Supplemental Condensed Consolidating Financial Information (Tables)

12 Months Ended

Dec. 31, 2014

Condensed Consolidating Statements of Income

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2014

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net revenues before provision for doubtful accounts	$	0		$	6,100,777		$	2,692,752		$	(29,220	)	$	8,764,309
Less: Provision for doubtful accounts		0			471,181			227,802			0			698,983
Net Revenues		0			5,629,596			2,464,950			(29,220	)		8,065,326
Operating charges:
Salaries, wages and benefits		0			2,757,738			1,087,723			0			3,845,461
Other operating expenses		0			1,217,525			592,556			(27,100	)		1,782,981
Supplies expense		0			546,578			349,115			0			895,693
Depreciation and amortization		0			269,490			106,134			0			375,624
Lease and rental expense		0			58,619			37,494			(2,120	)		93,993
EHR incentive income		0			(19,480	)		(8,422	)		0			(27,902	)
Costs related to extinguishment of debt		36,171			0			0			0			36,171
		36,171			4,830,470			2,164,600			(29,220	)		7,002,021
Income from operations		(36,171	)		799,126			300,350			0			1,063,305
Interest expense		127,528			4,516			1,594			0			133,638
Interest (income) expense, affiliate		0			88,246			(88,246	)		0			0
Equity in net income of consolidated affiliates		(646,386	)		(184,385	)		0			830,771			0
Income before income taxes		482,687			890,749			387,002			(830,771	)		929,667
Provision for income taxes		(62,656	)		305,320			82,007			0			324,671
Net income		545,343			585,429			304,995			(830,771	)		604,996
Less: Income attributable to noncontrolling interests		0			0			59,653			0			59,653
Net income attributable to UHS	$	545,343		$	585,429		$	245,342		$	(830,771	)	$	545,343

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2013

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net revenues before provision for doubtful accounts	$	0		$	5,658,699		$	2,780,983		$	(28,644	)	$	8,411,038
Less: Provision for doubtful accounts		0			657,106			470,110			0			1,127,216
Net Revenues		0			5,001,593			2,310,873			(28,644	)		7,283,822
Operating charges:
Salaries, wages and benefits		0			2,573,205			1,031,415			0			3,604,620
Other operating expenses		0			972,170			523,382			(26,808	)		1,468,744
Supplies expense		0			510,078			311,011			0			821,089
Depreciation and amortization		0			236,958			100,214			0			337,172
Lease and rental expense		0			62,518			37,076			(1,836	)		97,758
EHR incentive income		0			(43,027	)		(17,997	)		0			(61,024	)
		0			4,311,902			1,985,101			(28,644	)		6,268,359
Income from operations		0			689,691			325,772			0			1,015,463
Interest expense		139,793			3,365			2,973			0			146,131
Interest (income) expense, affiliate		0			84,640			(84,640	)		0			0
Equity in net income of consolidated affiliates		(597,020	)		(141,004	)		0			738,024			0
Income before income taxes		457,227			742,690			407,439			(738,024	)		869,332
Provision for income taxes		(53,506	)		262,346			106,469			0			315,309
Net income		510,733			480,344			300,970			(738,024	)		554,023
Less: Income attributable to noncontrolling interests		0			0			43,290			0			43,290
Net income attributable to UHS	$	510,733		$	480,344		$	257,680		$	(738,024	)	$	510,733

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2012

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net revenues before provision for doubtful accounts	$	0		$	5,152,816		$	2,562,781		$	(27,526	)	$	7,688,071
Less: Provision for doubtful accounts		0			411,538			315,133			0			726,671
Net Revenues		0			4,741,278			2,247,648			(27,526	)		6,961,400
Operating charges:
Salaries, wages and benefits		0			2,452,187			988,730			0			3,440,917
Other operating expenses		0			899,274			502,592			(25,744	)		1,376,122
Supplies expense		0			496,848			302,773			0			799,621
Depreciation and amortization		0			210,867			91,559			0			302,426
Lease and rental expense		0			59,596			37,071			(1,782	)		94,885
Transaction costs		0			5,716			0			0			5,716
EHR incentive income		0			(14,284	)		(15,754	)		0			(30,038	)
Costs related to extinguishment of debt		29,170			0			0			0			29,170
		29,170			4,110,204			1,906,971			(27,526	)		6,018,819
Income from operations		(29,170	)		631,074			340,677			0			942,581
Interest expense		172,467			3,749			2,702			0			178,918
Interest (income) expense, affiliate		0			93,363			(93,363	)		0			0
Equity in net income of consolidated affiliates		(567,906	)		(141,983	)		0			709,889			0
Income before income taxes		366,269			675,945			431,338			(709,889	)		763,663
Provision for income taxes		(77,177	)		237,072			114,721			0			274,616
Net income		443,446			438,873			316,617			(709,889	)		489,047
Less: Income attributable to noncontrolling interests		0			0			45,601			0			45,601
Net income attributable to UHS	$	443,446		$	438,873		$	271,016		$	(709,889	)	$	443,446

Condensed Consolidating Statements of Comprehensive Income

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2014

(amounts in thousands)

	Parent			Guarantors			Non Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Net income	$	545,343		$	585,429		$	304,995	$	(830,771	)	$	604,996
Other comprehensive income (loss):
Unrealized derivative gains on cash flow hedges		17,668			0			0		0			17,668
Amortization of terminated hedge		(336	)		0			0		0			(336	)
Minimum Pension Liability		(14,270	)		(14,270	)		0		14,270			(14,270	)
Foreign currency translation adjustment		(2,431	)		(2,431	)		0		2,431			(2,431	)
Other comprehensive income before tax		631			(16,701	)		0		16,701			631
Income tax expense related to items of other comprehensive income		1,053			(5,356	)		0		5,356			1,053
Total other comprehensive income, net of tax		(422	)		(11,345	)		0		11,345			(422	)
Comprehensive income		544,921			574,084			304,995		(819,426	)		604,574
Less: Comprehensive income attributable to noncontrolling interests		0			0			59,653		0			59,653
Comprehensive income attributable to UHS	$	544,921		$	574,084		$	245,342	$	(819,426	)	$	544,921

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2013

(amounts in thousands)

	Parent			Guarantors		Non Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Net income	$	510,733		$	480,344	$	300,970	$	(738,024	)	$	554,023
Other comprehensive income (loss):
Unrealized derivative gains on cash flow hedges		16,963			0		0		0			16,963
Amortization of terminated hedge		(336	)		0		0		0			(336	)
Minimum Pension Liability		14,657			14,657		0		(14,657	)		14,657
Other comprehensive income before tax		31,284			14,657		0		(14,657	)		31,284
Income tax expense related to items of other comprehensive income		11,940			5,670		0		(5,670	)		11,940
Total other comprehensive income, net of tax		19,344			8,987		0		(8,987	)		19,344
Comprehensive income		530,077			489,331		300,970		(747,011	)		573,367
Less: Comprehensive income attributable to noncontrolling interests		0			0		43,290		0			43,290
Comprehensive income attributable to UHS	$	530,077		$	489,331	$	257,680	$	(747,011	)	$	530,077

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2012

(amounts in thousands)

	Parent			Guarantors		Non Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Net income	$	443,446		$	438,873	$	316,617	$	(709,889	)	$	489,047
Other comprehensive income (loss):
Unrealized derivative gains on cash flow hedges		6,677			0		0		0			6,677
Amortization of terminated hedge		(336	)		0		0		0			(336	)
Minimum Pension Liability		4,986			4,986		0		(4,986	)		4,986
Other comprehensive income before tax		11,327			4,986		0		(4,986	)		11,327
Income tax expense related to items of other comprehensive income		4,306			1,898		0		(1,898	)		4,306
Total other comprehensive income, net of tax		7,021			3,088		0		(3,088	)		7,021
Comprehensive income		450,467			441,961		316,617		(712,977	)		496,068
Less: Comprehensive income attributable to noncontrolling interests		0			0		45,601		0			45,601
Comprehensive income attributable to UHS	$	450,467		$	441,961	$	271,016	$	(712,977	)	$	450,467

Condensed Consolidating Balance Sheet

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2014

(amounts in thousands)

	Parent		Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Assets
Current assets:
Cash and cash equivalents	$	0	$	21,784		$	10,285		$	0		$	32,069
Accounts receivable, net		0		933,971			348,764			0			1,282,735
Supplies		0		67,847			40,268			0			108,115
Deferred income taxes		113,822		743			0			0			114,565
Other current assets		0		62,431			15,223			0			77,654
Total current assets		113,822		1,086,776			414,540			0			1,615,138
Investments in subsidiaries		7,013,540		1,661,296			0			(8,674,836	)		0
Intercompany receivable		103,808		0			408,682			(512,490	)		0
Intercompany note receivable		0		0			1,222,637			(1,222,637	)		0
Property and equipment		0		4,494,567			1,717,463			0			6,212,030
Less: accumulated depreciation		0		(1,686,192	)		(846,149	)		0			(2,532,341	)
		0		2,808,375			871,314			0			3,679,689
Other assets:
Goodwill		0		2,764,555			526,658			0			3,291,213
Deferred charges		32,379		5,402			2,538			0			40,319
Other		9,601		283,302			55,181			0			348,084
	$	7,273,150	$	8,609,706		$	3,501,550		$	(10,409,963	)	$	8,974,443
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt	$	44,874	$	1,260		$	22,185			0		$	68,319
Accounts payable and accrued liabilities		20,245		1,051,309			41,508			0			1,113,062
Federal and state taxes		1,446		0			0			0			1,446
Total current liabilities		66,565		1,052,569			63,693			0			1,182,827
Intercompany payable		0		512,490			0			(512,490	)		0
Other noncurrent liabilities		1,322		189,456			77,777			0			268,555
Long-term debt		3,187,103		20,212			2,900			0			3,210,215
Intercompany note payable		0		1,222,637			0			(1,222,637	)		0
Deferred income taxes		282,214		0			0			0			282,214
Redeemable noncontrolling interests		0		0			239,552			0			239,552
UHS common stockholders’ equity		3,735,946		5,612,342			3,062,494			(8,674,836	)		3,735,946
Noncontrolling interest		0		0			55,134			0			55,134
Total equity		3,735,946		5,612,342			3,117,628			(8,674,836	)		3,791,080
	$	7,273,150	$	8,609,706		$	3,501,550		$	(10,409,963	)	$	8,974,443

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2013

(amounts in thousands)

	Parent		Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Assets
Current assets:
Cash and cash equivalents	$	0	$	7,990		$	9,248		$	0		$	17,238
Accounts receivable, net		0		799,898			317,063			0			1,116,961
Supplies		0		63,562			38,219			0			101,781
Deferred income taxes		76,719		43,184			0			0			119,903
Other current assets		0		63,786			12,660			0			76,446
Total current assets		76,719		978,420			377,190			0			1,432,329
Investments in subsidiaries		6,378,499		1,476,911			0			(7,855,410	)		0
Intercompany receivable		226,592		0			531,411			(758,003	)		0
Intercompany note receivable		0		0			982,568			(982,568	)		0
Property and equipment		0		4,093,914			1,597,988			0			5,691,902
Less: accumulated depreciation		0		(1,478,758	)		(770,975	)		0			(2,249,733	)
		0		2,615,156			827,013			0			3,442,169
Other assets:
Goodwill		0		2,552,190			496,826			0			3,049,016
Deferred charges		49,866		5,577			2,438			0			57,881
Other		8,411		251,365			70,552			0			330,328
	$	6,740,087	$	7,879,619		$	3,287,998		$	(9,595,981	)	$	8,311,723
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt	$	97,403		916			993			0		$	99,312
Accounts payable and accrued liabilities		28,099		837,354			87,996			0			953,449
Federal and state taxes		4,963		2,164			0			0			7,127
Total current liabilities		130,465		840,434			88,989			0			1,059,888
Intercompany payable		0		758,003			0			(758,003	)		0
Other noncurrent liabilities		7,591		199,104			77,894			0			284,589
Long-term debt		3,168,819		5,337			35,606			0			3,209,762
Intercompany note payable		0		982,568			0			(982,568	)		0
Deferred income taxes		183,233		55,915			0			0			239,148
Redeemable noncontrolling interests		0		0			218,107			0			218,107
UHS common stockholders’ equity		3,249,979		5,038,258			2,817,152			(7,855,410	)		3,249,979
Noncontrolling interest		0		0			50,250			0			50,250
Total equity		3,249,979		5,038,258			2,867,402			(7,855,410	)		3,300,229
	$	6,740,087	$	7,879,619		$	3,287,998		$	(9,595,981	)	$	8,311,723

Condensed Consolidating Statements of Cash Flows

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2014

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments		Total Consolidated Amounts
Net cash provided by operating activities	$	18,579		$	687,101		$	330,196		$	0	$	1,035,876
Cash Flows from Investing Activities:
Property and equipment additions, net of disposals		0			(230,102	)		(161,048	)		0		(391,150	)
Acquisition of property and businesses		0			(422,081	)		(9,305	)		0		(431,386	)
Proceeds received from sale of assets and businesses		0			11,450			3,728			0		15,178
Costs incurred for purchase and development of electronic health records application		0			(13,488	)		0			0		(13,488	)
Increase in insurance subsidiary investments		0			(12,000	)		0			0		(12,000	)
Net cash used in investing activities		0			(666,221	)		(166,625	)		0		(832,846	)
Cash Flows from Financing Activities:
Reduction of long-term debt		(866,748	)		(867	)		(11,514	)		0		(879,129	)
Additional borrowings		830,000			0			0			0		830,000
Financing costs		(14,976	)		0			0			0		(14,976	)
Repurchase of common shares		(100,749	)		0			0			0		(100,749	)
Dividends paid		(29,665	)		0			0			0		(29,665	)
Issuance of common stock		6,863			0			0			0		6,863
Excess income tax benefits related to stock based compensation		33,912			0			0			0		33,912
Profit distributions to noncontrolling interests		0			0			(33,680	)		0		(33,680	)
Changes in intercompany balances with affiliates, net		122,784			(5,444	)		(117,340	)		0		0
Net cash (used in) provided by financing activities		(18,579	)		(6,311	)		(162,534	)		0		(187,424	)
Effect of exchange rate changes on cash and cash equivalents		0			(775	)		0			0		(775	)
Increase in cash and cash equivalents		0			13,794			1,037			0		14,831
Cash and cash equivalents, beginning of period		0			7,990			9,248			0		17,238
Cash and cash equivalents, end of period	$	0		$	21,784		$	10,285		$	0	$	32,069

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2013

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments		Total Consolidated Amounts
Net cash provided by operating activities	$	17,946		$	587,083		$	279,212		$	0	$	884,241
Cash Flows from Investing Activities:
Property and equipment additions, net of disposals		0			(269,419	)		(89,074	)		0		(358,493	)
Acquisition of property and businesses		0			(8,094	)		(4,542	)		0		(12,636	)
Proceeds received from sale of assets and businesses		0			7,916			29,566			0		37,482
Costs incurred for purchase and development of electronic health records application		0			(49,811	)		0			0		(49,811	)
Net cash used in investing activities		0			(319,408	)		(64,050	)		0		(383,458	)
Cash Flows from Financing Activities:
Reduction of long-term debt		(429,996	)		(109	)		(10,119	)		0		(440,224	)
Additional borrowings		15,761			0			0			0		15,761
Financing costs		(231	)		0			0			0		(231	)
Repurchase of common shares		(27,201	)		0			0			0		(27,201	)
Dividends paid		(19,621	)		0			0			0		(19,621	)
Issuance of common stock		5,708			0			0			0		5,708
Excess income tax benefits related to stock based compensation		20,121			0			0			0		20,121
Profit distributions to noncontrolling interests		0			0			(61,329	)		0		(61,329	)
Changes in intercompany balances with affiliates, net		417,513			(271,525	)		(145,988	)		0		0
Net cash used in financing activities		(17,946	)		(271,634	)		(217,436	)		0		(507,016	)
Decrease in cash and cash equivalents		0			(3,959	)		(2,274	)		0		(6,233	)
Cash and cash equivalents, beginning of period		0			11,949			11,522			0		23,471
Cash and cash equivalents, end of period	$	0		$	7,990		$	9,248		$	0	$	17,238

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2012

(amounts in thousands)

	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net cash (used in) provided by operating activities	$	(37,648	)	$	594,606		$	242,273		$	0		$	799,231
Cash Flows from Investing Activities:
Property and equipment additions, net of disposals		0			(312,190	)		(51,002	)		0			(363,192	)
Acquisition of property and businesses		0			(513,596	)		(14,251	)		0			(527,847	)
Proceeds received from sale of assets and businesses		0			142,667			6,644			0			149,311
Costs incurred for purchase and development of electronic health records application		0			(54,362	)		0			0			(54,362	)
Return of Deposit on terminated purchase agreement		6,500			0			0			0			6,500
Net cash provided by (used in) investing activities		6,500			(737,481	)		(58,609	)		0			(789,590	)
Cash Flows from Financing Activities:
Reduction of long-term debt		(843,002	)		0			(8,258	)		1,613			(849,647	)
Additional borrowings		913,500			1,613			0			(1,613	)		913,500
Financing costs		(8,283	)		0			0			0			(8,283	)
Repurchase of common shares		(19,154	)		0			0			0			(19,154	)
Dividends paid		(58,395	)		0			0			0			(58,395	)
Issuance of common stock		5,435			0			0			0			5,435
Excess income tax benefits related to stock based compensation		16,040			0			0			0			16,040
Profit distributions to noncontrolling interests		0			0			(26,895	)		0			(26,895	)
Changes in intercompany balances with affiliates, net		25,007			119,990			(144,997	)		0			0
Net cash provided by (used in) financing activities		31,148			121,603			(180,150	)		0			(27,399	)
Increase (decrease) in cash and cash equivalents		0			(21,272	)		3,514			0			(17,758	)
Cash and cash equivalents, beginning of period		0			33,221			8,008			0			41,229
Cash and cash equivalents, end of period	$	0		$	11,949		$	11,522		$	0		$	23,471