UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 6, 2014
KINDRED HEALTHCARE, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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001-14057 |
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61-1323993 |
(State or other jurisdiction
of incorporation or organization) |
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(Commission
File Number) |
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(IRS Employer
Identification No.) |
680 South Fourth Street
Louisville, Kentucky
(Address of principal executive offices)
40202-2412
(Zip Code)
Registrants telephone number, including area code: (502) 596-7300
Not Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation to the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On August 6, 2014, Kindred Healthcare, Inc. (the Company) issued a press release announcing its financial results for the
second quarter ended June 30, 2014. The press release, dated August 6, 2014, is attached as Exhibit 99.1 to this Form 8-K. On August 6, 2014, the Company also made the press release available on its website at
www.kindredhealthcare.com.
The information contained herein is being furnished pursuant to Item 2.02 of Form 8-K, Results of
Operations and Financial Condition. This information shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or incorporated by reference in any
filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
Incorporated by reference is Exhibit 99.1 attached hereto, a press release issued by the Company on August 6, 2014 announcing its
financial results for the second quarter ended June 30, 2014. Also incorporated by reference is Exhibit 99.3 attached hereto, additional presentation materials being made available on August 6, 2014 in connection with the Companys
announcement of its financial results for the second quarter ended June 30, 2014. This information is being furnished under Item 7.01 and shall not be deemed filed for purposes of Section 18 of the Exchange Act, or
otherwise subject to the liability of such section.
Item 8.01. Other Events.
On August 6, 2014, the Company issued an additional press release announcing that its Board of Directors approved the payment of a
quarterly cash dividend to its shareholders. A cash dividend of $0.12 per common share will be paid on September 10, 2014 to all shareholders of record as of the close of business on August 20, 2014. Future declarations of quarterly
dividends will be subject to the approval of the Companys Board of Directors. A copy of the press release is attached hereto as Exhibit 99.2 and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d)
Exhibits
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Exhibit 99.1 |
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Press release (earnings) dated August 6, 2014. |
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Exhibit 99.2 |
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Press release (dividend) dated August 6, 2014. |
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Exhibit 99.3 |
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Additional presentation materials dated August 6, 2014. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereto duly authorized.
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KINDRED HEALTHCARE, INC. |
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Date: August 7, 2014 |
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By: |
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/s/ Joseph L. Landenwich |
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Joseph L. Landenwich |
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Co-General Counsel and Corporate Secretary |
Exhibit 99.1
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Contact: |
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Stephen Farber |
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Executive Vice President, Chief Financial Officer |
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(502) 596-2525 |
KINDRED HEALTHCARE ANNOUNCES SECOND QUARTER 2014 RESULTS
Core Diluted EPS from Continuing Operations Increased 26% to $0.34(1)
Strong Start to the Year Continues with 7% Growth in Both Consolidated Revenues and Core Operating Income
GAAP EPS Loss from Continuing Operations Totaled $0.48, Due to Pretax Charges of $0.83 per Diluted Share Related to Debt Refinancing,
Restructuring, Litigation and Transaction Costs
Affirms 2014 Earnings Guidance and Adjusts Share Count to Reflect Recent
Equity Offering
LOUISVILLE, Ky. (August 6, 2014) Kindred Healthcare, Inc. (Kindred or the Company)
(NYSE:KND) today announced its operating results for the second quarter ended June 30, 2014.
The Company has classified as
discontinued for all periods presented the operations of three transitional care (TC) hospitals and two nursing centers that were either closed or divested in the second quarter. All financial and statistical information included in this
press release reflects the continuing operations of the Companys businesses for all periods presented unless otherwise indicated.
Second
Quarter Highlights:
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Consolidated revenues and core operating income both increased 7% from the same period last year primarily resulting from improved hospital volumes, a strong rebound in the Companys Care Management division
operations, growth from acquisitions and solid cost controls throughout the Company |
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Strong hospital division results with 3.1% same-store admissions growth, 1.8% revenue growth per patient day and 1.3% growth in core operating costs per patient day |
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RehabCare division achieved sequential core operating income growth and margin improvement from 11.6% in the first quarter of 2014 to 12.3% in the second quarter of 2014 |
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Nursing center division core operating income increased 11.3% primarily due to growth in revenues and operating margins were significantly improved due to ongoing repositioning and cost control initiatives
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Care Management division delivered 66% revenue growth and core operating income that doubled compared to the same period last year |
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Recapitalization of the Company completed: |
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Divested 55 of 59 nursing centers leased from Ventas, Inc. (Ventas) (NYSE:VTR) as of August 1 |
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$2.25 billion refinancing of the Companys secured and unsecured debt on April 9 lowers borrowing costs, extends debt maturities and reduces interest rate risk |
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Recent common stock equity offering of 9.7 million shares generated $221 million in net proceeds used to repay the Companys revolving credit facility |
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Board of Directors declared regular quarterly cash dividend of $0.12 per share payable on September 10, 2014 |
(1) |
See reconciliation of core results to GAAP results on page 19. |
- MORE -
680 South Fourth Street Louisville, Kentucky 40202
502.596.7300 www.kindredhealthcare.com
Kindred Healthcare Announces Second Quarter 2014 Results
Page 2
August 6, 2014
Second Quarter Results
Continuing Operations
Consolidated
revenues for the second quarter ended June 30, 2014 increased 7% to $1.3 billion compared to $1.2 billion in the same period of 2013, primarily due to improved hospital volumes, a strong rebound in the Care Management divisions operations
and growth from acquisitions. Kindred reported a loss from continuing operations for the second quarter of 2014 of $25.9 million or $0.48 per diluted share compared to income from continuing operations of $13.6 million or $0.25 per diluted
share in the second quarter of 2013. Second quarter 2014 operating results included pretax charges of $70.9 million ($44.6 million net of income taxes) or $0.83 per diluted share related to debt refinancing, restructuring, litigation and
transaction costs. Without these items, diluted earnings per share from continuing operations increased 26% to $0.34. Operating results for the second quarter of 2013 included pretax charges of $1.5 million ($0.9 million net of income taxes) or
$0.02 per diluted share related to debt refinancing and transaction costs.
Management Commentary
Paul J. Diaz, Chief Executive Officer of the Company, commented, We are very pleased with our operating and financial results for the
second quarter of 2014, which reflects our progress delivering on our promise to provide hope, healing and recovery to the patients we serve. More specifically, in the first half of this year, we saw continued improvement in employee engagement and
reduced turnover, and improving quality measures, clinical outcomes and patient satisfaction in all of our business segments. We are also pleased to reaffirm our earnings guidance for the year, which reflects the change in share count from our
recent equity offering, as we achieved revenue and core operating income growth of 7% year-over-year, respectively. We made progress on a number of internal and external growth initiatives during the quarter enhancing our Integrated Care Market
capabilities, particularly in home health and hospice services. We continue to evaluate a robust pipeline of external opportunities to deploy our financial resources, industry leading infrastructure and management capabilities as we move forward
with the growth phase of our strategic plan. Overall, we remain committed to further improving our patients experience and the long-term growth, profitability and financial position of the Company.
Benjamin A. Breier, President and Chief Operating Officer of the Company, said, Same-store hospital admissions increased 3.1% in the
second quarter representing our first quarterly admissions increase since the third quarter of 2012 and our hospital core operating margin improved to 21.7% in the second quarter of 2014 from 21.3% in the same period a year ago. Our RehabCare
division also continues to make great progress, as evidenced by our sequential operating income growth and margin improvement, despite Medicare reimbursement pricing pressures. In addition, we have added 57 net new skilled nursing rehabilitation
sites of service during the year. Our efforts to reshape our nursing center division continue to pay off as we achieved a significant improvement in operating margins in the second quarter. We are developing three additional transitional care
centers in Indianapolis, Phoenix and Las Vegas, which will add to the momentum in this division.
Mr. Breier added, Our
Care Management division continues to make improvements in our home health and hospice operations, including enhancing our team, processes and technology, and we expect to apply these capabilities across a larger platform over time. In addition, our
recently announced acquisition of the Silver State Accountable Care Organization (ACO) in Las Vegas is a very exciting transaction for Kindred, and the partnership marks our first ownership and direct management of an ACO anywhere in the
country.
Stephen D. Farber, Executive Vice President, Chief Financial Officer, commented, We are pleased to have completed a
major recapitalization of the Company with both a $2.25 billion debt refinancing in the second quarter and a 9.7 million share equity offering in the second and third quarters. The equity offering raised $221 million in proceeds that the
Company has initially used to reduce its revolving credit facility, which helped to increase our available
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Kindred Healthcare Announces Second Quarter 2014 Results
Page 3
August 6, 2014
borrowing capacity under our revolver to approximately $652 million as of June 30, 2014. These transactions significantly improve our financial position, provide additional financial
flexibility and reduce interest expense. Our current outstanding share count is 64.6 million shares and for generally accepted accounting principles (GAAP) purposes, on a weighted average basis, we expect our 2014 third and fourth
quarters diluted shares used to compute earnings per share to approximate 63.0 million shares and on an annual basis for 2014, 58.3 million shares.
Earnings Guidance Continuing Operations
Kindred today affirmed its previous guidance for income from continuing operations for 2014 of between $58 million and $68 million. The
Company noted that its earnings guidance for 2014 continues to be based on the same assumptions initially disclosed and there has been no change in its earnings guidance. The affirmed guidance for 2014 reflects an increased share count from the
recent equity offering of 9.7 million shares of common stock. Under Kindreds current diluted share count of 58.3 million outstanding shares following the recent equity offering, income from continuing operations for 2014 equates to
$0.96 to $1.14 per diluted share. Under Kindreds diluted share count of 53.2 million outstanding shares prior to the equity offering, the same assumptions for income from continuing operations for 2014 of $58 million to $68 million
equated to $1.05 to $1.25 per diluted share.
The Company revised its operating cash flow guidance range of $245 million to $275 million
to a revised range of $200 million to $230 million. This update reflects growth in accounts receivable, increased cash settlements of certain previously-accrued balance sheet liabilities, and other cash flow items.
The Company maintained its expectation of $100 million to $105 million for routine capital expenditures and for timing reasons reduced its
anticipated 2014 cash outflows for development of new or replacement facilities by $5 million to approximately $15 million to $20 million. With these items, the Company expects its 2014 operating cash flows in excess of routine and development
capital spending to approximate $85 million to $105 million, which will be available to fund acquisitions, repay debt and pay dividends. Estimated dividend payments for 2014 are expected to approximate $29 million, an increase of approximately $3
million from the previous guidance due to the issuance of 9.7 million additional common shares in the Companys recently completed equity offering.
While Kindred does not typically provide quarterly guidance, given the many new shareholders of Kindred the Company notes that from a seasonal
trending perspective, the third quarter is historically the slowest volumes and earnings quarter, and is typically followed by a stronger fourth quarter. For the third quarter of 2014, the Company expects diluted earnings per share from continuing
operations to approximate $0.05 to $0.15. This compares to diluted earnings per share from continuing operations of $0.10 for the third quarter of 2013, excluding certain disclosed items and adjusted on a pro forma basis to include the incremental
9.7 million shares from the Companys recently completed equity offering.
Please note the Companys earnings and cash flow
guidance for 2014 excludes the effect of reimbursement changes, debt refinancing costs, severance, retirement, retention and restructuring costs, litigation costs, transaction costs, any further acquisitions or divestitures, any impairment charges,
and any repurchases of common stock.
Quarterly Cash Dividend
The Company also announced that its Board of Directors has approved the payment of the regular quarterly cash dividend to its shareholders of
$0.12 per common share to be paid on September 10, 2014 to shareholders of record as of the close of business on August 20, 2014. Future declarations of quarterly dividends will be subject to the approval of Kindreds Board of
Directors.
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page 4
August 6, 2014
Conference Call
As previously announced, investors and the general public may access a live webcast of the second quarter 2014 conference call through a link
on the Companys website at http://investors.kindredhealthcare.com. The conference call will be held on August 7 at 10:00 a.m. (Eastern Time). The Conference call webcast will feature accompanying slides, which can be accessed
through the Investor Relations section of the Companys website.
A telephone replay of the conference call will become available at
approximately 1:00 p.m. on August 7 by dialing (719) 457-0820, access code: 7592071. The replay will be available through August 17.
Forward-Looking Statements
This
press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the potential
acquisition of Gentiva Health Services, Inc. (Gentiva) (NASDAQ:GTIV) (including financing of the proposed transaction and the benefits, results, effects and timing of such transaction), and the Companys expected future financial
position, results of operations, cash flows, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management and statements containing the words such as
anticipate, approximate, believe, plan, estimate, expect, project, could, should, will, intend, may,
potential and other similar expressions, are forward-looking statements. Statements in this press release concerning the Companys business outlook or future economic performance, anticipated profitability, revenues, expenses or
other financial items, and product or services line growth, together with other statements that are not historical facts, are forward-looking statements that are estimates reflecting the best judgment of the Company based upon currently available
information.
Such forward-looking statements are inherently uncertain, and stockholders and other potential investors must recognize that
actual results may differ materially from the Companys expectations as a result of a variety of factors, including, without limitation, those discussed below. Such forward-looking statements are based upon managements current
expectations and include known and unknown risks, uncertainties and other factors, many of which the Company is unable to predict or control, that may cause the Companys actual results, performance or plans to differ materially from any future
results, performance or plans expressed or implied by such forward-looking statements. These statements involve risks, uncertainties and other factors discussed below and detailed from time to time in the Companys filings with the Securities
and Exchange Commission.
In addition to the factors set forth above, other factors that may affect the Companys plans, results or
stock price include, without limitation, (a) the impact of healthcare reform, which will initiate significant changes to the United States healthcare system, including potential material changes to the delivery of healthcare services and the
reimbursement paid for such services by the government or other third party payors, including reforms resulting from the Patient Protection and Affordable Care Act and the Healthcare Education and Reconciliation Act (collectively, the
ACA) or future deficit reduction measures adopted at the federal or state level. Healthcare reform is affecting each of the Companys businesses in some manner. Potential future efforts in the U.S. Congress to repeal, amend, modify
or retract funding for various aspects of the ACA create additional uncertainty about the ultimate impact of the ACA on the Company and the healthcare industry. Due to the substantial regulatory changes that will need to be implemented by the
Centers for Medicare and Medicaid Services (CMS) and others, and the numerous processes required to implement these reforms, the Company cannot predict which healthcare initiatives will be implemented at the federal or state level, the
timing of any such reforms, or the effect such reforms or any other future legislation or regulation will have on the Companys business, financial position, results of operations and liquidity, (b) the Companys ability to adjust to
the new patient criteria for long-term acute care (LTAC) hospitals under the Pathway for SGR Reform Act of 2013, which will reduce the population of patients eligible for the Companys hospital services and change the basis upon
which the Company is paid, (c) the impact of the final rules issued by CMS on August 1, 2012 which, among other things, will reduce Medicare reimbursement to the Companys TC hospitals in 2013 and beyond by imposing a budget
neutrality adjustment and modifying the short-stay outlier rules, (d) the impact of the final rules issued by CMS on July 29, 2011 which significantly reduced Medicare reimbursement to the Companys nursing centers and changed
payments for the provision of group therapy services effective October 1, 2011, (e) the impact of the Budget Control Act of 2011 (as amended by the American Taxpayer Relief Act of 2012 (the Taxpayer Relief Act)) which
instituted an automatic 2% reduction on each claim submitted to Medicare beginning April 1, 2013, (f) the costs of defending and insuring against alleged professional liability and other claims and investigations (including those related
to pending
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Kindred Healthcare Announces Second Quarter 2014 Results
Page 5
August 6, 2014
investigations and whistleblower and wage and hour class action lawsuits against the Company) and the Companys ability to predict the estimated costs and reserves related to such claims and
investigations, including the impact of differences in actuarial assumptions and estimates compared to eventual outcomes, (g) the impact of the Taxpayer Relief Act which, among other things, reduces Medicare payments by an additional 25% for
subsequent procedures when multiple therapy services are provided on the same day. At this time, the Company believes that the rules related to multiple therapy services will reduce its Medicare revenues by $25 million to $30 million on an
annual basis, (h) changes in the reimbursement rates or the methods or timing of payment from third party payors, including commercial payors and the Medicare and Medicaid programs, changes arising from and related to the Medicare prospective
payment system for LTAC hospitals, including potential changes in the Medicare payment rules, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, and changes in Medicare and Medicaid reimbursement for the Companys TC
hospitals, nursing centers, inpatient rehabilitation hospitals and home health and hospice operations, and the expiration of the Medicare Part B therapy cap exception process, (i) the effects of additional legislative changes and government
regulations, interpretation of regulations and changes in the nature and enforcement of regulations governing the healthcare industry, (j) the ability of the Companys hospitals and nursing centers to adjust to medical necessity reviews,
(k) the impact of the Companys significant level of indebtedness on its funding costs, operating flexibility and ability to fund ongoing operations, development capital expenditures or other strategic acquisitions with additional
borrowings, (l) the Companys ability to successfully redeploy its capital and proceeds of asset sales in pursuit of its business strategy and pursue its development activities, including through acquisitions, and successfully integrate
new operations, including the realization of anticipated revenues, economies of scale, cost savings and productivity gains associated with such operations, as and when planned, including the potential impact of unanticipated issues, expenses and
liabilities associated with those activities, (m) the Companys ability to pay a dividend as, when and if declared by the Board of Directors, in compliance with applicable laws and the Companys debt and other contractual
arrangements, (n) the failure of the Companys facilities to meet applicable licensure and certification requirements, (o) the further consolidation and cost containment efforts of managed care organizations and other third party
payors, (p) the Companys ability to meet its rental and debt service obligations, (q) the Companys ability to operate pursuant to the terms of its debt obligations, and comply with its covenants thereunder, and the
Companys ability to operate pursuant to its master lease agreements with Ventas, (r) the condition of the financial markets, including volatility and weakness in the equity, capital and credit markets, which could limit the availability
and terms of debt and equity financing sources to fund the requirements of the Companys businesses, or which could negatively impact the Companys investment portfolio, (s) the Companys ability to control costs, particularly
labor and employee benefit costs, (t) the Companys ability to successfully reduce (by divestiture of operations or otherwise) its exposure to professional liability and other claims, (u) the Companys obligations under various
laws to self-report suspected violations of law by the Company to various government agencies, including any associated obligation to refund overpayments to government payors, fines and other sanctions, (v) national, regional and
industry-specific economic, financial, business and political conditions, including their effect on the availability and cost of labor, credit, materials and other services, (w) increased operating costs due to shortages in qualified nurses,
therapists and other healthcare personnel, (x) the Companys ability to attract and retain key executives and other healthcare personnel, (y) the Companys ability to successfully dispose of unprofitable facilities,
(z) events or circumstances which could result in the impairment of an asset or other charges, such as the impact of the Medicare reimbursement regulations that resulted in the Company recording significant impairment charges in the last three
fiscal years, (aa) changes in GAAP and changes in tax accounting or tax laws (or authoritative interpretations relating to any of these matters), (bb) the Companys ability to maintain an effective system of internal control over financial
reporting, (cc) the Companys ability to realize the anticipated operating and financial synergies from the potential acquisition of Gentiva, (dd) the uncertainties as to whether Gentiva or any other companies that the Company may acquire will
have the accretive effect on the Companys earnings or cash flows that are expected, and (ee) the outcome of the potential acquisition of Gentiva, including the Companys ability to realize the strategic rationale behind the Gentiva
acquisition.
Many of these factors are beyond the Companys control. The Company cautions investors that any forward-looking
statements made by the Company are not guarantees of future performance. The Company disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future
events or developments.
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Kindred Healthcare Announces Second Quarter 2014 Results
Page 6
August 6, 2014
In addition to the results provided in accordance with GAAP, the Company has provided
information in this release to compute certain non-GAAP measurements for the three months and six months ended June 30, 2014 and 2013 before certain charges or on a core basis. A reconciliation of the non-GAAP measurements to the GAAP
measurements is included in this press release.
Also in this release, the Company provides the financial measure of free cash flows
excluding certain items. The Company recognizes that free cash flows excluding certain items is a non-GAAP measurement and is not intended to replace the presentation of the Companys cash flows in accordance with GAAP. The Company believes
that this non-GAAP measurement provides important information to investors related to the amount of discretionary cash flows that are available for other investing and financing activities. In addition, management uses free cash flows excluding
certain items in making decisions related to acquisitions, development capital expenditures, dividends, long-term debt repayments and other uses. The Company believes net cash flows provided by (used in) operating activities is the most comparable
GAAP measure. Readers of the Companys financial information should consider net cash flows provided by (used in) operating activities as an important measure of the Companys financial performance because it provides the most complete
measure of its performance. Free cash flows excluding certain items should be considered in addition to, not as a substitute for, or superior to, financial measures based upon GAAP as an indicator of operating performance. A reconciliation of
net cash flows provided by (used in) operating activities to free cash flows excluding certain items is included in this press release.
The Companys earnings release includes a financial measure referred to as operating income, or earnings before interest, income taxes,
depreciation, amortization and rent. The Companys management uses operating income as a meaningful measure of operational performance in addition to other measures. The Company uses operating income to assess the relative performance of its
operating divisions as well as the employees that operate these businesses. In addition, the Company believes this measurement is important because securities analysts and investors use this measurement to compare the Companys performance to
other companies in the healthcare industry. The Company believes that income (loss) from continuing operations is the most comparable GAAP measure. Readers of the Companys financial information should consider income (loss) from continuing
operations as an important measure of the Companys financial performance because it provides the most complete measure of its performance. Operating income should be considered in addition to, not as a substitute for, or superior to,
financial measures based upon GAAP as an indicator of operating performance. A reconciliation of operating income to income (loss) from continuing operations provided in the Condensed Business Segment Data is included in this press release.
About Kindred Healthcare
Kindred
Healthcare, Inc., a top-150 private employer in the United States, is a FORTUNE 500 healthcare services company based in Louisville, Kentucky with annual revenues of $5 billion and approximately 63,000 employees in 47 states. At June 30, 2014,
Kindred through its subsidiaries provided healthcare services in 2,353 locations, including 97 transitional care hospitals, five inpatient rehabilitation hospitals, 98 nursing centers, 21 sub-acute units, 153 Kindred at Home hospice, home health and
non-medical home care locations, 104 inpatient rehabilitation units (hospital-based) and a contract rehabilitation services business, RehabCare, which served 1,875 non-affiliated facilities. Ranked as one of Fortune magazines Most Admired
Healthcare Companies for six years in a row, Kindreds mission is to promote healing, provide hope, preserve dignity and produce value for each patient, resident, family member, customer, employee and shareholder we serve. For more information,
go to www.kindredhealthcare.com. You can also follow us on Twitter and Facebook.
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Kindred Healthcare Announces Second Quarter 2014 Results
Page
7
August 6, 2014
KINDRED HEALTHCARE, INC.
Financial Summary
(Unaudited)
(In thousands,
except per share amounts)
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Three months ended |
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Six months ended |
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June 30, |
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June 30, |
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2014 |
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2013 |
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2014 |
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2013 |
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Revenues |
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$ |
1,275,964 |
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$ |
1,191,030 |
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$ |
2,562,706 |
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$ |
2,450,464 |
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Income (loss) from continuing operations |
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$ |
(21,065 |
) |
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$ |
13,729 |
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$ |
921 |
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$ |
24,603 |
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Discontinued operations, net of income taxes: |
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Loss from operations |
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(8,153 |
) |
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(1,050 |
) |
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(14,654 |
) |
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(6,426 |
) |
Loss on divestiture of operations |
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(2,018 |
) |
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(10,852 |
) |
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(5,024 |
) |
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(12,877 |
) |
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Loss from discontinued operations |
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(10,171 |
) |
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(11,902 |
) |
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(19,678 |
) |
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(19,303 |
) |
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Net income (loss) |
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(31,236 |
) |
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1,827 |
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(18,757 |
) |
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|
5,300 |
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(Earnings) loss attributable to noncontrolling interests: |
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Continuing operations |
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(4,828 |
) |
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(116 |
) |
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(9,357 |
) |
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(583 |
) |
Discontinued operations |
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253 |
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|
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34 |
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323 |
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|
|
85 |
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|
|
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|
|
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(4,575 |
) |
|
|
(82 |
) |
|
|
(9,034 |
) |
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(498 |
) |
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Income (loss) attributable to Kindred |
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$ |
(35,811 |
) |
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$ |
1,745 |
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$ |
(27,791 |
) |
|
$ |
4,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Kindred stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(25,893 |
) |
|
$ |
13,613 |
|
|
$ |
(8,436 |
) |
|
$ |
24,020 |
|
Loss from discontinued operations |
|
|
(9,918 |
) |
|
|
(11,868 |
) |
|
|
(19,355 |
) |
|
|
(19,218 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(35,811 |
) |
|
$ |
1,745 |
|
|
$ |
(27,791 |
) |
|
$ |
4,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(0.48 |
) |
|
$ |
0.25 |
|
|
$ |
(0.16 |
) |
|
$ |
0.45 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.15 |
) |
|
|
(0.02 |
) |
|
|
(0.27 |
) |
|
|
(0.12 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(0.09 |
) |
|
|
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.19 |
) |
|
|
(0.22 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.67 |
) |
|
$ |
0.03 |
|
|
$ |
(0.52 |
) |
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(0.48 |
) |
|
$ |
0.25 |
|
|
$ |
(0.16 |
) |
|
$ |
0.45 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.15 |
) |
|
|
(0.02 |
) |
|
|
(0.27 |
) |
|
|
(0.12 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(0.09 |
) |
|
|
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.19 |
) |
|
|
(0.22 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.67 |
) |
|
$ |
0.03 |
|
|
$ |
(0.52 |
) |
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
53,714 |
|
|
|
52,265 |
|
|
|
53,180 |
|
|
|
52,164 |
|
Diluted |
|
|
53,714 |
|
|
|
52,284 |
|
|
|
53,180 |
|
|
|
52,184 |
|
Cash dividends declared and paid per common share |
|
$ |
0.12 |
|
|
$ |
|
|
|
$ |
0.24 |
|
|
$ |
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
8
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidated Statement of Operations
(Unaudited)
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Six months ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Revenues |
|
$ |
1,275,964 |
|
|
$ |
1,191,030 |
|
|
$ |
2,562,706 |
|
|
$ |
2,450,464 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
770,321 |
|
|
|
715,619 |
|
|
|
1,544,133 |
|
|
|
1,497,484 |
|
Supplies |
|
|
80,794 |
|
|
|
80,603 |
|
|
|
162,782 |
|
|
|
164,749 |
|
Rent |
|
|
80,209 |
|
|
|
77,324 |
|
|
|
161,257 |
|
|
|
153,843 |
|
Other operating expenses |
|
|
261,418 |
|
|
|
227,981 |
|
|
|
511,022 |
|
|
|
458,656 |
|
Other income |
|
|
(154 |
) |
|
|
(26 |
) |
|
|
(388 |
) |
|
|
(1,035 |
) |
Impairment charges |
|
|
|
|
|
|
438 |
|
|
|
|
|
|
|
625 |
|
Depreciation and amortization |
|
|
39,442 |
|
|
|
38,554 |
|
|
|
78,779 |
|
|
|
80,152 |
|
Interest expense |
|
|
80,530 |
|
|
|
29,074 |
|
|
|
106,329 |
|
|
|
57,233 |
|
Investment income |
|
|
(2,449 |
) |
|
|
(1,474 |
) |
|
|
(2,632 |
) |
|
|
(1,559 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,310,111 |
|
|
|
1,168,093 |
|
|
|
2,561,282 |
|
|
|
2,410,148 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
(34,147 |
) |
|
|
22,937 |
|
|
|
1,424 |
|
|
|
40,316 |
|
Provision (benefit) for income taxes |
|
|
(13,082 |
) |
|
|
9,208 |
|
|
|
503 |
|
|
|
15,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
|
(21,065 |
) |
|
|
13,729 |
|
|
|
921 |
|
|
|
24,603 |
|
Discontinued operations, net of income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(8,153 |
) |
|
|
(1,050 |
) |
|
|
(14,654 |
) |
|
|
(6,426 |
) |
Loss on divestiture of operations |
|
|
(2,018 |
) |
|
|
(10,852 |
) |
|
|
(5,024 |
) |
|
|
(12,877 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(10,171 |
) |
|
|
(11,902 |
) |
|
|
(19,678 |
) |
|
|
(19,303 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
(31,236 |
) |
|
|
1,827 |
|
|
|
(18,757 |
) |
|
|
5,300 |
|
(Earnings) loss attributable to noncontrolling interests: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
(4,828 |
) |
|
|
(116 |
) |
|
|
(9,357 |
) |
|
|
(583 |
) |
Discontinued operations |
|
|
253 |
|
|
|
34 |
|
|
|
323 |
|
|
|
85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,575 |
) |
|
|
(82 |
) |
|
|
(9,034 |
) |
|
|
(498 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) attributable to Kindred |
|
$ |
(35,811 |
) |
|
$ |
1,745 |
|
|
$ |
(27,791 |
) |
|
$ |
4,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Kindred stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(25,893 |
) |
|
$ |
13,613 |
|
|
$ |
(8,436 |
) |
|
$ |
24,020 |
|
Loss from discontinued operations |
|
|
(9,918 |
) |
|
|
(11,868 |
) |
|
|
(19,355 |
) |
|
|
(19,218 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(35,811 |
) |
|
$ |
1,745 |
|
|
$ |
(27,791 |
) |
|
$ |
4,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(0.48 |
) |
|
$ |
0.25 |
|
|
$ |
(0.16 |
) |
|
$ |
0.45 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.15 |
) |
|
|
(0.02 |
) |
|
|
(0.27 |
) |
|
|
(0.12 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(0.09 |
) |
|
|
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.19 |
) |
|
|
(0.22 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.67 |
) |
|
$ |
0.03 |
|
|
$ |
(0.52 |
) |
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(0.48 |
) |
|
$ |
0.25 |
|
|
$ |
(0.16 |
) |
|
$ |
0.45 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.15 |
) |
|
|
(0.02 |
) |
|
|
(0.27 |
) |
|
|
(0.12 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(0.09 |
) |
|
|
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.19 |
) |
|
|
(0.22 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.67 |
) |
|
$ |
0.03 |
|
|
$ |
(0.52 |
) |
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
53,714 |
|
|
|
52,265 |
|
|
|
53,180 |
|
|
|
52,164 |
|
Diluted |
|
|
53,714 |
|
|
|
52,284 |
|
|
|
53,180 |
|
|
|
52,184 |
|
Cash dividends declared and paid per common share |
|
$ |
0.12 |
|
|
$ |
|
|
|
$ |
0.24 |
|
|
$ |
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
9
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidated Balance Sheet
(Unaudited)
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2014 |
|
|
2013 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
45,416 |
|
|
$ |
35,972 |
|
Cashrestricted |
|
|
3,490 |
|
|
|
3,713 |
|
Insurance subsidiary investments |
|
|
93,527 |
|
|
|
96,295 |
|
Accounts receivable less allowance for loss |
|
|
1,006,963 |
|
|
|
916,529 |
|
Inventories |
|
|
25,660 |
|
|
|
25,780 |
|
Deferred tax assets |
|
|
39,658 |
|
|
|
37,920 |
|
Income taxes |
|
|
50,812 |
|
|
|
36,846 |
|
Other |
|
|
38,651 |
|
|
|
43,673 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,304,177 |
|
|
|
1,196,728 |
|
Property and equipment |
|
|
1,942,214 |
|
|
|
1,906,366 |
|
Accumulated depreciation |
|
|
(1,024,411 |
) |
|
|
(979,791 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
917,803 |
|
|
|
926,575 |
|
Goodwill |
|
|
994,854 |
|
|
|
992,102 |
|
Intangible assets less accumulated amortization |
|
|
411,260 |
|
|
|
423,303 |
|
Assets held for sale |
|
|
8,435 |
|
|
|
20,978 |
|
Insurance subsidiary investments |
|
|
160,565 |
|
|
|
149,094 |
|
Deferred tax assets |
|
|
|
|
|
|
17,043 |
|
Other |
|
|
235,716 |
|
|
|
220,046 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
4,032,810 |
|
|
$ |
3,945,869 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
162,040 |
|
|
$ |
181,772 |
|
Salaries, wages and other compensation |
|
|
346,318 |
|
|
|
361,192 |
|
Due to third party payors |
|
|
18,413 |
|
|
|
33,747 |
|
Professional liability risks |
|
|
69,657 |
|
|
|
60,993 |
|
Other accrued liabilities |
|
|
135,420 |
|
|
|
146,495 |
|
Long-term debt due within one year |
|
|
10,233 |
|
|
|
8,222 |
|
|
|
|
|
|
|
|
|
|
|
|
|
742,081 |
|
|
|
792,421 |
|
Long-term debt |
|
|
1,530,340 |
|
|
|
1,579,391 |
|
Professional liability risks |
|
|
243,536 |
|
|
|
246,230 |
|
Deferred tax liabilities |
|
|
5,286 |
|
|
|
|
|
Deferred credits and other liabilities |
|
|
215,855 |
|
|
|
206,611 |
|
Equity: |
|
|
|
|
|
|
|
|
Stockholders equity: |
|
|
|
|
|
|
|
|
Common stock, $0.25 par value; authorized 175,000 shares; issued 63,784 sharesJune 30, 2014 and 54,165 sharesDecember 31,
2013 |
|
|
15,946 |
|
|
|
13,541 |
|
Capital in excess of par value |
|
|
1,346,561 |
|
|
|
1,146,193 |
|
Accumulated other comprehensive loss |
|
|
(2,299 |
) |
|
|
(252 |
) |
Accumulated deficit |
|
|
(107,327 |
) |
|
|
(76,825 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
1,252,881 |
|
|
|
1,082,657 |
|
Noncontrolling interests |
|
|
42,831 |
|
|
|
38,559 |
|
|
|
|
|
|
|
|
|
|
Total equity |
|
|
1,295,712 |
|
|
|
1,121,216 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
4,032,810 |
|
|
$ |
3,945,869 |
|
|
|
|
|
|
|
|
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
10
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidated Statement of Cash Flows
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Six months ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(31,236 |
) |
|
$ |
1,827 |
|
|
$ |
(18,757 |
) |
|
$ |
5,300 |
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
40,922 |
|
|
|
46,960 |
|
|
|
82,226 |
|
|
|
99,914 |
|
Amortization of stock-based compensation costs |
|
|
6,378 |
|
|
|
3,840 |
|
|
|
8,963 |
|
|
|
6,088 |
|
Amortization of deferred financing costs |
|
|
16,832 |
|
|
|
4,407 |
|
|
|
19,229 |
|
|
|
7,020 |
|
Payment of capitalized lender fees related to debt issuance |
|
|
(19,125 |
) |
|
|
(1,600 |
) |
|
|
(19,125 |
) |
|
|
(1,600 |
) |
Provision for doubtful accounts |
|
|
12,133 |
|
|
|
10,071 |
|
|
|
20,893 |
|
|
|
21,337 |
|
Deferred income taxes |
|
|
17,528 |
|
|
|
(24,977 |
) |
|
|
21,503 |
|
|
|
(25,321 |
) |
Impairment charges |
|
|
220 |
|
|
|
646 |
|
|
|
664 |
|
|
|
1,082 |
|
Loss on divestiture of discontinued operations |
|
|
2,018 |
|
|
|
10,852 |
|
|
|
5,024 |
|
|
|
12,877 |
|
Other |
|
|
70 |
|
|
|
(1,284 |
) |
|
|
2,114 |
|
|
|
(864 |
) |
Change in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(41,066 |
) |
|
|
48,294 |
|
|
|
(112,895 |
) |
|
|
(19,117 |
) |
Inventories and other assets |
|
|
(3,769 |
) |
|
|
4,747 |
|
|
|
(9,987 |
) |
|
|
(3,400 |
) |
Accounts payable |
|
|
(5,425 |
) |
|
|
(3,288 |
) |
|
|
(18,877 |
) |
|
|
(19,078 |
) |
Income taxes |
|
|
(40,476 |
) |
|
|
10,025 |
|
|
|
(11,063 |
) |
|
|
22,700 |
|
Due to third party payors |
|
|
(12,354 |
) |
|
|
(8,187 |
) |
|
|
(14,367 |
) |
|
|
(9,215 |
) |
Other accrued liabilities |
|
|
7,387 |
|
|
|
(48,699 |
) |
|
|
(21,262 |
) |
|
|
(19,256 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities |
|
|
(49,963 |
) |
|
|
53,634 |
|
|
|
(65,717 |
) |
|
|
78,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine capital expenditures |
|
|
(24,485 |
) |
|
|
(17,430 |
) |
|
|
(46,162 |
) |
|
|
(39,800 |
) |
Development capital expenditures |
|
|
(372 |
) |
|
|
(5,086 |
) |
|
|
(1,123 |
) |
|
|
(7,474 |
) |
Acquisitions, net of cash acquired |
|
|
(1,383 |
) |
|
|
(26,933 |
) |
|
|
(24,098 |
) |
|
|
(26,933 |
) |
Sale of assets |
|
|
8,927 |
|
|
|
7,243 |
|
|
|
13,961 |
|
|
|
12,303 |
|
Purchase of insurance subsidiary investments |
|
|
(13,179 |
) |
|
|
(11,759 |
) |
|
|
(23,293 |
) |
|
|
(22,595 |
) |
Sale of insurance subsidiary investments |
|
|
17,758 |
|
|
|
15,526 |
|
|
|
26,520 |
|
|
|
25,528 |
|
Net change in insurance subsidiary cash and cash equivalents |
|
|
(4,957 |
) |
|
|
(9,782 |
) |
|
|
(11,556 |
) |
|
|
(42,878 |
) |
Change in other investments |
|
|
70 |
|
|
|
39 |
|
|
|
710 |
|
|
|
358 |
|
Other |
|
|
17 |
|
|
|
(77 |
) |
|
|
(534 |
) |
|
|
(221 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(17,604 |
) |
|
|
(48,259 |
) |
|
|
(65,575 |
) |
|
|
(101,712 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from borrowings under revolving credit |
|
|
648,315 |
|
|
|
377,900 |
|
|
|
1,157,015 |
|
|
|
861,400 |
|
Repayment of borrowings under revolving credit |
|
|
(943,715 |
) |
|
|
(385,200 |
) |
|
|
(1,369,515 |
) |
|
|
(844,400 |
) |
Proceeds from issuance of senior unsecured notes |
|
|
500,000 |
|
|
|
|
|
|
|
500,000 |
|
|
|
|
|
Proceeds from issuance of term loan, net of discount |
|
|
997,500 |
|
|
|
|
|
|
|
997,500 |
|
|
|
|
|
Repayment of senior unsecured notes |
|
|
(550,000 |
) |
|
|
|
|
|
|
(550,000 |
) |
|
|
|
|
Repayment of term loan |
|
|
(781,594 |
) |
|
|
(1,969 |
) |
|
|
(783,563 |
) |
|
|
(3,969 |
) |
Repayment of other long-term debt |
|
|
(67 |
) |
|
|
(91 |
) |
|
|
(157 |
) |
|
|
(757 |
) |
Payment of deferred financing costs |
|
|
(2,378 |
) |
|
|
(455 |
) |
|
|
(2,648 |
) |
|
|
(657 |
) |
Equity offering, net of offering costs |
|
|
203,977 |
|
|
|
|
|
|
|
203,977 |
|
|
|
|
|
Issuance of common stock in connection with employee benefit plans |
|
|
883 |
|
|
|
203 |
|
|
|
4,687 |
|
|
|
207 |
|
Dividends paid |
|
|
(6,572 |
) |
|
|
|
|
|
|
(13,086 |
) |
|
|
|
|
Distributions to noncontrolling interests |
|
|
(2,662 |
) |
|
|
(1,019 |
) |
|
|
(5,595 |
) |
|
|
(1,510 |
) |
Other |
|
|
248 |
|
|
|
19 |
|
|
|
2,121 |
|
|
|
351 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities |
|
|
63,935 |
|
|
|
(10,612 |
) |
|
|
140,736 |
|
|
|
10,665 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in cash and cash equivalents |
|
|
(3,632 |
) |
|
|
(5,237 |
) |
|
|
9,444 |
|
|
|
(12,580 |
) |
Cash and cash equivalents at beginning of period |
|
|
49,048 |
|
|
|
42,664 |
|
|
|
35,972 |
|
|
|
50,007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
$ |
45,416 |
|
|
$ |
37,427 |
|
|
$ |
45,416 |
|
|
$ |
37,427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
11
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidated Statement of Operations
(Unaudited)
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 Quarters |
|
|
2014 Quarters |
|
|
|
First |
|
|
Second |
|
|
Third |
|
|
Fourth |
|
|
First |
|
|
Second |
|
Revenues |
|
$ |
1,259,434 |
|
|
$ |
1,191,030 |
|
|
$ |
1,175,445 |
|
|
$ |
1,209,676 |
|
|
$ |
1,286,742 |
|
|
$ |
1,275,964 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
781,865 |
|
|
|
715,619 |
|
|
|
718,227 |
|
|
|
738,952 |
|
|
|
773,812 |
|
|
|
770,321 |
|
Supplies |
|
|
84,146 |
|
|
|
80,603 |
|
|
|
79,498 |
|
|
|
78,694 |
|
|
|
81,988 |
|
|
|
80,794 |
|
Rent |
|
|
76,519 |
|
|
|
77,324 |
|
|
|
76,762 |
|
|
|
80,921 |
|
|
|
81,048 |
|
|
|
80,209 |
|
Other operating expenses |
|
|
230,675 |
|
|
|
227,981 |
|
|
|
261,842 |
|
|
|
245,262 |
|
|
|
249,604 |
|
|
|
261,418 |
|
Other (income) expense |
|
|
(1,009 |
) |
|
|
(26 |
) |
|
|
51 |
|
|
|
(458 |
) |
|
|
(234 |
) |
|
|
(154 |
) |
Impairment charges |
|
|
187 |
|
|
|
438 |
|
|
|
441 |
|
|
|
76,127 |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
41,598 |
|
|
|
38,554 |
|
|
|
36,507 |
|
|
|
37,547 |
|
|
|
39,337 |
|
|
|
39,442 |
|
Interest expense |
|
|
28,159 |
|
|
|
29,074 |
|
|
|
25,624 |
|
|
|
25,152 |
|
|
|
25,799 |
|
|
|
80,530 |
|
Investment income |
|
|
(85 |
) |
|
|
(1,474 |
) |
|
|
(1,235 |
) |
|
|
(1,252 |
) |
|
|
(183 |
) |
|
|
(2,449 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,242,055 |
|
|
|
1,168,093 |
|
|
|
1,197,717 |
|
|
|
1,280,945 |
|
|
|
1,251,171 |
|
|
|
1,310,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
17,379 |
|
|
|
22,937 |
|
|
|
(22,272 |
) |
|
|
(71,269 |
) |
|
|
35,571 |
|
|
|
(34,147 |
) |
Provision (benefit) for income taxes |
|
|
6,505 |
|
|
|
9,208 |
|
|
|
(6,510 |
) |
|
|
(20,522 |
) |
|
|
13,585 |
|
|
|
(13,082 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
|
10,874 |
|
|
|
13,729 |
|
|
|
(15,762 |
) |
|
|
(50,747 |
) |
|
|
21,986 |
|
|
|
(21,065 |
) |
Discontinued operations, net of income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(5,376 |
) |
|
|
(1,050 |
) |
|
|
(25,466 |
) |
|
|
(7,150 |
) |
|
|
(6,501 |
) |
|
|
(8,153 |
) |
Loss on divestiture of operations |
|
|
(2,025 |
) |
|
|
(10,852 |
) |
|
|
(65,016 |
) |
|
|
(5,994 |
) |
|
|
(3,006 |
) |
|
|
(2,018 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(7,401 |
) |
|
|
(11,902 |
) |
|
|
(90,482 |
) |
|
|
(13,144 |
) |
|
|
(9,507 |
) |
|
|
(10,171 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
3,473 |
|
|
|
1,827 |
|
|
|
(106,244 |
) |
|
|
(63,891 |
) |
|
|
12,479 |
|
|
|
(31,236 |
) |
(Earnings) loss attributable to noncontrolling interests: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
(467 |
) |
|
|
(116 |
) |
|
|
(841 |
) |
|
|
(2,466 |
) |
|
|
(4,529 |
) |
|
|
(4,828 |
) |
Discontinued operations |
|
|
51 |
|
|
|
34 |
|
|
|
87 |
|
|
|
61 |
|
|
|
70 |
|
|
|
253 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(416 |
) |
|
|
(82 |
) |
|
|
(754 |
) |
|
|
(2,405 |
) |
|
|
(4,459 |
) |
|
|
(4,575 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) attributable to Kindred |
|
$ |
3,057 |
|
|
$ |
1,745 |
|
|
$ |
(106,998 |
) |
|
$ |
(66,296 |
) |
|
$ |
8,020 |
|
|
$ |
(35,811 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Kindred stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
10,407 |
|
|
$ |
13,613 |
|
|
$ |
(16,603 |
) |
|
$ |
(53,213 |
) |
|
$ |
17,457 |
|
|
$ |
(25,893 |
) |
Loss from discontinued operations |
|
|
(7,350 |
) |
|
|
(11,868 |
) |
|
|
(90,395 |
) |
|
|
(13,083 |
) |
|
|
(9,437 |
) |
|
|
(9,918 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
3,057 |
|
|
$ |
1,745 |
|
|
$ |
(106,998 |
) |
|
$ |
(66,296 |
) |
|
$ |
8,020 |
|
|
$ |
(35,811 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
0.20 |
|
|
$ |
0.25 |
|
|
$ |
(0.31 |
) |
|
$ |
(1.02 |
) |
|
$ |
0.32 |
|
|
$ |
(0.48 |
) |
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.10 |
) |
|
|
(0.02 |
) |
|
|
(0.49 |
) |
|
|
(0.14 |
) |
|
|
(0.11 |
) |
|
|
(0.15 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(1.24 |
) |
|
|
(0.11 |
) |
|
|
(0.06 |
) |
|
|
(0.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.14 |
) |
|
|
(0.22 |
) |
|
|
(1.73 |
) |
|
|
(0.25 |
) |
|
|
(0.17 |
) |
|
|
(0.19 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
(2.04 |
) |
|
$ |
(1.27 |
) |
|
$ |
0.15 |
|
|
$ |
(0.67 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
0.20 |
|
|
$ |
0.25 |
|
|
$ |
(0.31 |
) |
|
$ |
(1.02 |
) |
|
$ |
0.32 |
|
|
$ |
(0.48 |
) |
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.10 |
) |
|
|
(0.02 |
) |
|
|
(0.49 |
) |
|
|
(0.14 |
) |
|
|
(0.11 |
) |
|
|
(0.15 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(1.24 |
) |
|
|
(0.11 |
) |
|
|
(0.06 |
) |
|
|
(0.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.14 |
) |
|
|
(0.22 |
) |
|
|
(1.73 |
) |
|
|
(0.25 |
) |
|
|
(0.17 |
) |
|
|
(0.19 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
(2.04 |
) |
|
$ |
(1.27 |
) |
|
$ |
0.15 |
|
|
$ |
(0.67 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
52,062 |
|
|
|
52,265 |
|
|
|
52,323 |
|
|
|
52,344 |
|
|
|
52,641 |
|
|
|
53,714 |
|
Diluted |
|
|
52,083 |
|
|
|
52,284 |
|
|
|
52,323 |
|
|
|
52,344 |
|
|
|
52,711 |
|
|
|
53,714 |
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
12
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 Quarters |
|
|
2014 Quarters |
|
|
|
First |
|
|
Second |
|
|
Third |
|
|
Fourth |
|
|
First |
|
|
Second |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
657,814 |
|
|
$ |
606,604 |
|
|
$ |
594,154 |
|
|
$ |
606,988 |
|
|
$ |
646,458 |
|
|
$ |
632,156 |
|
Nursing center division |
|
|
270,205 |
|
|
|
264,847 |
|
|
|
265,696 |
|
|
|
270,080 |
|
|
|
277,902 |
|
|
|
280,255 |
|
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
258,750 |
|
|
|
249,647 |
|
|
|
245,330 |
|
|
|
243,280 |
|
|
|
254,255 |
|
|
|
253,989 |
|
Hospital rehabilitation services |
|
|
74,523 |
|
|
|
69,777 |
|
|
|
68,296 |
|
|
|
74,017 |
|
|
|
73,964 |
|
|
|
75,324 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
333,273 |
|
|
|
319,424 |
|
|
|
313,626 |
|
|
|
317,297 |
|
|
|
328,219 |
|
|
|
329,313 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
51,621 |
|
|
|
53,039 |
|
|
|
53,801 |
|
|
|
66,466 |
|
|
|
87,704 |
|
|
|
87,986 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,312,913 |
|
|
|
1,243,914 |
|
|
|
1,227,277 |
|
|
|
1,260,831 |
|
|
|
1,340,283 |
|
|
|
1,329,710 |
|
Eliminations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
(28,657 |
) |
|
|
(28,660 |
) |
|
|
(28,151 |
) |
|
|
(28,157 |
) |
|
|
(29,646 |
) |
|
|
(30,031 |
) |
Hospital rehabilitation services |
|
|
(23,609 |
) |
|
|
(23,223 |
) |
|
|
(22,520 |
) |
|
|
(22,123 |
) |
|
|
(23,233 |
) |
|
|
(22,855 |
) |
Nursing centers |
|
|
(1,213 |
) |
|
|
(1,001 |
) |
|
|
(1,161 |
) |
|
|
(875 |
) |
|
|
(662 |
) |
|
|
(860 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(53,479 |
) |
|
|
(52,884 |
) |
|
|
(51,832 |
) |
|
|
(51,155 |
) |
|
|
(53,541 |
) |
|
|
(53,746 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,259,434 |
|
|
$ |
1,191,030 |
|
|
$ |
1,175,445 |
|
|
$ |
1,209,676 |
|
|
$ |
1,286,742 |
|
|
$ |
1,275,964 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
147,493 |
|
|
$ |
129,366 |
|
|
$ |
112,483 |
|
|
$ |
126,788 |
|
|
$ |
145,395 |
|
|
$ |
132,878 |
(a) |
Nursing center division |
|
|
29,145 |
|
|
|
36,018 |
|
|
|
31,505 |
|
|
|
35,585 |
|
|
|
38,471 |
|
|
|
36,880 |
(b) |
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
13,239 |
|
|
|
21,623 |
|
|
|
(7,209 |
) |
|
|
14,260 |
|
|
|
18,328 |
|
|
|
19,982 |
(b) |
Hospital rehabilitation services |
|
|
18,132 |
|
|
|
19,573 |
|
|
|
18,215 |
|
|
|
18,005 |
|
|
|
19,820 |
|
|
|
20,084 |
(b) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,371 |
|
|
|
41,196 |
|
|
|
11,006 |
|
|
|
32,265 |
|
|
|
38,148 |
|
|
|
40,066 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
2,786 |
|
|
|
3,961 |
|
|
|
1,085 |
|
|
|
2,131 |
|
|
|
4,697 |
|
|
|
7,065 |
(b) |
Corporate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead |
|
|
(45,585 |
) |
|
|
(43,196 |
) |
|
|
(39,157 |
) |
|
|
(48,557 |
) |
|
|
(44,050 |
) |
|
|
(48,365 |
) (b) |
Insurance subsidiary |
|
|
(509 |
) |
|
|
(384 |
) |
|
|
(482 |
) |
|
|
(539 |
) |
|
|
(406 |
) |
|
|
(443 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(46,094 |
) |
|
|
(43,580 |
) |
|
|
(39,639 |
) |
|
|
(49,096 |
) |
|
|
(44,456 |
) |
|
|
(48,808 |
) |
Impairment charges |
|
|
(187 |
) |
|
|
(438 |
) |
|
|
(441 |
) |
|
|
(76,127 |
) |
|
|
|
|
|
|
|
|
Transaction costs |
|
|
(944 |
) |
|
|
(108 |
) |
|
|
(613 |
) |
|
|
(447 |
) |
|
|
(683 |
) |
|
|
(4,496 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
163,570 |
|
|
|
166,415 |
|
|
|
115,386 |
|
|
|
71,099 |
|
|
|
181,572 |
|
|
|
163,585 |
|
Rent |
|
|
(76,519 |
) |
|
|
(77,324 |
) |
|
|
(76,762 |
) |
|
|
(80,921 |
) |
|
|
(81,048 |
) |
|
|
(80,209 |
) (c) |
Depreciation and amortization |
|
|
(41,598 |
) |
|
|
(38,554 |
) |
|
|
(36,507 |
) |
|
|
(37,547 |
) |
|
|
(39,337 |
) |
|
|
(39,442 |
) |
Interest, net |
|
|
(28,074 |
) |
|
|
(27,600 |
) |
|
|
(24,389 |
) |
|
|
(23,900 |
) |
|
|
(25,616 |
) |
|
|
(78,081 |
) (d) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
17,379 |
|
|
|
22,937 |
|
|
|
(22,272 |
) |
|
|
(71,269 |
) |
|
|
35,571 |
|
|
|
(34,147 |
) |
Provision (benefit) for income taxes |
|
|
6,505 |
|
|
|
9,208 |
|
|
|
(6,510 |
) |
|
|
(20,522 |
) |
|
|
13,585 |
|
|
|
(13,082 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
10,874 |
|
|
$ |
13,729 |
|
|
$ |
(15,762 |
) |
|
$ |
(50,747 |
) |
|
$ |
21,986 |
|
|
$ |
(21,065 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
Includes litigation costs of $4.6 million. |
(b) |
Includes severance and other costs related to restructuring activities of $4.9 million (nursing center division$3.2 million, rehabilitation division$0.3 million (skilled nursing rehabilitation
services$0.2 million and hospital rehabilitation services$0.1 million), care management division$0.8 million and corporate$0.6 million). |
(c) |
Includes lease cancellation charges of $0.3 million incurred in connection with restructuring activities. |
(d) |
Includes $56.6 million of charges associated with debt refinancing. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
13
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidating Statement of Operations
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2014 |
|
|
|
|
|
|
Nursing |
|
|
Rehabilitation division |
|
|
Care |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital |
|
|
center |
|
|
Skilled nursing |
|
|
Hospital |
|
|
|
|
|
management |
|
|
Corporate |
|
|
Transaction |
|
|
|
|
|
|
|
|
|
division (a) |
|
|
division (b,c) |
|
|
services (b) |
|
|
services (b) |
|
|
Total |
|
|
division (b) |
|
|
(b,d) |
|
|
costs |
|
|
Eliminations |
|
|
Consolidated |
|
Revenues |
|
$ |
632,156 |
|
|
$ |
280,255 |
|
|
$ |
253,989 |
|
|
$ |
75,324 |
|
|
$ |
329,313 |
|
|
$ |
87,986 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(53,746 |
) |
|
$ |
1,275,964 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
271,092 |
|
|
|
128,641 |
|
|
|
223,907 |
|
|
|
50,303 |
|
|
|
274,210 |
|
|
|
66,804 |
|
|
|
29,813 |
|
|
|
|
|
|
|
(239 |
) |
|
|
770,321 |
|
Supplies |
|
|
66,509 |
|
|
|
10,559 |
|
|
|
680 |
|
|
|
32 |
|
|
|
712 |
|
|
|
2,833 |
|
|
|
181 |
|
|
|
|
|
|
|
|
|
|
|
80,794 |
|
Rent |
|
|
52,526 |
|
|
|
23,856 |
|
|
|
1,067 |
|
|
|
22 |
|
|
|
1,089 |
|
|
|
2,177 |
|
|
|
561 |
|
|
|
|
|
|
|
|
|
|
|
80,209 |
|
Other operating expenses |
|
|
161,722 |
|
|
|
104,317 |
|
|
|
9,406 |
|
|
|
4,899 |
|
|
|
14,305 |
|
|
|
11,281 |
|
|
|
18,804 |
|
|
|
4,496 |
|
|
|
(53,507 |
) |
|
|
261,418 |
|
Other (income) expense |
|
|
(45 |
) |
|
|
(142 |
) |
|
|
14 |
|
|
|
6 |
|
|
|
20 |
|
|
|
3 |
|
|
|
10 |
|
|
|
|
|
|
|
|
|
|
|
(154 |
) |
Depreciation and amortization |
|
|
17,008 |
|
|
|
7,686 |
|
|
|
2,885 |
|
|
|
2,488 |
|
|
|
5,373 |
|
|
|
2,139 |
|
|
|
7,236 |
|
|
|
|
|
|
|
|
|
|
|
39,442 |
|
Interest expense |
|
|
187 |
|
|
|
7 |
|
|
|
51 |
|
|
|
|
|
|
|
51 |
|
|
|
12 |
|
|
|
80,273 |
|
|
|
|
|
|
|
|
|
|
|
80,530 |
|
Investment income |
|
|
(16 |
) |
|
|
(10 |
) |
|
|
(225 |
) |
|
|
|
|
|
|
(225 |
) |
|
|
(1 |
) |
|
|
(2,197 |
) |
|
|
|
|
|
|
|
|
|
|
(2,449 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
568,983 |
|
|
|
274,914 |
|
|
|
237,785 |
|
|
|
57,750 |
|
|
|
295,535 |
|
|
|
85,248 |
|
|
|
134,681 |
|
|
|
4,496 |
|
|
|
(53,746 |
) |
|
|
1,310,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
$ |
63,173 |
|
|
$ |
5,341 |
|
|
$ |
16,204 |
|
|
$ |
17,574 |
|
|
$ |
33,778 |
|
|
$ |
2,738 |
|
|
$ |
(134,681 |
) |
|
$ |
(4,496 |
) |
|
$ |
|
|
|
|
(34,147 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(13,082 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(21,065 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures, excluding acquisitions (including discontinued operations): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine |
|
$ |
8,225 |
|
|
$ |
5,163 |
|
|
$ |
593 |
|
|
$ |
44 |
|
|
$ |
637 |
|
|
$ |
168 |
|
|
$ |
10,292 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
24,485 |
|
Development |
|
|
51 |
|
|
|
321 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
372 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
8,276 |
|
|
$ |
5,484 |
|
|
$ |
593 |
|
|
$ |
44 |
|
|
$ |
637 |
|
|
$ |
168 |
|
|
$ |
10,292 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
24,857 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2013 |
|
|
|
|
|
|
Nursing |
|
|
Rehabilitation division |
|
|
Care |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital |
|
|
center |
|
|
Skilled nursing |
|
|
Hospital |
|
|
|
|
|
management |
|
|
|
|
|
Transaction |
|
|
|
|
|
|
|
|
|
division |
|
|
division |
|
|
services |
|
|
services |
|
|
Total |
|
|
division |
|
|
Corporate (e) |
|
|
costs |
|
|
Eliminations |
|
|
Consolidated |
|
Revenues |
|
$ |
606,604 |
|
|
$ |
264,847 |
|
|
$ |
249,647 |
|
|
$ |
69,777 |
|
|
$ |
319,424 |
|
|
$ |
53,039 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(52,884 |
) |
|
$ |
1,191,030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
261,362 |
|
|
|
123,242 |
|
|
|
219,874 |
|
|
|
46,236 |
|
|
|
266,110 |
|
|
|
39,730 |
|
|
|
25,242 |
|
|
|
|
|
|
|
(67 |
) |
|
|
715,619 |
|
Supplies |
|
|
64,737 |
|
|
|
12,568 |
|
|
|
785 |
|
|
|
30 |
|
|
|
815 |
|
|
|
2,325 |
|
|
|
158 |
|
|
|
|
|
|
|
|
|
|
|
80,603 |
|
Rent |
|
|
50,221 |
|
|
|
24,104 |
|
|
|
1,197 |
|
|
|
19 |
|
|
|
1,216 |
|
|
|
1,155 |
|
|
|
628 |
|
|
|
|
|
|
|
|
|
|
|
77,324 |
|
Other operating expenses |
|
|
150,959 |
|
|
|
93,274 |
|
|
|
7,326 |
|
|
|
3,930 |
|
|
|
11,256 |
|
|
|
7,023 |
|
|
|
18,178 |
|
|
|
108 |
|
|
|
(52,817 |
) |
|
|
227,981 |
|
Other (income) expense |
|
|
180 |
|
|
|
(255 |
) |
|
|
39 |
|
|
|
8 |
|
|
|
47 |
|
|
|
|
|
|
|
2 |
|
|
|
|
|
|
|
|
|
|
|
(26 |
) |
Impairment charges |
|
|
408 |
|
|
|
30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
438 |
|
Depreciation and amortization |
|
|
17,525 |
|
|
|
6,814 |
|
|
|
2,878 |
|
|
|
2,319 |
|
|
|
5,197 |
|
|
|
1,615 |
|
|
|
7,403 |
|
|
|
|
|
|
|
|
|
|
|
38,554 |
|
Interest expense |
|
|
179 |
|
|
|
1 |
|
|
|
73 |
|
|
|
|
|
|
|
73 |
|
|
|
|
|
|
|
28,821 |
|
|
|
|
|
|
|
|
|
|
|
29,074 |
|
Investment income |
|
|
(2 |
) |
|
|
(13 |
) |
|
|
(74 |
) |
|
|
|
|
|
|
(74 |
) |
|
|
|
|
|
|
(1,385 |
) |
|
|
|
|
|
|
|
|
|
|
(1,474 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
545,569 |
|
|
|
259,765 |
|
|
|
232,098 |
|
|
|
52,542 |
|
|
|
284,640 |
|
|
|
51,848 |
|
|
|
79,047 |
|
|
|
108 |
|
|
|
(52,884 |
) |
|
|
1,168,093 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
$ |
61,035 |
|
|
$ |
5,082 |
|
|
$ |
17,549 |
|
|
$ |
17,235 |
|
|
$ |
34,784 |
|
|
$ |
1,191 |
|
|
$ |
(79,047 |
) |
|
$ |
(108 |
) |
|
$ |
|
|
|
|
22,937 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,208 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
13,729 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures, excluding acquisitions (including discontinued operations): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine |
|
$ |
5,593 |
|
|
$ |
4,259 |
|
|
$ |
464 |
|
|
$ |
45 |
|
|
$ |
509 |
|
|
$ |
339 |
|
|
$ |
6,730 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
17,430 |
|
Development |
|
|
5,079 |
|
|
|
7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,086 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
10,672 |
|
|
$ |
4,266 |
|
|
$ |
464 |
|
|
$ |
45 |
|
|
$ |
509 |
|
|
$ |
339 |
|
|
$ |
6,730 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
22,516 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
Includes litigation costs of $4.6 million. |
(b) |
Includes severance and other costs related to restructuring activities of $4.9 million (nursing center division$3.2 million, rehabilitation division$0.3 million (skilled nursing rehabilitation services -
$0.2 million and hospital rehabilitation services$0.1 million), care management division$0.8 million and corporate$0.6 million). |
(c) |
Includes lease cancellation charges of $0.3 million incurred in connection with restructuring activities. |
(d) |
Includes $56.6 million of charges associated with debt refinancing. |
(e) |
Includes $1.4 million of charges associated with debt refinancing. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
14
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Consolidating Statement of Operations
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2014 |
|
|
|
|
|
|
Nursing |
|
|
Rehabilitation division |
|
|
Care |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital |
|
|
center |
|
|
Skilled nursing |
|
|
Hospital |
|
|
|
|
|
management |
|
|
Corporate |
|
|
Transaction |
|
|
|
|
|
|
|
|
|
division (a) |
|
|
division (b,c) |
|
|
services (b) |
|
|
services (b) |
|
|
Total |
|
|
division (b) |
|
|
(b,d) |
|
|
costs |
|
|
Eliminations |
|
|
Consolidated |
|
Revenues |
|
$ |
1,278,614 |
|
|
$ |
558,157 |
|
|
$ |
508,244 |
|
|
$ |
149,288 |
|
|
$ |
657,532 |
|
|
$ |
175,690 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(107,287 |
) |
|
$ |
2,562,706 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
545,928 |
|
|
|
256,395 |
|
|
|
448,514 |
|
|
|
100,302 |
|
|
|
548,816 |
|
|
|
135,493 |
|
|
|
57,651 |
|
|
|
339 |
|
|
|
(489 |
) |
|
|
1,544,133 |
|
Supplies |
|
|
133,677 |
|
|
|
21,328 |
|
|
|
1,416 |
|
|
|
67 |
|
|
|
1,483 |
|
|
|
5,932 |
|
|
|
362 |
|
|
|
|
|
|
|
|
|
|
|
162,782 |
|
Rent |
|
|
105,661 |
|
|
|
47,808 |
|
|
|
2,156 |
|
|
|
73 |
|
|
|
2,229 |
|
|
|
4,433 |
|
|
|
1,126 |
|
|
|
|
|
|
|
|
|
|
|
161,257 |
|
Other operating expenses |
|
|
320,814 |
|
|
|
205,426 |
|
|
|
19,995 |
|
|
|
9,004 |
|
|
|
28,999 |
|
|
|
22,500 |
|
|
|
35,241 |
|
|
|
4,840 |
|
|
|
(106,798 |
) |
|
|
511,022 |
|
Other (income) expense |
|
|
(78 |
) |
|
|
(343 |
) |
|
|
9 |
|
|
|
11 |
|
|
|
20 |
|
|
|
3 |
|
|
|
10 |
|
|
|
|
|
|
|
|
|
|
|
(388 |
) |
Depreciation and amortization |
|
|
33,993 |
|
|
|
15,228 |
|
|
|
5,580 |
|
|
|
5,052 |
|
|
|
10,632 |
|
|
|
4,264 |
|
|
|
14,662 |
|
|
|
|
|
|
|
|
|
|
|
78,779 |
|
Interest expense |
|
|
372 |
|
|
|
12 |
|
|
|
109 |
|
|
|
|
|
|
|
109 |
|
|
|
22 |
|
|
|
105,814 |
|
|
|
|
|
|
|
|
|
|
|
106,329 |
|
Investment income |
|
|
(18 |
) |
|
|
(21 |
) |
|
|
(284 |
) |
|
|
|
|
|
|
(284 |
) |
|
|
(1 |
) |
|
|
(2,308 |
) |
|
|
|
|
|
|
|
|
|
|
(2,632 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,140,349 |
|
|
|
545,833 |
|
|
|
477,495 |
|
|
|
114,509 |
|
|
|
592,004 |
|
|
|
172,646 |
|
|
|
212,558 |
|
|
|
5,179 |
|
|
|
(107,287 |
) |
|
|
2,561,282 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
$ |
138,265 |
|
|
$ |
12,324 |
|
|
$ |
30,749 |
|
|
$ |
34,779 |
|
|
$ |
65,528 |
|
|
$ |
3,044 |
|
|
$ |
(212,558 |
) |
|
$ |
(5,179 |
) |
|
$ |
|
|
|
|
1,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
503 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
921 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures, excluding acquisitions (including discontinued operations): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine |
|
$ |
16,627 |
|
|
$ |
10,218 |
|
|
$ |
1,442 |
|
|
$ |
100 |
|
|
$ |
1,542 |
|
|
$ |
476 |
|
|
$ |
17,299 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
46,162 |
|
Development |
|
|
562 |
|
|
|
561 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
17,189 |
|
|
$ |
10,779 |
|
|
$ |
1,442 |
|
|
$ |
100 |
|
|
$ |
1,542 |
|
|
$ |
476 |
|
|
$ |
17,299 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
47,285 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2013 |
|
|
|
|
|
|
Nursing |
|
|
Rehabilitation division |
|
|
Care |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital |
|
|
center |
|
|
Skilled nursing |
|
|
Hospital |
|
|
|
|
|
management |
|
|
Corporate |
|
|
Transaction |
|
|
|
|
|
|
|
|
|
division (e) |
|
|
division (e) |
|
|
services (e) |
|
|
services (e) |
|
|
Total |
|
|
division (e) |
|
|
(e,f) |
|
|
costs |
|
|
Eliminations |
|
|
Consolidated |
|
Revenues |
|
$ |
1,264,418 |
|
|
$ |
535,052 |
|
|
$ |
508,397 |
|
|
$ |
144,300 |
|
|
$ |
652,697 |
|
|
$ |
104,660 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(106,363 |
) |
|
$ |
2,450,464 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
551,019 |
|
|
|
258,425 |
|
|
|
454,718 |
|
|
|
98,656 |
|
|
|
553,374 |
|
|
|
80,044 |
|
|
|
54,930 |
|
|
|
|
|
|
|
(308 |
) |
|
|
1,497,484 |
|
Supplies |
|
|
132,883 |
|
|
|
25,282 |
|
|
|
1,596 |
|
|
|
62 |
|
|
|
1,658 |
|
|
|
4,563 |
|
|
|
363 |
|
|
|
|
|
|
|
|
|
|
|
164,749 |
|
Rent |
|
|
99,803 |
|
|
|
47,980 |
|
|
|
2,432 |
|
|
|
36 |
|
|
|
2,468 |
|
|
|
2,341 |
|
|
|
1,251 |
|
|
|
|
|
|
|
|
|
|
|
153,843 |
|
Other operating expenses |
|
|
303,582 |
|
|
|
186,838 |
|
|
|
17,182 |
|
|
|
7,849 |
|
|
|
25,031 |
|
|
|
13,306 |
|
|
|
34,902 |
|
|
|
1,052 |
|
|
|
(106,055 |
) |
|
|
458,656 |
|
Other (income) expense |
|
|
75 |
|
|
|
(656 |
) |
|
|
39 |
|
|
|
28 |
|
|
|
67 |
|
|
|
|
|
|
|
(521 |
) |
|
|
|
|
|
|
|
|
|
|
(1,035 |
) |
Impairment charges |
|
|
584 |
|
|
|
41 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
625 |
|
Depreciation and amortization |
|
|
37,247 |
|
|
|
14,155 |
|
|
|
5,990 |
|
|
|
4,650 |
|
|
|
10,640 |
|
|
|
3,141 |
|
|
|
14,969 |
|
|
|
|
|
|
|
|
|
|
|
80,152 |
|
Interest expense |
|
|
361 |
|
|
|
6 |
|
|
|
169 |
|
|
|
|
|
|
|
169 |
|
|
|
|
|
|
|
56,697 |
|
|
|
|
|
|
|
|
|
|
|
57,233 |
|
Investment income |
|
|
(6 |
) |
|
|
(21 |
) |
|
|
(102 |
) |
|
|
|
|
|
|
(102 |
) |
|
|
|
|
|
|
(1,430 |
) |
|
|
|
|
|
|
|
|
|
|
(1,559 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,125,548 |
|
|
|
532,050 |
|
|
|
482,024 |
|
|
|
111,281 |
|
|
|
593,305 |
|
|
|
103,395 |
|
|
|
161,161 |
|
|
|
1,052 |
|
|
|
(106,363 |
) |
|
|
2,410,148 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
$ |
138,870 |
|
|
$ |
3,002 |
|
|
$ |
26,373 |
|
|
$ |
33,019 |
|
|
$ |
59,392 |
|
|
$ |
1,265 |
|
|
$ |
(161,161 |
) |
|
$ |
(1,052 |
) |
|
$ |
|
|
|
|
40,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
24,603 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures, excluding acquisitions (including discontinued operations): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine |
|
$ |
15,864 |
|
|
$ |
10,078 |
|
|
$ |
1,069 |
|
|
$ |
77 |
|
|
$ |
1,146 |
|
|
$ |
534 |
|
|
$ |
12,178 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
39,800 |
|
Development |
|
|
7,467 |
|
|
|
7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,474 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
23,331 |
|
|
$ |
10,085 |
|
|
$ |
1,069 |
|
|
$ |
77 |
|
|
$ |
1,146 |
|
|
$ |
534 |
|
|
$ |
12,178 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
47,274 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
Includes litigation costs of $4.6 million. |
(b) |
Includes severance and other costs related to restructuring activities of $4.9 million (nursing center division - $3.2 million, rehabilitation division - $0.3 million (skilled nursing rehabilitation services - $0.2
million and hospital rehabilitation services - $0.1 million), care management division - $0.8 million and corporate - $0.6 million). |
(c) |
Includes lease cancellation charges of $0.3 million incurred in connection with restructuring activities. |
(d) |
Includes $56.6 million of charges associated with debt refinancing. |
(e) |
Includes one-time bonus costs of $19.8 million (hospital division - $7.8 million, nursing center division - $4.6 million, rehabilitation division - $6.3 million (skilled nursing rehabilitation services - $5.0 million
and hospital rehabilitation services - $1.3 million), care management division - $0.8 million and corporate - $0.3 million). |
(f) |
Includes $1.4 million of charges associated with debt refinancing. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
15
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 Quarters |
|
|
2014 Quarters |
|
|
|
First |
|
|
Second |
|
|
Third |
|
|
Fourth |
|
|
First |
|
|
Second |
|
Hospital division data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of period data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of hospitals: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transitional care |
|
|
97 |
|
|
|
97 |
|
|
|
97 |
|
|
|
97 |
|
|
|
97 |
|
|
|
97 |
|
Inpatient rehabilitation |
|
|
5 |
|
|
|
5 |
|
|
|
5 |
|
|
|
5 |
|
|
|
5 |
|
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
102 |
|
|
|
102 |
|
|
|
102 |
|
|
|
102 |
|
|
|
102 |
|
|
|
102 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of licensed beds: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transitional care |
|
|
7,059 |
|
|
|
7,059 |
|
|
|
7,073 |
|
|
|
7,105 |
|
|
|
7,145 |
|
|
|
7,145 |
|
Inpatient rehabilitation |
|
|
215 |
|
|
|
215 |
|
|
|
215 |
|
|
|
215 |
|
|
|
215 |
|
|
|
215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,274 |
|
|
|
7,274 |
|
|
|
7,288 |
|
|
|
7,320 |
|
|
|
7,360 |
|
|
|
7,360 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue mix %: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
62.5 |
|
|
|
60.7 |
|
|
|
59.1 |
|
|
|
59.3 |
|
|
|
60.2 |
|
|
|
58.9 |
|
Medicaid |
|
|
5.4 |
|
|
|
5.9 |
|
|
|
6.9 |
|
|
|
6.2 |
|
|
|
6.5 |
|
|
|
6.6 |
|
Medicare Advantage |
|
|
10.2 |
|
|
|
11.1 |
|
|
|
11.1 |
|
|
|
11.7 |
|
|
|
11.2 |
|
|
|
11.0 |
|
Medicaid Managed |
|
|
1.9 |
|
|
|
1.9 |
|
|
|
2.0 |
|
|
|
1.9 |
|
|
|
2.3 |
|
|
|
2.9 |
|
Commercial insurance and other |
|
|
20.0 |
|
|
|
20.4 |
|
|
|
20.9 |
|
|
|
20.9 |
|
|
|
19.8 |
|
|
|
20.6 |
|
Admissions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
10,274 |
|
|
|
9,432 |
|
|
|
9,010 |
|
|
|
9,255 |
|
|
|
9,858 |
|
|
|
9,410 |
|
Medicaid |
|
|
685 |
|
|
|
744 |
|
|
|
788 |
|
|
|
712 |
|
|
|
835 |
|
|
|
914 |
|
Medicare Advantage |
|
|
1,519 |
|
|
|
1,474 |
|
|
|
1,422 |
|
|
|
1,450 |
|
|
|
1,515 |
|
|
|
1,449 |
|
Medicaid Managed |
|
|
209 |
|
|
|
208 |
|
|
|
225 |
|
|
|
252 |
|
|
|
317 |
|
|
|
381 |
|
Commercial insurance and other |
|
|
1,951 |
|
|
|
1,869 |
|
|
|
1,874 |
|
|
|
1,818 |
|
|
|
2,107 |
|
|
|
2,055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,638 |
|
|
|
13,727 |
|
|
|
13,319 |
|
|
|
13,487 |
|
|
|
14,632 |
|
|
|
14,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Admissions mix %: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
70.2 |
|
|
|
68.7 |
|
|
|
67.6 |
|
|
|
68.6 |
|
|
|
67.4 |
|
|
|
66.2 |
|
Medicaid |
|
|
4.7 |
|
|
|
5.4 |
|
|
|
5.9 |
|
|
|
5.3 |
|
|
|
5.7 |
|
|
|
6.4 |
|
Medicare Advantage |
|
|
10.4 |
|
|
|
10.8 |
|
|
|
10.7 |
|
|
|
10.7 |
|
|
|
10.3 |
|
|
|
10.2 |
|
Medicaid Managed |
|
|
1.4 |
|
|
|
1.5 |
|
|
|
1.7 |
|
|
|
1.9 |
|
|
|
2.2 |
|
|
|
2.7 |
|
Commercial insurance and other |
|
|
13.3 |
|
|
|
13.6 |
|
|
|
14.1 |
|
|
|
13.5 |
|
|
|
14.4 |
|
|
|
14.5 |
|
Patient days: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
252,195 |
|
|
|
234,490 |
|
|
|
223,639 |
|
|
|
226,662 |
|
|
|
239,759 |
|
|
|
230,122 |
|
Medicaid |
|
|
28,765 |
|
|
|
30,425 |
|
|
|
31,569 |
|
|
|
29,799 |
|
|
|
32,909 |
|
|
|
32,821 |
|
Medicare Advantage |
|
|
43,016 |
|
|
|
43,040 |
|
|
|
41,842 |
|
|
|
43,784 |
|
|
|
44,979 |
|
|
|
44,094 |
|
Medicaid Managed |
|
|
8,808 |
|
|
|
8,342 |
|
|
|
8,264 |
|
|
|
8,238 |
|
|
|
10,733 |
|
|
|
13,247 |
|
Commercial insurance and other |
|
|
63,227 |
|
|
|
57,091 |
|
|
|
59,575 |
|
|
|
57,334 |
|
|
|
62,858 |
|
|
|
61,892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
396,011 |
|
|
|
373,388 |
|
|
|
364,889 |
|
|
|
365,817 |
|
|
|
391,238 |
|
|
|
382,176 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average length of stay: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
24.5 |
|
|
|
24.9 |
|
|
|
24.8 |
|
|
|
24.5 |
|
|
|
24.3 |
|
|
|
24.5 |
|
Medicaid |
|
|
42.0 |
|
|
|
40.9 |
|
|
|
40.1 |
|
|
|
41.9 |
|
|
|
39.4 |
|
|
|
35.9 |
|
Medicare Advantage |
|
|
28.3 |
|
|
|
29.2 |
|
|
|
29.4 |
|
|
|
30.2 |
|
|
|
29.7 |
|
|
|
30.4 |
|
Medicaid Managed |
|
|
42.1 |
|
|
|
40.1 |
|
|
|
36.7 |
|
|
|
32.7 |
|
|
|
33.9 |
|
|
|
34.8 |
|
Commercial insurance and other |
|
|
32.4 |
|
|
|
30.5 |
|
|
|
31.8 |
|
|
|
31.5 |
|
|
|
29.8 |
|
|
|
30.1 |
|
Weighted average |
|
|
27.1 |
|
|
|
27.2 |
|
|
|
27.4 |
|
|
|
27.1 |
|
|
|
26.7 |
|
|
|
26.9 |
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
16
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data (Continued)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 Quarters |
|
|
2014 Quarters |
|
|
|
First |
|
|
Second |
|
|
Third |
|
|
Fourth |
|
|
First |
|
|
Second |
|
Hospital division data (continued): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues per admission: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
$ |
40,051 |
|
|
$ |
39,004 |
|
|
$ |
38,993 |
|
|
$ |
38,869 |
|
|
$ |
39,482 |
|
|
$ |
39,559 |
|
Medicaid |
|
|
51,450 |
|
|
|
48,221 |
|
|
|
51,934 |
|
|
|
52,635 |
|
|
|
50,201 |
|
|
|
45,392 |
|
Medicare Advantage |
|
|
44,326 |
|
|
|
45,709 |
|
|
|
46,429 |
|
|
|
49,051 |
|
|
|
47,739 |
|
|
|
48,067 |
|
Medicaid Managed |
|
|
58,770 |
|
|
|
55,496 |
|
|
|
52,771 |
|
|
|
46,112 |
|
|
|
47,781 |
|
|
|
48,953 |
|
Commercial insurance and other |
|
|
67,389 |
|
|
|
66,306 |
|
|
|
66,170 |
|
|
|
69,876 |
|
|
|
60,679 |
|
|
|
63,315 |
|
Weighted average |
|
|
44,939 |
|
|
|
44,190 |
|
|
|
44,609 |
|
|
|
45,006 |
|
|
|
44,181 |
|
|
|
44,490 |
|
Revenues per patient day: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
$ |
1,632 |
|
|
$ |
1,569 |
|
|
$ |
1,571 |
|
|
$ |
1,587 |
|
|
$ |
1,623 |
|
|
$ |
1,618 |
|
Medicaid |
|
|
1,225 |
|
|
|
1,179 |
|
|
|
1,296 |
|
|
|
1,258 |
|
|
|
1,274 |
|
|
|
1,264 |
|
Medicare Advantage |
|
|
1,565 |
|
|
|
1,565 |
|
|
|
1,578 |
|
|
|
1,624 |
|
|
|
1,608 |
|
|
|
1,580 |
|
Medicaid Managed |
|
|
1,395 |
|
|
|
1,384 |
|
|
|
1,437 |
|
|
|
1,411 |
|
|
|
1,411 |
|
|
|
1,408 |
|
Commercial insurance and other |
|
|
2,079 |
|
|
|
2,171 |
|
|
|
2,081 |
|
|
|
2,216 |
|
|
|
2,034 |
|
|
|
2,102 |
|
Weighted average |
|
|
1,661 |
|
|
|
1,625 |
|
|
|
1,628 |
|
|
|
1,659 |
|
|
|
1,652 |
|
|
|
1,654 |
|
Medicare case mix index (discharged patients only) |
|
|
1.18 |
|
|
|
1.18 |
|
|
|
1.16 |
|
|
|
1.16 |
|
|
|
1.17 |
|
|
|
1.18 |
|
Average daily census |
|
|
4,400 |
|
|
|
4,103 |
|
|
|
3,966 |
|
|
|
3,976 |
|
|
|
4,347 |
|
|
|
4,200 |
|
Occupancy % |
|
|
68.3 |
|
|
|
63.5 |
|
|
|
61.1 |
|
|
|
61.4 |
|
|
|
67.4 |
|
|
|
64.9 |
|
Annualized employee turnover % |
|
|
22.1 |
|
|
|
21.7 |
|
|
|
21.4 |
|
|
|
21.3 |
|
|
|
20.7 |
|
|
|
20.8 |
|
Nursing center division data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of period data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of facilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nursing centers: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned or leased |
|
|
94 |
|
|
|
94 |
|
|
|
94 |
|
|
|
94 |
|
|
|
94 |
|
|
|
94 |
|
Managed |
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
Assisted living facilities |
|
|
6 |
|
|
|
6 |
|
|
|
6 |
|
|
|
6 |
|
|
|
6 |
|
|
|
6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104 |
|
|
|
104 |
|
|
|
104 |
|
|
|
104 |
|
|
|
104 |
|
|
|
104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of licensed beds: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nursing centers: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned or leased |
|
|
11,921 |
|
|
|
11,921 |
|
|
|
11,921 |
|
|
|
11,921 |
|
|
|
11,921 |
|
|
|
11,909 |
|
Managed |
|
|
485 |
|
|
|
485 |
|
|
|
485 |
|
|
|
485 |
|
|
|
485 |
|
|
|
485 |
|
Assisted living facilities |
|
|
341 |
|
|
|
341 |
|
|
|
341 |
|
|
|
341 |
|
|
|
341 |
|
|
|
341 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,747 |
|
|
|
12,747 |
|
|
|
12,747 |
|
|
|
12,747 |
|
|
|
12,747 |
|
|
|
12,735 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue mix %: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
35.0 |
|
|
|
34.0 |
|
|
|
33.1 |
|
|
|
32.1 |
|
|
|
32.0 |
|
|
|
31.8 |
|
Medicaid |
|
|
35.7 |
|
|
|
36.4 |
|
|
|
38.8 |
|
|
|
39.8 |
|
|
|
40.4 |
|
|
|
39.7 |
|
Medicare Advantage |
|
|
8.2 |
|
|
|
8.3 |
|
|
|
7.3 |
|
|
|
7.8 |
|
|
|
8.6 |
|
|
|
8.1 |
|
Medicaid Managed |
|
|
3.4 |
|
|
|
3.5 |
|
|
|
3.5 |
|
|
|
3.5 |
|
|
|
3.2 |
|
|
|
3.6 |
|
Private and other |
|
|
17.7 |
|
|
|
17.8 |
|
|
|
17.3 |
|
|
|
16.8 |
|
|
|
15.8 |
|
|
|
16.8 |
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
17
August 6, 2014
KINDRED HEALTHCARE, INC.
Condensed Business Segment Data (Continued)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 Quarters |
|
|
2014 Quarters |
|
|
|
First |
|
|
Second |
|
|
Third |
|
|
Fourth |
|
|
First |
|
|
Second |
|
Nursing center division data (continued): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patient days (a): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
167,391 |
|
|
|
158,780 |
|
|
|
154,562 |
|
|
|
148,179 |
|
|
|
148,957 |
|
|
|
149,385 |
|
Medicaid |
|
|
505,962 |
|
|
|
506,025 |
|
|
|
515,789 |
|
|
|
522,071 |
|
|
|
516,487 |
|
|
|
506,917 |
|
Medicare Advantage |
|
|
51,695 |
|
|
|
51,337 |
|
|
|
45,338 |
|
|
|
48,537 |
|
|
|
54,404 |
|
|
|
51,355 |
|
Medicaid Managed |
|
|
52,500 |
|
|
|
52,532 |
|
|
|
53,740 |
|
|
|
53,100 |
|
|
|
49,857 |
|
|
|
55,997 |
|
Private and other |
|
|
163,641 |
|
|
|
163,167 |
|
|
|
162,506 |
|
|
|
159,518 |
|
|
|
152,807 |
|
|
|
155,530 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
941,189 |
|
|
|
931,841 |
|
|
|
931,935 |
|
|
|
931,405 |
|
|
|
922,512 |
|
|
|
919,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patient day mix % (a): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
17.8 |
|
|
|
17.0 |
|
|
|
16.6 |
|
|
|
15.9 |
|
|
|
16.1 |
|
|
|
16.3 |
|
Medicaid |
|
|
53.7 |
|
|
|
54.3 |
|
|
|
55.3 |
|
|
|
56.1 |
|
|
|
56.0 |
|
|
|
55.1 |
|
Medicare Advantage |
|
|
5.5 |
|
|
|
5.5 |
|
|
|
4.9 |
|
|
|
5.2 |
|
|
|
5.9 |
|
|
|
5.6 |
|
Medicaid Managed |
|
|
5.6 |
|
|
|
5.7 |
|
|
|
5.8 |
|
|
|
5.7 |
|
|
|
5.4 |
|
|
|
6.1 |
|
Private and other |
|
|
17.4 |
|
|
|
17.5 |
|
|
|
17.4 |
|
|
|
17.1 |
|
|
|
16.6 |
|
|
|
16.9 |
|
Revenues per patient day (a): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare Part A |
|
$ |
528 |
|
|
$ |
527 |
|
|
$ |
527 |
|
|
$ |
542 |
|
|
$ |
552 |
|
|
$ |
551 |
|
Total Medicare (including Part B) |
|
|
565 |
|
|
|
567 |
|
|
|
569 |
|
|
|
586 |
|
|
|
597 |
|
|
|
597 |
|
Medicaid |
|
|
191 |
|
|
|
190 |
|
|
|
200 |
|
|
|
206 |
|
|
|
217 |
|
|
|
220 |
|
Medicaid (net of provider taxes) (b) |
|
|
168 |
|
|
|
168 |
|
|
|
178 |
|
|
|
184 |
|
|
|
195 |
|
|
|
197 |
|
Medicare Advantage |
|
|
427 |
|
|
|
430 |
|
|
|
428 |
|
|
|
435 |
|
|
|
441 |
|
|
|
442 |
|
Medicaid Managed |
|
|
177 |
|
|
|
177 |
|
|
|
175 |
|
|
|
177 |
|
|
|
178 |
|
|
|
180 |
|
Private and other |
|
|
292 |
|
|
|
289 |
|
|
|
283 |
|
|
|
284 |
|
|
|
288 |
|
|
|
302 |
|
Weighted average |
|
|
287 |
|
|
|
284 |
|
|
|
285 |
|
|
|
290 |
|
|
|
301 |
|
|
|
305 |
|
Average daily census (a) |
|
|
10,458 |
|
|
|
10,240 |
|
|
|
10,130 |
|
|
|
10,124 |
|
|
|
10,250 |
|
|
|
10,101 |
|
Admissions (a) |
|
|
10,806 |
|
|
|
10,066 |
|
|
|
9,824 |
|
|
|
9,842 |
|
|
|
10,252 |
|
|
|
10,170 |
|
Occupancy % (a) |
|
|
83.3 |
|
|
|
81.5 |
|
|
|
80.5 |
|
|
|
80.2 |
|
|
|
81.2 |
|
|
|
80.2 |
|
Medicare average length of stay (a) |
|
|
30.4 |
|
|
|
31.1 |
|
|
|
31.8 |
|
|
|
31.5 |
|
|
|
29.8 |
|
|
|
29.7 |
|
Annualized employee turnover % |
|
|
41.3 |
|
|
|
44.0 |
|
|
|
44.3 |
|
|
|
42.8 |
|
|
|
39.4 |
|
|
|
40.7 |
|
Rehabilitation division data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue mix %: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-operated |
|
|
11 |
|
|
|
11 |
|
|
|
11 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
Non-affiliated |
|
|
89 |
|
|
|
89 |
|
|
|
89 |
|
|
|
88 |
|
|
|
88 |
|
|
|
88 |
|
Sites of service (at end of period) |
|
|
1,729 |
|
|
|
1,713 |
|
|
|
1,768 |
|
|
|
1,806 |
|
|
|
1,851 |
|
|
|
1,863 |
|
Revenue per site |
|
$ |
149,653 |
|
|
$ |
145,736 |
|
|
$ |
138,762 |
|
|
$ |
134,707 |
|
|
$ |
137,361 |
|
|
$ |
136,333 |
|
Therapist productivity % |
|
|
81.1 |
|
|
|
80.4 |
|
|
|
79.8 |
|
|
|
79.5 |
|
|
|
80.0 |
|
|
|
79.8 |
|
Hospital rehabilitation services: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue mix %: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-operated |
|
|
32 |
|
|
|
33 |
|
|
|
33 |
|
|
|
30 |
|
|
|
31 |
|
|
|
30 |
|
Non-affiliated |
|
|
68 |
|
|
|
67 |
|
|
|
67 |
|
|
|
70 |
|
|
|
69 |
|
|
|
70 |
|
Sites of service (at end of period): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inpatient rehabilitation units |
|
|
103 |
|
|
|
103 |
|
|
|
99 |
|
|
|
104 |
|
|
|
105 |
|
|
|
104 |
|
LTAC hospitals |
|
|
123 |
|
|
|
123 |
|
|
|
122 |
|
|
|
121 |
|
|
|
121 |
|
|
|
118 |
|
Sub-acute units |
|
|
8 |
|
|
|
8 |
|
|
|
7 |
|
|
|
10 |
|
|
|
10 |
|
|
|
9 |
|
Outpatient units |
|
|
98 |
|
|
|
104 |
|
|
|
104 |
|
|
|
144 |
|
|
|
143 |
|
|
|
143 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
332 |
|
|
|
338 |
|
|
|
332 |
|
|
|
379 |
|
|
|
379 |
|
|
|
374 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue per site |
|
$ |
224,466 |
|
|
$ |
206,441 |
|
|
$ |
205,711 |
|
|
$ |
195,296 |
|
|
$ |
195,157 |
|
|
$ |
201,400 |
|
Annualized employee turnover % |
|
|
10.4 |
|
|
|
13.2 |
|
|
|
14.0 |
|
|
|
13.7 |
|
|
|
12.5 |
|
|
|
14.7 |
|
(a) |
Excludes managed facilities. |
(b) |
Provider taxes are recorded in other operating expenses for all periods presented. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
18
August 6, 2014
KINDRED HEALTHCARE, INC.
Earnings (Loss) Per Common Share Reconciliation (a)
(Unaudited)
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
|
|
Basic |
|
|
Diluted |
|
|
Basic |
|
|
Diluted |
|
|
Basic |
|
|
Diluted |
|
|
Basic |
|
|
Diluted |
|
Earnings (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Kindred stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported in Statement of Operations |
|
$ |
(25,893 |
) |
|
$ |
(25,893 |
) |
|
$ |
13,613 |
|
|
$ |
13,613 |
|
|
$ |
(8,436 |
) |
|
$ |
(8,436 |
) |
|
$ |
24,020 |
|
|
$ |
24,020 |
|
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
|
|
|
|
(449 |
) |
|
|
(449 |
) |
|
|
|
|
|
|
|
|
|
|
(736 |
) |
|
|
(736 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
(25,893 |
) |
|
$ |
(25,893 |
) |
|
$ |
13,164 |
|
|
$ |
13,164 |
|
|
$ |
(8,436 |
) |
|
$ |
(8,436 |
) |
|
$ |
23,284 |
|
|
$ |
23,284 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations, net of income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported in Statement of Operations |
|
$ |
(7,900 |
) |
|
$ |
(7,900 |
) |
|
$ |
(1,016 |
) |
|
$ |
(1,016 |
) |
|
$ |
(14,331 |
) |
|
$ |
(14,331 |
) |
|
$ |
(6,341 |
) |
|
$ |
(6,341 |
) |
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
|
|
|
|
34 |
|
|
|
34 |
|
|
|
|
|
|
|
|
|
|
|
194 |
|
|
|
194 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
(7,900 |
) |
|
$ |
(7,900 |
) |
|
$ |
(982 |
) |
|
$ |
(982 |
) |
|
$ |
(14,331 |
) |
|
$ |
(14,331 |
) |
|
$ |
(6,147 |
) |
|
$ |
(6,147 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on divestiture of operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported in Statement of Operations |
|
$ |
(2,018 |
) |
|
$ |
(2,018 |
) |
|
$ |
(10,852 |
) |
|
$ |
(10,852 |
) |
|
$ |
(5,024 |
) |
|
$ |
(5,024 |
) |
|
$ |
(12,877 |
) |
|
$ |
(12,877 |
) |
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
|
|
|
|
358 |
|
|
|
358 |
|
|
|
|
|
|
|
|
|
|
|
395 |
|
|
|
395 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
(2,018 |
) |
|
$ |
(2,018 |
) |
|
$ |
(10,494 |
) |
|
$ |
(10,494 |
) |
|
$ |
(5,024 |
) |
|
$ |
(5,024 |
) |
|
$ |
(12,482 |
) |
|
$ |
(12,482 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported in Statement of Operations |
|
$ |
(9,918 |
) |
|
$ |
(9,918 |
) |
|
$ |
(11,868 |
) |
|
$ |
(11,868 |
) |
|
$ |
(19,355 |
) |
|
$ |
(19,355 |
) |
|
$ |
(19,218 |
) |
|
$ |
(19,218 |
) |
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
|
|
|
|
392 |
|
|
|
392 |
|
|
|
|
|
|
|
|
|
|
|
589 |
|
|
|
589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
(9,918 |
) |
|
$ |
(9,918 |
) |
|
$ |
(11,476 |
) |
|
$ |
(11,476 |
) |
|
$ |
(19,355 |
) |
|
$ |
(19,355 |
) |
|
$ |
(18,629 |
) |
|
$ |
(18,629 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported in Statement of Operations |
|
$ |
(35,811 |
) |
|
$ |
(35,811 |
) |
|
$ |
1,745 |
|
|
$ |
1,745 |
|
|
$ |
(27,791 |
) |
|
$ |
(27,791 |
) |
|
$ |
4,802 |
|
|
$ |
4,802 |
|
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
|
|
|
|
(57 |
) |
|
|
(57 |
) |
|
|
|
|
|
|
|
|
|
|
(147 |
) |
|
|
(147 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
(35,811 |
) |
|
$ |
(35,811 |
) |
|
$ |
1,688 |
|
|
$ |
1,688 |
|
|
$ |
(27,791 |
) |
|
$ |
(27,791 |
) |
|
$ |
4,655 |
|
|
$ |
4,655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in the computation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding - basic computation |
|
|
53,714 |
|
|
|
53,714 |
|
|
|
52,265 |
|
|
|
52,265 |
|
|
|
53,180 |
|
|
|
53,180 |
|
|
|
52,164 |
|
|
|
52,164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilutive effect of employee stock options |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted weighted average shares outstanding - diluted computation |
|
|
|
|
|
|
53,714 |
|
|
|
|
|
|
|
52,284 |
|
|
|
|
|
|
|
53,180 |
|
|
|
|
|
|
|
52,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
(0.48 |
) |
|
$ |
(0.48 |
) |
|
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
(0.16 |
) |
|
$ |
(0.16 |
) |
|
$ |
0.45 |
|
|
$ |
0.45 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
|
(0.15 |
) |
|
|
(0.15 |
) |
|
|
(0.02 |
) |
|
|
(0.02 |
) |
|
|
(0.27 |
) |
|
|
(0.27 |
) |
|
|
(0.12 |
) |
|
|
(0.12 |
) |
Loss on divestiture of operations |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
(0.20 |
) |
|
|
(0.20 |
) |
|
|
(0.09 |
) |
|
|
(0.09 |
) |
|
|
(0.24 |
) |
|
|
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
(0.19 |
) |
|
|
(0.19 |
) |
|
|
(0.22 |
) |
|
|
(0.22 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(0.67 |
) |
|
$ |
(0.67 |
) |
|
$ |
0.03 |
|
|
$ |
0.03 |
|
|
$ |
(0.52 |
) |
|
$ |
(0.52 |
) |
|
$ |
0.09 |
|
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
Earnings (loss) per common share are based upon the weighted average number of common shares outstanding during the respective periods. The diluted calculation of earnings per common share includes the dilutive effect
of stock options. The Company follows the provisions of the authoritative guidance for determining whether instruments granted in share-based payment transactions are participating securities, which requires that certain unvested restricted stock be
included as a participating security in the basic and diluted earnings per common share calculation pursuant to the two-class method. However, because the Company reported a loss from continuing operations for the three months and six months ended
June 30, 2014, there was no allocation to participating unvested restricted stockholders for these periods. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
19
August 6, 2014
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results
(Unaudited)
(In thousands,
except per share amounts and statistics)
In addition to the results provided in accordance with GAAP, the Company has provided
information in this release to compute certain non-GAAP measurements for the three months and six months ended June 30, 2014 and 2013 before certain charges or on a core basis. The charges that were excluded from core operating results are
denoted in the tables below.
The income tax benefit associated with the excluded charges was calculated using an effective income tax
rate of 37.1% and 36.9% for the three months ended June 30, 2014 and 2013, respectively, and 37.1% and 40.3% for the six months ended June 30, 2014 and 2013, respectively.
The use of these non-GAAP measurements are not intended to replace the presentation of the Companys financial results in accordance with
GAAP. The Company believes that the presentation of core operating results provides additional information to investors to facilitate the comparison between periods by excluding certain charges for the three months and six months ended June 30,
2014 and 2013 that the Company believes are not representative of its ongoing operations due to the materiality and nature of the charges. The Companys core operating results also represent a key performance measure for the purpose of
evaluating performance internally.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Six months ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Detail of charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One-time bonus costs |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
|
($19,842 |
) |
Severance and other restructuring costs |
|
|
(4,950 |
) |
|
|
|
|
|
|
(4,950 |
) |
|
|
|
|
Litigation costs |
|
|
(4,600 |
) |
|
|
|
|
|
|
(4,600 |
) |
|
|
|
|
Transaction costs |
|
|
(4,496 |
) |
|
|
(108 |
) |
|
|
(5,179 |
) |
|
|
(1,052 |
) |
Lease cancellation charges (rent expense) |
|
|
(247 |
) |
|
|
|
|
|
|
(247 |
) |
|
|
|
|
Debt refinancing charges (interest expense) |
|
|
(56,643 |
) |
|
|
(1,365 |
) |
|
|
(56,643 |
) |
|
|
(1,365 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(70,936 |
) |
|
|
(1,473 |
) |
|
|
(71,619 |
) |
|
|
(22,259 |
) |
Income tax benefit |
|
|
26,295 |
|
|
|
544 |
|
|
|
26,545 |
|
|
|
8,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges net of income taxes |
|
|
(44,641 |
) |
|
|
(929 |
) |
|
|
(45,074 |
) |
|
|
(13,298 |
) |
Allocation to participating unvested restricted stockholders |
|
|
|
|
|
|
31 |
|
|
|
|
|
|
|
407 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
|
($44,641 |
) |
|
|
($898 |
) |
|
|
($45,074 |
) |
|
|
($12,891 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average diluted shares outstanding |
|
|
53,714 |
|
|
|
52,284 |
|
|
|
53,180 |
|
|
|
52,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted loss per common share related to charges |
|
|
($0.83 |
) |
|
|
($0.02 |
) |
|
|
($0.85 |
) |
|
|
($0.25 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of operating income before charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income before charges |
|
$ |
177,631 |
|
|
$ |
166,523 |
|
|
$ |
359,886 |
|
|
$ |
350,879 |
|
Detail of charges excluded from core operating results: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One-time bonus costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19,842 |
) |
Severance and other restructuring costs |
|
|
(4,950 |
) |
|
|
|
|
|
|
(4,950 |
) |
|
|
|
|
Litigation costs |
|
|
(4,600 |
) |
|
|
|
|
|
|
(4,600 |
) |
|
|
|
|
Transaction costs |
|
|
(4,496 |
) |
|
|
(108 |
) |
|
|
(5,179 |
) |
|
|
(1,052 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14,046 |
) |
|
|
(108 |
) |
|
|
(14,729 |
) |
|
|
(20,894 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported operating income |
|
$ |
163,585 |
|
|
$ |
166,415 |
|
|
$ |
345,157 |
|
|
$ |
329,985 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of income from continuing operations before charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Kindred stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before charges |
|
$ |
18,748 |
|
|
$ |
14,542 |
|
|
$ |
36,638 |
|
|
$ |
37,318 |
|
Charges net of income taxes |
|
|
(44,641 |
) |
|
|
(929 |
) |
|
|
(45,074 |
) |
|
|
(13,298 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported income (loss) from continuing operations |
|
|
($25,893 |
) |
|
|
$13,613 |
|
|
|
($8,436 |
) |
|
|
$24,020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of diluted income per common share from continuing operations before charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per common share before charges (a) |
|
$ |
0.34 |
|
|
$ |
0.27 |
|
|
$ |
0.67 |
|
|
$ |
0.70 |
|
Charges net of income taxes |
|
|
(0.83 |
) |
|
|
(0.02 |
) |
|
|
(0.85 |
) |
|
|
(0.25 |
) |
Other |
|
|
0.01 |
|
|
|
|
|
|
|
0.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported diluted income (loss) per common share from continuing operations |
|
|
($0.48 |
) |
|
|
$0.25 |
|
|
|
($0.16 |
) |
|
|
$0.45 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average diluted shares used to compute income per common share from continuing operations before charges |
|
|
53,792 |
|
|
|
52,284 |
|
|
|
53,255 |
|
|
|
52,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of effective income tax rate before charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective income tax rate before charges |
|
|
35.9 |
% |
|
|
40.0 |
% |
|
|
37.0 |
% |
|
|
39.4 |
% |
Impact of charges on effective income tax rate |
|
|
2.4 |
% |
|
|
0.1 |
% |
|
|
-1.7 |
% |
|
|
-0.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported effective income tax rate |
|
|
38.3 |
% |
|
|
40.1 |
% |
|
|
35.3 |
% |
|
|
39.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
For purposes of computing diluted earnings per common share before charges, income from continuing operations before charges was reduced by $0.6 million and $0.5 million for the three months ended June 30, 2014 and
2013, respectively, and $1.1 million for both the six months ended June 30, 2014 and 2013, for the allocation of income to participating unvested restricted stockholders. |
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
20
August 6, 2014
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2014 |
|
|
|
|
|
|
Charges |
|
|
|
|
|
|
|
|
|
Severance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Before |
|
|
and other |
|
|
|
|
|
Debt |
|
|
Transaction |
|
|
|
|
|
As |
|
|
|
charges |
|
|
restructuring |
|
|
Litigation |
|
|
refinancing |
|
|
costs |
|
|
Total |
|
|
reported |
|
Income (loss) from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
137,478 |
|
|
$ |
|
|
|
$ |
(4,600 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(4,600 |
) |
|
$ |
132,878 |
|
Nursing center division |
|
|
40,085 |
|
|
|
(3,205 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,205 |
) |
|
|
36,880 |
|
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
20,158 |
|
|
|
(176 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(176 |
) |
|
|
19,982 |
|
Hospital rehabilitation services |
|
|
20,254 |
|
|
|
(170 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(170 |
) |
|
|
20,084 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,412 |
|
|
|
(346 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(346 |
) |
|
|
40,066 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
7,908 |
|
|
|
(843 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(843 |
) |
|
|
7,065 |
|
Corporate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead |
|
|
(47,809 |
) |
|
|
(556 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(556 |
) |
|
|
(48,365 |
) |
Insurance subsidiary |
|
|
(443 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(443 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(48,252 |
) |
|
|
(556 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(556 |
) |
|
|
(48,808 |
) |
Transaction costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,496 |
) |
|
|
(4,496 |
) |
|
|
(4,496 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
177,631 |
|
|
|
(4,950 |
) |
|
|
(4,600 |
) |
|
|
|
|
|
|
(4,496 |
) |
|
|
(14,046 |
) |
|
|
163,585 |
|
Rent |
|
|
(79,962 |
) |
|
|
(247 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(247 |
) |
|
|
(80,209 |
) |
Depreciation and amortization |
|
|
(39,442 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(39,442 |
) |
Interest, net |
|
|
(21,438 |
) |
|
|
|
|
|
|
|
|
|
|
(56,643 |
) |
|
|
|
|
|
|
(56,643 |
) |
|
|
(78,081 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
36,789 |
|
|
|
(5,197 |
) |
|
|
(4,600 |
) |
|
|
(56,643 |
) |
|
|
(4,496 |
) |
|
|
(70,936 |
) |
|
|
(34,147 |
) |
Provision (benefit) for income taxes |
|
|
13,213 |
|
|
|
(1,985 |
) |
|
|
(1,757 |
) |
|
|
(21,639 |
) |
|
|
(914 |
) |
|
|
(26,295 |
) |
|
|
(13,082 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
23,576 |
|
|
$ |
(3,212 |
) |
|
$ |
(2,843 |
) |
|
$ |
(35,004 |
) |
|
$ |
(3,582 |
) |
|
$ |
(44,641 |
) |
|
$ |
(21,065 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2013 |
|
|
|
|
|
|
Charges |
|
|
|
|
|
|
Before |
|
|
Debt |
|
|
Transaction |
|
|
|
|
|
As |
|
|
|
charges |
|
|
refinancing |
|
|
costs |
|
|
Total |
|
|
reported |
|
Income from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
129,366 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
129,366 |
|
Nursing center division |
|
|
36,018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,018 |
|
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
21,623 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,623 |
|
Hospital rehabilitation services |
|
|
19,573 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,573 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41,196 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41,196 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
3,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,961 |
|
Corporate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead |
|
|
(43,196 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(43,196 |
) |
Insurance subsidiary |
|
|
(384 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(384 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(43,580 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(43,580 |
) |
Impairment charges |
|
|
(438 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(438 |
) |
Transaction costs |
|
|
|
|
|
|
|
|
|
|
(108 |
) |
|
|
(108 |
) |
|
|
(108 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
166,523 |
|
|
|
|
|
|
|
(108 |
) |
|
|
(108 |
) |
|
|
166,415 |
|
Rent |
|
|
(77,324 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(77,324 |
) |
Depreciation and amortization |
|
|
(38,554 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(38,554 |
) |
Interest, net |
|
|
(26,235 |
) |
|
|
(1,365 |
) |
|
|
|
|
|
|
(1,365 |
) |
|
|
(27,600 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
|
24,410 |
|
|
|
(1,365 |
) |
|
|
(108 |
) |
|
|
(1,473 |
) |
|
|
22,937 |
|
Provision for income taxes |
|
|
9,752 |
|
|
|
(504 |
) |
|
|
(40 |
) |
|
|
(544 |
) |
|
|
9,208 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
14,658 |
|
|
$ |
(861 |
) |
|
$ |
(68 |
) |
|
$ |
(929 |
) |
|
$ |
13,729 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
21
August 6, 2014
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2014 |
|
|
|
|
|
|
Charges |
|
|
|
|
|
|
|
|
|
Severance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Before |
|
|
and other |
|
|
|
|
|
Debt |
|
|
Transaction |
|
|
|
|
|
As |
|
|
|
charges |
|
|
restructuring |
|
|
Litigation |
|
|
refinancing |
|
|
costs |
|
|
Total |
|
|
reported |
|
Income from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
282,873 |
|
|
$ |
|
|
|
$ |
(4,600 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(4,600 |
) |
|
$ |
278,273 |
|
Nursing center division |
|
|
78,556 |
|
|
|
(3,205 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,205 |
) |
|
|
75,351 |
|
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
38,486 |
|
|
|
(176 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(176 |
) |
|
|
38,310 |
|
Hospital rehabilitation services |
|
|
40,074 |
|
|
|
(170 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(170 |
) |
|
|
39,904 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
78,560 |
|
|
|
(346 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(346 |
) |
|
|
78,214 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
12,605 |
|
|
|
(843 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(843 |
) |
|
|
11,762 |
|
Corporate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead |
|
|
(91,859 |
) |
|
|
(556 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(556 |
) |
|
|
(92,415 |
) |
Insurance subsidiary |
|
|
(849 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(849 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(92,708 |
) |
|
|
(556 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(556 |
) |
|
|
(93,264 |
) |
Transaction costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,179 |
) |
|
|
(5,179 |
) |
|
|
(5,179 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
359,886 |
|
|
|
(4,950 |
) |
|
|
(4,600 |
) |
|
|
|
|
|
|
(5,179 |
) |
|
|
(14,729 |
) |
|
|
345,157 |
|
Rent |
|
|
(161,010 |
) |
|
|
(247 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(247 |
) |
|
|
(161,257 |
) |
Depreciation and amortization |
|
|
(78,779 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(78,779 |
) |
Interest, net |
|
|
(47,054 |
) |
|
|
|
|
|
|
|
|
|
|
(56,643 |
) |
|
|
|
|
|
|
(56,643 |
) |
|
|
(103,697 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
|
73,043 |
|
|
|
(5,197 |
) |
|
|
(4,600 |
) |
|
|
(56,643 |
) |
|
|
(5,179 |
) |
|
|
(71,619 |
) |
|
|
1,424 |
|
Provision for income taxes |
|
|
27,048 |
|
|
|
(1,988 |
) |
|
|
(1,760 |
) |
|
|
(21,669 |
) |
|
|
(1,128 |
) |
|
|
(26,545 |
) |
|
|
503 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
45,995 |
|
|
$ |
(3,209 |
) |
|
$ |
(2,840 |
) |
|
$ |
(34,974 |
) |
|
$ |
(4,051 |
) |
|
$ |
(45,074 |
) |
|
$ |
921 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2013 |
|
|
|
|
|
|
Charges |
|
|
|
|
|
|
Before |
|
|
One-time |
|
|
Debt |
|
|
Transaction |
|
|
|
|
|
As |
|
|
|
charges |
|
|
bonus |
|
|
refinancing |
|
|
costs |
|
|
Total |
|
|
reported |
|
Income from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hospital division |
|
$ |
284,622 |
|
|
$ |
(7,763 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(7,763 |
) |
|
$ |
276,859 |
|
Nursing center division |
|
|
69,787 |
|
|
|
(4,624 |
) |
|
|
|
|
|
|
|
|
|
|
(4,624 |
) |
|
|
65,163 |
|
Rehabilitation division: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing rehabilitation services |
|
|
39,914 |
|
|
|
(5,052 |
) |
|
|
|
|
|
|
|
|
|
|
(5,052 |
) |
|
|
34,862 |
|
Hospital rehabilitation services |
|
|
38,960 |
|
|
|
(1,255 |
) |
|
|
|
|
|
|
|
|
|
|
(1,255 |
) |
|
|
37,705 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
78,874 |
|
|
|
(6,307 |
) |
|
|
|
|
|
|
|
|
|
|
(6,307 |
) |
|
|
72,567 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Care management division |
|
|
7,580 |
|
|
|
(833 |
) |
|
|
|
|
|
|
|
|
|
|
(833 |
) |
|
|
6,747 |
|
Corporate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overhead |
|
|
(88,466 |
) |
|
|
(315 |
) |
|
|
|
|
|
|
|
|
|
|
(315 |
) |
|
|
(88,781 |
) |
Insurance subsidiary |
|
|
(893 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(893 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(89,359 |
) |
|
|
(315 |
) |
|
|
|
|
|
|
|
|
|
|
(315 |
) |
|
|
(89,674 |
) |
Impairment charges |
|
|
(625 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(625 |
) |
Transaction costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,052 |
) |
|
|
(1,052 |
) |
|
|
(1,052 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
350,879 |
|
|
|
(19,842 |
) |
|
|
|
|
|
|
(1,052 |
) |
|
|
(20,894 |
) |
|
|
329,985 |
|
Rent |
|
|
(153,843 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(153,843 |
) |
Depreciation and amortization |
|
|
(80,152 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(80,152 |
) |
Interest, net |
|
|
(54,309 |
) |
|
|
|
|
|
|
(1,365 |
) |
|
|
|
|
|
|
(1,365 |
) |
|
|
(55,674 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
|
62,575 |
|
|
|
(19,842 |
) |
|
|
(1,365 |
) |
|
|
(1,052 |
) |
|
|
(22,259 |
) |
|
|
40,316 |
|
Provision for income taxes |
|
|
24,674 |
|
|
|
(7,988 |
) |
|
|
(550 |
) |
|
|
(423 |
) |
|
|
(8,961 |
) |
|
|
15,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
37,901 |
|
|
$ |
(11,854 |
) |
|
$ |
(815 |
) |
|
$ |
(629 |
) |
|
$ |
(13,298 |
) |
|
$ |
24,603 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
22
August 6, 2014
KINDRED HEALTHCARE, INC.
Reconciliation of Non-GAAP Measurements to GAAP Results (Continued)
(Unaudited)
(In thousands)
The Company recognizes that free cash flows excluding certain items is a non-GAAP measurement and is not intended to replace the
presentation of the Companys cash flows in accordance with GAAP. The Company believes that this non-GAAP measurement provides important information to investors related to the amount of discretionary cash flows that are available for other
investing and financing activities. In addition, management uses free cash flows excluding certain items in making decisions related to acquisitions, development capital expenditures, dividends, long-term debt repayments and other uses.
The income tax benefit associated with the excluded payments was calculated using an effective income tax rate of 26.9% and 27.6% for the
three months ended June 30, 2014 and 2013, respectively, and 30.8% and 37.4% for the six months ended June 30, 2014 and 2013, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Six months ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Reconciliation of net cash flows provided by (used in) operating activities to free cash flows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows provided by (used in) operating activities |
|
|
($49,963 |
) |
|
$ |
53,634 |
|
|
|
($65,717 |
) |
|
$ |
78,467 |
|
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Routine capital expenditures |
|
|
(24,485 |
) |
|
|
(17,430 |
) |
|
|
(46,162 |
) |
|
|
(39,800 |
) |
Development capital expenditures |
|
|
(372 |
) |
|
|
(5,086 |
) |
|
|
(1,123 |
) |
|
|
(7,474 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(24,857 |
) |
|
|
(22,516 |
) |
|
|
(47,285 |
) |
|
|
(47,274 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flows including certain items |
|
|
(74,820 |
) |
|
|
31,118 |
|
|
|
(113,002 |
) |
|
|
31,193 |
|
Adjustments to remove certain payments (including payments made for discontinued operations) included in net cash flows provided by
(used in) operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Litigation |
|
|
700 |
|
|
|
|
|
|
|
25,850 |
|
|
|
|
|
One-time employee bonus |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,345 |
|
Capitalized lender fees related to debt refinancing |
|
|
19,125 |
|
|
|
1,600 |
|
|
|
19,125 |
|
|
|
1,600 |
|
Other debt refinancing costs (expensed) |
|
|
40,373 |
|
|
|
|
|
|
|
40,373 |
|
|
|
|
|
Severance, retirement and retention |
|
|
2,929 |
|
|
|
2,545 |
|
|
|
5,378 |
|
|
|
3,608 |
|
Transaction costs |
|
|
2,438 |
|
|
|
1,074 |
|
|
|
4,176 |
|
|
|
2,188 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
65,565 |
|
|
|
5,219 |
|
|
|
94,902 |
|
|
|
33,741 |
|
Benefit of reduced income tax payments resulting from certain payments |
|
|
(17,664 |
) |
|
|
(1,441 |
) |
|
|
(29,208 |
) |
|
|
(12,636 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47,901 |
|
|
|
3,778 |
|
|
|
65,694 |
|
|
|
21,105 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flows excluding certain items |
|
|
($26,919 |
) |
|
$ |
34,896 |
|
|
|
($47,308 |
) |
|
$ |
52,298 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- MORE -
Kindred Healthcare Announces Second Quarter 2014 Results
Page
23
August 6, 2014
KINDRED HEALTHCARE, INC.
Reconciliation of Earnings Guidance for 2014Continuing Operations (a)
(Unaudited)
(In millions,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of August 6, 2014 |
|
|
As of June 16, 2014 |
|
|
|
Low |
|
|
High |
|
|
Low |
|
|
High |
|
Operating income |
|
$ |
707 |
|
|
$ |
724 |
|
|
$ |
715 |
|
|
$ |
732 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rent |
|
|
330 |
|
|
|
330 |
|
|
|
335 |
|
|
|
335 |
|
Depreciation and amortization |
|
|
161 |
|
|
|
161 |
|
|
|
163 |
|
|
|
163 |
|
Interest, net |
|
|
98 |
|
|
|
98 |
|
|
|
98 |
|
|
|
98 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
|
118 |
|
|
|
135 |
|
|
|
119 |
|
|
|
136 |
|
Provision for income taxes |
|
|
45 |
|
|
|
52 |
|
|
|
46 |
|
|
|
53 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
73 |
|
|
|
83 |
|
|
|
73 |
|
|
|
83 |
|
Earnings attributable to noncontrolling interests |
|
|
(15 |
) |
|
|
(15 |
) |
|
|
(15 |
) |
|
|
(15 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations attributable to the Company |
|
|
58 |
|
|
|
68 |
|
|
|
58 |
|
|
|
68 |
|
Allocation to participating unvested restricted stockholders |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available to common stockholders |
|
$ |
56 |
|
|
$ |
66 |
|
|
$ |
56 |
|
|
$ |
66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per diluted share |
|
$ |
0.96 |
|
|
$ |
1.14 |
|
|
$ |
1.05 |
|
|
$ |
1.25 |
|
Shares used in computing earnings per diluted share |
|
|
58.3 |
|
|
|
58.3 |
|
|
|
53.2 |
|
|
|
53.2 |
|
(a) |
The earnings guidance excludes the effect of reimbursement changes, debt refinancing costs, severance, retirement, retention and restructuring costs, litigation costs, transaction costs, any further acquisitions or
divestitures, any impairment charges, and any repurchases of common stock. |
- END -
Exhibit 99.2
|
|
|
|
|
Contact: |
|
Stephen Farber |
|
|
|
|
Executive Vice President, Chief Financial Officer |
|
|
|
|
(502) 596-2525 |
|
|
KINDRED HEALTHCARE BOARD OF DIRECTORS DECLARES QUARTERLY
CASH DIVIDEND OF $0.12 PER SHARE
LOUISVILLE, Ky. (August 6, 2014) Kindred Healthcare, Inc. (Kindred or the Company) (NYSE:KND) today announced that its
Board of Directors approved the payment of the regular quarterly cash dividend to its shareholders. The quarterly cash dividend of $0.12 per common share will be paid on September 10, 2014 to shareholders of record as of the close of business
on August 20, 2014. Future declarations of quarterly dividends will be subject to the approval of Kindreds Board of Directors.
Forward-Looking Statements
This
press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the potential
acquisition of Gentiva Health Services, Inc. (Gentiva) (NASDAQ:GTIV) (including financing of the proposed transaction and the benefits, results, effects and timing of such transaction), and the Companys expected future financial
position, results of operations, cash flows, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management and statements containing the words such as
anticipate, approximate, believe, plan, estimate, expect, project, could, should, will, intend, may,
potential and other similar expressions, are forward-looking statements. Statements in this press release concerning the Companys business outlook or future economic performance, anticipated profitability, revenues, expenses or
other financial items, and product or services line growth, together with other statements that are not historical facts, are forward-looking statements that are estimates reflecting the best judgment of the Company based upon currently available
information.
Such forward-looking statements are inherently uncertain, and stockholders and other potential investors must recognize that
actual results may differ materially from the Companys expectations as a result of a variety of factors, including, without limitation, those discussed below. Such forward-looking statements are based upon managements current
expectations and include known and unknown risks, uncertainties and other factors, many of which the Company is unable to predict or control, that may cause the Companys actual results, performance or plans to differ materially from any future
results, performance or plans expressed or implied by such forward-looking statements. These statements involve risks, uncertainties and other factors discussed below and detailed from time to time in the Companys filings with the Securities
and Exchange Commission.
In addition to the factors set forth above, other factors that may affect the Companys plans, results or
stock price include, without limitation, (a) the impact of healthcare reform, which will initiate significant changes to the United States healthcare system, including potential material changes to the delivery of healthcare services and the
reimbursement paid for such services by the government or other third party payors, including reforms resulting from the Patient Protection and Affordable Care Act and the Healthcare Education and Reconciliation Act (collectively, the
ACA) or future deficit reduction measures adopted at the federal or state level. Healthcare reform is affecting each of the Companys
- MORE -
680 South Fourth Street Louisville, Kentucky 40202
502.596.7300 www.kindredhealthcare.com
Kindred Healthcare Board of Directors Declares Quarterly Cash Dividend of $0.12 Per Share
Page
2
August 6, 2014
businesses in some manner. Potential future efforts in the U.S. Congress to repeal, amend, modify or retract funding for various aspects of the ACA create additional uncertainty about the
ultimate impact of the ACA on the Company and the healthcare industry. Due to the substantial regulatory changes that will need to be implemented by the Centers for Medicare and Medicaid Services (CMS) and others, and the numerous
processes required to implement these reforms, the Company cannot predict which healthcare initiatives will be implemented at the federal or state level, the timing of any such reforms, or the effect such reforms or any other future legislation or
regulation will have on the Companys business, financial position, results of operations and liquidity, (b) the Companys ability to adjust to the new patient criteria for long-term acute care (LTAC) hospitals under the
Pathway for SGR Reform Act of 2013, which will reduce the population of patients eligible for the Companys hospital services and change the basis upon which the Company is paid, (c) the impact of the final rules issued by CMS on
August 1, 2012 which, among other things, will reduce Medicare reimbursement to the Companys transitional care (TC) hospitals in 2013 and beyond by imposing a budget neutrality adjustment and modifying the short-stay outlier
rules, (d) the impact of the final rules issued by CMS on July 29, 2011 which significantly reduced Medicare reimbursement to the Companys nursing centers and changed payments for the provision of group therapy services effective
October 1, 2011, (e) the impact of the Budget Control Act of 2011 (as amended by the American Taxpayer Relief Act of 2012 (the Taxpayer Relief Act)) which instituted an automatic 2% reduction on each claim submitted to Medicare
beginning April 1, 2013, (f) the costs of defending and insuring against alleged professional liability and other claims and investigations (including those related to pending investigations and whistleblower and wage and hour class action
lawsuits against the Company) and the Companys ability to predict the estimated costs and reserves related to such claims and investigations, including the impact of differences in actuarial assumptions and estimates compared to eventual
outcomes, (g) the impact of the Taxpayer Relief Act which, among other things, reduces Medicare payments by an additional 25% for subsequent procedures when multiple therapy services are provided on the same day. At this time, the Company
believes that the rules related to multiple therapy services will reduce its Medicare revenues by $25 million to $30 million on an annual basis, (h) changes in the reimbursement rates or the methods or timing of payment from third party
payors, including commercial payors and the Medicare and Medicaid programs, changes arising from and related to the Medicare prospective payment system for LTAC hospitals, including potential changes in the Medicare payment rules, the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003, and changes in Medicare and Medicaid reimbursement for the Companys TC hospitals, nursing centers, inpatient rehabilitation hospitals and home health and hospice operations, and
the expiration of the Medicare Part B therapy cap exception process, (i) the effects of additional legislative changes and government regulations, interpretation of regulations and changes in the nature and enforcement of regulations governing
the healthcare industry, (j) the ability of the Companys hospitals and nursing centers to adjust to medical necessity reviews, (k) the impact of the Companys significant level of indebtedness on the Companys funding
costs, operating flexibility and ability to fund ongoing operations, development capital expenditures or other strategic acquisitions with additional borrowings, (l) the Companys ability to successfully redeploy its capital and proceeds
of asset sales in pursuit of its business strategy and pursue its development activities, including through acquisitions, and successfully integrate new operations, including the realization of anticipated revenues, economies of scale, cost savings
and productivity gains associated with such operations, as and when planned, including the potential impact of unanticipated issues, expenses and liabilities associated with those activities, (m) the Companys ability to pay a dividend as,
when and if declared by the Board of Directors, in compliance with applicable laws and the Companys debt and other contractual arrangements, (n) the failure of the Companys facilities to meet applicable licensure and certification
requirements, (o) the further consolidation and cost containment efforts of managed care organizations and other third party payors, (p) the Companys ability to meet its rental and debt service obligations, (q) the
Companys ability to operate
- MORE -
Kindred Healthcare Board of Directors Declares Quarterly Cash Dividend of $0.12 Per Share
Page
3
August 6, 2014
pursuant to the terms of its debt obligations, and comply with its covenants thereunder, and the Companys ability to operate pursuant to its master lease agreements with Ventas, Inc.
(NYSE:VTR), (r) the condition of the financial markets, including volatility and weakness in the equity, capital and credit markets, which could limit the availability and terms of debt and equity financing sources to fund the requirements of
the Companys businesses, or which could negatively impact the Companys investment portfolio, (s) the Companys ability to control costs, particularly labor and employee benefit costs, (t) the Companys ability to
successfully reduce (by divestiture of operations or otherwise) its exposure to professional liability and other claims, (u) the Companys obligations under various laws to self-report suspected violations of law by the Company to various
government agencies, including any associated obligation to refund overpayments to government payors, fines and other sanctions, (v) national, regional and industry-specific economic, financial, business and political conditions, including
their effect on the availability and cost of labor, credit, materials and other services, (w) increased operating costs due to shortages in qualified nurses, therapists and other healthcare personnel, (x) the Companys ability to
attract and retain key executives and other healthcare personnel, (y) the Companys ability to successfully dispose of unprofitable facilities, (z) events or circumstances which could result in the impairment of an asset or other
charges, such as the impact of the Medicare reimbursement regulations that resulted in the Company recording significant impairment charges in the last three fiscal years, (aa) changes in generally accepted accounting principles or practices, and
changes in tax accounting or tax laws (or authoritative interpretations relating to any of these matters), (bb) the Companys ability to maintain an effective system of internal control over financial reporting, (cc) the Companys ability
to realize the anticipated operating and financial synergies from the potential acquisition of Gentiva, (dd) the uncertainties as to whether Gentiva or any other companies that the Company may acquire will have the accretive effect on the
Companys earnings or cash flows that are expected, and (ee) the outcome of the potential acquisition of Gentiva, including the Companys ability to realize the strategic rationale behind the Gentiva acquisition.
Many of these factors are beyond the Companys control. The Company cautions investors that any forward-looking statements made by the
Company are not guarantees of future performance. The Company disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
About Kindred Healthcare
Kindred Healthcare, Inc., a top-150 private employer in the United States, is a FORTUNE 500 healthcare services company based in Louisville,
Kentucky with annual revenues of $5 billion and approximately 63,000 employees in 47 states. At June 30, 2014, Kindred through its subsidiaries provided healthcare services in 2,353 locations, including 97 transitional care hospitals, five
inpatient rehabilitation hospitals, 98 nursing centers, 21 sub-acute units, 153 Kindred at Home hospice, home health and non-medical home care locations, 104 inpatient rehabilitation units (hospital-based) and a contract rehabilitation services
business, RehabCare, which served 1,875 non-affiliated facilities. Ranked as one of Fortune magazines Most Admired Healthcare Companies for six years in a row, Kindreds mission is to promote healing, provide hope, preserve dignity and
produce value for each patient, resident, family member, customer, employee and shareholder we serve. For more information, go to www.kindredhealthcare.com. You can also follow us on Twitter and Facebook.
- END -
|
Kindred
Healthcare Second Quarter Investor Update
August 6, 2014
Exhibit 99.3 |
|
2
Forward-Looking Statements
This
presentation
includes
forward-looking
statements
within
the
meaning
of
Section
27A
of
the
Securities
Act
of
1933,
as
amended,
and
Section
21E
of
the
Securities
Exchange
Act
of
1934,
as
amended.
All
statements
regarding
the
potential
acquisition
of
Gentiva
Health
Services,
Inc.
(Gentiva)
(NASDAQ:GTIV)
(including
financing
of
the
proposed
transaction
and
the
benefits,
results,
effects
and
timing
of
such
transaction),
and
the
Companys
expected
future
financial
position,
results
of
operations,
cash
flows,
financing
plans,
business
strategy,
budgets,
capital
expenditures,
competitive
positions,
growth
opportunities,
plans
and
objectives
of
management
and
statements
containing
the
words
such
as
anticipate,
approximate,
believe,
plan,
estimate,
expect,
project,
could,
should,
will,
intend,
may,
potential
and
other
similar
expressions,
are
forward-looking
statements.
Statements
in
this
presentation
concerning
the
Companys
business
outlook
or
future
economic
performance,
anticipated
profitability,
revenues,
expenses
or
other
financial
items,
and
product
or
services
line
growth,
together
with
other
statements
that
are
not
historical
facts,
are
forward-looking
statements
that
are
estimates
reflecting
the
best
judgment
of
the
Company
based
upon
currently
available
information.
Such
forward-looking
statements
are
inherently
uncertain,
and
stockholders
and
other
potential
investors
must
recognize
that
actual
results
may
differ
materially
from
the
Companys
expectations
as
a
result
of
a
variety
of
factors,
including,
without
limitation,
those
discussed
below.
Such
forward-looking
statements
are
based
upon
managements
current
expectations
and
include
known
and
unknown
risks,
uncertainties
and
other
factors,
many
of
which
the
Company
is
unable
to
predict
or
control,
that
may
cause
the
Companys
actual
results,
performance
or
plans
to
differ
materially
from
any
future
results,
performance
or
plans
expressed
or
implied
by
such
forward-looking
statements.
These
statements
involve
risks,
uncertainties
and
other
factors
discussed
below
and
detailed
from
time
to
time
in
Kindreds
filings
with
the
Securities
and
Exchange
Commission.
In
addition
to
the
factors
set
forth
above,
other
factors
that
may
affect
the
Companys
plans,
results
or
stock
price
include,
without
limitation,
(a)
the
impact
of
healthcare
reform,
which
will
initiate
significant
changes
to
the
United
States
healthcare
system,
including
potential
material
changes
to
the
delivery
of
healthcare
services
and
the
reimbursement
paid
for
such
services
by
the
government
or
other
third
party
payors,
including
reforms
resulting
from
the
Patient
Protection
and
Affordable
Care
Act
and
the
Healthcare
Education
and
Reconciliation
Act
(collectively,
the
ACA)
or
future
deficit
reduction
measures
adopted
at
the
federal
or
state
level.
Healthcare
reform
is
affecting
each
of
the
Companys
businesses
in
some
manner.
Potential
future
efforts
in
the
U.S.
Congress
to
repeal,
amend,
modify
or
retract
funding
for
various
aspects
of
the
ACA
create
additional
uncertainty
about
the
ultimate
impact
of
the
ACA
on
the
Company
and
the
healthcare
industry.
Due
to
the
substantial
regulatory
changes
that
will
need
to
be
implemented
by
the
Centers
for
Medicare
and
Medicaid
Services
(CMS)
and
others,
and
the
numerous
processes
required
to
implement
these
reforms,
the
Company
cannot
predict
which
healthcare
initiatives
will
be
implemented
at
the
federal
or
state
level,
the
timing
of
any
such
reforms,
or
the
effect
such
reforms
or
any
other
future
legislation
or
regulation
will
have
on
the
Companys
business,
financial
position,
results
of
operations
and
liquidity,
(b)
the
Companys
ability
to
adjust
to
the
new
patient
criteria
for
long-term
acute
care
(LTAC)
hospitals
under
the
Pathway
for
SGR
Reform
Act
of
2013,
which
will
reduce
the
population
of
patients
eligible
for
the
Companys
hospital
services
and
change
the
basis
upon
which
the
Company
is
paid,
(c)
the
impact
of
the
final
rules
issued
by
CMS
on
August
1,
2012
which,
among
other
things,
will
reduce
Medicare
reimbursement
to
the
Companys
transitional
care
(TC)
hospitals
in
2013
and
beyond
by
imposing
a
budget
neutrality
adjustment
and
modifying
the
short-stay
outlier
rules,
(d)
the
impact
of
the
final
rules
issued
by
CMS
on
July
29,
2011
which
significantly
reduced
Medicare
reimbursement
to
the
Companys
nursing
centers
and
changed
payments
for
the
provision
of
group
therapy
services
effective
October
1,
2011,
(e)
the
impact
of
the
Budget
Control
Act
of
2011
(as
amended
by
the
American
Taxpayer
Relief
Act
of
2012
(the
Taxpayer
Relief
Act))
which
instituted
an
automatic
2%
reduction
on
each
claim
submitted
to
Medicare
beginning
April
1,
2013,
(f)
the
costs
of
defending
and
insuring
against
alleged
professional
liability
and
other
claims
and
investigations
(including
those
related
to
pending
investigations
and
whistleblower
and
wage
and
hour
class
action
lawsuits
against
the
Company)
and
the
Companys
ability
to
predict
the
estimated
costs
and
reserves
related
to
such
claims
and
investigations,
including
the
impact
of
differences
in
actuarial
assumptions
and
estimates
compared
to
eventual
outcomes,
(g)
the
impact
of
the
Taxpayer
Relief
Act
which,
among
other
things,
reduces
Medicare
payments
by
an
additional
25%
for
subsequent
procedures
when
multiple
therapy
services
are
provided
on
the
same
day.
At
this
time,
the
Company
believes
that
the
rules
related
to
multiple
therapy
services
will
reduce
its
Medicare
revenues
by
$25
million
to
$30
million
on
an
annual
basis,
(h)
changes
in
the
reimbursement
rates
or
the
methods
or
timing
of
payment
from
third
party
payors,
including
commercial
payors
and
the
Medicare
and
Medicaid
programs,
changes
arising
from
and
related
to
the
Medicare
prospective
payment
system
for
LTAC
hospitals,
including
potential
changes
in
the
Medicare
payment
rules,
the
Medicare
Prescription
Drug,
Improvement,
and
Modernization
Act
of
2003,
and
changes
in
Medicare
and
Medicaid
reimbursement
for
the
Companys
TC
hospitals,
nursing
centers,
inpatient
rehabilitation
hospitals
and
home
health
and
hospice
operations,
and
the
expiration
of
the
Medicare
Part
B
therapy
cap
exception
process,
(i)
the
effects
of
additional
legislative
changes
and
government
regulations,
interpretation
of
regulations
and
changes
in
the
nature
and
enforcement
of
regulations
governing
the
healthcare
industry,
(j)
the
ability
of
the
Companys
hospitals
and
nursing
centers
to
adjust
to
medical
necessity
reviews,
(k)
the
impact
of
the
Companys
significant
level
of
indebtedness
on
its
funding
costs,
operating
flexibility
and
ability
to
fund
ongoing
operations,
development
capital
expenditures
or
other
strategic
acquisitions
with
additional
borrowings,
(l)
the
Companys
ability
to
successfully
redeploy
its
capital
and
proceeds
of
asset
sales
in
pursuit
of
its
business
strategy
and
pursue
its
development
activities,
including
through
acquisitions,
and
successfully
integrate
new
operations,
including
the
realization
of
anticipated
revenues,
economies
of
scale,
cost
savings
and
productivity
gains
associated
with
such
operations,
as
and
when
planned,
including
the
potential
impact
of
unanticipated
issues,
expenses
and
liabilities
associated
with
those
activities,
(m)
the
Companys
ability
to
pay
a
dividend
as,
when
and
if
declared
by
the
Board
of
Directors,
in
compliance
with
applicable
laws
and
the
Companys
debt
and
other
contractual
arrangements,
(n)
the
failure
of
the
Companys
facilities
to
meet
applicable
licensure
and
certification
requirements,
(o)
the
further
consolidation
and
cost
containment
efforts
of
managed
care
organizations
and
other
third
party
payors,
(p)
the
Companys
ability
to
meet
its
rental
and
debt
service
obligations,
(q)
the
Companys
ability
to
operate
pursuant
to
the
terms
of
its
debt
obligations,
and
comply
with
its
covenants
thereunder,
and
the
Companys
ability
to
operate
pursuant
to
its
master
lease
agreements
with
Ventas,
Inc.
(NYSE:VTR),
(r)
the
condition
of
the
financial
markets,
including
volatility
and
weakness
in
the
equity,
capital
and
credit
markets,
which
could
limit
the
availability
and
terms
of
debt
and
equity
financing
sources
to
fund
the
requirements
of
the
Companys
businesses,
or
which
could
negatively
impact
the
Companys
investment
portfolio,
(s)
the
Companys
ability
to
control
costs,
particularly
labor
and
employee
benefit
costs,
(t)
the
Companys
ability
to
successfully
reduce
(by
divestiture
of
operations
or
otherwise)
its
exposure
to
professional
liability
and
other
claims,
(u)
the
Companys
obligations
under
various
laws
to
self-
report
suspected
violations
of
law
by
the
Company
to
various
government
agencies,
including
any
associated
obligation
to
refund
overpayments
to
government
payors,
fines
and
other
sanctions,
(v)
national,
regional
and
industry-
specific
economic,
financial,
business
and
political
conditions,
including
their
effect
on
the
availability
and
cost
of
labor,
credit,
materials
and
other
services,
(w)
increased
operating
costs
due
to
shortages
in
qualified
nurses,
therapists
and
other
healthcare
personnel,
(x)
the
Companys
ability
to
attract
and
retain
key
executives
and
other
healthcare
personnel,
(y)
the
Companys
ability
to
successfully
dispose
of
unprofitable
facilities,
(z)
events
or
circumstances
which
could
result
in
the
impairment
of
an
asset
or
other
charges,
such
as
the
impact
of
the
Medicare
reimbursement
regulations
that
resulted
in
the
Company
recording
significant
impairment
charges
in
the
last
three
fiscal
years,
(aa)
changes
in
generally
accepted
accounting
principles
or
practices
(GAAP),
and
changes
in
tax
accounting
or
tax
laws
(or
authoritative
interpretations
relating
to
any
of
these
matters),
(bb)
the
Companys
ability
to
maintain
an
effective
system
of
internal
control
over
financial
reporting,
(cc)
the
Companys
ability
to
realize
the
anticipated
operating
and
financial
synergies
from
the
potential
acquisition
of
Gentiva,
(dd)
the
uncertainties
as
to
whether
Gentiva
or
any
other
companies
that
the
Company
may
acquire
will
have
the
accretive
effect
on
the
Companys
earnings
or
cash
flows
that
are
expected,
and
(ee)
the
outcome
of
the
potential
acquisition
of
Gentiva,
including
the
Companys
ability
to
realize
the
strategic
rationale
behind
the
Gentiva
acquisition.
Many
of
these
factors
are
beyond
the
Companys
control.
The
Company
cautions
investors
that
any
forward-looking
statements
made
by
the
Company
are
not
guarantees
of
future
performance.
The
Company
disclaims
any
obligation
to
update
any
such
factors
or
to
announce
publicly
the
results
of
any
revisions
to
any
of
the
forward-looking
statements
to
reflect
future
events
or
developments.
In
addition
to
the
results
provided
in
accordance
with
GAAP,
the
Company
has
provided
information
in
this
presentation
to
compute
certain
non-GAAP
measurements
for
specified
periods
before
certain
charges
or
on
a
core
basis.
A
reconciliation
of
the
non-GAAP
measurements
to
the
GAAP
measurements
is
included
in
this
presentation
and
on
our
website
at
www.kindredhealthcare.com
under
the
heading
Investors.
2 |
|
Kindred
Healthcares Second Quarter Success and Opportunity
Continued Progress on Employee Engagement, Quality Assurance,
Clinical Outcomes and Patient Satisfaction Measures Across The Enterprise
Strong Second Quarter and First Half of the Year
Financial Results
Continued Progress Advancing Integrated Care Market Strategy and
Development of Care Management Capabilities
Completed Business Segment Repositioning, Refinancing and Successful
Equity Offering
Management Team, Balance Sheet and Industry Leading Infrastructure
Positioned for Growth!
Excited for the Opportunities in the Acquisition Pipeline
3 |
|
4
Strong Second Quarter
Continuing Operations
(1)
($ in millions, except statistics)
Actual
Prior Year
% change
Revenues
$1,276
$1,191
+7%
Operating expenses
1,098
1,025
Operating income
178
166
+7
Margin
13.9%
14.0%
Net income
19
15
Diluted EPS
$0.34
$0.27
+26
Diluted EPS - Reported
($0.48)
$0.25
(1) Before certain disclosed items reconciled in the Appendix.
Key Q2 operating metrics:
Strong revenue and operating income growth, both up 7%
Improving hospital volumes, nursing center and Kindred at Home growth, lower interest costs
and solid cost controls across the organization drove year-over-year
results Results exclude debt refinancing, severance, reorganization and transaction
costs in both periods
Recent common stock equity offering of 9.7 million shares generated $221 million in net proceeds
used to repay the Companys revolving credit facility
Refinancing of the Companys existing secured and unsecured debt on April 9 lowers
borrowing costs, extends debt maturities and reduces interest rate risk
|
|
5
Core Operating Margins
Annualized
impact
of
Medicare
cuts
($
in
millions):
--Sequestration
(effective
April
1,
2013)
..
$45
--LTAC
Budget
Neutrality
(cumulative
impact
for
first
two
years
of
three-year
phase-in).
$35
--Rehab
Services
(effective
October
1,
2012
and
April
1,
2013)
........................
$21 Total
$101
Margin Expansion Across Enterprise Reflects Full Recovery from Reimbursement Cuts
|
|
6
2014 Earnings Guidance
(1)
Adjusted to exclude new discontinued operations
($ millions, except statistics)
Low
High
Low
High
Revenue
$5,100
$5,100
$5,200
$5,200
EBITDAR
707
724
715
732
Rent
330
330
335
335
EBITDA
377
394
380
397
D&A
161
161
163
163
EBIT
216
233
217
234
Interest , net
98
98
98
98
Pretax
118
135
119
136
Taxes
45
52
46
53
Net income
73
83
73
83
Noncontrolling interest
(15)
(15)
(15)
(15)
Income to Kindred
$58
$68
$58
$68
Shares
58.3
58.3
53.2
53.2
Diluted EPS
$0.96
$1.14
$1.05
$1.25
As of August 6, 2014
As of June 16, 2014
(1)
2014
earnings
guidance
reaffirmed
with
dilution
impact
of
Q2
equity
offering.
The earnings guidance excludes the effect of reimbursement changes, debt refinancing costs,
severance, retirement, retention and restructuring costs, litigation costs,
transaction costs, any further acquisitions or divestitures, any impairment charges, and any repurchases of common stock. |
|
7
Post-Refinancing
Pre-Refinancing
Weighted Avg. Maturity: ~4.3 years
Upsized term loan to
$1 billion
Unstacked maturity
cliff in 2018
Reduced coupon on
ABL and Term Loan by
50bps and 25bps,
respectively
Reduced coupon on
unsecured notes by
1.875%
Increased duration of
notes by 3.0 years
Comments
$777.2
$750.0
$550.0
$1,527
$0
$500
$1,000
$1,500
$2,000
$2,500
2014
2015
2016
2017
2018
2019
2020
2021
2022
Term Loan
ABL
Unsecured
Weighted Avg. Maturity: ~7.3 years
$1,000.0
$750.0
$500.0
$0
$500
$1,000
$1,500
$2,000
$2,500
2014
2015
2016
2017
2018
2019
2020
2021
2022
Term Loan
ABL
Unsecured
Recapitalization Benefits
Funded Debt:
Equity Offering:
Completed an oversubscribed equity offering
$221M net proceeds
Increased shares outstanding from 54.8 million to 64.6 million
growth of 18%
($millions)
12/31/2013
Coupon
Maturity
ABL ($750mm)
$256.1
L+275 bps
Jun-18
Term Loan B
$777.2
L+275 bps
Jun-18
Unsecured
$550.0
8.25%
Jun-19
($millions)
6/30/2014
Coupon
Maturity
ABL ($750mm)
$43.6
L+225 bps
April-19
Term Loan B
$993.1
L+300 bps
April-21
Unsecured
$500.0
6.375%
April-22 |
|
Rehab / LTAC
/ Skilled Nursing 8
Kindreds Current Capital Structure and Leverage Ratio Are
Positioned Strongly Against Peers and Set for Growth!
Total Adjusted Debt / 2014 EBITDAR
Senior Living
Home Health
Median: 5.5x
7.3x
6.8x
6.5x
6.2x
6.2x
5.5x
5.2x
3.3x
3.3x
3.0x
3.0x
PF BKD
GTIV
FVE
SKH
AMED
SEM
KND
HLS
AFAM
ENSG
LHCG
Current Kindred adjusted debt/ LTM EBITDAR 5.2x with goal of 4.5x and
operating range of 4.5x to 5.5x
Source: CitiBank |
|
Hospital
Division $2.5 billion Revenues
(1)
$518 million Operating Income
(2)
Transitional Care Hospitals (certified as LTAC hospitals)
97 Transitional Care Hospitals
(3)
7,145 licensed beds
(3)
Inpatient Rehabilitation Hospitals (IRFs)
5 IRFs
(3)
215 licensed beds
(3)
(1)
Revenues for the twelve months ended June 30, 2014 (divisional revenues before intercompany
eliminations). (2)
Operating income for the twelve months ended June 30, 2014.
(3)
As of June 30, 2014.
(4)
Before certain disclosed items reconciled in the Appendix.
Continued clinical success with low rates of
rehospitalizations and reduced employee
turnover with improved teammate engagement
Strong results with same-store admissions
increase of 3% and only 1% growth in core
operating costs per patient day; operating
income margin improvement to 21.7%
from 21.3%
(4)
9 |
|
2,237 sites of service served through
23,058 therapists
(3)
Including 104 hospital-based acute
rehabilitation units
(3)
Therapists continue to deliver outstanding
clinical results and patient functional
improvement across sites of service
Sequential core operating income and margin
improvements for second quarter in a row
Added 57 net new skilled nursing rehabilitation
sites during first half of 2014
In October 2013, acquired TherEX which provides
on-site, hospital-based rehabilitation services in
11 states
$1.3 billion Revenues
(1)
$121 million Operating Income
(2)
(1)
Revenues for the twelve months ended June 30, 2014 (divisional revenues before intercompany
eliminations). (2)
Operating income for the twelve months ended June 30, 2014.
(3)
As of June 30, 2014.
10
Total Sites of Service
Productivity |
|
Nursing Center
Division 47 Transitional Care Centers
(Sub-Acute facilities
licensed as SNFs)
(3)
13 Nursing and Rehabilitation Centers
(with Transitional Care Units)
(3)
12
Hospital-Based
Sub-Acute
Units
(3)
38
Skilled
Nursing
Centers
(Traditional
SNFs)
(3)
Reduced nurse turnover and
improved retention rates for all
teammates
Nursing center division core
operating income increased 11%
(4)
primarily due to growth in
revenues. Operating margins
significantly improved due to
improving reimbursement rates
and ongoing cost control initiatives
Admissions up 1% compared to
prior year
Declines in average length of stay
(ALOS) continue to weigh on
average daily census (ADC)
Divested of 55 of 59 nursing
centers leased from Ventas as of
August 1, 2014
$1.1 billion Revenues
(1)
$143 million Operating Income
(2)
(1)
Revenues for the twelve months ended June 30, 2014 (divisional revenues before intercompany
eliminations). (2)
Operating income for the twelve months ended June 30, 2014.
(3)
As of June 30, 2014.
(4)
Before certain disclosed items reconciled in the Appendix.
11
Nursing Center Operating Income Margin
(4) |
|
Patient satisfaction for Home Health and Hospice remain
high with Home Health outcome measures outperforming
national benchmarks
Care Management division delivered 66% revenue growth
and doubled core operating income compared to prior year
Operating 202 sites of service in 13 states
Focus on integration efforts has improved margin from 7.5%
in Q2 2013 to 9.0%
(2)
in Q2 2014
Acquired
Silver
State
Accountable
Care
Organization
in
June
2014
Opportunities to expand Kindred Home Based Primary Care in
deal pipeline
12
202 sites of service in 13 states
69 in Kindreds Integrated Care Markets
5,000
caregivers serving 16,100
patients on a daily basis
Care Management
Division/Kindred At Home $352
million Pro Forma Annualized
Revenues
(1
)
Care Management Division and
(1)
Annualized based upon revenues and operating income for the three months ended June 30,
2014 (2)
Before certain disclosed items reconciled in the Appendix.
Revenue
Operating Income |
|
Delivered Attractive Financial Performances
13
(1)
Before certain disclosed items as reconciled in the Appendix
(2)
Reimbursement cuts totaled $70 million
(3)
Reflects midpoint of Companys August 6, 2014 earnings guidance
Core Operating Margin
(1)
:
12.7%
13.9%
13.6%
14.0%
Share Price & Dividends
($ in millions)
Closing Share Price
Cumulative
Dividends
12/30/2011
12/31/2012
12/31/2013
8/5/2014
Despite sequential years of significant
reimbursement cuts and a whole-sale
restructuring of the Companys business and
capital structure, the Company has delivered on
its promise to its patients, customers,
teammates and shareholders!
$4.2
$4.8
$4.8
$5.1
2011
2012
2013
2014
Revenue
($ in billions)
$529
$679
$658
$715
2011
2012
2013
2014
Core Operating Income
($ in millions)
(2)
$11.77
$10.82
$19.74
$23.99
$0.24
$0.60
(3) |
|
Revenue
Mix1
(1)
Revenue before intercompany eliminations for 12 months ended 2010 and in line with full year
guidance for 2014. (2)
Before certain disclosed items as reconciled in the Appendix.
Yesterday
2010
14
Profitability
EBITDA Margin
(2)
Revenue
Repositioning and Recapitalization Complete Growth Phase Begins
Today
2014
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
KND is successfully shifting its business to faster growing businesses, improving margins,
profitability and operating cash flows |
|
Equity
22.4%
Funded
Debt
11.3%
Capitalized
Leases
66.3%
Capital
Structure
(1)
15
Equity
31.0%
Funded
Debt
30.0%
Capitalized
Leases
39.0%
(1)
Leases capitalized using 6x rent; Equity represents market cap and Funded Debt
calculated as of 6/30/14 and 12/31/10 for 2010.
Repositioning and Recapitalization Complete Growth Phase Begins
Yesterday
2010
Today
2014
VTR Round I reduces capitalized lease exposure
by >$342M
VTR Round II reduces capitalized lease exposure
by >$360M
Add on equity offering completed in June 2014 |
|
16
Track Record of Accretive M&A Growth
2012
2013
2014
2011
Date: Dec 2013/
Feb. 2014
Paid: $83.0mm
Date: Dec. 2013
Paid: $95.0mm
Date: Dec. 2012
Paid: $2.0mm
Date: Aug. 2012
Paid: $71.0mm
Date: Sept. 2011
Paid: $51.0mm
Date: April 2011
Paid: Undisclosed
Date: Sept. 2013
Paid: $14.0mm
Date: June 2011
Paid: $1.3bn
Date: Oct. 2011
Paid: Undisclosed
Homecare
Advantage
Real Estate of 9 SNFs
(Previously Leased from HCP)
Synergy Home
Health Care, Inc.
Date: Oct. 2013
Paid: Undisclosed
All Heart Home Health
and Hospice &
Western Reserve
Date: Spring/Summer 2013
Paid: Undisclosed
Mercy Continuing Care Hospital &
Qstaff Home Health &
Caring Hearts Home Health
Date: Jun. 2013
Paid: Undisclosed
Arrowhead
Home Health
Date: Jul. 2012
Paid: Undisclosed
Illinois Family
Kindred has a history of thoughtful, disciplined growth, and successfully integrating
acquisitions and achieving synergies. Current acquisition opportunities build on this
track record of success. |
|
Demonstrated
Development Success by Line of Business 17
Footnotes:
-
Purchase multiple is calculated by investment amount (i.e. required cash at closing or capital
committed for de novo project) divided by trailing twelve month EBITDA as of 6/30/14.
-
KND Multiple derived using enterprise value and trailing twelve months EBITDA as of second
quarter 2014. -
Acquired revenue represents the trailing twelve month results ended 6/30/14.
$303
Home
Health &
Hospice
$250
LTAC
$13
Subacute
$56
IRF
Post RehabCare Acquisition, KND
has acquired $622 million in
revenues across our service lines
Acquisition Summary
($millions)
Advancing the Strategic Plan:
Successfully
divested
approx.
122
nursing
homes
and
15
hospitals
through
Ventas
non-renewals
and
other
transactions
while
deploying
approx.
$533M
of
capital
since
the
RehabCare
acquisition
to
grow
our
Integrated
Care
Markets
and
Care
Management
Division
Acquired Revenues
by Service Line:
Subacute
IRF
Home
Health
LTAC
Revenues
$13
$56
$303
$250
EBITDA Margin
15%
12%
11%
21%
Revenues
$622
EBITDA Margin
15%
Purchase Price
533
$
Post-Acquisition Purchase Multiple
5.6x
EPS / $10M
$0.010
Total Development |
|
18
Lower
Higher
What Are Our Development Priorities?
Home Health & Hospice
Rehab
Home Based Primary Care
ALF platform
Assets across all business lines that
in-fill our integrated care markets
and enable our Continue-the-Care
strategy.
Core assets at reasonable value that
enhance the execution of the
Integrated Care Market strategy
while driving earnings.
While prioritization of initiatives is important for focusing efforts, Kindred is
positioned to execute across the prioritization spectrum.
Preference
Higher
Lower
Key Considerations:
Does it advance our Continue the Care
strategy
Does it offer strong returns within the asset class
Does it build out our integrated care markets
Does it lead to population health and risk taking
Does it meet our financial criteria
Priorities: |
|
19
Hospitals (LTACs and
IRFs
Rehab Services
Transitional Care
Centers (Sub-Acute)
Home Care and Hospice
Assisted Living
Communities
Care Management
Services
Robust Pipeline of Growth Opportunities
Since 2011, Kindred has invested
in over $1.1 billion in acquisitions
that have created significant
value
Kindred continues to be the
buyer of choice for high quality
assets within the post-acute
sector
Kindred has a robust pipeline of
potential acquisition
opportunities and continues to
be poised for growth
Each Kindred business line has numerous opportunities for organic and
transactional growth. |
|
Appendix
21
*
*
*
*
*
*
*
*
* |
|
Explanation of
Non-GAAP Measures The enclosed presentation includes financial measures referred to
as operating income, or earnings before interest, income taxes, depreciation,
amortization and rent. The Companys management uses operating income as a meaningful
measure of operational performance in addition to other measures. The Company uses
operating income to assess the relative performance of its operating divisions as well as the employees that operate these
businesses. In addition, the Company believes this measurement is important because securities
analysts and investors use this measurement to compare the
Companys
performance
to
other
companies
in
the
healthcare
industry.
The
Company
believes
that
income
(loss)
from
continuing
operations
is
the
most comparable GAAP measure. Readers of the Companys financial information should
consider income (loss) from continuing operations as an important measure of the
Companys financial performance because it provides the most complete measure of its performance.
Operating income should be
considered in addition to, not as a substitute for, or superior to, financial measures based
upon GAAP as an indicator of operating performance. A reconciliation of operating
income to income (loss) from continuing operations is provided in the enclosed Appendix.
In addition to the results provided in accordance with GAAP, the
Company provides information in the enclosed presentation to compute certain non-GAAP
measurements
for
the
twelve
months
ended
June
30,
2014
and
three
months
ended
June
30,
2014
and
2013
before
certain
charges
or
on
a
core
basis.
The
charges that were excluded from core operating results are denoted in the tables in the
enclosed Appendix. The use of these non-GAAP measurements are not intended to
replace the presentation of the Company's financial results in accordance with GAAP. The
Company
believes
that
the
presentation
of
core
operating
results
provides
additional
information
to
investors
to
facilitate
the
comparison
between
periods
by excluding certain charges for the twelve months ended June 30, 2014 and three months ended
June 30, 2014 and 2013 that the Company believes are not representative of its ongoing
operations due to the materiality and nature of the charges. The Company's core operating results also represent a key
performance measure for the purpose of evaluating performance internally.
22 |
|
Reconciliation
of Non-GAAP Measures ($ in thousands)
23
Twelve
2013 Quarters
2014 Quarters
months ended
First
Second
Third
Fourth
First
Second
June 30, 2014
Revenues:
Hospital division
657,814
$
606,604
$
594,154
$
606,988
$
646,458
$
632,156
$
2,479,756
$
Nursing center division
270,205
264,847
265,696
270,080
277,902
280,255
1,093,933
Rehabilitation division:
Skilled nursing rehabilitation services
258,750
249,647
245,330
243,280
254,255
253,989
996,854
Hospital rehabilitation services
74,523
69,777
68,296
74,017
73,964
75,324
291,601
333,273
319,424
313,626
317,297
328,219
329,313
1,288,455
Care management division
51,621
53,039
53,801
66,466
87,704
87,986
295,957
1,312,913
1,243,914
1,227,277
1,260,831
1,340,283
1,329,710
5,158,101
Eliminations:
Skilled nursing rehabilitation services
(28,657)
(28,660)
(28,151)
(28,157)
(29,646)
(30,031)
(115,985)
Hospital rehabilitation services
(23,609)
(23,223)
(22,520)
(22,123)
(23,233)
(22,855)
(90,731)
Nursing centers
(1,213)
(1,001)
(1,161)
(875)
(662)
(860)
(3,558)
(53,479)
(52,884)
(51,832)
(51,155)
(53,541)
(53,746)
(210,274)
1,259,434
$
1,191,030
$
1,175,445
$
1,209,676
$
1,286,742
$
1,275,964
$
4,947,827
$
Income (loss) from continuing operations:
Operating income (loss):
Hospital division
147,493
$
129,366
$
112,483
$
126,788
$
145,395
$
132,878
$
517,544
$
Nursing center division
29,145
36,018
31,505
35,585
38,471
36,880
(b)
142,441
Rehabilitation division:
Skilled nursing rehabilitation services
13,239
21,623
(7,209)
14,260
18,328
19,982
(b)
45,361
Hospital rehabilitation services
18,132
19,573
18,215
18,005
19,820
20,084
(b)
76,124
31,371
41,196
11,006
32,265
38,148
40,066
121,485
Care management division
2,786
3,961
1,085
2,131
4,697
7,065
(b)
14,978
Corporate:
Overhead
(45,585)
(43,196)
(39,157)
(48,557)
(44,050)
(48,365)
(b)
(180,129)
Insurance subsidiary
(509)
(384)
(482)
(539)
(406)
(443)
(1,870)
(46,094)
(43,580)
(39,639)
(49,096)
(44,456)
(48,808)
(181,999)
Impairment charges
(187)
(438)
(441)
(76,127)
-
-
(76,568)
Transaction costs
(944)
(108)
(613)
(447)
(683)
(4,496)
(6,239)
Operating income
163,570
166,415
115,386
71,099
181,572
163,585
531,642
Rent
(76,519)
(77,324)
(76,762)
(80,921)
(81,048)
(80,209)
(c)
(318,940)
Depreciation and amortization
(41,598)
(38,554)
(36,507)
(37,547)
(39,337)
(39,442)
(152,833)
Interest, net
(28,074)
(27,600)
(24,389)
(23,900)
(25,616)
(78,081)
(d)
(151,986)
Income (loss) from continuing operations
before income taxes
17,379
22,937
(22,272)
(71,269)
35,571
(34,147)
(92,117)
Provision (benefit) for income taxes
6,505
9,208
(6,510)
(20,522)
13,585
(13,082)
(26,529)
10,874
$
13,729
$
(15,762)
$
(50,747)
$
21,986
$
(21,065)
$
(65,588)
$
|
|
Reconciliation
of Non-GAAP Measures (continued)
($ in thousands)
24
Three months ended
June 30,
2014
2013
Detail of charges:
Severance and other restructuring costs
($4,950)
$0
Litigation costs
(4,600)
-
Transaction costs
(4,496)
(108)
Lease cancellation charges (rent expense)
(247)
-
Debt refinancing charges (interest expense)
(56,643)
(1,365)
(70,936)
(1,473)
Income tax benefit
26,295
544
Charges net of income taxes
(44,641)
(929)
Allocation to participating unvested restricted stockholders
-
31
Available to common stockholders
($44,641)
($898)
Weighted average diluted shares outstanding
53,714
52,284
Diluted loss per common share related to charges
($0.83)
($0.02)
Reconciliation of operating income before charges:
Operating income before charges
$177,631
$166,523
Detail of charges excluded from core operating results:
Severance and other restructuring costs
(4,950)
-
Litigation costs
(4,600)
-
Transaction costs
(4,496)
(108)
(14,046)
(108)
Reported operating income
$163,585
$166,415
Reconciliation of income from continuing operations before charges:
Amounts attributable to Kindred stockholders:
Income from continuing operations before charges
$18,748
$14,542
Charges net of income taxes
(44,641)
(929)
Reported income (loss) from continuing operations
($25,893)
$13,613
Reconciliation of diluted income per common share from continuing operations
before charges:
Diluted income per common share before charges (a)
$0.34
$0.27
Charges net of income taxes
(0.83)
(0.02)
Other
0.01
-
Reported diluted income (loss) per common share from
continuing operations ($0.48)
$0.25
Weighted average diluted shares used to compute income per common share
from continuing operations before charges
53,792
52,284
Reconciliation of effective income tax rate before charges:
Effective income tax rate before charges
35.9%
40.0%
Impact of charges on effective income tax rate
2.4%
0.1%
Reported effective income tax rate
38.3%
40.1%
(a)
For purposes of computing diluted earnings per common share before charges, income from
continuing operations before charges was reduced by $0.6 million and $0.5 million for
the three months ended June 30, 2014 and 2013, respectively, for the allocation of
income to participating unvested restricted stockholders. |
|
Reconciliation
of Non-GAAP Measures (continued)
($ in thousands)
25
Three months ended June 30, 2014
Charges
Severance
Before
and other
Debt
Transaction
As
charges
restructuring
Litigation
refinancing
costs
Total
reported
Income (loss) from continuing operations:
Operating income (loss):
Hospital division
137,478
$
-
$
(4,600)
$
-
$
-
$
(4,600)
$
132,878
$
Nursing center division
40,085
(3,205)
-
-
-
(3,205)
36,880
Rehabilitation division:
Skilled nursing rehabilitation services
20,158
(176)
-
-
-
(176)
19,982
Hospital rehabilitation services
20,254
(170)
-
-
-
(170)
20,084
40,412
(346)
-
-
-
(346)
40,066
Care management division
7,908
(843)
-
-
-
(843)
7,065
Corporate:
Overhead
(47,809)
(556)
-
-
-
(556)
(48,365)
Insurance subsidiary
(443)
-
-
-
-
-
(443)
(48,252)
(556)
-
-
-
(556)
(48,808)
Transaction costs
-
-
-
-
(4,496)
(4,496)
(4,496)
Operating income
177,631
(4,950)
(4,600)
-
(4,496)
(14,046)
163,585
Rent
(79,962)
(247)
-
-
-
(247)
(80,209)
Depreciation and amortization
(39,442)
-
-
-
-
-
(39,442)
Interest, net
(21,438)
-
-
(56,643)
(56,643)
(78,081)
Income (loss) from continuing operations
before income taxes
36,789
(5,197)
(4,600)
(56,643)
(4,496)
(70,936)
(34,147)
Provision (benefit) for income taxes
13,213
(1,985)
(1,757)
(21,639)
(914)
(26,295)
(13,082)
23,576
$
(3,212)
$
(2,843)
$
(35,004)
$
(3,582)
$
(44,641)
$
(21,065)
$ |
|
Reconciliation
of Non-GAAP Measures (continued)
($ in thousands)
26
Three months ended June 30, 2013
Charges
Before
Debt
Transaction
As
charges
refinancing
costs
Total
reported
Income from continuing operations:
Operating income (loss):
Hospital division
129,366
$
-
$
-
$
-
$
129,366
$
Nursing center division
36,018
-
-
-
36,018
Rehabilitation division:
Skilled nursing rehabilitation services
21,623
-
-
-
21,623
Hospital rehabilitation services
19,573
-
-
-
19,573
41,196
-
-
-
41,196
Care management division
3,961
-
-
-
3,961
Corporate:
Overhead
(43,196)
-
-
-
(43,196)
Insurance subsidiary
(384)
-
-
-
(384)
(43,580)
-
-
-
(43,580)
Impairment charges
(438)
-
-
-
(438)
Transaction costs
-
-
(108)
(108)
(108)
Operating income
166,523
-
(108)
(108)
166,415
Rent
(77,324)
-
-
-
(77,324)
Depreciation and amortization
(38,554)
-
-
-
(38,554)
Interest, net
(26,235)
(1,365)
-
(1,365)
(27,600)
Income from continuing operations
before income taxes
24,410
(1,365)
(108)
(1,473)
22,937
Provision for income taxes
9,752
(504)
(40)
(544)
9,208
14,658
$
(861)
$
(68)
$
(929)
$
13,729
$ |
|
Reconciliation
of Non-GAAP Measures (continued)
($ in thousands)
27
2013
2012
2011
Reconciliation of operating income before charges:
Operating income before charges
$657,914
$679,471
$528,879
Detail of charges excluded from core operating results:
One-time bonus costs
(19,842)
-
-
Severance and other restructuring costs
(12,558)
(8,730)
(18,259)
Litigation costs
(30,850)
(5,000)
-
Impairment charges
(76,082)
(107,899)
(73,554)
Transaction costs
(2,112)
(2,231)
(33,937)
(141,444)
(123,860)
(125,750)
Reported operating income
$516,470
$555,611
$403,129 |
|
Second Quarter
Investor Update August 6, 2014 |
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