(State of Incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
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. |
Item 9.01. | Financial Statements and Exhibits. |
Exhibit No. | Description | |||||||
99.1 | ||||||||
104 | Cover Page Interactive Data File (embedded within the inline XBRL document) |
TENET HEALTHCARE CORPORATION | ||||||||
Date: February 9, 2021 | By: | /s/ R. SCOTT RAMSEY | ||||||
R. Scott Ramsey | ||||||||
Senior Vice President, Controller |
($ in millions, except per share results) | 4Q20 | 4Q19 | FY 2020 | FY 2019 | ||||||||||
Net income (loss) from continuing operations available (attributable) to Tenet common shareholders | $414 | $(3) | $399 | $(226) | ||||||||||
Net income (loss) from continuing operations available (attributable) to Tenet common shareholders per diluted share | $3.86 | $(0.03) | $3.75 | $(2.19) | ||||||||||
Adjusted EBITDA excluding grant income | $832 | $799 | $2,247 | $2,730 | ||||||||||
Adjusted EBITDA | $1,278 | $799 | $3,146 | $2,730 | ||||||||||
Adjusted diluted earnings per share from continuing operations | $4.72 | $0.95 | $7.92 | $2.84 | ||||||||||
The table above as well as tables and discussions throughout this earnings release include certain financial measures that are not in accordance with Generally Accepted Accounting Principles (GAAP). Reconciliations of GAAP measures to the Adjusted (non-GAAP) measures used are detailed in Tables #1-3 included at the end of this earnings release. Management’s reasoning for the use of these non-GAAP measures and descriptions of the various non-GAAP measures are included in the Non-GAAP Financial Measures section of this earnings release. |
Hospital segment results ($ in millions) | 4Q20 | 4Q19 | FY 2020 | FY 2019 | ||||||||||
Revenues | ||||||||||||||
Net operating revenues | $4,065 | $3,983 | $14,790 | $15,522 | ||||||||||
Grant income | $406 | — | $823 | — | ||||||||||
Facilities net patient service revenues; same-hospital basis (a) | $3,737 | $3,673 | $13,611 | $14,339 | ||||||||||
Volumes | ||||||||||||||
Same-hospital admissions (decline) growth (a) | (10.6) | % | 2.6 | % | (11.6) | % | 2.3 | % | ||||||
Same-hospital adjusted admissions (decline) growth (a)(b) | (14.8) | % | 1.9 | % | (15.7) | % | 1.9 | % | ||||||
Adjusted EBITDA | ||||||||||||||
Adjusted EBITDA excluding grant income | $431 | $401 | $1,088 | $1,449 | ||||||||||
Adjusted EBITDA | $837 | $401 | $1,911 | $1,449 |
Hospital Segment Volume Statistics | 3Q20 | Oct. 2020 | Nov. 2020 | Dec. 2020 | 4Q20 | |||||||||||||||
Admissions | ~89% | ~90% | ~91% | ~87% | ~89% | |||||||||||||||
Outpatient visits (including outpatient ER visits) | ~84% | ~86% | ~86% | ~81% | ~85% | |||||||||||||||
Emergency Room visits (inpatient and outpatient) | ~77% | ~79% | ~78% | ~71% | ~76% | |||||||||||||||
Hospital surgeries | ~89% | ~93% | ~91% | ~85% | ~90% |
Ambulatory segment results ($ in millions) | 4Q20 | 4Q19 | FY 2020 | FY 2019 | ||||||||||
Revenues | ||||||||||||||
Net operating revenues | $649 | $632 | $2,072 | $2,158 | ||||||||||
Grant income excluding equity earnings impact | $31 | — | $59 | — | ||||||||||
Grant income in equity earnings | $9 | — | $17 | — | ||||||||||
Same-facility system-wide net patient service revenues (c) | $1,374 | $1,380 | $4,394 | $4,652 | ||||||||||
Volumes | ||||||||||||||
Same-facility system-wide surgical cases (decline) growth | (5.5) | % | 3.4 | % | (15.2) | % | 3.3 | % | ||||||
Same-facility system-wide total ambulatory cases (decline) growth | (1.7) | % | 5.7 | % | (10.0) | % | 3.7 | % | ||||||
Adjusted EBITDA and NCI | ||||||||||||||
Adjusted EBITDA excluding grant income | $290 | $304 | $792 | $895 | ||||||||||
Adjusted EBITDA | $330 | $304 | $868 | $895 | ||||||||||
Adjusted EBITDA less facility-level NCI excluding grant income | $193 | $190 | $516 | $568 | ||||||||||
Adjusted EBITDA less facility-level NCI | $214 | $190 | $558 | $568 | ||||||||||
Adjusted EBITDA less total NCI excluding grant income (d) | $187 | $186 | $505 | $554 | ||||||||||
Adjusted EBITDA less total NCI (d) | $207 | $186 | $545 | $554 |
Ambulatory Segment | 3Q20 | Oct. 2020 | Nov. 2020 | Dec. 2020 | 4Q20 | |||||||||||||||
Surgical cases | ~94% | ~96% | ~93% | ~93% | ~95% |
Conifer segment results ($ in millions) | 4Q20 | 4Q19 | FY 2020 | FY 2019 | ||||||||||
Net operating revenues | $344 | $332 | $1,306 | $1,372 | ||||||||||
Adjusted EBITDA | $111 | $94 | $367 | $386 |
($ in millions) | December 31, 2020 | December 31, 2019 | ||||||
Cash and cash equivalents | $2,446 | $262 | ||||||
Accounts receivable days outstanding | 55.6 | 58.4 | ||||||
Line-of-credit borrowings outstanding | — | — | ||||||
Ratio of net debt plus Medicare advances liability to Adjusted EBITDA (e) | 4.70 | 5.31 | ||||||
Ratio of net debt plus Medicare advances liability to Adjusted EBITDA on a pro forma basis including last 12 months of SCD Adjusted EBITDA for FY 2020 (e) | 4.42 | 5.31 |
($ in millions) | 4Q20 | 4Q19 | FY 2020 | FY 2019 | ||||||||||
Net cash provided by operating activities | $446 | $520 | $3,407 | $1,233 | ||||||||||
Capital expenditures | $(166) | $(178) | $(540) | $(670) | ||||||||||
Free cash flow | $280 | $342 | $2,867 | $563 | ||||||||||
Adjusted free cash flow | $361 | $399 | $3,201 | $760 | ||||||||||
Net cash used in investing activities | $(1,202) | $(193) | $(1,608) | $(619) | ||||||||||
Net cash (used in) provided by financing activities | $(98) | $(379) | $385 | $(763) |
CONSOLIDATED ($ in millions except per share amounts) | FY 2021 Outlook | 1Q21 Outlook | |||||||||
Net operating revenues | $19,200 to $19,600 | $4,600 to $4,800 | |||||||||
Net income (loss) from continuing operations available (attributable) to Tenet common stockholders | $226 to $411 | $(39) to $41 | |||||||||
Adjusted EBITDA | $2,900 to $3,100 | $625 to $725 | |||||||||
Adjusted EBITDA margin | 15.1% to 15.8% | 13.6% to 15.1% | |||||||||
Diluted income (loss) per common share from continuing operations | $2.09 to $3.81 | $(0.37) to $0.38 | |||||||||
Adjusted net income from continuing operations | $380 to $520 | $25 to $100 | |||||||||
Adjusted diluted earnings per share from continuing operations | $3.52 to $4.81 | $0.23 to $0.93 | |||||||||
Equity in earnings of unconsolidated affiliates | $190 to $210 | $30 to $40 | |||||||||
Depreciation and amortization | $855 to $875 | $215 to $225 | |||||||||
Interest expense | $935 to $945 | $240 to $250 | |||||||||
Net income available to NCI | $545 to $565 | $115 to $125 | |||||||||
Weighted average diluted common shares | ~108 million | ~107 million | |||||||||
NCI cash distributions | $460 to $480 | ||||||||||
Effective tax rate (f) | ~16% | ||||||||||
Net cash provided by operating activities | $1,075 to $1,375 | ||||||||||
Adjusted net cash provided by operating activities | $1,225 to $1,475 | ||||||||||
Capital expenditures | $700 to $750 | ||||||||||
Adjusted free cash flow | $525 to $725 |
Hospital Segment ($ in millions) | FY 2021 Outlook | |||||||
Net operating revenues | $15,625 to $15,875 | |||||||
Adjusted EBITDA | $1,340 to $1,470 | |||||||
NCI | ~$15 | |||||||
Inpatient admissions (g) | 90% to 95% of 2019 actual | |||||||
Outpatient visits (g) | 85% to 90% of 2019 actual | |||||||
Adjusted admissions (g) | 85% to 90% of 2019 actual | |||||||
Decline in net revenues per adjusted admission (g) | (3)% to (5)% | |||||||
Decline in expenses per adjusted admission (g) | (5)% to (7)% |
Ambulatory Segment ($ in millions) | FY 2021 Outlook | |||||||
Net operating revenues | $2,800 to $2,900 | |||||||
Adjusted EBITDA | $1,210 to $1,270 | |||||||
NCI | $470 to $490 | |||||||
Adjusted EBITDA less total NCI | $740 to $780 | |||||||
Surgical cases volumes (g) | 98% to 103% of 2019 actual | |||||||
Decline in net revenues per surgical case (g) | (1)% to (3)% |
Conifer Segment ($ in millions) | FY 2021 Outlook | |||||||
Net operating revenues | $1,300 to $1,350 | |||||||
Adjusted EBITDA | $350 to $360 | |||||||
NCI | ~$60 | |||||||
Investor Contact | Media Contact | |||||||
Regina Nethery | Lesley Bogdanow | |||||||
469-893-2387 | 469-893-2640 | |||||||
regina.nethery@tenethealth.com | mediarelations@tenethealth.com |
Description | Page | ||||
Table #4 - Reconciliations of Outlook Net Income to Outlook Adjusted EBITDA | |||||
(Dollars in millions except per share amounts) | Three Months Ended December 31, | |||||||||||||||||||||||||||||||
2020 | % | 2019 | % | Change | ||||||||||||||||||||||||||||
Net operating revenues | $ | 4,915 | 100.0 | % | $ | 4,806 | 100.0 | % | 2.3 | % | ||||||||||||||||||||||
Grant income | 437 | 8.9 | % | — | — | % | n/a | |||||||||||||||||||||||||
Equity in earnings of unconsolidated affiliates | 66 | 1.3 | % | 61 | 1.3 | % | 8.2 | % | ||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||
Salaries, wages and benefits | 2,225 | 45.3 | % | 2,230 | 46.5 | % | (0.2) | % | ||||||||||||||||||||||||
Supplies | 824 | 16.8 | % | 803 | 16.7 | % | 2.6 | % | ||||||||||||||||||||||||
Other operating expenses, net | 1,071 | 21.8 | % | 1,035 | 21.6 | % | 3.5 | % | ||||||||||||||||||||||||
Depreciation and amortization | 233 | 4.7 | % | 223 | 4.6 | % | ||||||||||||||||||||||||||
Impairment and restructuring charges, and acquisition-related costs | 124 | 2.5 | % | 84 | 1.7 | % | ||||||||||||||||||||||||||
Litigation and investigation costs | 31 | 0.6 | % | 26 | 0.5 | % | ||||||||||||||||||||||||||
Net (gains) losses on sales, consolidation and deconsolidation of facilities | (10) | (0.2) | % | 12 | 0.3 | % | ||||||||||||||||||||||||||
Operating income | 920 | 18.7 | % | 454 | 9.4 | % | ||||||||||||||||||||||||||
Interest expense | (242) | (243) | ||||||||||||||||||||||||||||||
Other non-operating expense, net | (2) | (2) | ||||||||||||||||||||||||||||||
Income from continuing operations, before income taxes | 676 | 209 | ||||||||||||||||||||||||||||||
Income tax expense | (130) | (85) | ||||||||||||||||||||||||||||||
Income from continuing operations, before discontinued operations | 546 | 124 | ||||||||||||||||||||||||||||||
Discontinued operations: | ||||||||||||||||||||||||||||||||
Income from operations | — | 2 | ||||||||||||||||||||||||||||||
Income tax expense | — | (2) | ||||||||||||||||||||||||||||||
Income from discontinued operations | — | — | ||||||||||||||||||||||||||||||
Net income | 546 | 124 | ||||||||||||||||||||||||||||||
Less: Net income available to noncontrolling interests | 132 | 127 | ||||||||||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | 414 | $ | (3) | ||||||||||||||||||||||||||||
Amounts available (attributable) to Tenet Healthcare Corporation common shareholders | ||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of tax | $ | 414 | $ | (3) | ||||||||||||||||||||||||||||
Income from discontinued operations, net of tax | — | — | ||||||||||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | 414 | $ | (3) | ||||||||||||||||||||||||||||
Earnings (loss) per share available (attributable) to Tenet Healthcare Corporation common shareholders: | ||||||||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||||||||
Continuing operations | $ | 3.92 | $ | (0.03) | ||||||||||||||||||||||||||||
Discontinued operations | — | — | ||||||||||||||||||||||||||||||
$ | 3.92 | $ | (0.03) | |||||||||||||||||||||||||||||
Diluted | ||||||||||||||||||||||||||||||||
Continuing operations | $ | 3.86 | $ | (0.03) | ||||||||||||||||||||||||||||
Discontinued operations | — | — | ||||||||||||||||||||||||||||||
$ | 3.86 | $ | (0.03) | |||||||||||||||||||||||||||||
Weighted average shares and dilutive securities outstanding (in thousands): | ||||||||||||||||||||||||||||||||
Basic | 105,630 | 104,048 | ||||||||||||||||||||||||||||||
Diluted | 107,237 | 104,048 |
(Dollars in millions except per share amounts) | Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||
2020 | % | 2019 | % | Change | ||||||||||||||||||||||||||||
Net operating revenues | $ | 17,640 | 100.0 | % | $ | 18,479 | 100.0 | % | (4.5) | % | ||||||||||||||||||||||
Grant income | 882 | 5.0 | % | — | — | % | n/a | |||||||||||||||||||||||||
Equity in earnings of unconsolidated affiliates | 169 | 1.0 | % | 175 | 0.9 | % | (3.4) | % | ||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||
Salaries, wages and benefits | 8,418 | 47.8 | % | 8,698 | 47.0 | % | (3.2) | % | ||||||||||||||||||||||||
Supplies | 2,982 | 16.9 | % | 3,057 | 16.5 | % | (2.5) | % | ||||||||||||||||||||||||
Other operating expenses, net | 4,125 | 23.4 | % | 4,171 | 22.6 | % | (1.1) | % | ||||||||||||||||||||||||
Depreciation and amortization | 857 | 4.9 | % | 850 | 4.6 | % | ||||||||||||||||||||||||||
Impairment and restructuring charges, and acquisition-related costs | 290 | 1.6 | % | 185 | 1.0 | % | ||||||||||||||||||||||||||
Litigation and investigation costs | 44 | 0.2 | % | 141 | 0.8 | % | ||||||||||||||||||||||||||
Net (gains) losses on sales, consolidation and deconsolidation of facilities | (14) | (0.1) | % | 15 | 0.1 | % | ||||||||||||||||||||||||||
Operating income | 1,989 | 11.3 | % | 1,537 | 8.3 | % | ||||||||||||||||||||||||||
Interest expense | (1,003) | (985) | ||||||||||||||||||||||||||||||
Other non-operating income (expense), net | 1 | (5) | ||||||||||||||||||||||||||||||
Loss from early extinguishment of debt | (316) | (227) | ||||||||||||||||||||||||||||||
Income from continuing operations, before income taxes | 671 | 320 | ||||||||||||||||||||||||||||||
Income tax benefit (expense) | 97 | (160) | ||||||||||||||||||||||||||||||
Income from continuing operations, before discontinued operations | 768 | 160 | ||||||||||||||||||||||||||||||
Discontinued operations: | ||||||||||||||||||||||||||||||||
Income from operations | — | 15 | ||||||||||||||||||||||||||||||
Income tax expense | — | (4) | ||||||||||||||||||||||||||||||
Income from discontinued operations | — | 11 | ||||||||||||||||||||||||||||||
Net income | 768 | 171 | ||||||||||||||||||||||||||||||
Less: Net income available to noncontrolling interests | 369 | 386 | ||||||||||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | 399 | $ | (215) | ||||||||||||||||||||||||||||
Amounts available (attributable) to Tenet Healthcare Corporation common shareholders | ||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of tax | $ | 399 | $ | (226) | ||||||||||||||||||||||||||||
Income from discontinued operations, net of tax | — | 11 | ||||||||||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | 399 | $ | (215) | ||||||||||||||||||||||||||||
Earnings (loss) per share available (attributable) to Tenet Healthcare Corporation common shareholders: | ||||||||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||||||||
Continuing operations | $ | 3.80 | $ | (2.19) | ||||||||||||||||||||||||||||
Discontinued operations | — | 0.11 | ||||||||||||||||||||||||||||||
$ | 3.80 | $ | (2.08) | |||||||||||||||||||||||||||||
Diluted | ||||||||||||||||||||||||||||||||
Continuing operations | $ | 3.75 | $ | (2.19) | ||||||||||||||||||||||||||||
Discontinued operations | — | 0.11 | ||||||||||||||||||||||||||||||
$ | 3.75 | $ | (2.08) | |||||||||||||||||||||||||||||
Weighted average shares and dilutive securities outstanding (in thousands): | ||||||||||||||||||||||||||||||||
Basic | 105,010 | 103,398 | ||||||||||||||||||||||||||||||
Diluted | 106,263 | 103,398 |
December 31, | December 31, | |||||||||||||
(Dollars in millions) | 2020 | 2019 | ||||||||||||
ASSETS | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 2,446 | $ | 262 | ||||||||||
Accounts receivable | 2,690 | 2,743 | ||||||||||||
Inventories of supplies, at cost | 368 | 310 | ||||||||||||
Income tax receivable | 1 | 10 | ||||||||||||
Assets held for sale | 140 | 387 | ||||||||||||
Other current assets | 1,502 | 1,369 | ||||||||||||
Total current assets | 7,147 | 5,081 | ||||||||||||
Investments and other assets | 2,534 | 2,369 | ||||||||||||
Deferred income taxes | 325 | 183 | ||||||||||||
Property and equipment, at cost, less accumulated depreciation and amortization | 6,692 | 6,878 | ||||||||||||
Goodwill | 8,808 | 7,252 | ||||||||||||
Other intangible assets, at cost, less accumulated amortization | 1,600 | 1,602 | ||||||||||||
Total assets | $ | 27,106 | $ | 23,365 | ||||||||||
LIABILITIES AND EQUITY | ||||||||||||||
Current liabilities: | ||||||||||||||
Current portion of long-term debt | $ | 145 | $ | 171 | ||||||||||
Accounts payable | 1,207 | 1,204 | ||||||||||||
Accrued compensation and benefits | 942 | 877 | ||||||||||||
Professional and general liability reserves | 243 | 330 | ||||||||||||
Accrued interest payable | 248 | 245 | ||||||||||||
Liabilities held for sale | 70 | 44 | ||||||||||||
Contract liabilities | 659 | 61 | ||||||||||||
Other current liabilities | 1,333 | 1,273 | ||||||||||||
Total current liabilities | 4,847 | 4,205 | ||||||||||||
Long-term debt, net of current portion | 15,574 | 14,580 | ||||||||||||
Professional and general liability reserves | 735 | 635 | ||||||||||||
Defined benefit plan obligations | 497 | 560 | ||||||||||||
Deferred income taxes | 29 | 27 | ||||||||||||
Contract liabilities - long-term | 918 | 18 | ||||||||||||
Other long-term liabilities | 1,617 | 1,397 | ||||||||||||
Total liabilities | 24,217 | 21,422 | ||||||||||||
Commitments and contingencies | ||||||||||||||
Redeemable noncontrolling interests in equity of consolidated subsidiaries | 1,952 | 1,506 | ||||||||||||
Equity: | ||||||||||||||
Shareholders’ equity: | ||||||||||||||
Common stock | 7 | 7 | ||||||||||||
Additional paid-in capital | 4,844 | 4,760 | ||||||||||||
Accumulated other comprehensive loss | (281) | (257) | ||||||||||||
Accumulated deficit | (2,128) | (2,513) | ||||||||||||
Common stock in treasury, at cost | (2,414) | (2,414) | ||||||||||||
Total shareholders’ equity (deficit) | 28 | (417) | ||||||||||||
Noncontrolling interests | 909 | 854 | ||||||||||||
Total equity | 937 | 437 | ||||||||||||
Total liabilities and equity | $ | 27,106 | $ | 23,365 |
Twelve Months Ended | ||||||||||||||
(Dollars in millions) | December 31, | |||||||||||||
2020 | 2019 | |||||||||||||
Net income | $ | 768 | $ | 171 | ||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
Depreciation and amortization | 857 | 850 | ||||||||||||
Deferred income tax (benefit) expense | (128) | 144 | ||||||||||||
Stock-based compensation expense | 44 | 42 | ||||||||||||
Impairment and restructuring charges, and acquisition-related costs | 290 | 185 | ||||||||||||
Litigation and investigation costs | 44 | 141 | ||||||||||||
Net losses (gains) on sales, consolidation and deconsolidation of facilities | (14) | 15 | ||||||||||||
Loss from early extinguishment of debt | 316 | 227 | ||||||||||||
Equity in earnings of unconsolidated affiliates, net of distributions received | (37) | (32) | ||||||||||||
Amortization of debt discount and debt issuance costs | 38 | 35 | ||||||||||||
Pre-tax income from discontinued operations | — | (15) | ||||||||||||
Other items, net | (29) | (15) | ||||||||||||
Changes in cash from operating assets and liabilities: | ||||||||||||||
Accounts receivable | 195 | (247) | ||||||||||||
Inventories and other current assets | (145) | (94) | ||||||||||||
Income taxes | 19 | 8 | ||||||||||||
Accounts payable, accrued expenses and other current liabilities | 1,302 | 12 | ||||||||||||
Other long-term liabilities | 221 | 3 | ||||||||||||
Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (333) | (192) | ||||||||||||
Net cash used in operating activities from discontinued operations, excluding income taxes | (1) | (5) | ||||||||||||
Net cash provided by operating activities | 3,407 | 1,233 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||
Purchases of property and equipment — continuing operations | (540) | (670) | ||||||||||||
Purchases of businesses or joint venture interests, net of cash acquired | (1,177) | (25) | ||||||||||||
Proceeds from sales of facilities and other assets — continuing operations | 77 | 63 | ||||||||||||
Proceeds from sales of facilities and other assets — discontinued operations | — | 17 | ||||||||||||
Proceeds from sales of marketable securities, long-term investments and other assets | 59 | 82 | ||||||||||||
Purchases of marketable securities and equity investments | (44) | (62) | ||||||||||||
Other long-term assets | (1) | (24) | ||||||||||||
Other items, net | 18 | — | ||||||||||||
Net cash used in investing activities | (1,608) | (619) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||
Repayments of borrowings under credit facility | (740) | (2,640) | ||||||||||||
Proceeds from borrowings under credit facility | 740 | 2,640 | ||||||||||||
Repayments of other borrowings | (3,293) | (6,131) | ||||||||||||
Proceeds from other borrowings | 3,818 | 5,719 | ||||||||||||
Debt issuance costs | (48) | (70) | ||||||||||||
Distributions paid to noncontrolling interests | (287) | (307) | ||||||||||||
Proceeds from sale of noncontrolling interests | 14 | 21 | ||||||||||||
Purchases of noncontrolling interests | (39) | (11) | ||||||||||||
Proceeds from exercise of stock options and employee stock purchase plan | 23 | 12 | ||||||||||||
Medicare advances and grants received by unconsolidated affiliates | 187 | — | ||||||||||||
Other items, net | 10 | 4 | ||||||||||||
Net cash provided by (used in) financing activities | 385 | (763) | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 2,184 | (149) | ||||||||||||
Cash and cash equivalents at beginning of period | 262 | 411 | ||||||||||||
Cash and cash equivalents at end of period | $ | 2,446 | $ | 262 | ||||||||||
Supplemental disclosures: | ||||||||||||||
Interest paid, net of capitalized interest | $ | (962) | $ | (946) | ||||||||||
Income tax payments, net | $ | (12) | $ | (12) |
(Dollars in millions) | Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||||
Net operating revenues (1) : | |||||||||||||||||||||||||||||
Hospital Operations and other (prior to inter-segment eliminations) (2) | $ | 4,065 | $ | 3,983 | $ | 14,790 | $ | 15,522 | |||||||||||||||||||||
Ambulatory Care | 649 | 632 | 2,072 | 2,158 | |||||||||||||||||||||||||
Conifer | |||||||||||||||||||||||||||||
Tenet | 143 | 141 | 528 | 573 | |||||||||||||||||||||||||
Other clients | 201 | 191 | 778 | 799 | |||||||||||||||||||||||||
Total Conifer revenues | 344 | 332 | 1,306 | 1,372 | |||||||||||||||||||||||||
Inter-segment eliminations | (143) | (141) | (528) | (573) | |||||||||||||||||||||||||
Total | $ | 4,915 | $ | 4,806 | $ | 17,640 | $ | 18,479 | |||||||||||||||||||||
Equity in earnings of unconsolidated affiliates: | |||||||||||||||||||||||||||||
Hospital Operations and other | $ | 5 | $ | 3 | $ | 6 | $ | 15 | |||||||||||||||||||||
Ambulatory Care | 61 | 58 | 163 | 160 | |||||||||||||||||||||||||
Total | $ | 66 | $ | 61 | $ | 169 | $ | 175 | |||||||||||||||||||||
Adjusted EBITDA: | |||||||||||||||||||||||||||||
Hospital Operations and other (3) | $ | 837 | $ | 401 | $ | 1,911 | $ | 1,449 | |||||||||||||||||||||
Ambulatory Care | 330 | 304 | 868 | 895 | |||||||||||||||||||||||||
Conifer | 111 | 94 | 367 | 386 | |||||||||||||||||||||||||
Total | $ | 1,278 | $ | 799 | $ | 3,146 | $ | 2,730 | |||||||||||||||||||||
Adjusted EBITDA margins: | |||||||||||||||||||||||||||||
Hospital Operations and other (including grant income; excluding health plan revenues) | 20.7 | % | 10.1 | % | 12.9 | % | 9.3 | % | |||||||||||||||||||||
Ambulatory Care (including grant income) | 50.8 | % | 48.1 | % | 41.9 | % | 41.5 | % | |||||||||||||||||||||
Conifer | 32.3 | % | 28.3 | % | 28.1 | % | 28.1 | % | |||||||||||||||||||||
Total | 26.1 | % | 16.6 | % | 17.9 | % | 14.8 | % | |||||||||||||||||||||
Adjusted EBITDA margins (excluding grant income and health plan revenue): | |||||||||||||||||||||||||||||
Hospital Operations and other (excluding grant income and health plan revenues) | 10.7 | % | 10.1 | % | 7.4 | % | 9.3 | % | |||||||||||||||||||||
Ambulatory Care (excluding grant income) | 44.7 | % | 48.1 | % | 38.2 | % | 41.5 | % | |||||||||||||||||||||
Conifer | 32.3 | % | 28.3 | % | 28.1 | % | 28.1 | % | |||||||||||||||||||||
Total | 17.0 | % | 16.6 | % | 12.8 | % | 14.8 | % | |||||||||||||||||||||
Capital expenditures: | |||||||||||||||||||||||||||||
Hospital Operations and other | $ | 139 | $ | 149 | $ | 467 | $ | 572 | |||||||||||||||||||||
Ambulatory Care | 19 | 18 | 51 | 75 | |||||||||||||||||||||||||
Conifer | 8 | 11 | 22 | 23 | |||||||||||||||||||||||||
Total | $ | 166 | $ | 178 | $ | 540 | $ | 670 | |||||||||||||||||||||
(1) Net operating revenues include the impact of implicit price concessions and bad debts | |||||||||||||||||||||||||||||
(2) Hospital Operations and other revenues includes health plan revenues of $21 million and $1 million for the twelve months ended December 31, 2020 and 2019, respectively. | |||||||||||||||||||||||||||||
(3) Hospital Operations and other Adjusted EBITDA excludes health plan EBITDA of $20 million and $(2) million for the twelve months ended December 31, 2020 and 2019, respectively. |
(Dollars in millions except per share amounts) | 2020 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net income available to Tenet Healthcare Corporation common shareholders | $ | 414 | $ | 399 | ||||||||||
Net income from discontinued operations | — | — | ||||||||||||
Net income from continuing operations | 414 | 399 | ||||||||||||
Less: Impairment and restructuring charges, and acquisition-related costs | (124) | (290) | ||||||||||||
Litigation and investigation costs | (31) | (44) | ||||||||||||
Net gains on sales, consolidation and deconsolidation of facilities | 10 | 14 | ||||||||||||
Loss from early extinguishment of debt | — | (316) | ||||||||||||
Income from divested and closed businesses | 20 | 20 | ||||||||||||
Noncontrolling interest impact | 1 | 1 | ||||||||||||
Tax impact of above items | 32 | 172 | ||||||||||||
Adjusted net income available from continuing operations to common shareholders | $ | 506 | $ | 842 | ||||||||||
Diluted earnings per share from continuing operations | $ | 3.86 | $ | 3.75 | ||||||||||
Less: Impairment and restructuring charges, and acquisition-related costs | (1.16) | (2.73) | ||||||||||||
Litigation and investigation costs | (0.29) | (0.41) | ||||||||||||
Net gains on sales, consolidation and deconsolidation of facilities | 0.09 | 0.13 | ||||||||||||
Loss from early extinguishment of debt | — | (2.97) | ||||||||||||
Income from divested and closed businesses | 0.19 | 0.18 | ||||||||||||
Noncontrolling interest impact | 0.01 | 0.01 | ||||||||||||
Tax impact of above items | 0.30 | 1.62 | ||||||||||||
Adjusted diluted earnings per share from continuing operations | $ | 4.72 | $ | 7.92 | ||||||||||
Weighted average basic shares outstanding (in thousands) | 105,630 | 105,010 | ||||||||||||
Weighted average dilutive shares outstanding (in thousands) | 107,237 | 106,263 |
(Dollars in millions except per share amounts) | 2019 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net loss attributable to Tenet Healthcare Corporation common shareholders | $ | (3) | $ | (215) | ||||||||||
Net income from discontinued operations | — | 11 | ||||||||||||
Net loss from continuing operations | (3) | (226) | ||||||||||||
Less: Impairment and restructuring charges, and acquisition-related costs | (84) | (185) | ||||||||||||
Litigation and investigation costs | (26) | (141) | ||||||||||||
Net losses on sales, consolidation and deconsolidation of facilities | (12) | (15) | ||||||||||||
Loss from early extinguishment of debt | — | (227) | ||||||||||||
Loss from divested and closed businesses | — | (2) | ||||||||||||
Noncontrolling interest impact | — | 4 | ||||||||||||
Tax impact of above items | 19 | 42 | ||||||||||||
Adjusted net income available from continuing operations to common shareholders | $ | 100 | $ | 298 | ||||||||||
Diluted loss per share from continuing operations | $ | (0.03) | $ | (2.19) | ||||||||||
Less: Impairment and restructuring charges, and acquisition-related costs | (0.79) | (1.76) | ||||||||||||
Litigation and investigation costs | (0.25) | (1.34) | ||||||||||||
Net losses on sales, consolidation and deconsolidation of facilities | (0.11) | (0.14) | ||||||||||||
Loss from early extinguishment of debt | — | (2.16) | ||||||||||||
Loss from divested and closed businesses | — | (0.02) | ||||||||||||
Noncontrolling interest impact | — | 0.04 | ||||||||||||
Tax impact of above items | 0.18 | 0.40 | ||||||||||||
Adjusted diluted earnings per share from continuing operations | $ | 0.95 | $ | 2.84 | ||||||||||
Weighted average basic shares outstanding (in thousands) | 104,048 | 103,398 | ||||||||||||
Weighted average dilutive shares outstanding (in thousands) | 105,666 | 104,855 |
(Dollars in millions) | 2020 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net income available to Tenet Healthcare Corporation common shareholders | $ | 414 | $ | 399 | ||||||||||
Less: Net income available to noncontrolling interests | (132) | (369) | ||||||||||||
Income from discontinued operations, net of tax | — | — | ||||||||||||
Income from continuing operations | 546 | 768 | ||||||||||||
Income tax (expense) benefit | (130) | 97 | ||||||||||||
Loss from early extinguishment of debt | — | (316) | ||||||||||||
Other non-operating (expense) income, net | (2) | 1 | ||||||||||||
Interest expense | (242) | (1,003) | ||||||||||||
Operating income | 920 | 1,989 | ||||||||||||
Litigation and investigation costs | (31) | (44) | ||||||||||||
Net gains on sales, consolidation and deconsolidation of facilities | 10 | 14 | ||||||||||||
Impairment and restructuring charges, and acquisition-related costs | (124) | (290) | ||||||||||||
Depreciation and amortization | (233) | (857) | ||||||||||||
Income from divested and closed businesses | 20 | 20 | ||||||||||||
Adjusted EBITDA | $ | 1,278 | $ | 3,146 | ||||||||||
Net operating revenues | $ | 4,915 | $ | 17,640 | ||||||||||
Less: Net operating revenues from closed health plan business | 21 | 21 | ||||||||||||
Adjusted net operating revenues | $ | 4,894 | $ | 17,619 | ||||||||||
Net income available to Tenet Healthcare Corporation common shareholders as a % of net operating revenues | 8.4 | % | 2.3 | % | ||||||||||
Adjusted EBITDA as a % of Adjusted net operating revenues (Adjusted EBITDA margin) | 26.1 | % | 17.9 | % |
(Dollars in millions) | 2019 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net loss attributable to Tenet Healthcare Corporation common shareholders | $ | (3) | $ | (215) | ||||||||||
Less: Net income available to noncontrolling interests | (127) | (386) | ||||||||||||
Income from discontinued operations, net of tax | — | 11 | ||||||||||||
Income from continuing operations | 124 | 160 | ||||||||||||
Income tax expense | (85) | (160) | ||||||||||||
Loss from early extinguishment of debt | — | (227) | ||||||||||||
Other non-operating expense, net | (2) | (5) | ||||||||||||
Interest expense | (243) | (985) | ||||||||||||
Operating income | 454 | 1,537 | ||||||||||||
Litigation and investigation costs | (26) | (141) | ||||||||||||
Net losses on sales, consolidation and deconsolidation of facilities | (12) | (15) | ||||||||||||
Impairment and restructuring charges, and acquisition-related costs | (84) | (185) | ||||||||||||
Depreciation and amortization | (223) | (850) | ||||||||||||
Loss from divested and closed businesses | — | (2) | ||||||||||||
Adjusted EBITDA | $ | 799 | $ | 2,730 | ||||||||||
Net operating revenues | $ | 4,806 | $ | 18,479 | ||||||||||
Less: Net operating revenues from closed health plan business | — | 1 | ||||||||||||
Adjusted net operating revenues | $ | 4,806 | $ | 18,478 | ||||||||||
Net loss attributable to Tenet Healthcare Corporation common shareholders as a % of net operating revenues | (0.1) | % | (1.2) | % | ||||||||||
Adjusted EBITDA as a % of Adjusted net operating revenues (Adjusted EBITDA margin) | 16.6 | % | 14.8 | % |
(Dollars in millions) | 2020 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net cash provided by operating activities | $ | 446 | $ | 3,407 | ||||||||||
Purchases of property and equipment | (166) | (540) | ||||||||||||
Free cash flow | $ | 280 | $ | 2,867 | ||||||||||
Net cash used in investing activities | $ | (1,202) | $ | (1,608) | ||||||||||
Net cash (used in) provided by financing activities | $ | (98) | $ | 385 | ||||||||||
Net cash provided by operating activities | $ | 446 | $ | 3,407 | ||||||||||
Less: Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (81) | (333) | ||||||||||||
Net cash used in operating activities from discontinued operations | — | (1) | ||||||||||||
Adjusted net cash provided by operating activities from continuing operations | 527 | 3,741 | ||||||||||||
Purchases of property and equipment | (166) | (540) | ||||||||||||
Adjusted free cash flow – continuing operations | $ | 361 | $ | 3,201 |
(Dollars in millions) | 2019 | |||||||||||||
4th Qtr | Full Year | |||||||||||||
Net cash provided by operating activities | $ | 520 | $ | 1,233 | ||||||||||
Purchases of property and equipment | (178) | (670) | ||||||||||||
Free cash flow | $ | 342 | $ | 563 | ||||||||||
Net cash used in investing activities | $ | (193) | $ | (619) | ||||||||||
Net cash used in financing activities | $ | (379) | $ | (763) | ||||||||||
Net cash provided by operating activities | $ | 520 | $ | 1,233 | ||||||||||
Less: Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements | (56) | (192) | ||||||||||||
Net cash used in operating activities from discontinued operations | (1) | (5) | ||||||||||||
Adjusted net cash provided by operating activities from continuing operations | 577 | 1,430 | ||||||||||||
Purchases of property and equipment | (178) | (670) | ||||||||||||
Adjusted free cash flow – continuing operations | $ | 399 | $ | 760 |
(Dollars in millions) | 1Q21 | FY 2021 | ||||||||||||||||||||||||
Low | High | Low | High | |||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | (39) | $ | 41 | $ | 226 | $ | 411 | ||||||||||||||||||
Less: Net income available to noncontrolling interests | (115) | (125) | (545) | (565) | ||||||||||||||||||||||
Income tax expense | (5) | (30) | (150) | (200) | ||||||||||||||||||||||
Interest expense | (250) | (240) | (945) | (935) | ||||||||||||||||||||||
Loss from early extinguishment of debt(1) | (24) | (24) | (24) | (24) | ||||||||||||||||||||||
Other non-operating income (expense), net | (5) | — | — | 10 | ||||||||||||||||||||||
Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements(1) | (50) | (40) | (150) | (100) | ||||||||||||||||||||||
Depreciation and amortization | (215) | (225) | (855) | (875) | ||||||||||||||||||||||
Loss from divested and closed businesses | — | — | (5) | — | ||||||||||||||||||||||
Adjusted EBITDA | $ | 625 | $ | 725 | $ | 2,900 | $ | 3,100 | ||||||||||||||||||
Income (loss) from continuing operations | $ | (39) | $ | 41 | $ | 226 | $ | 411 | ||||||||||||||||||
Net operating revenues | $ | 4,600 | $ | 4,800 | $ | 19,200 | $ | 19,600 | ||||||||||||||||||
Income (loss) from continuing operations as a % of operating revenues | (0.8) | % | 0.9 | % | 1.2 | % | 2.1 | % | ||||||||||||||||||
Adjusted EBITDA as a % of net operating revenues (Adjusted EBITDA margin) | 13.6 | % | 15.1 | % | 15.1 | % | 15.8 | % |
(Dollars in millions except per share amounts) | 1Q21 | FY 2021 | ||||||||||||||||||||||||
Low | High | Low | High | |||||||||||||||||||||||
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders | $ | (39) | $ | 41 | $ | 226 | $ | 411 | ||||||||||||||||||
Net income from discontinued operations, net of tax | — | — | — | — | ||||||||||||||||||||||
Net income (loss) from continuing operations | (39) | 41 | 226 | 411 | ||||||||||||||||||||||
Less: Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements | (50) | (40) | (150) | (100) | ||||||||||||||||||||||
Loss from early extinguishment of debt | (24) | (24) | (24) | (24) | ||||||||||||||||||||||
Loss from divested and closed businesses | — | — | (5) | — | ||||||||||||||||||||||
Tax impact of above items | 10 | 5 | 25 | 15 | ||||||||||||||||||||||
Noncontrolling interests impact of above items | — | — | — | — | ||||||||||||||||||||||
Adjusted net income available from continuing operations to common shareholders | $ | 25 | $ | 100 | $ | 380 | $ | 520 | ||||||||||||||||||
Diluted earnings (loss) per share from continuing operations | $ | (0.37) | $ | 0.38 | $ | 2.09 | $ | 3.81 | ||||||||||||||||||
Less: Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements | (0.47) | (0.38) | (1.39) | (0.92) | ||||||||||||||||||||||
Loss from early extinguishment of debt | (0.22) | (0.22) | (0.22) | (0.22) | ||||||||||||||||||||||
Loss from divested and closed businesses | — | — | (0.05) | — | ||||||||||||||||||||||
Tax impact of above items | 0.09 | 0.05 | 0.23 | 0.14 | ||||||||||||||||||||||
Noncontrolling interests impact of above items | — | — | — | — | ||||||||||||||||||||||
Adjusted diluted earnings per share from continuing operations | $ | 0.23 | $ | 0.93 | $ | 3.52 | $ | 4.81 | ||||||||||||||||||
Weighted average basic shares outstanding (in thousands) | 106,000 | 106,000 | 107,000 | 107,000 | ||||||||||||||||||||||
Weighted average dilutive shares outstanding (in thousands) | 107,000 | 107,000 | 108,000 | 108,000 |
(Dollars in millions) | FY 2021 | |||||||||||||||||||||||||||||||
Low | High | |||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 1,075 | $ | 1,375 | ||||||||||||||||||||||||||||
Purchases of property and equipment – continuing operations | (700) | (750) | ||||||||||||||||||||||||||||||
Free cash flow – continuing operations | $ | 375 | $ | 625 | ||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 1,075 | $ | 1,375 | ||||||||||||||||||||||||||||
Less: Payments for restructuring charges, acquisition-related costs and litigation costs and settlements(1) | (150) | (100) | ||||||||||||||||||||||||||||||
Adjusted net cash provided by operating activities – continuing operations | 1,225 | 1,475 | ||||||||||||||||||||||||||||||
Purchases of property and equipment – continuing operations | (700) | (750) | ||||||||||||||||||||||||||||||
Adjusted free cash flow – continuing operations(2) | $ | 525 | $ | 725 |
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