Exhibit 99.2
MEDCATH CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Going Concern Basis)
| | | 000000000 | | | | 000000000 | | | | 000000000 | | | | 000000000 | |
| | | Period July 1, 2011 to
September 22, 2011 | | | Three Months Ended
September 30, 2010 | | | 2011 Fiscal Period | | | Year Ended
September 30, 2010 | |
Net revenue | | $ | 42,482 | | | $ | 41,414 | | | $ | 167,301 | | | $ | 166,411 | |
Operating expenses: | | | | | | | | | | | | | | | | |
Personnel expense | | | 19,231 | | | | 16,727 | | | | 72,477 | | | | 66,734 | |
Medical supplies expense | | | 7,468 | | | | 8,201 | | | | 32,342 | | | | 33,410 | |
Bad debt expense | | | 8,252 | | | | 5,761 | | | | 25,908 | | | | 23,805 | |
Other operating expenses | | | 21,175 | | | | 14,518 | | | | 65,254 | | | | 53,459 | |
Pre-opening expenses | | | — | | | | — | | | | — | | | | 866 | |
Depreciation | | | 1,798 | | | | 2,586 | | | | 8,014 | | | | 12,221 | |
Impairment of long-lived assets | | | — | | | | 28,509 | | | | 20,358 | | | | 66,022 | |
Loss (gain) on disposal of property, equipment and other assets | | | 79 | | | | (33 | ) | | | (226 | ) | | | (54 | ) |
| | | | | | | | | | | | | | | | |
Total operating expenses | | | 58,003 | | | | 76,269 | | | | 224,127 | | | | 256,463 | |
| | | | | | | | | | | | | | | | |
Loss from operations | | | (15,521 | ) | | | (34,855 | ) | | | (56,826 | ) | | | (90,052 | ) |
Other income (expenses): | | | | | | | | | | | | | | | | |
Interest expense | | | (13 | ) | | | (1,103 | ) | | | (2,320 | ) | | | (3,935 | ) |
Interest and other income | | | 44 | | | | 10 | | | | 179 | | | | 86 | |
Gain on sale of unconsolidated affiliates | | | — | | | | — | | | | 15,391 | | | | — | |
Loss on note receivable | | | — | | | | — | | | | — | | | | (1,507 | ) |
Equity in net (losses) earnings of unconsolidated affiliates | | | (462 | ) | | | 1,375 | | | | 1,216 | | | | 5,359 | |
| | | | | | | | | | | | | | | | |
Total other (expense) income, net | | | (431 | ) | | | 282 | | | | 14,466 | | | | 3 | |
| | | | | | | | | | | | | | | | |
Loss from continuing operations before income taxes | | | (15,952 | ) | | | (34,573 | ) | | | (42,360 | ) | | | (90,049 | ) |
Income tax benefit | | | (5,833 | ) | | | (12,387 | ) | | | (16,963 | ) | | | (33,377 | ) |
| | | | | | | | | | | | | | | | |
Loss from continuing operations | | | (10,119 | ) | | | (22,186 | ) | | | (25,397 | ) | | | (56,672 | ) |
Income from discontinued operations, net of taxes | | | 87,283 | | | | 7,167 | | | | 154,742 | | | | 20,690 | |
| | | | | | | | | | | | | | | | |
Net income (loss) | | | 77,164 | | | | (15,019 | ) | | | 129,345 | | | | (35,982 | ) |
Less: Net income attributable to noncontrolling interests | | | (46,403 | ) | | | (6,671 | ) | | | (62,709 | ) | | | (12,389 | ) |
| | | | | | | | | | | | | | | | |
Net income (loss) attributable to MedCath Corporation | | $ | 30,761 | | | $ | (21,690 | ) | | $ | 66,636 | | | $ | (48,371 | ) |
| | | | | | | | | | | | | | | | |
Amounts attributable to MedCath Corporation common stockholders: | | | | | | | | | | | | | | | | |
Loss from continuing operations, net of taxes | | $ | (11,518 | ) | | $ | (26,417 | ) | | $ | (29,177 | ) | | $ | (61,843 | ) |
Income from discontinued operations, net of taxes | | | 42,279 | | | | 4,727 | | | | 95,813 | | | | 13,472 | |
| | | | | | | | | | | | | | | | |
Net income (loss) | | $ | 30,761 | | | $ | (21,690 | ) | | $ | 66,636 | | | $ | (48,371 | ) |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share, basic | | | | | | | | | | | | | | | | |
Loss from continuing operations attributable to MedCath Corporation common stockholders | | $ | (0.57 | ) | | $ | (1.33 | ) | | $ | (1.45 | ) | | $ | (3.12 | ) |
Income from discontinued operations attributable to MedCath Corporation common stockholders | | | 2.09 | | | | 0.24 | | | | 4.75 | | | | 0.68 | |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share, basic | | $ | 1.52 | | | $ | (1.09 | ) | | $ | 3.30 | | | $ | (2.44 | ) |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share, diluted | | | | | | | | | | | | | | | | |
Loss from continuing operations attributable to MedCath Corporation common stockholders | | $ | (0.57 | ) | | $ | (1.33 | ) | | $ | (1.45 | ) | | $ | (3.12 | ) |
Income from discontinued operations attributable to MedCath Corporation common stockholders | | | 2.09 | | | | 0.24 | | | | 4.75 | | | | 0.68 | |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share, diluted | | $ | 1.52 | | | $ | (1.09 | ) | | $ | 3.30 | | | $ | (2.44 | ) |
| | | | | | | | | | | | | | | | |
Weighted average number of shares, basic | | | 20,216 | | | | 19,898 | | | | 20,153 | | | | 19,842 | |
Dilutive effect of stock options and restricted stock | | | 6 | | | | — | | | | 6 | | | | — | |
| | | | | | | | | | | | | | | | |
Weighted average number of shares, diluted | | | 20,222 | | | | 19,898 | | | | 20,159 | | | | 19,842 | |
| | | | | | | | | | | | | | | | |
MEDCATH CORPORATION
SELECTED OPERATING DATA
(In thousands, except per share data and selected operating data)
(Unaudited)
| | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | |
| | | Period July 1,
2011 to
September 22,
2011 | | | Three Months
Ended
September 30,
2010 | | | % Change | | | 2011 Fiscal
Period | | | Year Ended
September
30, 2010 | | | % Change | |
Statement of Operations Data: | | | | | | | | | | | | | | | | | | | | | | | | |
Net revenue | | $ | 42,482 | | | $ | 41,414 | | | | 2.6 | % | | $ | 167,301 | | | $ | 166,411 | | | | 0.5 | % |
Adjusted EBITDA (1) | | $ | (6,263 | ) | | $ | (457 | ) | | | (1270.5 | )% | | $ | (13,156 | ) | | $ | (9,813 | ) | | | (34.1 | )% |
Loss from operations | | $ | (15,521 | ) | | $ | (34,855 | ) | | | 55.5 | % | | $ | (56,826 | ) | | $ | (90,052 | ) | | | 36.9 | % |
Loss from continuing operations, net of taxes | | $ | (11,518 | ) | | $ | (26,417 | ) | | | 56.4 | % | | $ | (29,177 | ) | | $ | (61,843 | ) | | | 52.8 | % |
Loss per share from continuing operations, basic | | $ | (0.57 | ) | | $ | (1.33 | ) | | | 57.1 | % | | $ | (1.45 | ) | | $ | (3.12 | ) | | | 53.5 | % |
Loss per share from continuing operations, diluted | | $ | (0.57 | ) | | $ | (1.33 | ) | | | 57.1 | % | | $ | (1.45 | ) | | $ | (3.12 | ) | | | 53.6 | % |
| (1) | See Supplemental Financial Disclosure-Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures. |
| | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | |
| | | Period July 1,
2011 to
September 22,
2011 | | | Three Months
Ended
September 30,
2010 | | | % Change | | | 2011 Fiscal
Period | | | Year Ended
September
30, 2010 | | | % Change | |
Selected Operating Data (a): | | | | | | | | | | | | | | | | | | | | | | | | |
Number of hospitals | | | 3 | | | | 3 | | | | | | | | 3 | | | | 3 | | | | | |
Licensed beds (c) | | | 254 | | | | 254 | | | | | | | | 254 | | | | 254 | | | | | |
Staffed and available beds (d) | | | 214 | | | | 214 | | | | | | | | 214 | | | | 214 | | | | | |
Admissions (e) | | | 1,785 | | | | 1,989 | | | | (10.3 | )% | | | 7,907 | | | | 8,380 | | | | (5.6 | )% |
Adjusted admissions (f) | | | 2,930 | | | | 3,263 | | | | (10.2 | )% | | | 12,675 | | | | 13,036 | | | | (2.8 | )% |
Patient days (g) | | | 7,191 | | | | 7,755 | | | | (7.3 | )% | | | 31,713 | | | | 33,041 | | | | (4.0 | )% |
Adjusted patient days (h) | | | 11,843 | | | | 12,698 | | | | (6.7 | )% | | | 50,803 | | | | 51,341 | | | | (1.0 | )% |
Average length of stay (days) (i) | | | 4.03 | | | | 3.90 | | | | 3.3 | % | | | 4.01 | | | | 3.94 | | | | 1.8 | % |
Occupancy (j) | | | 36.5 | % | | | 39.4 | % | | | | | | | 40.6 | % | | | 42.3 | % | | | | |
Inpatient catheterization procedures (k) | | | 448 | | | | 544 | | | | (17.6 | )% | | | 1,778 | | | | 2,304 | | | | (22.8 | )% |
Inpatient surgical procedures (l) | | | 399 | | | | 470 | | | | (15.1 | )% | | | 1,832 | | | | 2,023 | | | | (9.4 | )% |
| | | | | | |
Combined Operating Data (b): | | | | | | | | | | | | | | | | | | | | | | | | |
Number of hospitals | | | 4 | | | | 4 | | | | | | | | 4 | | | | 4 | | | | | |
Licensed beds (c) | | | 366 | | | | 366 | | | | | | | | 366 | | | | 366 | | | | | |
Staffed and available beds (d) | | | 323 | | | | 323 | | | | | | | | 323 | | | | 323 | | | | | |
Admissions (e) | | | 3,396 | | | | 3,812 | | | | (10.9 | )% | | | 14,662 | | | | 15,642 | | | | (6.3 | )% |
Adjusted admissions (f) | | | 6,113 | | | | 6,529 | | | | (6.4 | )% | | | 25,491 | | | | 26,398 | | | | (3.4 | )% |
Patient days (g) | | | 11,908 | | | | 13,303 | | | | (10.5 | )% | | | 52,450 | | | | 55,115 | | | | (4.8 | )% |
Adjusted patient days (h) | | | 21,162 | | | | 22,638 | | | | (6.5 | )% | | | 90,145 | | | | 91,957 | | | | (2.0 | )% |
Average length of stay (days) (i) | | | 3.51 | | | | 3.49 | | | | 0.6 | % | | | 3.58 | | | | 3.52 | | | | 1.7 | % |
Occupancy (j) | | | 40.1 | % | | | 44.8 | % | | | | | | | 44.5 | % | | | 46.7 | % | | | | |
Inpatient catheterization procedures (k) | | | 690 | | | | 687 | | | | 0.4 | % | | | 2,855 | | | | 3,048 | | | | (6.3 | )% |
Inpatient surgical procedures (l) | | | 799 | | | | 920 | | | | (13.2 | )% | | | 3,469 | | | | 3,638 | | | | (4.6 | )% |
| (a) | Selected operating data includes consolidated hospitals in operation as of the end of the period reported in continuing operations but does not include hospitals which are accounted for using the equity method or as discontinued operations in our consolidated financial statements. The 2011 Fiscal Period is as of September 22, 2011. Subsequent to that date, the Company disposed of its interest in two of the consolidated hospitals. |
| (b) | Combined operating data includes hospitals in operation as of the end of the period reported in continuing operations including hospitals which are accounted for using the equity method in our consolidated financial statements. The 2011 Fiscal Period is as of September 22, 2011. Subsequent to that date, the Company disposed of its interest in two of the consolidated hospitals and its interest in an equity accounted for hospital. |
| (c) | Licensed beds represent the number of beds for which the appropriate state agency licenses a facility regardless of whether the beds are actually available for patient use. |
| (d) | Staffed and available beds represent the number of beds that were readily available for patient use at the end of the period. |
| (e) | Admissions represent the number of patients admitted for inpatient treatment. |
| (f) | Adjusted admissions is a general measure of combined inpatient and outpatient volume. We computed adjusted admissions by dividing gross patient revenue by gross inpatient revenue and then multiplying the quotient by admissions. |
| (g) | Patient days represent the total number of days of care provided to inpatients. |
| (h) | Adjusted patient days is a general measure of combined inpatient and outpatient volume. We computed adjusted patient days by dividing gross patient revenue by gross inpatient revenue and then multiplying the quotient by patient days. |
| (i) | Average length of stay (days) represents the average number of days inpatients stay in our hospitals. |
| (j) | We computed occupancy by dividing patient days by the number of days in the period and then dividing the quotient by the number of staffed and available beds. |
| (k) | Inpatients with a catheterization procedure represent the number of inpatients with a procedure performed in one of the hospitals’ catheterization labs during the period. |
| (l) | Inpatient surgical procedures represent the number of surgical procedures performed on inpatients during the period. |
MEDCATH CORPORATION
SUPPLEMENTAL FINANCIAL DISCLOSURE—RECONCILIATION OF GAAP FINANCIAL MEASURES
TO NON-GAAP FINANCIAL MEASURES
(Unaudited)
The following table reconciles the loss from continuing operations, net of taxes attributable to MedCath Corporation’s common stockholders as derived directly from MedCath Corporation’s consolidated financial statements to Adjusted EBITDA for the periods indicated.
| | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | |
| | | Period July 1, 2011 to | | | Three Months Ended | | | 2011 | | | Year Ended | |
| | | September 22, 2011 | | | September 30, 2010 | | | Fiscal Period | | | September 30, 2010 | |
| | | (in thousands) | | | (in thousands) | |
Loss from continuing operations, net of taxes | | $ | (11,518 | ) | | $ | (26,417 | ) | | $ | (29,177 | ) | | $ | (61,843 | ) |
Add: | | | | | | | | | | | | | | | | |
Income tax benefit | | | (5,833 | ) | | | (12,387 | ) | | | (16,963 | ) | | | (33,377 | ) |
Net income attributable to noncontrolling interests | | | 749 | | | | 4,231 | | | | 1,399 | | | | (734 | ) |
Equity in net earnings (losses) of unconsolidated affiliates | | | 462 | | | | (1,375 | ) | | | (1,216 | ) | | | (5,359 | ) |
Interest and other income | | | (44 | ) | | | (10 | ) | | | (179 | ) | | | (86 | ) |
Loss on note receivable | | | — | | | | — | | | | — | | | | 1,507 | |
Gain on sale of unconsolidated affiliates | | | — | | | | — | | | | (15,391 | ) | | | — | |
Interest expense | | | 13 | | | | 1,103 | | | | 2,320 | | | | 3,935 | |
(Gain) loss on disposal of property, equipment and other assets | | | 79 | | | | (33 | ) | | | (226 | ) | | | (54 | ) |
Impairment of long-lived assets | | | — | | | | 28,509 | | | | 20,358 | | | | 66,022 | |
Depreciation | | | 1,798 | | | | 2,586 | | | | 8,014 | | | | 12,221 | |
Pre-opening expenses | | | — | | | | — | | | | — | | | | 866 | |
Share-based compensation expense | | | 1,035 | | | | 772 | | | | 4,311 | | | | 3,148 | |
Professional fees for strategic options process | | | 6,996 | | | | 2,564 | | | | 13,594 | | | | 3,941 | |
| | | | | | | | | | | | | | | | |
Adjusted EBITDA | | $ | (6,263 | ) | | $ | (457 | ) | | $ | (13,156 | ) | | $ | (9,813 | ) |
| | | | | | | | | | | | | | | | |
The following table reconciles MedCath Corporation’s diluted (loss) earnings per share from continuing operations, net of taxes attributable to MedCath Corporation’s common stockholders as derived directly from MedCath’s consolidated financial statements to Adjusted diluted earnings per share from continuing operations (inclusive of the effect of dilutive shares) for the periods indicated.
| | | September 30, | | | | September 30, | | | | September 30, | | | | September 30, | |
| | | Period July 1, 2011 to | | | Three Months Ended | | | 2011 | | | Year Ended | |
| | | September 22, 2011 | | | September 30, 2010 | | | Fiscal Period | | | September 30, 2010 | |
Diluted (loss) earnings per share | | $ | (0.57 | ) | | $ | (1.33 | ) | | $ | (1.45 | ) | | $ | (3.12 | ) |
Add: | | | | | | | | | | | | | | | | |
Gain on sale of unconsolidated affiliates | | | — | | | | — | | | | (0.47 | ) | | | — | |
Professional fees for strategic options process | | | 0.21 | | | | 0.08 | | | | 0.41 | | | | 0.12 | |
Impairment of long-lived assets | | | — | | | | 0.87 | | | | 0.62 | | | | 2.02 | |
Loss on note receivable | | | — | | | | — | | | | — | | | | 0.05 | |
Share-based compensation expense | | | 0.03 | | | | 0.02 | | | | 0.13 | | | | 0.10 | |
Pre-opening expense | | | — | | | | — | | | | — | | | | 0.03 | |
| | | | | | | | | | | | | | | | |
Adjusted diluted loss per share | | $ | (0.33 | ) | | $ | (0.36 | ) | | $ | (0.76 | ) | | $ | (0.80 | ) |
| | | | | | | | | | | | | | | | |
