$ | 318.0 | 13.4 | % | $ | 281.1 | 12.7 | % | $ | 36.9 | 13.1 | % | ||||||||||||
Related
key indicators:
|
||||||||||||||||||||||||
Charity
care write-offs (dollars in millions)
|
$ | 44.1 | 1.9 | % | $ | 44.9 | 2.0 | % | $ | (0.8 | ) | (1.8 | )% | |||||||||||
Self-pay
revenues, net of charity care write-offs and uninsured discounts (dollars
in millions)
|
$ | 343.5 | 14.5 | % | $ | 285.0 | 12.9 | % | $ | 58.5 | 20.5 | % | ||||||||||||
Net
revenue days outstanding (at end of period)
|
39.7 | N/A | 41.0 | N/A | (1.3 | ) | (3.1 | )% |
Nine
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
|||||||||||||||||||||||
Increase
|
Increase
|
|||||||||||||||||||||||
2010
|
2009
|
(Decrease)
|
2010
|
2009
|
(Decrease)
|
|||||||||||||||||||
Federal
income taxes
|
$ | 64.6 | $ | 57.7 | $ | 6.9 | 35.0 | % | 35.0 | % |
—
|
bps | ||||||||||||
State
income taxes, net of federal income tax benefit
|
5.1 | 4.5 | 0.6 | 2.8 | 2.8 | — | ||||||||||||||||||
Net
(reversal) accrual of interest on the long-term income tax
liability
|
(4.5 | ) | 1.8 | (6.3 | ) | (2.4 | ) | 1.2 | (360 | ) | ||||||||||||||
Other
items, net
|
0.3 | 0.2 | 0.1 | — | — | — | ||||||||||||||||||
Effective
income taxes/rate
|
$ | 65.5 | $ | 64.2 | $ | 1.3 | 35.4 | % | 39.0 | % |
(360
|
)bps |
Three
Months Ended
September 30,
|
Nine
Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net
cash flows provided by continuing operations
|
$ | 113.6 | $ | 70.3 | $ | 281.7 | $ | 229.3 | ||||||||
Less:
Purchase of property and equipment
|
(48.4 | ) | (33.7 | ) | (122.0 | ) | (118.8 | ) | ||||||||
Free
operating cash flow
|
65.2 | 36.6 | 159.7 | 110.5 | ||||||||||||
Acquisitions,
net of cash acquired
|
(142.2 | ) | — | (184.9 | ) | (79.7 | ) | |||||||||
Proceeds
from borrowings
|
400.0 | — | 400.0 | — | ||||||||||||
Payments
on borrowings
|
(255.2 | ) | — | (255.2 | ) | (13.5 | ) | |||||||||
Repurchases
of common stock
|
(46.9 | ) | (0.4 | ) | (97.4 | ) | (3.0 | ) | ||||||||
Payment
of debt issue costs
|
(8.7 | ) | — | (13.1 | ) | — | ||||||||||
Proceeds
from exercise of stock options
|
1.2 | 0.3 | 14.7 | 9.9 | ||||||||||||
Other
|
(1.3 | ) | (2.0 | ) | 1.5 | (0.9 | ) | |||||||||
Cash
flows from operations used in discontinued operations
|
(0.5 | ) | 3.9 | (1.2 | ) | 1.0 | ||||||||||
Cash
flows from investing activities provided by (used in) discontinued
operations
|
— | 9.1 | — | 19.5 | ||||||||||||
Increase
(decrease) in cash and cash equivalents
|
$ | 11.6 | $ | 47.5 | $ | 24.1 | $ | 43.8 |
Three
Months Ended
September 30,
|
Nine
Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Capital
projects
|
$ | 22.5 | $ | 21.1 | $ | 56.2 | $ | 79.4 | ||||||||
Routine
|
12.1 | 9.9 | 31.9 | 30.9 | ||||||||||||
Information
systems
|
13.8 | 2.7 | 33.9 | 8.5 | ||||||||||||
$ | 48.4 | $ | 33.7 | $ | 122.0 | $ | 118.8 | |||||||||
Depreciation
expense
|
$ | 35.7 | $ | 34.8 | $ | 107.3 | $ | 105.2 | ||||||||
Ratio
of capital expenditures to depreciation expense
|
135.6 | % | 96.8 | % | 113.7 | % | 112.9 | % |
December
31,
2009
|
Proceeds
from
Borrowings
|
Payments
on
Borrowings
|
Other
|
Amortization
of
Convertible
Debt
Discounts
|
September
30,
2010
|
|||||||||||||||||||
Credit
Agreement:
|
||||||||||||||||||||||||
Term
B Loans
|
$ | 692.9 | $ | — | $ | (249.2 | ) | $ | — | $ | — | $ | 443.7 | |||||||||||
Revolving
Loans
|
— | — | — | — | — | — | ||||||||||||||||||
6.625%
Senior Notes
|
— | 400.0 | — | — | — | 400.0 | ||||||||||||||||||
Province
7½% Notes
|
6.1 | — | (6.0 | ) | — | — | 0.1 | |||||||||||||||||
3¼%
Debentures
|
225.0 | — | — | — | — | 225.0 | ||||||||||||||||||
3½%
Notes
|
575.0 | — | — | — | — | 575.0 | ||||||||||||||||||
Unamortized
discounts on 3¼% Debentures and 3½% Notes
|
(102.4 | ) | — | — | — | 16.7 | (85.7 | ) | ||||||||||||||||
Capital
leases
|
3.2 | — | (1.1 | ) | 1.6 | — | 3.7 | |||||||||||||||||
$ | 1,399.8 | $ | 400.0 | $ | (256.3 | ) | $ | 1.6 | $ | 16.7 | $ | 1,561.8 |
September
30,
2010
|
December
31,
2009
|
Increase
(Decrease)
|
||||||||||
Current
portion of long-term debt
|
$ | 1.3 | $ | 1.0 | $ | 0.3 | ||||||
Long-term
debt
|
1,560.5 | 1,398.8 | 161.7 | |||||||||
Unamortized
discounts of convertible debt instruments
|
85.7 | 102.4 | (16.7 | ) | ||||||||
Total
debt, excluding unamortized discounts of convertible debt
instruments
|
1,647.5 | 1,502.2 | 145.3 | |||||||||
Total
LifePoint Hospitals, Inc. stockholders’ equity
|
1,891.0 | 1,827.7 | 63.3 | |||||||||
Total
capitalization
|
$ | 3,538.5 | $ | 3,329.9 | $ | 208.6 | ||||||
Total
debt to total capitalization
|
46.6 | % | 45.1 | % |
150
|
bps | ||||||
Percentage
of:
|
||||||||||||
Fixed
rate debt, excluding unamortized discounts of convertible debt
instruments
|
73.1 | % | 53.9 | % | ||||||||
Variable
rate debt (a)
|
26.9 | 46.1 | ||||||||||
100.0 | % | 100.0 | % | |||||||||
Percentage
of:
|
||||||||||||
Senior
debt
|
66.6 | % | 46.3 | % | ||||||||
Subordinated
debt, excluding unamortized discounts of convertible debt
instruments
|
33.4 | 53.7 | ||||||||||
100.0 | % | 100.0 | % |
(a)
|
The
above calculation does not consider the effect of our interest rate swap.
Our interest rate swap mitigates our floating rate risk on our outstanding
variable rate borrowings which converts our variable rate debt to an
annual fixed rate of 5.585%. Our interest rate swap decreases our variable
rate debt as a percentage of our outstanding debt from 26.9% and 46.1% to
zero and 16.2% as of September 30, 2010 and December 31, 2009,
respectively. Please refer to Note 4 to our accompanying condensed
consolidated financial statements included elsewhere in this report for a
discussion of our interest rate swap
agreement.
|
October
1, 2015 to September 30, 2016
|
103.313 | % | ||
October
1, 2016 to September 30, 2017
|
102.208 | % | ||
October
1, 2017 to September 30, 2018
|
101.104 | % | ||
October
1, 2018 and thereafter
|
100.000 | % |
Payment Due by Period
|
||||||||||||||||||||
Contractual Obligations
|
Total
|
October
1, 2010 to
December 31, 2010
|
2011-2012
|
2013-2014
|
After 2014
|
|||||||||||||||
Long-term
debt obligations(a)
|
$ | 2,167.7 | $ | 20.1 | $ | 149.8 | $ | 1,133.4 | $ | 864.4 |
(a)
|
Included in our long-term debt
obligations are principal and interest owed on our outstanding debt
obligations, giving consideration to our interest rate swap. We used the
3.070% effective interest rate at September 30, 2010 for our $443.7
million outstanding Term B Loans to estimate interest payments on this
variable rate debt instrument. The maturity date of the $443.7 million
Term B Loans is contingent upon refinancing our outstanding 3½% Notes
beyond their current maturity date of May 15, 2014. In the event we do not
refinance our 3½% Notes, the extended portion of the Term B Loans mature
on February 13, 2014. For purposes of the above table, we assumed that we
would not refinance our 3½% Notes beyond their current maturity date and
that the $443.7 million Term B Loans would mature on February 13, 2014.
Our interest rate swap requires us to make quarterly interest payments at
an annual fixed rate of 5.585% while the counterparty is obligated to make
quarterly floating payments to us based on the three-month LIBOR on a
decreasing notional amount. Our calculation for long-term debt obligations
includes an estimate for the net result of these payments between us and
the counterparty using the difference between our required annual fixed
rate of 5.585% and the three-month LIBOR in effect as of September 30,
2010 of 0.299% based on the effective notional amounts for the indicated
period. Holders of our $225.0 million outstanding 3¼% Debentures may
require us to purchase for cash some or all of the 3¼% Debentures on
February 15, 2013, February 15, 2015, and February 15, 2020. For purposes
of the above table, we assumed that our 3¼% Debentures would be
outstanding during the entire term, which ends on August 15,
2025.
|
|
•
|
it
requires assumptions to be made that were uncertain at the time the
estimate was made; and
|
|
•
|
changes
in the estimate or different estimates that could have been made could
have a material impact on our consolidated results of operations or
financial condition.
|
|
•
|
Revenue
recognition/Allowance for contractual
discounts;
|
|
•
|
Allowance
for doubtful accounts and provision for doubtful
accounts;
|
|
•
|
Goodwill
impairment analysis;
|
|
•
|
Reserves
for self-insurance claims;
|
|
•
|
Accounting
for stock-based compensation; and
|
|
•
|
Accounting
for income taxes.
|
|
•
|
Legal
proceedings and general liability
claims;
|
|
•
|
Physician
commitments; and
|
|
•
|
Capital
expenditure commitments.
|
Carrying Amount
|
Fair Value
|
|||||||||||||||
September
30,
2010
|
December
31,
2009
|
September
30,
2010
|
December
31,
2009
|
|||||||||||||
Term
B Loans
|
$ | 443.7 | $ | 692.9 | $ | 441.5 | $ | 673.8 | ||||||||
6.625% Senior
Notes
|
$ | 400.0 | N/A | $ | 406.0 | N/A | ||||||||||
3½%
Notes, excluding unamortized discount
|
$ | 575.0 | $ | 575.0 | $ | 572.8 | $ | 536.2 | ||||||||
3¼%
Debentures, excluding unamortized discount
|
$ | 225.0 | $ | 225.0 | $ | 220.5 | $ | 206.2 |
Period
|
Total
Number
of
Shares
Purchased
|
Weighted
Average
Price
Paid
per Share
|
Total
Number
of
Shares
Purchased
as
Part
of a
Publicly
Announced
Program
|
Approximate
Dollar
Value
of
Shares that
May
Yet be
Purchased
Under
the
Program
|
||||||||||||
(In
millions)
|
||||||||||||||||
July
1, 2010 to July 31, 2010
|
3,191 | $ | 30.81 | — | $ | 54.7 | ||||||||||
August
1, 2010 to August 31, 2010
|
1,216,957 | $ | 32.00 | 1,216,464 | $ | 15.8 | ||||||||||
September
1, 2010 to September 30, 2010
|
240,938 | $ | 32.62 | 236,828 | $ | 158.1 | ||||||||||
Total
|
1,461,086 | $ | 32.10 | 1,453,292 | $ | 158.1 |
Exhibit
Number
|
Description
|
|
3.1
|
Amended
and Restated Certificate of Incorporation (incorporated by reference from
exhibits to the Registration Statement on Form S-8 filed on April 19,
2005, File No. 333-124093).
|
|
3.2
|
Third
Amended and Restated Bylaws (incorporated by reference from exhibits to
the LifePoint Hospitals, Inc. Current Report on Form 8-K dated September
21, 2010, File No. 000-51251).
|
|
4.1
|
Indenture,
dated September 23, 2010, by and among LifePoint Hospitals, Inc., the
Guarantors (as defined therein) and Bank Of New York Mellon Trust Company,
N.A. as trustee (including the Form of 6.625% Senior Note due 2020)
(incorporated by reference from exhibits to the LifePoint Hospitals, Inc.
Current Report on Form 8-K dated September 27, 2010, File No.
000-51251).
|
|
4.2
|
Registration
Rights Agreement, dated September 23, 2010, by and among LifePoint
Hospitals, Inc., the Guarantors (as defined therein) and Barclays Capital
Inc., as representative of the several initial purchasers (incorporated by
reference from exhibits to the LifePoint Hospitals, Inc. Current Report on
Form 8-K dated September 27, 2010, File No. 000-51251).
|
|
10.1
|
Purchase
Agreement dated September 20, 2010 among LifePoint Hospitals, Inc., the
Guarantors party thereto, Barclays Capital Inc., as representative of the
Initial Purchasers named therein (incorporated by reference from exhibits
to the LifePoint Hospitals, Inc. Current Report on Form 8-K dated
September 24, 2010, File No. 000-51251).
|
|
31.1
|
Certification
of the Chief Executive Officer of LifePoint Hospitals, Inc. Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification
of the Chief Financial Officer of LifePoint Hospitals, Inc. Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification
of the Chief Executive Officer of LifePoint Hospitals, Inc. Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification
of the Chief Financial Officer of LifePoint Hospitals, Inc. Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS
|
XBRL
Instance Document.*
|
|
101.SCH
|
XBRL
Taxonomy Extension Schema Document.*
|
|
101.CAL
|
XBRL
Taxonomy Calculation Linkbase Document.*
|
|
101.DEF
|
XBRL
Taxonomy Definition Linkbase Document.*
|
|
101.LAB
|
XBRL
Taxonomy Label Linkbase Document.*
|
|
101.PRE
|
|
XBRL
Taxonomy Presentation Linkbase
Document.*
|
*
|
Furnished
electronically herewith
|
LifePoint
Hospitals, Inc.
|
|||
By:
|
/s/ Michael S. Coggin
|
||
Michael
S. Coggin
|
|||
Senior
Vice President and
|
|||
Chief
Accounting Officer
|
|||
(Principal
Accounting Officer)
|
Exhibit
Number
|
Description
|
|
3.1
|
Amended
and Restated Certificate of Incorporation (incorporated by reference from
exhibits to the Registration Statement on Form S-8 filed on April 19,
2005, File No. 333-124093).
|
|
3.2
|
Third
Amended and Restated Bylaws (incorporated by reference from exhibits to
the LifePoint Hospitals, Inc. Current Report on Form 8-K dated September
21, 2010, File No. 000-51251).
|
|
4.1
|
Indenture,
dated September 23, 2010, by and among LifePoint Hospitals, Inc., the
Guarantors (as defined therein) and Bank Of New York Mellon Trust Company,
N.A. as trustee (including the Form of 6.625% Senior Note due 2020)
(incorporated by reference from exhibits to the LifePoint Hospitals, Inc.
Current Report on Form 8-K dated September 27, 2010, File No.
000-51251).
|
|
4.2
|
Registration
Rights Agreement, dated September 23, 2010, by and among LifePoint
Hospitals, Inc., the Guarantors (as defined therein) and Barclays Capital
Inc., as representative of the several initial purchasers (incorporated by
reference from exhibits to the LifePoint Hospitals, Inc. Current Report on
Form 8-K dated September 27, 2010, File No. 000-51251).
|
|
10.1
|
Purchase
Agreement dated September 20, 2010 among LifePoint Hospitals, Inc., the
Guarantors party thereto, Barclays Capital Inc., as representative of the
Initial Purchasers named therein (incorporated by reference from exhibits
to the LifePoint Hospitals, Inc. Current Report on Form 8-K dated
September 24, 2010, File No. 000-51251).
|
|
31.1
|
Certification
of the Chief Executive Officer of LifePoint Hospitals, Inc. Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification
of the Chief Financial Officer of LifePoint Hospitals, Inc. Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification
of the Chief Executive Officer of LifePoint Hospitals, Inc. Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification
of the Chief Financial Officer of LifePoint Hospitals, Inc. Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS
|
XBRL
Instance Document.*
|
|
101.SCH
|
XBRL
Taxonomy Extension Schema Document.*
|
|
101.CAL
|
XBRL
Taxonomy Calculation Linkbase Document.*
|
|
101.DEF
|
XBRL
Taxonomy Definition Linkbase Document.*
|
|
101.LAB
|
XBRL
Taxonomy Label Linkbase Document.*
|
|
101.PRE
|
|
XBRL
Taxonomy Presentation Linkbase
Document.*
|
*
|
Furnished
electronically herewith
|