Financial Information for the Company and Its Subsidiaries

The 2020 Senior Unsecured Notes and 2022 Senior Unsecured Notes are senior unsecured obligations of the Company and are guaranteed by its existing and subsequently acquired or organized 100% owned domestic subsidiaries. The 2020 Senior Unsecured Notes and 2022 Senior Unsecured Notes are guaranteed on a full and unconditional and joint and several basis, with limited exceptions considered customary for such guarantees, including the release of the guarantee when a subsidiary's assets are sold. The following condensed consolidating financial statements present the Company (as parent issuer), the subsidiary guarantors, the subsidiary non-guarantors and consolidating adjustments. These condensed consolidating financial statements have been prepared and presented in accordance with Rule 3-10 of Regulation S-X “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” The operating and investing activities of the separate legal entities are fully interdependent and integrated. Accordingly, the results of the separate legal entities are not representative of what the operating results would be on a stand-alone basis.



Condensed Consolidating Balance Sheet - March 31, 2015 (In thousands)
	Parent Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Assets
Current assets:
Cash and cash equivalents	$	30,118	$	38,681	$	47,357	$	—		$	116,156
Restricted cash and marketable securities	—		—		10,957		—			10,957
Accounts receivable, net	—		130,807		113,195		—			244,002
Supplies inventory	—		286		20,187		—			20,473
Prepaid and other current assets	51,155		32,196		19,729		(5,719		)	97,361
Total current assets	81,273		201,970		211,425		(5,719		)	488,949
Property and equipment, net	11,910		8,665		162,871		—			183,446
Investments in and receivables from unconsolidated affiliates	4,025,683		1,635,845		—		(5,582,217		)	79,311
Goodwill	—		1,549,964		—		1,950,704			3,500,668
Intangible assets, net	66,001		1,237,487		2,779		—			1,306,267
Other assets	3,734		1,040		20,594		—			25,368
Total assets	$	4,188,601	$	4,634,971	$	397,669	$	(3,637,232	)	$	5,584,009
Liabilities and Equity
Current liabilities:
Current portion of long-term debt	$	8,700	$	—	$	10,158	$	—		$	18,858
Accounts payable	2,255		224		28,256		(4,927		)	25,808
Accrued salaries and benefits	19,652		111,525		13,430		—			144,607
Accrued interest	17,840		—		17		—			17,857
Other accrued liabilities	7,272		39,909		29,312		(792		)	75,701
Total current liabilities	55,719		151,658		81,173		(5,719		)	282,831
Long-term debt	2,204,775		—		56,204		(30,985		)	2,229,994
Deferred income taxes	218,564		429,880		—		—			648,444
Other long-term liabilities	7,867		65,622		18,996		—			92,485
Intercompany payable	—		1,228,136		21		(1,228,157		)	—
Noncontrolling interests – redeemable	—		—		62,793		120,666			183,459
Equity:
Total AmSurg Corp. equity	1,701,676		2,759,675		132,731		(2,892,406		)	1,701,676
Noncontrolling interests – non-redeemable	—		—		45,751		399,369			445,120
Total equity	1,701,676		2,759,675		178,482		(2,493,037		)	2,146,796
Total liabilities and equity	$	4,188,601	$	4,634,971	$	397,669	$	(3,637,232	)	$	5,584,009



Condensed Consolidating Balance Sheet - December 31, 2014 (In thousands)
	Parent Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Assets
Current assets:
Cash and cash equivalents	$	134,351	$	23,471	$	50,257	$	—		$	208,079
Restricted cash and marketable securities	—		—		10,219		—			10,219
Accounts receivable, net	—		123,772		109,281		—			233,053
Supplies inventory	—		301		19,673		—			19,974
Prepaid and other current assets	47,997		58,388		13,795		(4,818		)	115,362
Total current assets	182,348		205,932		203,225		(4,818		)	586,687
Property and equipment, net	10,391		9,972		160,085		—			180,448
Investments in and receivables from unconsolidated affiliates	3,912,804		1,587,881		—		(5,425,210		)	75,475
Goodwill	—		1,490,981		—		1,890,168			3,381,149
Intangible assets, net	67,678		1,203,218		2,983		—			1,273,879
Other assets	3,323		943		23,086		(1,466		)	25,886
Total assets	$	4,176,544	$	4,498,927	$	389,379	$	(3,541,326	)	$	5,523,524
Liabilities and Equity
Current liabilities:
Current portion of long-term debt	$	8,700	$	—	$	10,126	$	—		$	18,826
Accounts payable	1,849		35		31,781		(4,080		)	29,585
Accrued salaries and benefits	25,035		101,395		13,614		—			140,044
Accrued interest	29,621		—		23		—			29,644
Other accrued liabilities	8,051		44,305		16,368		(738		)	67,986
Total current liabilities	73,256		145,735		71,912		(4,818		)	286,085
Long-term debt	2,206,950		—		53,648		(28,412		)	2,232,186
Deferred income taxes	209,400		425,546		—		(1,466		)	633,480
Other long-term liabilities	7,391		63,616		18,436		—			89,443
Intercompany payable	—		1,219,979		8,010		(1,227,989		)	—
Noncontrolling interests – redeemable	—		—		63,544		120,555			184,099
Equity:
Total AmSurg Corp. equity	1,679,547		2,644,051		130,206		(2,774,257		)	1,679,547
Noncontrolling interests – non-redeemable	—		—		43,623		375,061			418,684
Total equity	1,679,547		2,644,051		173,829		(2,399,196		)	2,098,231
Total liabilities and equity	$	4,176,544	$	4,498,927	$	389,379	$	(3,541,326	)	$	5,523,524



Condensed Consolidating Statement of Earnings - For the Three Months Ended March 31, 2015 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Net revenue	$	7,091		$	285,579		$	286,629		$	(8,854	)	$	570,445
Operating expenses:
Salaries and benefits	17,643			211,601			73,063			(128		)	302,179
Supply cost	—			396			42,188			—			42,584
Other operating expenses	6,634			29,611			63,051			(8,726		)	90,570
Transaction costs	268			1,203			—			—			1,471
Depreciation and amortization	834			14,307			7,677			—			22,818
Total operating expenses	25,379			257,118			185,979			(8,854		)	459,622
Loss on deconsolidation	(188		)	(188		)	(35		)	188			(223		)
Equity in earnings of unconsolidated affiliates	60,387			54,583			—			(112,319		)	2,651
Operating income	41,911			82,856			100,615			(112,131		)	113,251
Interest expense, net	11,886			17,754			607			—			30,247
Earnings from operations before income taxes	30,025			65,102			100,008			(112,131		)	83,004
Income tax expense	8,987			4,903			359			—			14,249
Net earnings	21,038			60,199			99,649			(112,131		)	68,755
Net earnings attributable to noncontrolling interests	—			—			47,717			—			47,717
Net earnings attributable to AmSurg Corp. shareholders	21,038			60,199			51,932			(112,131		)	21,038
Preferred stock dividends	(2,264		)	—			—			—			(2,264		)
Net earnings attributable to AmSurg Corp. common shareholders	$	18,774		$	60,199		$	51,932		$	(112,131	)	$	18,774



Condensed Consolidating Statement of Earnings - For the Three Months Ended March 31, 2014 (In thousands)
	Parent Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Net revenue	$	6,127		$	—	$	258,043	$	(4,609	)	$	259,561
Operating expenses:
Salaries and benefits	14,485			—		67,785		(121		)	82,149
Supply cost	—			—		37,805		—			37,805
Other operating expenses	4,166			—		54,491		(4,488		)	54,169
Depreciation and amortization	825			—		7,434		—			8,259
Total operating expenses	19,476			—		167,515		(4,609		)	182,382
Gain on deconsolidation	2,045			2,045		—		(2,045		)	2,045
Equity in earnings of unconsolidated affiliates	48,052			48,052		—		(95,340		)	764
Operating income	36,748			50,097		90,528		(97,385		)	79,988
Interest expense	6,452			—		508		—			6,960
Earnings from continuing operations before income taxes	30,296			50,097		90,020		(97,385		)	73,028
Income tax expense	12,704			—		278		—			12,982
Net earnings from continuing operations	17,592			50,097		89,742		(97,385		)	60,046
Net earnings (loss) from discontinued operations	(397		)	—		465		—			68
Net earnings	17,195			50,097		90,207		(97,385		)	60,114
Net earnings attributable to noncontrolling interests	—			—		42,919		—			42,919
Net earnings attributable to AmSurg Corp. common shareholders	$	17,195		$	50,097	$	47,288	$	(97,385	)	$	17,195
Amounts attributable to AmSurg Corp. common shareholders:
Earnings from continuing operations, net of income tax	$	17,592		$	50,097	$	47,088	$	(97,385	)	$	17,392
Discontinued operations, net of income tax	(397		)	—		200		—			(197		)
Net earnings attributable to AmSurg Corp. common shareholders	$	17,195		$	50,097	$	47,288	$	(97,385	)	$	17,195



Condensed Consolidating Statement of Cash Flows - For the Three Months Ended March 31, 2015 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Cash flows from operating activities:
Net cash flows provided by (used in) operating activities	$	(33,779	)	$	91,981		$	102,821		$	(62,196	)	$	98,827
Cash flows from investing activities:
Acquisitions and related expenses	(62,056		)	(127,047		)	—			62,525			(126,578		)
Acquisition of property and equipment	(2,678		)	(2,538		)	(9,567		)	—			(14,783		)
Other	—			(1,322		)	1,102			—			(220		)
Net cash flows used in investing activities	(64,734		)	(130,907		)	(8,465		)	62,525			(141,581		)
Cash flows from financing activities:
Proceeds from long-term borrowings	—			—			2,227			—			2,227
Repayment on long-term borrowings	(2,175		)	—			(3,038		)	—			(5,213		)
Distributions to owners, including noncontrolling interests	—			(10,241		)	(99,157		)	62,196			(47,202		)
Capital contributions	—			62,056			—			(62,056		)	—
Cash dividends for preferred shares	(2,264		)	—			—			—			(2,264		)
Changes in intercompany balances with affiliates, net	(2,573		)	—			2,573			—			—
Other financing activities, net	1,292			2,321			139			(469		)	3,283
Net cash flows provided by (used in) financing activities	(5,720		)	54,136			(97,256		)	(329		)	(49,169		)
Net increase (decrease) in cash and cash equivalents	(104,233		)	15,210			(2,900		)	—			(91,923		)
Cash and cash equivalents, beginning of period	134,351			23,471			50,257			—			208,079
Cash and cash equivalents, end of period	$	30,118		$	38,681		$	47,357		$	—		$	116,156



Condensed Consolidating Statement of Cash Flows - For the Three Months Ended March 31, 2014 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Cash flows from operating activities:
Net cash flows provided by operating activities	$	18,482		$	48,096		$	96,257		$	(93,016	)	$	69,819
Cash flows from investing activities:
Acquisitions and related expenses	—			(5,082		)	—			44			(5,038		)
Acquisition of property and equipment	(1,237		)	—			(5,801		)	—			(7,038		)
Proceeds from sale of interests in surgery centers	—			1,111			—			—			1,111
Other	(629		)	211			—			—			(418		)
Net cash flows used in investing activities	(1,866		)	(3,760		)	(5,801		)	44			(11,383		)
Cash flows from financing activities:
Proceeds from long-term borrowings	30,000			—			1,945			—			31,945
Repayment on long-term borrowings	(47,679		)	—			(3,174		)	—			(50,853		)
Distributions to owners, including noncontrolling interests	—			(44,920		)	(91,290		)	93,016			(43,194		)
Changes in intercompany balances with affiliates, net	556			—			(556		)	—			—
Other financing activities, net	(641		)	584			43			(44		)	(58		)
Net cash flows used in financing activities	(17,764		)	(44,336		)	(93,032		)	92,972			(62,160		)
Net decrease in cash and cash equivalents	(1,148		)	—			(2,576		)	—			(3,724		)
Cash and cash equivalents, beginning of period	6,710			—			44,130			—			50,840
Cash and cash equivalents, end of period	$	5,562		$	—		$	41,554		$	—		$	47,116