[August 04, 2015] |
|
AmSurg Reports Second-Quarter Adjusted Diluted EPS of $0.97 and Diluted EPS of $0.65
AmSurg Corp. (NASDAQ: AMSG) today announced financial results for the
second quarter ended June 30, 2015. The Company's results for the
quarter included:
-
Net revenues of $642.0 million, an increase of 131% from the second
quarter of 2014;
-
Net earnings from continuing operations attributable to AmSurg common
shareholders of $31.4 million. Adjusted net earnings of $49.9 million
increased 131% from the second quarter of 2014;
-
Net earnings per diluted share from continuing operations attributable
to AmSurg common shareholders of $0.65 and adjusted net earnings per
diluted share of $0.97, up 45% on 59% higher diluted shares
outstanding; and
-
Adjusted EBITDA of $128.0 million, a 148% increase from the second
quarter of 2014.
See page 6 for a reconciliation of all GAAP and non-GAAP financial
results.
"AmSurg produced strong growth for the second quarter, which
significantly exceeded our expectations," said Christopher A. Holden,
President and Chief Executive Officer of AmSurg. "Our performance was
driven by successful execution of our organic growth and acquisition
strategies in both our Ambulatory and Physicians Services businesses.
The combination of AmSurg and Sheridan continues to be catalytic for
both operating divisions.
"For the second quarter of 2015, Ambulatory Services produced
same-center revenue growth of 5.1%, driven by improved reimbursement,
case mix and increased volumes. Physician Services produced
same-contract revenue growth of 14.3%. Volumes continued to strengthen
over prior-year trends, contributing 3.8% to this revenue growth and led
primarily by neonatology and radiology encounters. Revenue per encounter
increased 10.5% for the quarter, reflecting the continued growth in
Florida exchange revenues, increased acuity, annual increases in
contracted rates and higher reimbursement trends at several prior-year
platform acquisitions. Our organic growth drove improved margins for the
quarter and supports the increase in our financial guidance for the full
year.
"During the second quarter, we purchased two ambulatory surgery centers
(ASCs) and an anesthesia practice. Subsequent to the quarter end, we
acquired a multi-specialty ASC and the previously announced acquisition
of Coastal Anesthesiology Consultants. In addition, we are pleased to
announce the acquisition of Bay Area Anesthesia, LLC, which delivers
both inpatient and outpatient anesthesia services at seven healthcare
facilities in the Tampa market, including three locations affiliated
with BayCare Health System and two ASCs that are owned jointly by AmSurg
and BayCare Health System. With these transactions, we have exceeded our
2015 capital expenditure target of $200 million for acquisitions. We
remain well positioned to act on additional acquisition opportunities
across both operating divisions in 2015, and as indicated by our recent
transactions, we have a robust pipeline of potential opportunities."
Ambulatory Services
Net revenues for Ambulatory Services grew 12% to $311.0 million for the
second quarter of 2015 from $278.2 million for the second quarter of
2014. Same-center revenue rose 5.1% for second quarter of 2015 compared
with the second quarter of 2014, comprised of a 1.3% increase in
procedures and a 3.8% increase in net revenue per procedure. Adjusted
EBITDA was $60.3 million for the second quarter of 2015, a 17% increase
from $51.6 million for the second quarter of 2014, while adjusted EBITDA
margin increased 80 basis points to 19.4% from 18.6%.
Ambulatory Services acquired two ASCs during the second quarter and
ended the quarter with 250 centers. Ambulatory Services had six centers
under letter of intent at the end of the second quarter, one of which
has already been acquired in the third quarter. There were also two
centers under development at the end of the second quarter, one of which
is expected to open in late 2015.
Physician Services
For the second quarter of 2015, net revenues for Physician Services were
$331.0 million. Adjusted EBITDA was $67.7 million for the quarter, and
adjusted EBITDA margin was 20.4%.
Comparable-quarter revenue growth for Physician Services was 24.3%, of
which 10.9% was from same-contract revenues, 1.6% from net new contract
revenues and 11.8% from acquisition revenues. Same-contract growth in
net revenues totaled 14.3% for the second quarter of 2015, comprised of
a 3.8% increase in patient encounters and a 10.5% increase in net
revenue per patient encounter.
Physician Services completed the acquisition of one anesthesiology
practice during the second quarter and has acquired two additional
anesthesiology practices since the end of the quarter.
Liquidity
AmSurg had cash and cash equivalents of $126.3 million at the end of the
second quarter and availability of $300 million under its revolving
credit facility. Net cash flows from operations, less distributions to
noncontrolling interests, were $98.7 million for the second quarter. The
Company's ratio of total debt at the end of the second quarter of 2015
to trailing 12 months EBITDA as calculated under the Company's credit
agreement was 4.7.
Guidance
AmSurg today has raised its financial and operating guidance for 2015
and established its financial guidance for the third quarter of the
year. The Company's guidance for adjusted net earnings per diluted share
from continuing operations attributable to common shareholders
("Adjusted EPS") excludes transaction and severance costs related to
acquisitions, acquisition-related amortization expense, gains and losses
on deconsolidations, share-based compensation expense and changes in
contingent purchase price consideration. The Company's guidance is as
follows:
-
Revenues in a range of $2.50 billion to $2.52 billion, up from a range
of $2.46 billion to $2.49 billion;
-
Same-center revenue increase of 3% to 4% for Ambulatory Services,
compared with the prior range of 2% to 3%; same-contract revenue
growth of 8% to 10% in Physician Services, up from a range of 6% to 8%;
-
Adjusted EBITDA of $474 million to $480 million, up from a range of
$454 million to $460 million;
-
Adjusted EPS in a range of $3.52 to $3.59, up from a range of $3.31 to
$3.39; and
-
For the third quarter of 2015, adjusted EPS in a range of $0.92 to
$0.95.
The information contained in the preceding paragraphs, including
information regarding the Company's financial results for future
periods, is forward-looking information. Forward-looking information
involves known and unknown risks and uncertainties as described below.
There can be no assurance that AmSurg will attain the financial targets
set forth in this press release. The Company's actual results and
performance could differ materially from those expressed or implied by
the forward-looking information contained in this press release.
Non-GAAP adjusted earnings per share guidance for the second quarter and
full year of 2015 exclude acquisition-related transaction costs,
acquisition-related amortization expense, gains and losses on future
deconsolidation transactions and share-based compensation expense, net
of the tax impact thereon, the exact amount of which are not currently
determinable but may be significant and may vary significantly from
period to period (see page 6 for a reconciliation of all GAAP and
non-GAAP financial results).
Conference Call
AmSurg Corp. will hold a conference call to discuss this release
Tuesday, August 4, 2015, at 5:00 p.m. Eastern time. Investors will have
the opportunity to listen to the conference call over the Internet by
going to www.amsurg.com
and clicking "Investors" at least 15 minutes early to register,
download, and install any necessary audio software. For those who cannot
listen to the live broadcast, a replay will be available at these sites
shortly after the call and continue for 30 days.
Safe Harbor
This press release contains forward-looking statements. These
statements, which have been included in reliance on the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995,
involve risks and uncertainties. Investors are hereby cautioned that
these statements may be affected by important factors, including, but
not limited to, the following risks: we may face challenges managing our
Physician Services Division as a new business and may not realize
anticipated benefits; we may become subject to investigations by federal
and state entities and unpredictable impacts of the Health Reform Law;
we may not be able to successfully maintain effective internal controls
over financial reporting; we may not be able to implement our business
strategy, manage the growth in our business, and integrate acquired
businesses; our substantial indebtedness and restrictions in our debt
instruments could adversely affect our business or our ability to
implement our growth strategy, or limit our ability to react to changes
in the economy or our industry; we may not generate sufficient cash to
service our indebtedness; regulatory changes may obligate us to buy out
interests of physicians who are minority owners of our surgery centers;
we may not be able to successfully maintain our information systems and
processes, implement new systems and processes, and maintain the
security of those systems and processes; we may be subject to litigation
and investigations and liability claims for damages and other expenses
not covered by insurance; we may be required to write-off a portion of
our intangible assets; payments from third-party payors, including
government healthcare programs, may decrease or not increase as our
costs increase; there may be adverse developments affecting the medical
practices of our physician partners; we may not be able to maintain
favorable relations with our physician partners; we may not be able to
grow our ambulatory services revenue by increasing procedure volume
while maintaining operating margins and profitability at our existing
surgery centers; we may not be able to compete for physician partners,
managed care contracts, patients and strategic relationships; adverse
weather and other factors beyond our control may affect our business; we
may be adversely impacted by changes in patient volume and patient mix;
several client relationships generate a significant portion of our
physician services revenues; our physician services contracts may be
cancelled or not renewed or we may not be able to enter into additional
contracts under terms acceptable to us; reimbursement rates, revenue and
profit margin under our fee-for-service physician services payor
contracts may decrease; we may not be able to timely or accurately bill
for services; we may not be able to enroll our physician services
providers in the Medicare and Medicaid programs on a timely basis; our
strategic partnerships with healthcare providers may not be successful;
we may not be able to successfully recruit and retain physicians, nurses
and other clinical providers; we may not be able to accurately assess
the costs we will incur under new contracts; our margins may be
negatively impacted by cross-selling to existing clients or selling
bundled services to new clients; we may not be able to enforce
non-compete agreements with our physicians and other clinical employees
in some jurisdictions; there may be unfavorable changes in regulatory,
economic and other conditions in the states where we operate;
legislative or regulatory action may make our captive insurance company
arrangement less feasible or otherwise reduce our profitability; our
reserves with respect to our losses covered under our insurance programs
may not be sufficient; and the other risk factors are described in
AmSurg's Annual Report on Form 10-K for the fiscal year ended December
31, 2014, as updated by other filings with the Securities and Exchange
Commission. Consequently, actual results, performance or developments
may differ materially from the forward-looking statements included
above. AmSurg disclaims any intent or obligation to update these
forward-looking statements.
About AmSurg
AmSurg's Ambulatory Services Division acquires, develops and operates
ambulatory surgery centers in partnership with physicians throughout the
U.S. AmSurg's Physician Services Division, Sheridan, provides outsourced
physician services in multiple specialties to hospitals, ASCs and other
healthcare facilities throughout the U.S., primarily in the areas of
anesthesiology, children's services, emergency medicine and radiology.
Through these businesses as of June 30, 2015, AmSurg owned and operated
250 ASCs in 34 states and provided physician services to more than 350
healthcare facilities in 27 states. AmSurg has partnerships with, or
employs, over 5,000 physicians in 38 states and the District of Columbia.
|
|
|
|
AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data
(In thousands, except earnings per share)
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
Statement of Earnings Data:
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Revenues
|
|
|
$
|
707,733
|
|
|
|
$
|
278,227
|
|
|
|
$
|
1,345,930
|
|
|
|
$
|
537,788
|
|
Provision for uncollectibles
|
|
|
|
(65,783
|
)
|
|
|
|
-
|
|
|
|
|
(133,535
|
)
|
|
|
|
-
|
|
Net revenue
|
|
|
|
641,950
|
|
|
|
|
278,227
|
|
|
|
|
1,212,395
|
|
|
|
|
537,788
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
|
|
320,396
|
|
|
|
|
84,053
|
|
|
|
|
622,575
|
|
|
|
|
166,202
|
|
Supply cost
|
|
|
|
45,790
|
|
|
|
|
40,873
|
|
|
|
|
88,374
|
|
|
|
|
78,678
|
|
Other operating expenses
|
|
|
|
105,002
|
|
|
|
|
55,812
|
|
|
|
|
195,572
|
|
|
|
|
109,981
|
|
Transaction costs
|
|
|
|
1,982
|
|
|
|
|
3,579
|
|
|
|
|
3,453
|
|
|
|
|
3,579
|
|
Depreciation and amortization
|
|
|
|
23,612
|
|
|
|
|
8,436
|
|
|
|
|
46,430
|
|
|
|
|
16,695
|
|
Total operating expenses
|
|
|
|
496,782
|
|
|
|
|
192,753
|
|
|
|
|
956,404
|
|
|
|
|
375,135
|
|
Gain (loss) on deconsolidation
|
|
|
|
(3,035
|
)
|
|
|
|
1,366
|
|
|
|
|
(3,258
|
)
|
|
|
|
3,411
|
|
Equity in earnings of unconsolidated affiliates
|
|
|
|
3,989
|
|
|
|
|
539
|
|
|
|
|
6,640
|
|
|
|
|
1,303
|
|
Operating income
|
|
|
|
146,122
|
|
|
|
|
87,379
|
|
|
|
|
259,373
|
|
|
|
|
167,367
|
|
Interest expense, net
|
|
|
|
30,182
|
|
|
|
|
6,892
|
|
|
|
|
60,429
|
|
|
|
|
13,852
|
|
Earnings from continuing operations before income taxes
|
|
|
|
115,940
|
|
|
|
|
80,487
|
|
|
|
|
198,944
|
|
|
|
|
153,515
|
|
Income tax expense
|
|
|
|
25,193
|
|
|
|
|
12,798
|
|
|
|
|
39,442
|
|
|
|
|
25,780
|
|
Net earnings from continuing operations
|
|
|
|
90,747
|
|
|
|
|
67,689
|
|
|
|
|
159,502
|
|
|
|
|
127,735
|
|
Net earnings from discontinued operations
|
|
|
|
-
|
|
|
|
|
483
|
|
|
|
|
-
|
|
|
|
|
551
|
|
Net earnings
|
|
|
|
90,747
|
|
|
|
|
68,172
|
|
|
|
|
159,502
|
|
|
|
|
128,286
|
|
Less net earnings attributable to noncontrolling interests
|
|
|
|
57,072
|
|
|
|
|
49,211
|
|
|
|
|
104,789
|
|
|
|
|
92,130
|
|
Net earnings attributable to AmSurg Corp. shareholders
|
|
|
|
33,675
|
|
|
|
|
18,961
|
|
|
|
|
54,713
|
|
|
|
|
36,156
|
|
Preferred stock dividends
|
|
|
|
(2,264
|
)
|
|
|
|
-
|
|
|
|
|
(4,528
|
)
|
|
|
|
-
|
|
Net earnings attributable to AmSurg Corp. common shareholders
|
|
|
$
|
31,411
|
|
|
|
$
|
18,961
|
|
|
|
$
|
50,185
|
|
|
|
$
|
36,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to AmSurg Corp. common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing operations, net of income tax
|
|
|
$
|
31,411
|
|
|
|
$
|
18,771
|
|
|
|
$
|
50,185
|
|
|
|
$
|
36,163
|
|
Earnings (loss) from discontinued operations, net of income tax
|
|
|
|
-
|
|
|
|
|
190
|
|
|
|
|
-
|
|
|
|
|
(7
|
)
|
Net earnings attributable to AmSurg Corp. common shareholders
|
|
|
$
|
31,411
|
|
|
|
$
|
18,961
|
|
|
|
$
|
50,185
|
|
|
|
$
|
36,156
|
|
Basic earnings per share attributable to AmSurg Corp. common
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings from continuing operations
|
|
|
$
|
0.66
|
|
|
|
$
|
0.59
|
|
|
|
$
|
1.05
|
|
|
|
$
|
1.14
|
|
Net earnings from discontinued operations
|
|
|
|
-
|
|
|
|
|
0.01
|
|
|
|
|
-
|
|
|
|
|
-
|
|
Net earnings
|
|
|
$
|
0.66
|
|
|
|
$
|
0.60
|
|
|
|
$
|
1.05
|
|
|
|
$
|
1.14
|
|
Diluted earnings per share attributable to AmSurg Corp. common
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings from continuing operations
|
|
|
$
|
0.65
|
|
|
|
$
|
0.58
|
|
|
|
$
|
1.05
|
|
|
|
$
|
1.12
|
|
Net earnings from discontinued operations
|
|
|
|
-
|
|
|
|
|
0.01
|
|
|
|
|
-
|
|
|
|
|
-
|
|
Net earnings
|
|
|
$
|
0.65
|
|
|
|
$
|
0.59
|
|
|
|
$
|
1.05
|
|
|
|
$
|
1.12
|
|
Weighted average number of shares and share equivalents outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
47,678
|
|
|
|
|
31,825
|
|
|
|
|
47,625
|
|
|
|
|
31,770
|
|
Diluted
|
|
|
|
48,099
|
|
|
|
|
32,233
|
|
|
|
|
48,002
|
|
|
|
|
32,177
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data,
continued
(In thousands, except earnings per share)
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Reconciliation of net earnings to Adjusted net earnings (1):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to AmSurg Corp. shareholders
|
|
|
$
|
33,675
|
|
|
|
$
|
18,961
|
|
|
|
$
|
54,713
|
|
|
|
$
|
36,156
|
|
(Earnings) loss from discontinued operations
|
|
|
|
-
|
|
|
|
|
(312
|
)
|
|
|
|
-
|
|
|
|
|
16
|
|
Amortization of purchased intangibles
|
|
|
|
12,490
|
|
|
|
|
-
|
|
|
|
|
24,912
|
|
|
|
|
-
|
|
Share-based compensation
|
|
|
|
3,883
|
|
|
|
|
2,506
|
|
|
|
|
7,592
|
|
|
|
|
4,964
|
|
Net change in fair value of contingent consideration
|
|
|
|
6,410
|
|
|
|
|
-
|
|
|
|
|
6,410
|
|
|
|
|
-
|
|
(Gain) loss on deconsolidation
|
|
|
|
3,035
|
|
|
|
|
(1,366
|
)
|
|
|
|
3,258
|
|
|
|
|
(3,411
|
)
|
Transaction costs
|
|
|
|
1,982
|
|
|
|
|
3,579
|
|
|
|
|
3,453
|
|
|
|
|
3,579
|
|
Total pre-tax adjustments
|
|
|
|
27,800
|
|
|
|
|
4,407
|
|
|
|
|
45,625
|
|
|
|
|
5,148
|
|
Tax effect
|
|
|
|
11,593
|
|
|
|
|
1,769
|
|
|
|
|
18,723
|
|
|
|
|
1,394
|
|
Total adjustments, net
|
|
|
|
16,207
|
|
|
|
|
2,638
|
|
|
|
|
26,902
|
|
|
|
|
3,754
|
|
Adjusted net earnings
|
|
|
$
|
49,882
|
|
|
|
$
|
21,599
|
|
|
|
$
|
81,615
|
|
|
|
$
|
39,910
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic shares outstanding
|
|
|
|
47,678
|
|
|
|
|
31,825
|
|
|
|
|
47,625
|
|
|
|
|
31,770
|
|
Effect of dilutive securities, options and non-vested shares
|
|
|
|
3,550
|
|
|
|
|
408
|
|
|
|
|
3,518
|
|
|
|
|
407
|
|
Diluted shares outstanding, if converted
|
|
|
|
51,228
|
|
|
|
|
32,233
|
|
|
|
|
51,143
|
|
|
|
|
32,177
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per share
|
|
|
$
|
0.97
|
|
|
|
$
|
0.67
|
|
|
|
$
|
1.60
|
|
|
|
$
|
1.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of net earnings to Adjusted EBITDA (2):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to AmSurg Corp. shareholders
|
|
|
$
|
33,675
|
|
|
|
$
|
18,961
|
|
|
|
$
|
54,713
|
|
|
|
$
|
36,156
|
|
(Earnings) loss from discontinued operations
|
|
|
|
-
|
|
|
|
|
(190
|
)
|
|
|
|
-
|
|
|
|
|
7
|
|
Interest expense, net
|
|
|
|
30,182
|
|
|
|
|
6,892
|
|
|
|
|
60,429
|
|
|
|
|
13,852
|
|
Income tax expense
|
|
|
|
25,193
|
|
|
|
|
12,798
|
|
|
|
|
39,442
|
|
|
|
|
25,780
|
|
Depreciation and amortization
|
|
|
|
23,612
|
|
|
|
|
8,436
|
|
|
|
|
46,430
|
|
|
|
|
16,695
|
|
EBITDA
|
|
|
|
112,662
|
|
|
|
|
46,897
|
|
|
|
|
201,014
|
|
|
|
|
92,490
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in fair value of contingent consideration
|
|
|
|
6,410
|
|
|
|
|
-
|
|
|
|
|
6,410
|
|
|
|
|
-
|
|
Share-based compensation
|
|
|
|
3,883
|
|
|
|
|
2,506
|
|
|
|
|
7,592
|
|
|
|
|
4,964
|
|
Transaction costs
|
|
|
|
1,982
|
|
|
|
|
3,579
|
|
|
|
|
3,453
|
|
|
|
|
3,579
|
|
(Gain) loss on deconsolidation
|
|
|
|
3,035
|
|
|
|
|
(1,366
|
)
|
|
|
|
3,258
|
|
|
|
|
(3,411
|
)
|
Total adjustments
|
|
|
|
15,310
|
|
|
|
|
4,719
|
|
|
|
|
20,713
|
|
|
|
|
5,132
|
|
Adjusted EBITDA
|
|
|
$
|
127,972
|
|
|
|
$
|
51,616
|
|
|
|
$
|
221,727
|
|
|
|
$
|
97,622
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
Ambulatory Services Adjusted EBITDA
|
|
|
$
|
60,304
|
|
|
|
$
|
51,616
|
|
|
|
$
|
107,612
|
|
|
|
$
|
97,622
|
|
Physician Services Adjusted EBITDA
|
|
|
|
67,668
|
|
|
|
|
-
|
|
|
|
|
114,115
|
|
|
|
|
-
|
|
Adjusted EBITDA
|
|
|
$
|
127,972
|
|
|
|
$
|
51,616
|
|
|
|
$
|
221,727
|
|
|
|
$
|
97,622
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue by Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Ambulatory Services
|
|
|
$
|
310,991
|
|
|
|
$
|
278,227
|
|
|
|
$
|
594,901
|
|
|
|
$
|
537,788
|
|
Physician Services
|
|
|
|
330,959
|
|
|
|
|
-
|
|
|
|
|
617,494
|
|
|
|
|
-
|
|
Total net revenue
|
|
|
$
|
641,950
|
|
|
|
$
|
278,227
|
|
|
|
$
|
1,212,395
|
|
|
|
$
|
537,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See footnotes on page 10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data,
continued
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Data- Ambulatory Services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Procedures performed during the period at consolidated centers
|
|
|
|
441,302
|
|
|
|
|
416,320
|
|
|
|
|
845,821
|
|
|
|
801,017
|
|
Centers in operation at end of period (consolidated)
|
|
|
|
239
|
|
|
|
|
231
|
|
|
|
|
239
|
|
|
|
231
|
|
Centers in operation at end of period (unconsolidated)
|
|
|
|
11
|
|
|
|
|
7
|
|
|
|
|
11
|
|
|
|
7
|
|
Average number of continuing centers in operation (consolidated)
|
|
|
|
238
|
|
|
|
|
233
|
|
|
|
|
237
|
|
|
|
233
|
|
New centers added during the period
|
|
|
|
2
|
|
|
|
|
1
|
|
|
|
|
4
|
|
|
|
2
|
|
Centers discontinued during the period
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
1
|
|
Centers under development at end of period
|
|
|
|
2
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
|
1
|
|
Centers under letter of intent at end of period
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
6
|
|
Average revenue per consolidated center
|
|
|
$
|
1,308
|
|
|
|
$
|
1,199
|
|
|
|
$
|
2,515
|
|
|
|
$ 2,309
|
|
Same center revenues increase (decrease)
|
|
|
|
5.1
|
%
|
|
|
|
0.9
|
%
|
|
|
|
4.4
|
%
|
|
|
(0.7
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Data- Physician Services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2015
|
|
|
Six Months Ended June 30, 2015
|
Contribution to Net Revenue Growth:
|
|
|
|
|
|
|
|
|
|
|
|
|
Same contract
|
|
|
|
|
|
|
|
|
|
10.9
|
%
|
|
|
8.1
|
%
|
|
New contract
|
|
|
|
|
|
|
|
|
|
1.6
|
|
|
|
2.0
|
|
Acquired contract and other
|
|
|
|
|
|
|
|
|
|
11.8
|
|
|
|
9.3
|
|
Total net revenue growth
|
|
|
|
|
|
|
|
|
|
24.3
|
%
|
|
|
19.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same contract revenue growth
|
|
|
|
|
|
|
|
|
|
14.3
|
%
|
|
|
10.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data,
continued
(In thousands)
|
|
|
|
June 30,
2015
|
|
|
December 31,
2014
|
Balance Sheet Data:
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
126,289
|
|
|
|
$
|
208,079
|
Restricted cash and marketable securities
|
|
|
|
11,581
|
|
|
|
|
10,219
|
Accounts receivable, net of allowance of $125,123 and $113,357,
respectively
|
|
|
|
259,872
|
|
|
|
|
233,053
|
Supplies inventory
|
|
|
|
20,985
|
|
|
|
|
19,974
|
Prepaid and other current assets
|
|
|
|
83,857
|
|
|
|
|
115,362
|
Total current assets
|
|
|
|
502,584
|
|
|
|
|
586,687
|
Property and equipment, net
|
|
|
|
188,755
|
|
|
|
|
180,448
|
Investments in unconsolidated affiliates
|
|
|
|
83,679
|
|
|
|
|
75,475
|
Goodwill
|
|
|
|
3,586,021
|
|
|
|
|
3,381,149
|
Intangible assets, net
|
|
|
|
1,282,377
|
|
|
|
|
1,273,879
|
Other assets
|
|
|
|
24,616
|
|
|
|
|
25,886
|
Total assets
|
|
|
$
|
5,668,032
|
|
|
|
$
|
5,523,524
|
Liabilities and Equity
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Current portion of long-term debt
|
|
|
$
|
19,778
|
|
|
|
$
|
18,826
|
Accounts payable
|
|
|
|
28,514
|
|
|
|
|
29,585
|
Accrued salaries and benefits
|
|
|
|
141,719
|
|
|
|
|
140,044
|
Accrued interest
|
|
|
|
29,804
|
|
|
|
|
29,644
|
Other accrued liabilities
|
|
|
|
97,149
|
|
|
|
|
67,986
|
Total current liabilities
|
|
|
|
316,964
|
|
|
|
|
286,085
|
Long-term debt
|
|
|
|
2,229,683
|
|
|
|
|
2,232,186
|
Deferred income taxes
|
|
|
|
623,667
|
|
|
|
|
633,480
|
Other long-term liabilities
|
|
|
|
91,954
|
|
|
|
|
89,443
|
Commitments and contingencies
|
|
|
|
|
|
|
Noncontrolling interests - redeemable
|
|
|
|
185,177
|
|
|
|
|
184,099
|
Equity:
|
|
|
|
|
|
|
Preferred stock, no par value, 5,000 shares authorized, 1,725
shares issued and outstanding
|
|
|
|
166,632
|
|
|
|
|
166,632
|
Common stock, no par value, 120,000 shares authorized, 48,443 and
48,113 shares issued and outstanding, respectively
|
|
|
|
893,319
|
|
|
|
|
885,393
|
Retained earnings
|
|
|
|
677,707
|
|
|
|
|
627,522
|
Total AmSurg Corp. equity
|
|
|
|
1,737,658
|
|
|
|
|
1,679,547
|
Noncontrolling interests - non-redeemable
|
|
|
|
482,929
|
|
|
|
|
418,684
|
Total equity
|
|
|
|
2,220,587
|
|
|
|
|
2,098,231
|
Total liabilities and equity
|
|
|
$
|
5,668,032
|
|
|
|
$
|
5,523,524
|
|
|
|
|
|
|
|
|
|
AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data,
continued
(In thousands)
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
Statement of Cash Flow Data:
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
$
|
90,747
|
|
|
|
$
|
68,172
|
|
|
|
$
|
159,502
|
|
|
|
$
|
128,286
|
|
Adjustments to reconcile net earnings to net cash flows provided
by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
23,612
|
|
|
|
|
8,436
|
|
|
|
|
46,430
|
|
|
|
|
16,695
|
|
Amortization of deferred loan costs
|
|
|
|
2,081
|
|
|
|
|
498
|
|
|
|
|
4,155
|
|
|
|
|
996
|
|
Provision for uncollectibles
|
|
|
|
70,515
|
|
|
|
|
5,542
|
|
|
|
|
144,514
|
|
|
|
|
10,736
|
|
Net loss on sale of long-lived assets
|
|
|
|
-
|
|
|
|
|
7
|
|
|
|
|
-
|
|
|
|
|
611
|
|
Loss (gain) on deconsolidation
|
|
|
|
3,035
|
|
|
|
|
(1,366
|
)
|
|
|
|
3,258
|
|
|
|
|
(3,411
|
)
|
Share-based compensation
|
|
|
|
3,883
|
|
|
|
|
2,506
|
|
|
|
|
7,592
|
|
|
|
|
4,964
|
|
Excess tax benefit from share-based compensation
|
|
|
|
(216
|
)
|
|
|
|
(363
|
)
|
|
|
|
(3,533
|
)
|
|
|
|
(2,090
|
)
|
Deferred income taxes
|
|
|
|
(635
|
)
|
|
|
|
5,939
|
|
|
|
|
2,699
|
|
|
|
|
17,872
|
|
Equity in earnings of unconsolidated affiliates
|
|
|
|
(3,989
|
)
|
|
|
|
(539
|
)
|
|
|
|
(6,640
|
)
|
|
|
|
(1,303
|
)
|
Net change in fair value of contingent consideration
|
|
|
|
6,410
|
|
|
|
|
-
|
|
|
|
|
6,410
|
|
|
|
|
-
|
|
Increases (decreases) in cash and cash equivalents, net of
acquisitions and dispositions:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
(82,842
|
)
|
|
|
|
(9,870
|
)
|
|
|
|
(157,056
|
)
|
|
|
|
(16,715
|
)
|
Supplies inventory
|
|
|
|
(80
|
)
|
|
|
|
238
|
|
|
|
|
(110
|
)
|
|
|
|
(7
|
)
|
Prepaid and other current assets
|
|
|
|
16,485
|
|
|
|
|
1,328
|
|
|
|
|
30,327
|
|
|
|
|
(2,310
|
)
|
Accounts payable
|
|
|
|
1,830
|
|
|
|
|
1,181
|
|
|
|
|
(696
|
)
|
|
|
|
(2,397
|
)
|
Accrued expenses and other liabilities
|
|
|
|
20,534
|
|
|
|
|
1,375
|
|
|
|
|
12,648
|
|
|
|
|
769
|
|
Other, net
|
|
|
|
1,198
|
|
|
|
|
678
|
|
|
|
|
1,895
|
|
|
|
|
885
|
|
Net cash flows provided by operating activities
|
|
|
|
152,568
|
|
|
|
|
83,762
|
|
|
|
|
251,395
|
|
|
|
|
153,581
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions and related expenses
|
|
|
|
(69,454
|
)
|
|
|
|
(19,399
|
)
|
|
|
|
(196,032
|
)
|
|
|
|
(24,437
|
)
|
Acquisition of property and equipment
|
|
|
|
(17,882
|
)
|
|
|
|
(9,037
|
)
|
|
|
|
(32,665
|
)
|
|
|
|
(16,075
|
)
|
Proceeds from sale of interests in surgery centers
|
|
|
|
-
|
|
|
|
|
981
|
|
|
|
|
-
|
|
|
|
|
2,092
|
|
Purchases of marketable securities
|
|
|
|
(1,245
|
)
|
|
|
|
-
|
|
|
|
|
(1,245
|
)
|
|
|
|
-
|
|
Maturities of marketable securities
|
|
|
|
2,988
|
|
|
|
|
-
|
|
|
|
|
2,988
|
|
|
|
|
-
|
|
Other
|
|
|
|
(1,767
|
)
|
|
|
|
(963
|
)
|
|
|
|
(1,987
|
)
|
|
|
|
(1,381
|
)
|
Net cash flows used in investing activities
|
|
|
|
(87,360
|
)
|
|
|
|
(28,418
|
)
|
|
|
|
(228,941
|
)
|
|
|
|
(39,801
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
|
5,568
|
|
|
|
|
42,301
|
|
|
|
|
7,795
|
|
|
|
|
74,246
|
|
Repayment on long-term borrowings
|
|
|
|
(5,075
|
)
|
|
|
|
(51,473
|
)
|
|
|
|
(10,288
|
)
|
|
|
|
(102,326
|
)
|
Distributions to noncontrolling interests
|
|
|
|
(53,831
|
)
|
|
|
|
(48,816
|
)
|
|
|
|
(101,033
|
)
|
|
|
|
(92,010
|
)
|
Cash dividends for preferred shares
|
|
|
|
(2,264
|
)
|
|
|
|
-
|
|
|
|
|
(4,528
|
)
|
|
|
|
-
|
|
Proceeds from issuance of common stock upon exercise of stock options
|
|
|
|
334
|
|
|
|
|
1,158
|
|
|
|
|
2,080
|
|
|
|
|
1,646
|
|
Repurchase of common stock
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
(3,684
|
)
|
|
|
|
(2,857
|
)
|
Excess tax benefit from share-based compensation
|
|
|
|
216
|
|
|
|
|
363
|
|
|
|
|
3,533
|
|
|
|
|
2,090
|
|
Other
|
|
|
|
(23
|
)
|
|
|
|
(1,082
|
)
|
|
|
|
1,881
|
|
|
|
|
(498
|
)
|
Net cash flows used in financing activities
|
|
|
|
(55,075
|
)
|
|
|
|
(57,549
|
)
|
|
|
|
(104,244
|
)
|
|
|
|
(119,709
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
10,133
|
|
|
|
|
(2,205
|
)
|
|
|
|
(81,790
|
)
|
|
|
|
(5,929
|
)
|
Cash and cash equivalents, beginning of period
|
|
|
|
116,156
|
|
|
|
|
47,116
|
|
|
|
|
208,079
|
|
|
|
|
50,840
|
|
Cash and cash equivalents, end of period
|
|
|
$
|
126,289
|
|
|
|
$
|
44,911
|
|
|
|
$
|
126,289
|
|
|
|
$
|
44,911
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMSURG CORP.
|
Footnotes to Reconciliations of Non-GAAP Measures to GAAP
Measures
|
|
(1)
|
We believe the calculation of adjusted net earnings per diluted
share attributable to AmSurg Corp. common shareholders provides a
better measure of our ongoing performance and provides better
comparability to prior periods because it excludes the gains or loss
from deconsolidations, which are non-cash in nature, transaction
costs, including associated debt extinguishment costs and deferred
financing write-off, and acquisition-related amortization expense
(the majority of which relate to the Sheridan Transaction and which
are of a nature and significance not generally associated with our
historical individual center acquisition activity), changes in
contingent purchase price consideration and share-based compensation
expense. Adjusted net earnings from continuing operations per
diluted share attributable to AmSurg Corp. common shareholders
should not be considered as a measure of financial performance under
accounting principles generally accepted in the United States, and
the items excluded from it is a significant component in
understanding and assessing financial performance. Because adjusted
net earnings from continuing operations per diluted share
attributable to AmSurg Corp. common shareholders is not a
measurement determined in accordance with accounting principles
generally accepted in the United States and is thus susceptible to
varying calculations, it may not be comparable as presented to other
similarly titled measures of other companies. For purposes of
calculating adjusted earnings per share, we utilize the if-converted
method to determine the number of diluted shares outstanding. In
periods where utilizing the if-converted method is anti-dilutive,
the mandatory convertible preferred stock will not be included in
the calculation of diluted shares outstanding.
|
|
(2)
|
We define Adjusted EBITDA of AmSurg as earnings before interest
expense, net, income taxes, depreciation, amortization, share-based
compensation, transaction costs, changes in contingent purchase
price consideration, gain or loss on deconsolidations and
discontinued operations. Adjusted EBITDA should not be considered a
measure of financial performance under generally accepted accounting
principles. Items excluded from Adjusted EBITDA are significant
components in understanding and assessing financial performance.
Adjusted EBITDA is an analytical indicator used by management and
the health care industry to evaluate company performance, allocate
resources and measure leverage and debt service capacity. Adjusted
EBITDA should not be considered in isolation or as an alternative to
net income, cash flows from operations, investing or financing
activities, or other financial statement data presented in the
consolidated financial statements as indicators of financial
performance or liquidity. Because Adjusted EBITDA is not a
measurement determined in accordance with generally accepted
accounting principles and is thus susceptible to varying
calculations, Adjusted EBITDA as presented may not be comparable to
other similarly titled measures of other companies. Net earnings
from continuing operations attributable to AmSurg Corp. common
shareholders is the financial measure calculated and presented in
accordance with generally accepted accounting principles that is
most comparable to Adjusted EBITDA as defined.
|
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