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 and nine months ended September 30, 2018 and 2017, condensed consolidating balance sheets at September 30, 2018 and December 31, 2017 and condensed consolidating statements of cash flows for the nine months ended September 30, 2018 and 2017, segregating HCA Healthcare, Inc. issuer, HCA Inc. issuer, the subsidiary guarantors, the subsidiary non-guarantors HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2018 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Revenues $ — $ — $ 6,747 $ 4,704 $ — $ 11,451 Salaries and benefits — — 3,090 2,287 — 5,377 Supplies — — 1,115 775 — 1,890 Other operating expenses 2 — 1,137 958 — 2,097 Equity in earnings of affiliates (728 ) — (2 ) (7 ) 728 (9 ) Depreciation and amortization — — 340 242 — 582 Interest expense (income) 16 913 (423 ) (64 ) — 442 Losses (gains) on sales of facilities — — (6 ) — — (6 ) Losses on retirement of debt — 9 — — — 9 Management fees — — (158 ) 158 — — (710 ) 922 5,093 4,349 728 10,382 Income (loss) before income taxes 710 (922 ) 1,654 355 (728 ) 1,069 Provision (benefit) for income taxes (49 ) (214 ) 379 57 — 173 Net income (loss) 759 (708 ) 1,275 298 (728 ) 896 Net income attributable to noncontrolling interests — — 22 115 — 137 Net income (loss) attributable to HCA Healthcare, Inc. $ 759 $ (708 ) $ 1,253 $ 183 $ (728 ) $ 759 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 754 $ (703 ) $ 1,258 $ 168 $ (723 ) $ 754 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary (as adjusted) Subsidiary (as adjusted) Eliminations Condensed Revenues $ — $ — $ 6,303 $ 4,393 $ — $ 10,696 Salaries and benefits — — 2,915 2,166 — 5,081 Supplies — — 1,033 744 — 1,777 Other operating expenses — — 1,093 982 — 2,075 Equity in earnings of affiliates (436 ) — (1 ) (12 ) 436 (13 ) Depreciation and amortization — — 311 228 — 539 Interest expense (income) 16 792 (342 ) (39 ) — 427 Gains on sales of facilities — — (3 ) (4 ) — (7 ) Losses on retirement of debt — 39 — — — 39 Management fees — — (159 ) 159 — — (420 ) 831 4,847 4,224 436 9,918 Income (loss) before income taxes 420 (831 ) 1,456 169 (436 ) 778 Provision (benefit) for income taxes (6 ) (307 ) 528 33 — 248 Net income (loss) 426 (524 ) 928 136 (436 ) 530 Net income attributable to noncontrolling interests — — 24 80 — 104 Net income (loss) attributable to HCA Healthcare, Inc. $ 426 $ (524 ) $ 904 $ 56 $ (436 ) $ 426 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 451 $ (522 ) $ 907 $ 76 $ (461 ) $ 451 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Revenues $ — $ — $ 20,297 $ 14,106 $ — $ 34,403 Salaries and benefits — — 9,184 6,756 — 15,940 Supplies — — 3,383 2,339 — 5,722 Other operating expenses 7 — 3,387 2,931 — 6,325 Equity in earnings of affiliates (2,670 ) — (5 ) (20 ) 2,670 (25 ) Depreciation and amortization — — 992 705 — 1,697 Interest expense (income) 48 2,617 (1,179 ) (177 ) — 1,309 Gains on sales of facilities — — (378 ) (42 ) — (420 ) Losses on retirement of debt — 9 — — — 9 Management fees — — (473 ) 473 — — (2,615 ) 2,626 14,911 12,965 2,670 30,557 Income (loss) before income taxes 2,615 (2,626 ) 5,386 1,141 (2,670 ) 3,846 Provision (benefit) for income taxes (108 ) (610 ) 1,235 185 — 702 Net income (loss) 2,723 (2,016 ) 4,151 956 (2,670 ) 3,144 Net income attributable to noncontrolling interests — — 72 349 — 421 Net income (loss) attributable to HCA Healthcare, Inc. $ 2,723 $ (2,016 ) $ 4,079 $ 607 $ (2,670 ) $ 2,723 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 2,735 $ (1,974 ) $ 4,091 $ 565 $ (2,682 ) $ 2,735 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary (as adjusted) Subsidiary (as adjusted) Eliminations Condensed Revenues $ — $ — $ 19,008 $ 13,044 $ — $ 32,052 Salaries and benefits — — 8,689 6,189 — 14,878 Supplies — — 3,163 2,206 — 5,369 Other operating expenses 5 — 3,207 2,758 — 5,970 Equity in earnings of affiliates (1,702 ) — (4 ) (32 ) 1,702 (36 ) Depreciation and amortization — — 923 658 — 1,581 Interest expense (income) 48 2,280 (947 ) (124 ) — 1,257 Gains on sales of facilities — — (6 ) (4 ) — (10 ) Losses on retirement of debt — 39 — — — 39 Management fees — — (479 ) 479 — — (1,649 ) 2,319 14,546 12,130 1,702 29,048 Income (loss) before income taxes 1,649 (2,319 ) 4,462 914 (1,702 ) 3,004 Provision (benefit) for income taxes (93 ) (856 ) 1,619 232 — 902 Net income (loss) 1,742 (1,463 ) 2,843 682 (1,702 ) 2,102 Net income attributable to noncontrolling interests — — 74 286 — 360 Net income (loss) attributable to HCA Healthcare, Inc. $ 1,742 $ (1,463 ) $ 2,769 $ 396 $ (1,702 ) $ 1,742 Comprehensive income (loss) attributable to HCA Healthcare, Inc. $ 1,812 $ (1,458 ) $ 2,778 $ 452 $ (1,772 ) $ 1,812 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET SEPTEMBER 30, 2018 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed ASSETS Current assets: Cash and cash equivalents $ — $ — $ 105 $ 473 $ — $ 578 Accounts receivable — — 3,854 2,678 — 6,532 Inventories — — 1,088 546 — 1,634 Other 47 — 667 552 — 1,266 47 — 5,714 4,249 — 10,010 Property and equipment, net — — 12,192 6,849 — 19,041 Investments of insurance subsidiaries — — — 367 — 367 Investments in and advances to affiliates 32,263 — 29 209 (32,263 ) 238 Goodwill and other intangible assets — — 5,736 2,023 — 7,759 Other 389 106 29 105 — 629 $ 32,699 $ 106 $ 23,700 $ 13,802 $ (32,263 ) $ 38,044 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Accounts payable $ — $ — $ 1,627 $ 787 $ — $ 2,414 Accrued salaries — — 914 542 — 1,456 Other accrued expenses 10 296 790 1,074 — 2,170 Long-term debt due within one year — 97 61 33 — 191 10 393 3,392 2,436 — 6,231 Long-term debt, net 996 31,471 281 168 — 32,916 Intercompany balances 36,790 (7,734 ) (27,263 ) (1,793 ) — — Professional liability risks — — — 1,239 — 1,239 Income taxes and other liabilities 508 — 364 516 — 1,388 38,304 24,130 (23,226 ) 2,566 — 41,774 Stockholders’ (deficit) equity attributable to HCA Healthcare, Inc. (5,605 ) (24,024 ) 46,846 9,441 (32,263 ) (5,605 ) Noncontrolling interests — — 80 1,795 — 1,875 (5,605 ) (24,024 ) 46,926 11,236 (32,263 ) (3,730 ) $ 32,699 $ 106 $ 23,700 $ 13,802 $ (32,263 ) $ 38,044 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed ASSETS Current assets: Cash and cash equivalents $ 1 $ — $ 112 $ 619 $ — $ 732 Accounts receivable — — 3,693 2,808 — 6,501 Inventories — — 1,030 543 — 1,573 Other — — 663 508 — 1,171 1 — 5,498 4,478 — 9,977 Property and equipment, net — — 11,110 6,785 — 17,895 Investments of insurance subsidiaries — — — 418 — 418 Investments in and advances to affiliates 29,581 — 22 177 (29,581 ) 199 Goodwill and other intangible assets — — 4,893 2,501 — 7,394 Other 510 50 47 103 — 710 $ 30,092 $ 50 $ 21,570 $ 14,462 $ (29,581 ) $ 36,593 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Accounts payable $ — $ — $ 1,793 $ 813 $ — $ 2,606 Accrued salaries — — 862 507 — 1,369 Other accrued expenses 29 378 536 1,040 — 1,983 Long-term debt due within one year — 97 64 39 — 200 29 475 3,255 2,399 — 6,158 Long-term debt, net 995 31,367 307 189 — 32,858 Intercompany balances 35,322 (9,742 ) (25,228 ) (352 ) — — Professional liability risks — — — 1,198 — 1,198 Income taxes and other liabilities 552 — 357 465 — 1,374 36,898 22,100 (21,309) 3,899 — 41,588 Stockholders’ (deficit) equity attributable to HCA Healthcare, Inc. (6,806 ) (22,050 ) 42,755 8,876 (29,581 ) (6,806 ) Noncontrolling interests — — 124 1,687 — 1,811 (6,806 ) (22,050 ) 42,879 10,563 (29,581 ) (4,995 ) $ 30,092 $ 50 $ 21,570 $ 14,462 $ (29,581 ) $ 36,593 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018 (Dollars in millions) HCA HCA Inc. Subsidiary Subsidiary Eliminations Condensed Cash flows from operating activities: Net income (loss) $ 2,723 $ (2,016 ) $ 4,151 $ 956 $ (2,670 ) $ 3,144 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Changes in operating assets and liabilities (15 ) (83 ) (154 ) 105 — (147 ) Depreciation and amortization — — 992 705 — 1,697 Gains on sales of facilities — — (378 ) (42 ) — (420 ) Losses on retirement of debt — 9 — — — 9 Amortization of debt issuance costs — 23 — — — 23 Share-based compensation — — 204 — — 204 Equity in earnings of affiliates (2,670 ) — — — 2,670 — Other 67 — — 9 — 76 Net cash provided by (used in) operating activities 105 (2,067 ) 4,815 1,733 — 4,586 Cash flows from investing activities: Purchase of property and equipment — — (1,425 ) (995 ) — (2,420 ) Acquisition of hospitals and health care entities — — (894 ) (162 ) — (1,056 ) Disposition of hospitals and health care entities — — 770 32 — 802 Change in investments — — 19 46 — 65 Other — — (18 ) 12 — (6 ) Net cash used in investing activities — — (1,548 ) (1,067 ) — (2,615 ) Cash flows from financing activities: Issuance of long-term debt — 2,000 — — — 2,000 Net change in revolving credit facilities — (330 ) — — — (330 ) Repayment of long-term debt — (1,566 ) (44 ) (42 ) — (1,652 ) Distributions to noncontrolling interests — — (63 ) (252 ) — (315 ) Payment of debt issuance costs — (24 ) — — — (24 ) Payment of cash dividends (366 ) — — — — (366 ) Repurchases of common stock (1,195 ) — — — — (1,195 ) Changes in intercompany balances with affiliates, net 1,697 1,987 (3,167 ) (517 ) — — Other (242 ) — — 10 — (232 ) Net cash (used in) provided by financing activities (106 ) 2,067 (3,274 ) (801 ) — (2,114 ) Effect on exchange rate changes on cash and cash equivalents — — — (11 ) — (11 ) Change in cash and cash equivalents (1 ) — (7 ) (146 ) — (154 ) Cash and cash equivalents at beginning of period 1 — 112 619 — 732 Cash and cash equivalents at end of period $ — $ — $ 105 $ 473 $ — $ 578 HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions) HCA HCA Inc. Subsidiary (as adjusted) Subsidiary (as adjusted) Eliminations Condensed Cash flows from operating activities: Net income (loss) $ 1,742 $ (1,463 ) $ 2,843 $ 682 $ (1,702 ) $ 2,102 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Changes in operating assets and liabilities (15 ) (293 ) (191 ) 210 — (289 ) Depreciation and amortization — — 923 658 — 1,581 Income taxes (9 ) — — — — (9 ) Gains on sales of facilities — — (6 ) (4 ) — (10 ) Losses on retirement of debt — 39 — — — 39 Amortization of debt issuance costs — 23 — — — 23 Share-based compensation — — 195 — — 195 Equity in earnings of affiliates (1,702 ) — — — 1,702 — Other 58 — 2 — — 60 Net cash provided by (used in) operating activities 74 (1,694 ) 3,766 1,546 — 3,692 Cash flows from investing activities: Purchase of property and equipment — — (1,161 ) (872 ) — (2,033 ) Acquisition of hospitals and health care entities — — (9 ) (1,133 ) — (1,142 ) Disposition of hospitals and health care entities — — 12 12 — 24 Change in investments — — 1 (16 ) — (15 ) Other — — (7 ) 1 — (6 ) Net cash used in investing activities — — (1,164 ) (2,008 ) — (3,172 ) Cash flows from financing activities: Issuance of long-term debt — 1,500 — 2 — 1,502 Net change in revolving credit facilities — 650 — — — 650 Repayment of long-term debt — (604 ) (54 ) (42 ) — (700 ) Distributions to noncontrolling interests — — (105 ) (258 ) — (363 ) Payment of debt issuance costs — (25 ) — — — (25 ) Repurchases of common stock (1,475 ) — — — — (1,475 ) Changes in intercompany balances with affiliates, net 1,468 173 (2,439 ) 798 — — Other (66 ) — 1 28 — (37 ) Net cash (used in) provided by financing activities (73 ) 1,694 (2,597 ) 528 — (448 ) Change in cash and cash equivalents 1 — 5 66 — 72 Cash and cash equivalents at beginning of period — — 114 532 — 646 Cash and cash equivalents at end of period $ 1 $ — $ 119 $ 598 $ — $ 718 The above supplemental condensed consolidating financial information for the quarter and nine months ended September 30, 2017 has been adjusted to properly record the impact of certain subsidiaries that were non-guarantors non-guarantor Non-Guarantors As Adjustment As Adjusted Quarter ended September 30, 2017 Net income (loss) attributable to HCA Healthcare, Inc.: HCA Healthcare, Inc. Issuer $ 426 $ — $ 426 HCA Inc. Issuer (524 ) — (524 ) Subsidiary Guarantors 787 117 904 Subsidiary Non-Guarantors 173 (117 ) 56 Eliminations (436 ) — (436 ) Condensed Consolidated $ 426 $ — $ 426 As Adjustment As Adjusted Nine months ended September 30, 2017 Net income (loss) attributable to HCA Healthcare, Inc.: HCA Healthcare, Inc. Issuer $ 1,742 $ — $ 1,742 HCA Inc. Issuer (1,463 ) — (1,463 ) Subsidiary Guarantors 2,467 302 2,769 Subsidiary Non-Guarantors 698 (302 ) 396 Eliminations (1,702 ) — (1,702 ) Condensed Consolidated $ 1,742 $ — $ 1,742 As Adjustment As Adjusted Nine months ended September 30, 2017 Net cash provided (used in) operating activities: HCA Healthcare, Inc. Issuer $ 74 $ — $ 74 HCA Inc. Issuer (1,694 ) — (1,694 ) Subsidiary Guarantors 3,342 424 3,766 Subsidiary Non-Guarantors 1,970 (424 ) 1,546 Eliminations — — — Condensed Consolidated $ 3,692 $ — $ 3,692 |