EXHIBIT 99
(PROVINCE HEALTHCARE LOGO)
NEWS RELEASE
FOR IMMEDIATE RELEASE
CONTACT: MERILYN H. HERBERT
VICE PRESIDENT, INVESTOR RELATIONS
(615) 370-1377
PROVINCE HEALTHCARE REPORTS THIRD QUARTER RESULTS
Brentwood, TN, October 27, 2003 - Province Healthcare Company (NYSE:PRV)
today announced results consistent with its previously disclosed expectations
for the third quarter ended September 30, 2003. Diluted earnings per share (EPS)
for the quarter were $0.20, compared with $0.19 in the prior year's quarter.
Net operating revenues for the third quarter of 2003 increased 6.2% to
$195.4 million compared with $184.0 million in the same quarter of last year.
Earnings before interest, income taxes, depreciation, amortization, loss on sale
of assets, loss on extinguishment of debt and minority interests ("Adjusted
EBITDA") were $33.3 million compared with $31.4 million in last year's third
quarter. Net income for the quarter was $9.8 million, compared with last year's
net income of $9.4 million. Cash flow from operations exceeded all expectations
and totaled $34.9 million in the third quarter of 2003. Accounts receivable days
outstanding stood at 55 days at September 30, 2003.
Net operating revenues for the first nine months of 2003 increased 11.9% to
$585.6 million compared with $523.6 million in the same period of 2002. Adjusted
EBITDA was $97.9 million compared with $95.3 million in the previous year. Net
income for the first nine months of 2003 was $29.3 million or $0.60 per diluted
share, compared with last year's $0.64 per diluted share on net income of $32.1
million.
Province ended the third quarter of 2003 with 20 owned or leased hospitals,
all of which are now same-store hospitals.
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Adjusted admissions increased 2.3% quarter over quarter, and total
admissions increased 0.5%. In addition, gross outpatient revenue increased 11.4%
and net revenue per adjusted admissions increased 3.8%.
Martin S. Rash, Chairman and Chief Executive Officer of Province
Healthcare, said, "Our third quarter results clearly indicate the favorable
trends at Province, with positive admissions in this tough economic environment,
a 6.2% increase in revenue, and continued strong cash flow from operations.
Expectations had been cash flow from operations in the third quarter of
approximately $20.0 million, which we exceeded by $14.9 million. Additionally,
103 new physicians will start to practice in our communities this year, our best
recruiting year in the history of our Company."
A listen-only simulcast, as well as a 30-day replay, of Province
Healthcare's third quarter conference call will be available on-line at
www.prhc.net on October 28, 2003, beginning at 11:00 a.m. Eastern Standard Time.
The Company owns or leases 20 general acute care hospitals in 13 states
with a total of 2,281 licensed beds. The Company also provides management
services to 37 non-urban hospitals in 14 states with a total of 3,043 licensed
beds.
Certain statements contained in this release, constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements may include projections of revenues, income or loss,
capital expenditures, capital structure, or other financial items, statements
regarding the plans and objectives of management for future operations,
statements of future economic performance, statements of the assumptions
underlying or relating to any of the foregoing statements, and other statements
which are other than statements of historical fact. These statements are based
on current estimates of future events, and the Company has no obligation to
update or correct these estimates unless considered material to the Company.
Forward-looking statements involve known and unknown risks and uncertainties
which may cause the Company's actual results in future periods to differ
materially from forecasted results. Those risks include, among others, risks
associated with general economic and business conditions, the effect of future
governmental regulations, changes in
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PAGE THREE
reimbursement levels by government programs, including Medicare and Medicaid or
other third party payors, the Company's continued ability to recruit and retain
physicians and the Company's ability to successfully complete and integrate
acquisitions. Those and other risks are described in the Company's reports and
filings with the Securities and Exchange Commission.
CONTACT: Merilyn H. Herbert, Province Healthcare Company (PRV) at (615) 370-1377
- TABLES TO FOLLOW -
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
September 30, December 31,
2003 2002(*)
--------------- ---------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 38,804 $ 14,417
Accounts receivable, less allowance for doubtful accounts
of $62,173 in 2003 and $68,158 in 2002 114,378 117,431
Inventories 19,131 19,835
Prepaid expenses and other 15,710 14,071
--------------- ---------------
188,023 165,754
Property and equipment, net 463,949 447,379
Goodwill 318,014 319,390
Unallocated purchase price 3,247 466
Other assets 40,435 38,722
--------------- ---------------
$ 1,013,668 $ 971,711
=============== ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 17,680 $ 20,162
Accrued salaries and benefits 25,903 25,380
Accrued expenses 25,701 13,198
Current portion of long-term debt 1,724 1,668
--------------- ---------------
71,008 60,408
Long-term debt, less current portion 451,546 461,576
Other liabilities 44,577 33,913
Minority interests 2,726 2,612
Stockholders' equity:
Preferred stock - $0.01 par value, 100,000 shares
authorized, none issued and outstanding -- --
Common stock - $0.01 par value; 150,000,000 shares
authorized at September 30, 2003 and December 31, 2002,
issued and outstanding 48,734,607 shares
and 48,581,549 shares at September 30, 2003 and
December 31, 2002, respectively 487 486
Additional paid-in-capital 305,457 304,102
Retained earnings 138,886 109,567
Accumulated other comprehensive loss (1,019) (953)
--------------- ---------------
Total stockholders' equity 443,811 413,202
--------------- ---------------
$ 1,013,668 $ 971,711
=============== ===============
- ------------------
(*) Derived from the audited consolidated financial statements of Province
and its subsidiaries, contained in the Company's Annual Report on Form
10-K, filed with the Securities and Exchange Commission on March 24, 2003.
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended September 30,
2003 2002
------------------------------------------------------
% of % of
Amount Revenues Amount Revenues
----------- ----------- ----------- -----------
Revenue:
Net patient service revenue $ 189,091 $ 178,111
Other 6,338 5,851
----------- -----------
Net operating revenue 195,429 100.0% 183,962 100.0%
Operating expenses:
Salaries, wages and benefits 71,109 36.4 72,115 39.2
Purchased services 18,038 9.2 19,305 10.5
Supplies 24,738 12.7 23,396 12.7
Provision for doubtful accounts 20,008 10.2 14,042 7.6
Other operating expenses 25,827 13.2 21,576 11.8
Rentals and leases 2,385 1.2 2,165 1.2
----------- ----------- ----------- -----------
162,105 82.9 152,599 83.0
----------- ----------- ----------- -----------
Adjusted EBITDA (*) 33,324 17.1 31,363 17.0
Depreciation and amortization 9,738 5.1 9,419 5.1
Interest expense 7,097 3.6 6,218 3.4
Minority interests 52 -- 16 --
Loss on sale of assets 82 -- -- --
Loss on early extinguishment of debt 10 -- -- --
----------- ----------- ----------- -----------
Income before provision for income taxes 16,345 8.4 15,710 8.5
Income taxes 6,538 3.4 6,284 3.4
----------- ----------- ----------- -----------
Net income $ 9,807 5.0% $ 9,426 5.1%
=========== =========== =========== ===========
Net income per common share:
Basic $ 0.20 $ 0.19
=========== ===========
Diluted $ 0.20 $ 0.19
=========== ===========
Weighted average common shares:
Basic 48,729,000 48,544,000
=========== ===========
Diluted 49,639,000 49,607,000
=========== ===========
-----------------------------------
(*) Adjusted EBITDA for 2003 and 2002, represents income before provision for
income taxes, depreciation and amortization, interest, minority interests,
loss on sale of assets and loss on extinguishment of debt. Adjusted EBITDA
serves as a measure of leverage capacity and debt service ability, and is
commonly used as an analytical indicator within the healthcare industry.
Adjusted EBITDA, however, is not a measure of financial performance under
accounting principles generally accepted in the United States, and should
not be considered an alternative to net income as a measure of operating
performance or to cash flows from operating, investing or financing
activities as a measure of liquidity. Because Adjusted EBITDA is not a
measurement determined in accordance with accounting principles generally
accepted in the United States and is susceptible to varying calculations,
Adjusted EBITDA as presented may not be comparable to other similarly
titled measures of other companies.
PROVINCE HEALTHCARE COMPANY AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Nine Months Ended September 30,
2003 2002
--------------------------------- ---------------------------------
% of % of
Amount Revenues Amount Revenues
--------------- --------------- --------------- ---------------
Revenue:
Net patient service revenue $ 566,298 $ 506,125
Other 19,344 17,438
--------------- ---------------
Net operating revenue 585,642 100.0% 523,563 100.0%
Operating expenses:
Salaries, wages and benefits 221,379 37.8 201,743 38.5
Purchased services 54,699 9.3 54,605 10.4
Supplies 73,344 12.5 63,606 12.1
Provision for doubtful accounts 54,991 9.4 41,533 7.9
Other operating expenses 76,120 13.1 60,275 11.7
Rentals and leases 7,241 1.2 6,518 1.2
--------------- --------------- --------------- ---------------
487,774 83.3 428,280 81.8
--------------- --------------- --------------- ---------------
Adjusted EBITDA (*) 97,868 16.7 95,283 18.2
Depreciation and amortization 28,515 4.9 25,751 4.9
Interest expense 19,716 3.5 15,959 3.1
Minority interests 201 -- 72 --
Loss on sale of assets 85 -- 53 --
Loss on early extinguishment of debt 486 -- -- --
--------------- --------------- --------------- ---------------
Income before provision for income taxes 48,865 8.3 53,448 10.2
Income taxes 19,546 3.3 21,379 4.1
--------------- --------------- --------------- ---------------
Net income $ 29,319 5.0% $ 32,069 6.1%
=============== =============== =============== ===============
Net income per common share:
Basic $ 0.60 $ 0.67
=============== ===============
Diluted $ 0.60 $ 0.64
=============== ===============
Weighted average common shares:
Basic 48,681,000 48,002,000
=============== ===============
Diluted 49,143,000 61,424,000
=============== ===============
- -----------------------------------
See accompanying footnote on previous page.
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
Three Months Ended September 30,
----------------------------------
2003 2002
--------------- ---------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 9,807 $ 9,426
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 9,738 9,418
Deferred income taxes 314 1,727
Provision for professional liability 1,423 1,807
Loss on early extinguishment of debt 9 --
Loss of sale of assets 83 --
Changes in operating assets and liabilities, net of effects
from acquisitions and disposals:
Accounts receivable 3,594 (465)
Inventories 240 194
Prepaid expenses and other 4,620 (1,747)
Accounts payable and accrued expenses 4,023 3,668
Accrued salaries and benefits (815) (3,611)
Other 1,814 2,184
--------------- ---------------
Net cash provided by operating activities 34,850 22,601
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (13,552) (10,321)
Escrow deposit on potential investment 3,798 --
Purchase of hospitals and healthcare entities (94) 321
--------------- ---------------
Net cash used in investing activities (9,848) (10,000)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt (13) 27
Repayments of debt (5,359) (24,259)
Issuance of common stock 121 790
--------------- ---------------
Net cash (used in) provided by financing activities (5,251) (23,442)
--------------- ---------------
Increase (decrease) in cash and cash equivalents 19,751 (10,841)
Cash and cash equivalents at beginning of period 19,053 23,044
--------------- ---------------
Cash and cash equivalents at end of period $ 38,804 $ 12,203
=============== ===============
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
Nine Months Ended September 30,
--------------------------------
2003 2002
-------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 29,319 $ 32,069
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 28,515 25,751
Deferred income taxes 3,469 1,840
Provision for professional liability 4,806 5,403
Loss on early extinguishment of debt 486 --
Loss of sale of assets 85 53
Changes in operating assets and liabilities, net of effects
from acquisitions and disposals:
Accounts receivable 4,068
Inventories 637 (1,311)
Prepaid expenses and other
Accounts payable and accrued expenses
Accrued salaries and benefits 523
Other 6,173 2,973
-------------- --------------
Net cash provided by operating activities 90,070 75,235
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (44,406) (36,109)
Purchase of hospitals and healthcare entities (3,247) (171,707)
-------------- --------------
Net cash used in investing activities (47,653) (207,816)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt 194,199 134,355
Repayments of debt (213,585) (39,451)
Issuance of common stock 1,356 10,505
-------------- --------------
Net cash (used in) provided by financing activities (18,030) 105,409
-------------- --------------
Increase (decrease) in cash and cash equivalents 24,387 (27,172)
Cash and cash equivalents at beginning of period 14,417 39,375
-------------- --------------
Cash and cash equivalents at end of period $ 38,804 $ 12,203
============== ==============
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
SELECTED OPERATING STATISTICS (UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Actual Same Store(1)
---------------------------- ----------------------------
Three Months Ended Three Months Ended
September 30, September 30,
---------------------------- ----------------------------
2003 2002 2003 2002
------------ ------------ ------------ ------------
CONSOLIDATED HOSPITALS:
Number of hospitals at end of period 20 20 20 20
Licensed beds at end of period 2,281 2,315 2,281 2,315
Beds in service at end of period 1,993 1,905 1,993 1,905
Inpatient admissions 18,683 18,584 18,683 18,584
Adjusted admissions (2) 34,284 33,520 34,284 33,520
Patient days 76,084 77,738 76,084 77,738
Adjusted patient days (3) 139,634 140,250 139,634 140,250
Average length of stay (days) 4.1 4.2 4.1 4.2
Net patient service revenue $ 189,091 $ 178,111 $ 189,091 $ 178,111
Gross revenue:
Inpatient $ 228,966 $ 213,510 $ 228,966 $ 213,510
Outpatient 191,130 171,600 191,130 171,600
------------ ------------ ------------ ------------
$ 420,096 $ 385,110 $ 420,096 $ 385,110
------------ ------------ ------------ ------------
NET PATIENT REVENUE BY PAYOR:
Medicare 37.4% 42.2% 37.4% 42.2%
Medicaid 11.4 10.9 11.4 10.9
Other 51.2 46.9 51.2 46.9
------------ ------------ ------------ ------------
Total 100.0% 100.0% 100.0% 100.0%
============ ============ ============ ============
Three Months Ended September 30,
--------------------------------
2003 2002
-------------- --------------
DILUTED EARNINGS PER SHARE CALCULATION:
Net income $ 9,807 $ 9,426
Add convertible notes interest, net of tax (4) -- --
-------------- --------------
Adjusted net income $ 9,807 $ 9,426
============== ==============
Basic shares plus stock options 49,639 49,607
Convertible shares (4) -- --
-------------- --------------
Diluted shares outstanding 49,639 49,607
============== ==============
Diluted earnings per share $ 0.20 $ 0.19
============== ==============
- ------------
(1) Represents twenty hospitals owned or leased during both periods.
(2) Used by management and investors as a general measure of combined inpatient
and outpatient volume. Adjusted admissions are computed by multiplying
admissions (inpatient volume) by the outpatient factor. The outpatient
factor is the sum of gross inpatient revenue and gross outpatient revenue
divided by gross inpatient revenue. The adjusted admissions computation
equates outpatient revenue to the volume measure (admissions) used to
measure inpatient volume, resulting in a general measure of combined
inpatient and outpatient volume.
(3) Adjusted patient days are computed by multiplying patient days (inpatient
volume) by the outpatient factor. The outpatient factor is the sum of gross
inpatient revenue and gross outpatient revenue divided by gross inpatient
revenue. The adjusted patient days computation equates outpatient revenue
to the volume measure (patient days) used to measure inpatient volume,
resulting in a general measure of combined inpatient and outpatient volume.
(4) The Company's two outstanding series of convertible notes are anti-dilutive
for the three and nine months ended September 30, 2003, and for the three
months ended September 30, 2002, and thus, are not included in the diluted
earnings per share calculation for such periods.
PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
SELECTED OPERATING STATISTICS (UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Actual Same Store(1)
---------------------------- ----------------------------
Nine Months Ended Nine Months Ended
September 30, September 30,
---------------------------- ----------------------------
2003 2002 2003 2002
------------ ------------ ------------ ------------
CONSOLIDATED HOSPITALS:
Number of hospitals at end of period 20 20 20 20
Licensed beds at end of period 2,281 2,315 2,281 2,315
Beds in service at end of period 1,993 1,905 1,993 1,905
Inpatient admissions 56,971 54,432 52,546 53,019
Adjusted admissions(2) 102,477 93,773 92,655 90,833
Patient days 238,340 234,492 219,025 228,602
Adjusted patient days(3) 428,648 403,590 386,040 391,263
Average length of stay (days) 4.2 4.3 4.2 4.3
Net patient service revenue $ 566,298 $ 506,125 $ 502,347 $ 488,904
Gross revenue:
Inpatient $ 705,158 $ 633,588 $ 658,757 $ 621,281
Outpatient 563,273 457,010 502,448 442,363
------------ ------------ ------------ ------------
$ 1,268,431 $ 1,090,598 $ 1,161,205 $ 1,063,644
------------ ------------ ------------ ------------
NET PATIENT REVENUE BY PAYOR:
Medicare 38.0% 46.2% 38.8% 46.9%
Medicaid 11.4 12.1 12.5 12.5
Other 50.6 41.7 48.7 40.6
------------ ------------ ------------ ------------
Total 100.0% 100.0% 100.0% 100.0%
============ ============ ============ ============
Nine Months Ended September 30,
2003 2002
--------------- ---------------
DILUTED EARNINGS PER SHARE CALCULATION:
Net income $ 29,319 $ 32,069
Add convertible notes interest, net of tax (4) -- 7,302
--------------- ---------------
Adjusted net income $ 29,319 $ 39,371
=============== ===============
Basic shares plus stock options 49,143 49,525
Convertible shares (4) -- 11,899
--------------- ---------------
Diluted shares outstanding 49,143 61,424
=============== ===============
Diluted earnings per share $ 0.60 $ 0.64
=============== ===============
- -----------------------------------
See accompanying footnotes on previous page.