Supplemental Condensed Consolidating Financial Information | NOTE 12 — SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION During December 2012, HCA Healthcare, Inc. issued $1.000 billion aggregate principal amount of 6.250% senior unsecured notes due 2021. These notes are senior unsecured obligations and are not guaranteed by any of our subsidiaries. HCA Inc., a direct wholly-owned subsidiary of HCA Healthcare, Inc., is the obligor under a significant portion of our other indebtedness, including our senior secured credit facilities, senior secured notes and senior unsecured notes (other than the senior unsecured notes issued by HCA Healthcare, Inc.). The senior secured notes and senior unsecured notes issued by HCA Inc. are fully and unconditionally guaranteed by HCA Healthcare, Inc. The senior secured credit facilities and senior secured notes are fully and unconditionally guaranteed by substantially all existing and future, direct and indirect, 100% owned material domestic subsidiaries that are “Unrestricted Subsidiaries” under our Indenture dated December 16, 1993 (except for certain special purpose subsidiaries that only guarantee and pledge their assets under our senior secured asset-based revolving credit facility). Our summarized condensed consolidating comprehensive income statements for the quarters ended March 31, 2017 and 2016, condensed consolidating balance sheets at March 31, 2017 and December 31, 2016 and condensed consolidating statements of cash flows for the quarters ended March 31, 2017 and 2016, segregating HCA Healthcare, Inc. issuer, HCA Inc. issuer, the subsidiary guarantors, the subsidiary non-guarantors and eliminations, follow: HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED MARCH 31, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Revenues before provision for doubtful accounts $ — $ — $ 5,853 $ 5,530 $ — $ 11,383 Provision for doubtful accounts — — 419 341 — 760 Revenues — — 5,434 5,189 — 10,623 Salaries and benefits — — 2,466 2,435 — 4,901 Supplies — — 951 846 — 1,797 Other operating expenses 1 — 927 1,002 — 1,930 Equity in earnings of affiliates (608 ) — (1 ) (9 ) 608 (10 ) Depreciation and amortization — — 251 270 — 521 Interest expense 16 733 (269 ) (61 ) — 419 Gains on sales of facilities — — — (1 ) — (1 ) Management fees — — (210 ) 210 — — (591 ) 733 4,115 4,692 608 9,557 Income (loss) before income taxes 591 (733 ) 1,319 497 (608 ) 1,066 Provision (benefit) for income taxes (68 ) (270 ) 478 149 — 289 Net income (loss) 659 (463 ) 841 348 (608 ) 777 Net income attributable to noncontrolling interests — — 23 95 — 118 Net income (loss) attributable to HCA Healthcare, Inc. $ 659 $ (463 ) $ 818 $ 253 $ (608 ) $ 659 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 677 $ (456 ) $ 821 $ 261 $ (626 ) $ 677 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED MARCH 31, 2016 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Revenues before provision for doubtful accounts $ — $ — $ 5,673 $ 5,377 $ — $ 11,050 Provision for doubtful accounts — — 494 296 — 790 Revenues — — 5,179 5,081 — 10,260 Salaries and benefits — — 2,354 2,348 — 4,702 Supplies — — 898 816 — 1,714 Other operating expenses 2 — 857 994 — 1,853 Equity in earnings of affiliates (629 ) — (2 ) (10 ) 629 (12 ) Depreciation and amortization — — 227 252 — 479 Interest expense 16 650 (207 ) (43 ) — 416 Losses (gains) on sales of facilities — — 2 (1 ) — 1 Legal claim costs — 12 — — — 12 Management fees — — (160 ) 160 — — (611 ) 662 3,969 4,516 629 9,165 Income (loss) before income taxes 611 (662 ) 1,210 565 (629 ) 1,095 Provision (benefit) for income taxes (83 ) (244 ) 438 173 — 284 Net income (loss) 694 (418 ) 772 392 (629 ) 811 Net income attributable to noncontrolling interests — — 22 95 — 117 Net income (loss) attributable to HCA Healthcare, Inc. $ 694 $ (418 ) $ 750 $ 297 $ (629 ) $ 694 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 665 $ (425 ) $ 752 $ 273 $ (600 ) $ 665 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET MARCH 31, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed ASSETS Current assets: Cash and cash equivalents $ — $ — $ 182 $ 571 $ — $ 753 Accounts receivable, net — — 3,009 2,655 — 5,664 Inventories — — 890 611 — 1,501 Other — — 432 687 — 1,119 — — 4,513 4,524 — 9,037 Property and equipment, net — — 8,446 8,016 — 16,462 Investments of insurance subsidiaries — — — 349 — 349 Investments in and advances to affiliates 27,671 — 16 178 (27,671 ) 194 Goodwill and other intangible assets — — 1,728 5,026 — 6,754 Other 756 37 33 173 — 999 $ 28,427 $ 37 $ 14,736 $ 18,266 $ (27,671 ) $ 33,795 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Accounts payable $ — $ — $ 1,304 $ 929 $ — $ 2,233 Accrued salaries — — 644 506 — 1,150 Other accrued expenses 239 277 432 920 — 1,868 Long-term debt due within one year — 97 58 57 — 212 239 374 2,438 2,412 — 5,463 Long-term debt, net 993 29,841 188 280 — 31,302 Intercompany balances 33,807 (9,633 ) (26,980 ) 2,806 — — Professional liability risks — — — 1,134 — 1,134 Income taxes and other liabilities 405 8 395 445 — 1,253 35,444 20,590 (23,959) 7,077 — 39,152 Stockholders’ (deficit) equity attributable to HCA Healthcare, Inc. (7,017 ) (20,553 ) 38,573 9,651 (27,671 ) (7,017 ) Noncontrolling interests — — 122 1,538 — 1,660 (7,017 ) (20,553 ) 38,695 11,189 (27,671 ) (5,357 ) $ 28,427 $ 37 $ 14,736 $ 18,266 $ (27,671 ) $ 33,795 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2016 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed ASSETS Current assets: Cash and cash equivalents $ — $ — $ 110 $ 536 $ — $ 646 Accounts receivable, net — — 3,028 2,798 — 5,826 Inventories — — 890 613 — 1,503 Other — — 445 666 — 1,111 — — 4,473 4,613 — 9,086 Property and equipment, net — — 8,463 7,889 — 16,352 Investments of insurance subsidiaries — — — 336 — 336 Investments in and advances to affiliates 27,045 — 16 190 (27,045 ) 206 Goodwill and other intangible assets — — 1,728 4,976 — 6,704 Other 877 — 34 163 — 1,074 $ 27,922 $ — $ 14,714 $ 18,167 $ (27,045 ) $ 33,758 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Accounts payable $ — $ — $ 1,439 $ 879 $ — $ 2,318 Accrued salaries — — 704 561 — 1,265 Other accrued expenses 29 572 464 970 — 2,035 Long-term debt due within one year — 97 60 59 — 216 29 669 2,667 2,469 — 5,834 Long-term debt, net 993 29,693 199 275 — 31,160 Intercompany balances 33,784 (10,277 ) (26,447 ) 2,940 — — Professional liability risks — — — 1,148 — 1,148 Income taxes and other liabilities 418 12 387 432 — 1,249 35,224 20,097 (23,194 ) 7,264 — 39,391 Stockholders’ (deficit) equity attributable to HCA Healthcare, Inc. (7,302 ) (20,097 ) 37,752 9,390 (27,045 ) (7,302 ) Noncontrolling interests — — 156 1,513 — 1,669 (7,302 ) (20,097 ) 37,908 10,903 (27,045 ) (5,633 ) $ 27,922 $ — $ 14,714 $ 18,167 $ (27,045 ) $ 33,758 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE QUARTER ENDED MARCH 31, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Cash flows from operating activities: Net income (loss) $ 659 $ (463 ) $ 841 $ 348 $ (608 ) $ 777 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Changes in operating assets and liabilities (15 ) (295 ) (601 ) (269 ) — (1,180 ) Provision for doubtful accounts — — 419 341 — 760 Depreciation and amortization — — 251 270 — 521 Income taxes 292 — — — — 292 Gains on sales of facilities — — — (1 ) — (1 ) Amortization of debt issuance costs — 8 — — — 8 Share-based compensation — — 73 — — 73 Equity in earnings of affiliates (608 ) — — — 608 — Other 19 — — 11 — 30 Net cash provided by (used in) operating activities 347 (750 ) 983 700 — 1,280 Cash flows from investing activities: Purchase of property and equipment — — (229 ) (342 ) — (571 ) Acquisition of hospitals and health care entities — — (5 ) (85 ) — (90 ) Disposition of hospitals and health care entities — — 4 — — 4 Change in investments — — — (19 ) — (19 ) Other — — — 7 — 7 Net cash used in investing activities — — (230 ) (439 ) — (669 ) Cash flows from financing activities: Net change in revolving credit facilities — 160 — — — 160 Repayment of long-term debt — (18 ) (16 ) (9 ) — (43 ) Distributions to noncontrolling interests — — (57 ) (88 ) — (145 ) Payment of debt issuance costs — (2 ) — — — (2 ) Repurchases of common stock (424 ) — — — — (424 ) Changes in intercompany balances with affiliates, net 134 610 (608 ) (136 ) — — Other (57 ) — — 7 — (50 ) Net cash (used in) provided by financing activities (347 ) 750 (681 ) (226 ) — (504 ) Change in cash and cash equivalents — — 72 35 — 107 Cash and cash equivalents at beginning of period — — 110 536 — 646 Cash and cash equivalents at end of period $ — $ — $ 182 $ 571 $ — $ 753 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE QUARTER ENDED MARCH 31, 2016 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Cash flows from operating activities: Net income (loss) $ 694 $ (418 ) $ 772 $ 392 $ (629 ) $ 811 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Changes in operating assets and liabilities (36 ) (67 ) (740 ) (303 ) — (1,146 ) Provision for doubtful accounts — — 494 296 — 790 Depreciation and amortization — — 227 252 — 479 Income taxes 360 — — — — 360 Losses (gains) on sales of facilities — — 2 (1 ) — 1 Legal claim costs — 12 — — — 12 Amortization of debt issuance costs — 10 — — — 10 Share-based compensation — — 65 — — 65 Equity in earnings of affiliates (629 ) — — — 629 — Other 19 — (4 ) 2 — 17 Net cash provided by (used in) operating activities 408 (463 ) 816 638 — 1,399 Cash flows from investing activities: Purchase of property and equipment — — (161 ) (348 ) — (509 ) Acquisition of hospitals and health care entities — — — (9 ) — (9 ) Disposition of hospitals and health care entities — — — 4 — 4 Change in investments — — — 11 — 11 Other — — — 7 — 7 Net cash used in investing activities — — (161 ) (335 ) — (496 ) Cash flows from financing activities: Issuance of long-term debt — 3,000 — — — 3,000 Net change in revolving credit facilities — (930 ) — — — (930 ) Repayment of long-term debt — (1,980 ) (17 ) (14 ) — (2,011 ) Distributions to noncontrolling interests — — (16 ) (95 ) — (111 ) Payment of debt issuance costs — (22 ) — — — (22 ) Repurchases of common stock (621 ) — — — — (621 ) Changes in intercompany balances with affiliates, net 311 395 (556 ) (150 ) — — Other (97 ) — — — — (97 ) Net cash (used in) provided by financing activities (407 ) 463 (589 ) (259 ) — (792 ) Change in cash and cash equivalents 1 — 66 44 — 111 Cash and cash equivalents at beginning of period — — 155 586 — 741 Cash and cash equivalents at end of period $ 1 $ — $ 221 $ 630 $ — $ 852 |