Province Healthcare Reports Second Quarter Results BRENTWOOD,
Tenn., July 27 /PRNewswire-FirstCall/ -- Province Healthcare
Company (NYSE:PRV) today announced results for the second quarter
ended June 30, 2004. Diluted earnings per share (EPS) for the
second quarter were $0.34 compared to $0.20 in the prior year's
quarter. As previously announced, the Company sold Glades General
Hospital in Belle Glade, Florida, on April 30, 2004, and sold Brim
Healthcare, Inc. on June 30, 2004. The operating results for both
entities are reported as "discontinued operations", and the
consolidated financial statements and statistics for all prior
periods have been adjusted to reflect this presentation. Diluted
earnings per share from continuing operations for the quarter
increased 15.0% to $0.23 compared to $0.20 in the prior year's
quarter. Revenues from continuing operations for the second quarter
of 2004 increased 13.4% to $208.5 million, compared with $183.9
million in the same quarter of last year. For the quarter, income
from continuing operations was $11.8 million, compared with $9.9
million in the prior year's quarter. Cash flow from operations for
the second quarter increased 38.1% to $23.8 million, compared with
$17.2 million in the same quarter of last year. Revenues from
continuing operations for the six months ended June 30, 2004
increased 11.7% to $409.1 million, compared with $366.4 million in
the same period of 2003. Income from continuing operations for
first half of the year was $24.0 million, compared with last year's
income from continuing operations of $19.8 million. Diluted
earnings per share from continuing operations for the first half of
the year increased 14.6% to $0.47 per diluted share, compared with
$0.41 per diluted share in the prior year period. Province ended
the second quarter of 2004 with 20 owned or leased hospitals, of
which 19 are same-store hospitals. Memorial Medical Center in Las
Cruces, New Mexico, acquired through a long-term lease effective
June 1, 2004, is excluded from same-store results. On a same-store
basis, net patient revenue for the quarter increased 6.4%, net
patient revenue per adjusted admission increased 6.8% and surgeries
increased 2.9%. Province continues to see the results of the
successful recruitment of primarily specialist physicians in 2003
and 2004; strong outpatient growth and increasing acuity.
Specialists typically generate 20% fewer admissions, but 50%
greater net revenue per admission. Same-store adjusted admissions
were flat quarter over quarter, as a result of an increase in
same-store outpatient revenue and a decline in same-store
admissions. Additionally, same-store acuity, as measured by the
Medicare case mix index, increased to 1.22 in the second quarter of
2004 from 1.19 in the second quarter of 2003. Same-store accounts
receivable days outstanding stood at 54 days at June 30, 2004.
Martin S. Rash, Chairman and Chief Executive Officer of Province
Healthcare, said, "The initial operations of Memorial Medical
Center in Las Cruces, New Mexico are exceeding our expectations,
and we expect this hospital to be slightly accretive for the
remainder of the year. We continue to be pleased with our
successful physician recruitment efforts, with 71 physicians
recruited to date, of which two-thirds are specialists. We are very
confident in our operations for the remainder of year." A
listen-only simulcast of Province Healthcare's second quarter
conference call will be available on-line at http://www.prhc.net/
on July 28, 2004, beginning at 11:00 a.m. Eastern Daylight Time.
The Company owns or leases 20 general acute care hospitals in 12
states with a total of 2,492 licensed beds. Certain information
contained in this release constitutes forward-looking statements.
These statements are based only on our current estimates of future
events. Forward-looking statements involve known and unknown risks
and uncertainties which may cause our actual results in future
periods to differ materially from forecasted results. Those risks
include, among others, risks associated with general economic and
business conditions, the effect of future governmental regulations,
changes in reimbursement levels by government programs, including
Medicare and Medicaid or other third party payors, the Company's
continued ability to recruit and retain physicians and the
Company's ability to successfully complete and integrate
acquisitions. Those and other risks and uncertainties are described
in our most recent reports and filings with the Securities and
Exchange Commission. You should not rely on the forward-looking
statements contained in this release, as we cannot predict or
control many of the factors that may cause future events or results
to differ from those forecasted. We undertake no obligation to
update any forward- looking statements on the basis of any
information, future events or otherwise. - TABLES TO FOLLOW -
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE
SHEETS (Dollars in thousands, except per share amounts) June 30,
December 31, 2004 2003(*) ASSETS Current assets: Cash and cash
equivalents $1,987 $46,117 Accounts receivable, less allowance for
doubtful accounts of $81,591 in 2004 and $66,835 in 2003 125,754
110,335 Inventories 21,108 18,424 Prepaid expenses and other 20,580
14,844 Assets of discontinued operations 3,011 15,362 172,440
205,082 Property and equipment, net 551,535 459,843 Goodwill
390,305 309,191 Other assets 33,636 36,874 $1,147,916 $1,010,990
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts
payable $28,925 $16,083 Accrued salaries and benefits 29,901 27,852
Accrued expenses 23,221 13,586 Current portion of long-term debt
305 743 Liabilities of discontinued operations 550 5,386 82,902
63,650 Long-term debt, less current portion 521,213 447,956 Other
liabilities 56,848 50,601 Minority interests 2,089 1,910
Stockholders' equity: Preferred stock - $0.01 par value, 100,000
shares authorized, none issued and outstanding - - - - Common stock
- $0.01 par value; 150,000,000 shares authorized at June 30, 2004
and December 31, 2003, issued and outstanding 49,804,885 shares and
48,841,157 shares at June 30, 2004 and December 31, 2003,
respectively 498 488 Additional paid-in-capital 314,058 306,091
Retained earnings 170,945 141,186 Accumulated other comprehensive
loss (637) (892) Total stockholders' equity 484,864 446,873
$1,147,916 $1,010,990 (*) Derived from the audited consolidated
financial statements of Province and its subsidiaries, contained in
the Company's Annual Report on Form 10-K, filed with the Securities
and Exchange Commission on March 9, 2004. The December 31, 2003
balance sheet presented above reflects the restatement of Brim
Healthcare, Inc. as a discontinued operation. PROVINCE HEALTHCARE
COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Dollars
in thousands, except per share data) Three Months Ended June 30,
2004 2003 % of % of Amount Revenues Amount Revenues Revenues: Net
patient revenue $205,886 $181,758 Other 2,648 2,177 208,534 100.0%
183,935 100.0% Expenses: Salaries, wages and benefits 75,221 36.1
70,732 38.5 Purchased services 20,504 9.8 17,578 9.6 Supplies
25,847 12.4 23,040 12.5 Provision for doubtful accounts 21,711 10.4
16,263 8.8 Other operating expenses 24,269 11.6 21,341 11.6 Rentals
and leases 2,961 1.4 2,234 1.2 Depreciation and amortization 11,466
5.5 9,079 4.9 Interest expense 7,416 3.6 6,635 3.6 Minority
interests 169 0.1 82 - - Loss on sale of assets 18 - - - - - - Loss
on early extinguishment of debt - - - - 477 0.3 Total expenses
189,582 90.9 167,461 91.0 Income before provision for income taxes
18,952 9.1 16,474 9.0 Income taxes 7,122 3.4 6,555 3.6 Income from
continuing operations 11,830 5.7% 9,919 5.4% Discontinued
operations, net of tax: Loss from operations (464) (258) Net gain
on divestitures 6,833 - - Net income $18,199 $9,661 Diluted
earnings (loss) per common share: Continuing operations (a) $0.23
$0.20 Discontinued operations: Loss from operations (0.01) - - Net
gain on divestitures 0.12 - - Net income $0.34 $0.20 (a) See
calculation of diluted earnings per common share from continuing
operations in the Selected Operating Statistics section (attached).
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF INCOME (Dollars in thousands, except per share data)
Six Months Ended June 30, 2004 2003 % of % of Amount Revenues
Amount Revenues Revenues: Net patient revenue $404,127 $361,438
Other 4,983 4,940 409,110 100.0% 366,378 100.0% Expenses: Salaries,
wages and benefits 149,576 36.6 141,781 38.7 Purchased services
38,942 9.5 34,141 9.3 Supplies 51,886 12.7 47,035 12.9 Provision
for doubtful accounts 41,944 10.2 32,303 8.8 Other operating
expenses 46,935 11.5 42,804 11.7 Rentals and leases 5,256 1.3 4,478
1.2 Depreciation and amortization 21,642 5.3 17,915 4.9 Interest
expense 14,336 3.5 12,357 3.4 Minority interests 236 - - 149 - -
Loss on sale of assets 18 - - - - - - Loss on early extinguishment
of debt - - - - 477 0.1 Total expenses 370,771 90.6 333,440 91.0
Income before provision for income taxes 38,339 9.4 32,938 9.0
Income taxes 14,302 3.5 13,127 3.6 Income from continuing
operations 24,037 5.9% 19,811 5.4% Discontinued operations, net of
tax: Loss from operations (940) (299) Net gain on divestitures
6,663 - - Net income $29,760 $19,512 Diluted earnings (loss) per
common share: Continuing operations (b) $0.47 $0.41 Discontinued
operations: Loss from operations (0.02) (0.01) Net gain on
divestitures 0.11 - - Net income $0.56 $0.40 (b) See calculation of
diluted earnings per common share from continuing operations in the
Selected Operating Statistics section (attached). PROVINCE
HEALTHCARE COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Three Months
Ended June 30, 2004 2003 Cash flows from operating activities:
Income from continuing operations $11,830 $9,919 Adjustments to
reconcile income from continuing operations to net cash provided by
operating activities: Depreciation and amortization 11,466 9,079
Deferred income taxes 8,158 2,325 Provision for professional
liability 1,641 1,404 Loss on early extinguishment of debt - - 477
Loss on sale of assets 18 - - Changes in operating assets and
liabilities, net of effects from acquisitions and disposals:
Accounts receivable 1,658 842 Inventories (388) 284 Prepaid
expenses and other (8,208) 3,100 Accounts payable and accrued
expenses (3,192) (16,338) Accrued salaries and benefits 1,126 1,139
Other (313) 4,998 Net cash provided by operating activities 23,796
17,229 Cash flows from investing activities: Purchase of property
and equipment (19,245) (15,250) Escrow deposit on potential
investment - - (3,798) Purchase of hospitals and healthcare
entities (152,779) (3,153) Net cash used in investing activities
(172,024) (22,201) Cash flows from financing activities: Proceeds
from long-term debt 110,000 194,212 Repayments of debt (34,870)
(186,887) Issuance of common stock 3,362 72 Net cash provided by
financing activities 78,492 7,397 Net cash provided by (used in)
continuing operations (69,736) 2,425 Net cash provided by
discontinued operations 15,115 724 Increase (decrease) in cash and
cash equivalents (54,621) 3,149 Cash and cash equivalents at
beginning of period 56,608 15,990 Cash and cash equivalents at end
of period $1,987 $19,139 PROVINCE HEALTHCARE COMPANY AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In thousands) Six Months Ended June 30, 2004 2003 Cash
flows from operating activities: Income from continuing operations
$24,037 $19,811 Adjustments to reconcile income from continuing
operations to net cash provided by operating activities:
Depreciation and amortization 21,642 17,915 Deferred income taxes
10,532 3,155 Provision for professional liability 3,244 3,383 Loss
on early extinguishment of debt - - 477 Loss on sale of assets 18 -
- Changes in operating assets and liabilities, net of effects from
acquisitions and disposals: Accounts receivable (3,298) (375)
Inventories (199) 429 Prepaid expenses and other (10,591) (1,920)
Accounts payable and accrued expenses 5,146 5,091 Accrued salaries
and benefits (3,273) 1,942 Other 1,551 4,026 Net cash provided by
operating activities 48,809 53,934 Cash flows from investing
activities: Purchase of property and equipment (37,712) (30,404)
Escrow deposit on potential investment - - (3,798) Purchase of
hospitals and healthcare entities (152,783) (3,153) Net cash used
in investing activities (190,495) (37,355) Cash flows from
financing activities: Proceeds from long-term debt 110,000 194,212
Repayments of debt (35,125) (207,274) Issuance of common stock
7,264 1,235 Net cash provided by (used in) financing activities
82,139 (11,827) Net cash provided by (used in) continuing
operations (59,547) 4,752 Net cash provided by (used in)
discontinued operations 15,417 (238) Increase (decrease) in cash
and cash equivalents (44,130) 4,514 Cash and cash equivalents at
beginning of period 46,117 14,625 Cash and cash equivalents at end
of period $1,987 $19,139 PROVINCE HEALTHCARE COMPANY AND
SUBSIDIARIES SELECTED OPERATING STATISTICS (Unaudited) Actual Same
Store(1) Three Months Ended Three Months Ended June 30, June 30,
2004 2003 2004 2003 Consolidated Hospitals: Number of hospitals at
end of period 20 19 5.3% 19 19 - -% Licensed beds at end of period
2,492 2,208 12.9 2,206 2,208 - - Beds in service at end of period
2,119 1,933 9.6 1,920 1,933 (0.7) Inpatient admissions 17,724
17,579 1.0 16,883 17,579 (4.0) Adjusted admissions (2) 33,564
32,143 4.4 32,026 32,143 (0.4) Patient days 76,208 74,713 2.0
72,580 74,713 (2.8) Adjusted patient days (3) 144,323 136,619 5.6
137,678 136,619 0.8 Average length of stay (days) 4.3 4.3 - - 4.3
4.3 - - Net patient revenue $205,886 $181,758 13.3 $193,417
$181,758 6.4 Net patient revenue: Per inpatient admission $11,616
$10,340 12.3 $11,456 $10,340 10.8 Per adjusted admission $6,134
$5,655 8.5 $6,039 $5,655 6.8 Gross revenue: Inpatient $239,461
$219,842 8.9 $225,931 $219,842 2.8 Outpatient 214,010 182,075 17.5
202,566 182,075 11.3 $453,471 $401,917 12.8 $428,497 $401,917 6.6
Net Patient Revenue by Payor: Medicare 38.8% 38.5% 38.5% 38.5%
Medicaid 8.7 10.7 9.7 10.7 Other 52.5 50.8 51.8 50.8 Total 100.0%
100.0% 100.0% 100.0% Three Months Ended June 30, 2004 2003 Diluted
Earnings Per Share Calculation: Income from continuing operations
$11,830 $9,919 Add convertible notes interest, net of tax (4) 1,899
-- Adjusted net income $13,729 $9,919 Basic shares plus stock
options 50,600 49,032 Convertible shares (4) 9,100 -- Diluted
shares outstanding 59,700 49,032 Diluted earnings per share $0.23
$0.20 (1) Represents hospitals owned or leased during both periods.
(2) Used by management and investors as a general measure of
combined inpatient and outpatient volume. Adjusted admissions are
computed by multiplying admissions (inpatient volume) by the
outpatient factor. The outpatient factor is the sum of gross
inpatient revenue and gross outpatient revenue divided by gross
inpatient revenue. The adjusted admissions computation equates
outpatient revenue to the volume measure (admissions) used to
measure inpatient volume, resulting in a general measure of
combined inpatient and outpatient volume. (3) Adjusted patient days
are computed by multiplying patient days (inpatient volume) by the
outpatient factor. The outpatient factor is the sum of gross
inpatient revenue and gross outpatient revenue divided by gross
inpatient revenue. The adjusted patient days computation equates
outpatient revenue to the volume measure (patient days) used to
measure inpatient volume, resulting in a general measure of
combined inpatient and outpatient volume. (4) The Company's two
outstanding series of convertible notes are anti- dilutive for the
three and six month periods ended June 30, 2003 and thus, are not
included in the diluted earnings per share calculation for such
period. PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES SELECTED
OPERATING STATISTICS (Unaudited) Actual Same Store(1) Six Months
Ended Six Months Ended June 30, June 30, 2004 2003 2004 2003
Consolidated Hospitals: Number of hospitals at end of period 20 19
5.3% 19 19 - -% Licensed beds at end of period 2,492 2,208 12.9
2,206 2,208 - - Beds in service at end of period 2,119 1,933 9.6
1,920 1,933 (0.7) Inpatient admissions 36,717 36,303 1.1 35,876
36,303 (1.2) Adjusted admissions (2) 67,548 65,252 3.5 66,010
65,252 1.2 Patient days 157,455 155,296 1.4 153,827 155,296 (1.0)
Adjusted patient days (3) 289,643 279,137 3.8 282,998 279,137 1.4
Average length of stay (days) 4.3 4.3 - - 4.3 4.3 - - Net patient
revenue $404,127 $361,438 11.8 $391,658 $361,438 8.4 Net patient
revenue: Per inpatient admission $11,007 $9,956 10.6 $10,917 $9,956
9.7 Per adjusted admission $5,983 $5,539 8.0 $5,933 $5,539 7.1
Gross revenue: Inpatient $493,404 $447,607 10.2 $479,874 $447,606
7.2 Outpatient 414,286 357,079 16.0 402,842 357,079 12.8 $907,690
$804,686 12.8 $882,716 $804,685 9.7 Net Patient Revenue by Payor:
Medicare 39.6% 39.0% 39.5% 39.0% Medicaid 9.0 10.7 9.5 10.7 Other
51.4 50.3 51.0 50.3 Total 100.0% 100.0% 100.0% 100.0% Six Months
Ended June 30, 2004 2003 Diluted Earnings Per Share Calculation:
Income from continuing operations $24,037 $19,811 Add convertible
notes interest, net of tax (4) 3,797 -- Adjusted net income $27,834
$19,811 Basic shares plus stock options 50,469 48,895 Convertible
shares (4) 9,100 -- Diluted shares outstanding 59,569 48,895
Diluted earnings per share $0.47 $0.41 See accompanying footnotes
on previous page. DATASOURCE: Province Healthcare Company CONTACT:
Pamela L. Hunter, Vice President, Investor Relations of Province
Healthcare Company, +1-615-370-1377 Web site: http://www.prhc.net/
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