Exhibit Number
99.1
[CHS LOGO] COMMUNITY HEALTH
SYSTEM INC.
Investor Contact: W. Larry Cash
Executive Vice President
and Chief Financial Officer
(615) 465-7000
COMMUNITY HEALTH SYSTEMS, INC. ANNOUNCES
FIRST QUARTER 2006 RESULTS WITH NET OPERATING REVENUES UP 13%
BRENTWOOD, TN. (April 26, 2006) -- Community Health Systems, Inc. (NYSE: CYH)
today announced financial and operating results for the first quarter ended
March 31, 2006.
Net operating revenues for the quarter ended March 31, 2006, totaled
$1.027 billion, a 13.0% increase compared with $908.3 million for the same
period last year. Income from continuing operations increased 16.7% to $57.3
million, or $0.58 per share (diluted), on 98.2 million weighted average shares
outstanding for the quarter ended March 31, 2006, compared with $49.1 million,
or $0.52 per share (diluted), on 98.1 million weighted average shares
outstanding for the same period last year. Net income increased to $54.0
million, or $0.55 per share (diluted), for the quarter ended March 31, 2006,
compared with $36.0 million, or $0.39 per share (diluted), for the same period
last year. Loss on discontinued operations for the quarter ended March 31, 2006,
consists of an after-tax loss of approximately $3.2 million, or $0.03 per share
(diluted), related primarily to the sale of one hospital in March of 2006, which
was designated as being held for sale at December 31, 2005.
The first quarter 2006 results include additional compensation expense of
$3.2 million, or $0.02 per diluted share, resulting from stock-based
compensation calculated under SFAS No. 123(R), "Share-Based Payment".
Adjusted EBITDA for the first quarter of 2006 was $158.5 million, compared
with $143.8 million for the same period last year, representing a 10.2%
increase. Adjusted EBITDA is EBITDA adjusted to exclude discontinued operations
and minority interest in earnings. The Company uses adjusted EBITDA as a measure
of liquidity. Net cash provided by operating activities for the first quarter of
2006 was $90.8 million, compared with $148.7 million for the same period last
year.
The consolidated financial results for the quarter ended March 31, 2006,
reflect a 4.6% increase in total admissions compared with the same period last
year. This increase is primarily attributable to hospitals acquired during 2006
and 2005. On a same-store basis, admissions decreased 2.4% and adjusted
admissions decreased 0.9%, compared with the same period last year. The absence
of a flu season and respiratory - related volume contributed to these decreases
compared to a strong season last year. On a same-store basis, net operating
revenues increased 6.8%, compared with the same period last year.
Commenting on the results, Wayne T. Smith, chairman, president and chief
executive officer of Community Health Systems, Inc. stated, "The first quarter
marks a very strong start to 2006. For the first time in Community Health
Systems' operating history, the Company exceeded $1 billion in quarterly
revenues. In addition to our impressive top-line growth, we have compiled an
enviable track record of consistently meeting our earnings targets. Our
continued profitability and operating execution reflects our ability to leverage
our proven centralized and standardized operating platform in our hospitals."
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CYH Announces First Quarter 2006 Results
Page 2
April 26, 2006
On March 1, 2006, the Company completed the acquisition of Forrest City
Hospital, a 118 bed acute care hospital located in Forrest City, Arkansas. The
Company is the sole provider of acute care hospital services in the Forrest
City, Arkansas, market.
On April 1, 2006, the Company completed the acquisition of two hospitals
from the Baptist Health System, Birmingham, Alabama: Baptist Medical Center -
DeKalb (134 beds) located in Fort Payne, Alabama and Baptist Medical Center -
Cherokee (60 beds) located in Centre, Alabama. Each hospital is the sole
provider of hospital services in its community.
"Our acquisition pace has continued to be strong and steady through the
first quarter of this year," Smith added. "More importantly, with the definitive
agreements we have pending and other active opportunities in our pipeline, the
market looks very favorable for 2006. Our track record demonstrates that we are
well positioned to make the most of these opportunities. We are very pleased
with these trends in our business as we continue to build our portfolio of
hospitals and extend our business model to more communities. We look forward to
another successful year for Community Health Systems."
Included on pages 9, 10 and 11 of this press release is a table setting
forth selected information concerning the consolidated results of the Company
for the year ended December 31, 2005, and updated projected consolidated
operating results of the Company for the year ending December 31, 2006.
Located in the Nashville, Tennessee, suburb of Brentwood, Community Health
Systems, Inc. is a leading operator of general acute care hospitals in non-urban
communities throughout the country. Through its subsidiaries, the Company
currently owns, leases or operates 73 hospitals in 21 states. Its hospitals
offer a broad range of inpatient medical and surgical services, outpatient
treatment and skilled nursing care. Shares in Community Health Systems, Inc. are
traded on the New York Stock Exchange under the symbol "CYH".
Community Health Systems, Inc. will hold a conference call to discuss this
press release on Thursday, April 27, 2006, at 10:30 a.m. Central, 11:30 a.m.
Eastern. Investors will have the opportunity to listen to a live Internet
broadcast of the conference call by clicking on the Investor Relations link of
the Company's website at www.chs.net, or at www.earnings.com. To listen to the
live call, please go to the website at least fifteen 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 shortly after the call and
continue through May 27, 2006. A copy of the Company's Form 8-K (including this
press release) and conference call slide show will also be available on the
Company's website at www.chs.net.
Statements contained in this news release regarding expected operating
results, acquisition transactions and other events are forward-looking
statements that involve risk and uncertainties. Actual future events or results
may differ materially from these statements. Readers are referred to the
documents filed by Community Health Systems, Inc. with the Securities and
Exchange Commission, including the Company's annual report on Form 10-K and,
current reports on Form 8-K. These filings identify important risk factors and
other uncertainties that could cause actual results to differ from those
contained in the forward-looking statements. The Company undertakes no
obligation to revise or update any forward-looking statements, or to make any
other forward-looking statements, whether as a result of new information, future
events or otherwise.
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CYH Announces First Quarter 2006 Results
Page 3
April 26, 2006
COMMUNITY HEALTH SYSTEMS, INC.
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per share amounts)
THREE MONTHS ENDED
MARCH 31,
---------------------------------
2006 2005(a)
--------------- ---------------
Net operating revenues $ 1,026,562 $ 908,263
Adjusted EBITDA (e) $ 158,458 $ 143,782
Income from continuing operations $ 57,254 $ 49,079
Net income $ 54,038 $ 35,988
Income from continuing operations
per share-basic $ 0.59 $ 0.56
Income from continuing operations
per share-diluted $ 0.58(b) $ 0.52(c)
Net income per share - basic $ 0.56 $ 0.41
Net income per share - diluted $ 0.55 $ 0.39(c)
Weighted average number of shares
outstanding - basic 96,552 87,926
Weighted average number of shares
outstanding - diluted 98,209(d) 98,087(d)
Net cash provided by operating activities $ 90,814 $ 148,709
- ------------
(a) Pursuant to Statement of Financial Accounting Standards ("SFAS") No. 144,
the Company has restated the first quarter 2005 financial statements and
statistical results to reflect the reclassification as discontinued
operations of one hospital designated as being held-for-sale during the
second quarter of 2005, which was subsequently sold in March of 2006. Four
hospitals were previously classified as discontinued operations in 2005.
(b) Includes additional compensation expense of $0.02 per share (diluted)
resulting from stock-based compensation calculated under SFAS No. 123(R)
"Share-Based Payment". The Company adopted SFAS No. 123(R) beginning
January 1, 2006, using the modified prospective application transition
method.
(c) For purposes of calculating earnings per share for the quarter ended March
31, 2005, the convertible notes are dilutive and accordingly after tax
interest expense of $2.2 million per quarter is excluded from the
calculation of earnings and 8.6 million shares are added to the number of
shares outstanding to calculate fully diluted earnings per share.
(d) Adjusted to include assumed exercise of employee stock options and assumed
conversion of convertible notes. As of March 31, 2006, all of the
convertible notes have been redeemed. 8,569,593 shares of common stock of
the Company were issued upon conversion of the outstanding notes and $0.4
million of the notes were redeemed in exchange for cash. There was no
impact on earnings per share (diluted) as a result of this conversion
since weighted average number of shares outstanding-diluted for the three
months ended March 31, 2005 included the shares issuable upon conversion
of the convertible notes.
(Footnotes continued on next page.)
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CYH Announces First Quarter 2006 Results
Page 4
April 26, 2006
(e) EBITDA consists of income before interest, income taxes, and depreciation
and amortization. Adjusted EBITDA is EBITDA adjusted to exclude
discontinued operations and minority interest in earnings. The Company has
from time to time sold minority interests in certain of its subsidiaries
or acquired subsidiaries with existing minority interest ownership
positions. The Company believes that it is useful to present adjusted
EBITDA because it excludes the portion of EBITDA attributable to these
third party interests and clarifies for investors the Company's portion of
EBITDA generated by continuing operations. The Company uses adjusted
EBITDA as a measure of liquidity. The Company has included this measure
because it believes it provides investors with additional information
about the Company's ability to incur and service debt and make capital
expenditures. Adjusted EBITDA is the basis for a key component in the
determination of the Company's compliance with some of the covenants under
the Company's senior secured credit facility, as well as to determine the
interest rate and commitment fee payable under the senior secured credit
facility.
Adjusted EBITDA is not a measurement of financial performance or liquidity
under generally accepted accounting principles. It should not be
considered in isolation or as a substitute for net income, operating
income, cash flows from operating, investing or financing activities, or
any other measure calculated in accordance with generally accepted
accounting principles. The items excluded from adjusted EBITDA are
significant components in understanding and evaluating financial
performance and liquidity. This calculation of adjusted EBITDA may not be
comparable to similarly titled measures reported by other companies.
The following table reconciles adjusted EBITDA, as defined, to net cash
provided by operating activities as derived directly from the consolidated
financial statements for the three months ended March 31, 2006 and 2005
(in thousands):
THREE MONTHS ENDED
MARCH 31,
----------------------------
2006 2005
------------ ------------
Adjusted EBITDA $ 158,458 $ 143,782
Interest expense, net (21,787) (22,781)
Provision for income taxes (36,298) (31,238)
Loss from operations of hospitals sold and
lease termination, net of taxes (657) (5,473)
Depreciation and amortization of
discontinued operations
-- 1,340
Other non-cash expenses, net
(1,299) 25
Net changes in operating assets and liabilities,
net of effects of acquisitions
(7,603) 63,054
------------ ------------
Net cash provided by operating activities $ 90,814 $ 148,709
============ =============
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CYH Announces First Quarter 2006 Results
Page 5
April 26, 2006
COMMUNITY HEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
THREE MONTHS ENDED
MARCH 31,
----------------------------
2006 2005
------------ ------------
Net operating revenues $ 1,026,562 $ 908,263
------------ ------------
Operating expenses:
Salaries and benefits 407,668 360,233
Provision for bad debts 107,591 93,051
Supplies 122,820 112,656
Other operating expenses 207,043 178,064
Rent 22,982 20,477
Depreciation and amortization 42,506 39,797
Minority interests in earnings 613 887
------------ ------------
Total expenses 911,223 805,165
------------ ------------
Income from operations 115,339 103,098
Interest expense, net 21,787 22,781
------------ ------------
Income from continuing operations
before income taxes 93,552 80,317
Provision for income taxes 36,298 31,238
------------ ------------
Income from continuing operations 57,254 49,079
------------ ------------
Discontinued operations, net of taxes;
Loss from operations (657) (5,473)
Loss on sale of hospitals (2,559) (7,618)
------------ ------------
Loss on discontinued operations (3,216) (13,091)
------------ ------------
Net income $ 54,038 $ 35,988
============ ============
Income from continuing operations per share-basic $ 0.59 $ 0.56
============ ============
Income from continuing operations per share-diluted $ 0.58 $ 0.52
============ ============
Net income per share - basic $ 0.56 $ 0.41
============ ============
Net income per share - diluted $ 0.55 $ 0.39
============ ============
Weighted average number of shares
outstanding:
Basic 96,552 87,926
------------ ------------
Diluted 98,209 98,087
------------ ------------
Net Income per share calculation:
Net income $ 54,038 $ 35,988
Add - Convertible notes interest, net of taxes 135 2,189
------------ ------------
Adjusted net income $ 54,173 $ 38,177
============ ============
Weighted average number of shares
outstanding - basic 96,552 87,926
Add effect of dilutive securities:
Stock awards 1,068 1,579
Convertible notes 589 8,582
------------ ------------
Weighted average number of shares
outstanding - diluted 98,209 98,087
============ ============
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CYH Announces First Quarter 2006 Results
Page 6
April 26, 2006
COMMUNITY HEALTH SYSTEMS, INC.
SELECTED OPERATING DATA
(Unaudited)
($ in thousands)
FOR THE THREE MONTHS ENDED MARCH 31,
--------------------------------------------------------------------
CONSOLIDATED SAME-STORE
----------------------------------- ------------------------------
2006 2005 % CHANGE 2006 2005 % CHANGE
------------- -------- -------- -------- -------- --------
Number of hospitals (at end of period) 71 67 67 67
Licensed beds (at end of period) 8,074 7,580 7,509 7,580
Beds in service (at end of period) 6,528 6,175 6,183 6,175
Admissions 78,966 75,490 4.6% 73,703 75,490 -2.4%
Adjusted admissions 143,168 134,513 6.4% 133,266 134,513 -0.9%
Patient days 333,249 319,499 4.3% 310,266 319,499 -2.9%
Average length of stay (days) 4.2 4.2 4.2 4.2
Occupancy rate (average beds in service) 57.0% 58.7% 56.9% 58.7%
Net operating revenues $ 1,026,562 $908,263 13.0% $970,036 $908,153 6.8%
Net inpatient revenue as a % of
total net operating revenues 50.9% 51.9% 50.9% 51.9%
Net outpatient revenue as a % of
total net operating revenues 47.8% 47.0% 47.8% 47.0%
Income from operations $ 115,339 $103,098 11.9% $114,810 $103,302 11.1%
Income from operations as a
% of net operating revenues 11.2% 11.4% 11.8% 11.4%
Depreciation and amortization $ 42,506 $ 39,797 $ 40,344 $ 39,628
Minority interest in earnings $ 613 $ 887 $ 958 $ 887
Liquidity Data:
Adjusted EBITDA $ 158,458 $143,782 10.2%
Adjusted EBITDA as a % of net
operating revenues 15.4% 15.8%
Net cash provided by operating activities $ 90,814 $148,709
Net cash provided by operating activities as
a % of net operating revenue 8.8% 16.4%
- ----------
Continuing operating results and statistical data exclude discontinued
operations for all periods presented.
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CYH Announces First Quarter 2006 Results
Page 7
April 26, 2006
COMMUNITY HEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
MARCH 31, DECEMBER 31,
2006 2005
-------------- --------------
ASSETS
Current assets
Cash and cash equivalents $ 111,951 $ 104,108
Patient accounts receivable, net of allowance for doubtful accounts of
$340,847 and $346,024 at March 31, 2006 and December 31, 2005,
respectively 699,067 656,029
Supplies 94,864 95,200
Deferred income taxes 4,128 4,128
Prepaid expenses and taxes 32,445 33,377
Other current assets 53,455 36,494
-------------- --------------
Total current assets 995,910 929,336
-------------- --------------
Property and equipment 2,175,228 2,128,639
Less accumulated depreciation and amortization (547,770) (517,648)
-------------- --------------
Property and equipment, net 1,627,458 1,610,991
-------------- --------------
Goodwill 1,267,557 1,259,816
-------------- --------------
Other assets, net 158,364 149,202
-------------- --------------
Total assets $ 4,049,289 $ 3,949,345
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt $ 19,284 $ 19,124
Accounts payable 158,190 189,940
Current income taxes payable 31,822 19,811
Accrued interest 11,062 8,591
Accrued liabilities 252,238 215,064
-------------- --------------
Total current liabilities 472,596 452,530
-------------- --------------
Long-term debt 1,516,269 1,648,500
-------------- --------------
Deferred income taxes 157,579 157,579
-------------- --------------
Other long-term liabilities 139,818 126,159
-------------- --------------
Stockholders' equity
Preferred stock, $.01 par value per share, 100,000,000 shares authorized,
none issued - -
Common stock, $.01 par value per share, 300,000,000 shares authorized;
99,443,600 shares issued and 98,468,051 shares outstanding
at March 31, 2006 and 94,539,837 shares issued and 93,564,288 shares
outstanding at December 31, 2005 994 945
Additional paid-in capital 1,334,789 1,208,930
Treasury stock, at cost, 975,549 shares at March 31, 2006 and
December 31, 2005 (6,678) (6,678)
Unearned stock-based compensation - (13,204)
Accumulated other comprehensive income 20,491 15,191
Retained earnings 413,431 359,393
-------------- --------------
Total stockholders' equity 1,763,027 1,564,577
-------------- --------------
Total liabilities and stockholders' equity $ 4,049,289 $ 3,949,345
============== ==============
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CYH Announces First Quarter 2006 Results
Page 8
April 26, 2006
COMMUNITY HEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
THREE MONTHS ENDED
MARCH 31,
---------- ----------
2006 2005
---------- ----------
Cash flows from operating activities
Net income $ 54,038 $ 35,988
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 42,506 41,137
Minority interest in earnings 613 887
Stock-based compensation expense 3,651 496
Loss on sale of hospitals 3,937 6,295
Excess tax benefits relating to stock-based compensation (4,360) -
Other non-cash expenses, net (590) (471)
Changes in operating assets and liabilities, net of effects of acquisitions
and divestitures:
Patient accounts receivable (42,326) (11,510)
Supplies, prepaid expenses and other current assets 2,798 1,849
Accounts payable, accrued liabilities and income taxes 28,371 66,025
Other 2,176 8,013
--------- ---------
Net cash provided by operating activities 90,814 148,709
--------- ---------
Cash flows from investing activities
Acquisitions of facilities and other related equipment (17,448) (24,854)
Purchases of property and equipment (39,704) (33,166)
Disposition of hospitals 500 51,861
Proceeds from sale of equipment 34 2,131
Increase in other assets (22,425) (7,237)
--------- ---------
Net cash used in investing activities (79,043) (11,265)
--------- ---------
Cash flows from financing activities
Proceeds from exercise of stock options 1,919 15,958
Excess tax benefits relating to stock-based compensation 4,360 -
Stock buy-back (8,112) (4,390)
Deferred financing costs (16) (749)
Redemption of convertible notes (128) -
Proceeds from minority investors in joint ventures 3,060 1,383
Redemption of minority investments in joint ventures (530) (290)
Distributions to minority investors in joint ventures (596) (382)
Borrowings under credit agreement - -
Repayments of long-term indebtedness (3,885) (13,025)
--------- ---------
Net cash provided by (used in) financing activities (3,928) (1,495)
--------- ---------
Net change in cash and cash equivalents 7,843 135,949
Cash and cash equivalents at beginning of period 104,108 82,498
--------- ---------
Cash and cash equivalents at end of period $ 111,951 $ 218,447
========= =========
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CYH Announces First Quarter 2006 Results
Page 9
April 26, 2006
REGULATION FD DISCLOSURE
The following table sets forth selected information concerning the
consolidated operating results of the Company for the year ended December 31,
2005, and the Company's updated projected consolidated operating results of the
Company for the year ending December 31, 2006. These projections are based on
the Company's historical operating performance, current trends and other
assumptions that the Company believes are reasonable at this time.
The following is provided as guidance to analysts and investors:
2005
Actual Results Adjusted
for Pro-forma Effect 2006
of Stock-Based Projection
Compensation Expense Range
------------------------- -----------------
Net operating revenues (in millions) $ 3,738 $4,225 to $4,275
Adjusted EBITDA (in millions) $ 556 $620 to $645
Income from continuing operations per share - diluted $ 1.91 $ 2.16 to $2.21
Same hospitals annual admissions growth 2.1% 1.0% to 2.0 %
Weighted average diluted shares (in millions) 98.6 99 to 100
Acquisitions of new hospitals 5 5 to 7
Income from Continuing Operations Per Share - Diluted:
1st quarter ended March 31 $ 0.50 $ 0.58 (actual)
2nd quarter ending June 30 $ 0.46 $ 0.51 to $0.53
3rd quarter ending September 30 $ 0.44 $ 0.50 to $0.51
4th quarter ending December 31 $ 0.51 $ 0.56 to $0.58
The following assumptions were used in developing the guidance provided
above:
- - For comparative purposes, the 2005 actual results have been restated to
include pro-forma stock-based stock option compensation expense of $17.6
million, or $0.11 per share (diluted) as if SFAS No. 123(R) was adopted on
January 1, 2005, and reflected in the Company's reported earnings for
2005. Adjusted EBITDA and income from continuing operations per share -
diluted, as reported in 2005 were $573.2 million and $2.02 per share,
respectively. The quarterly income from continuing operations per
share-diluted, as reported in 2005 were $0.52 (1st qtr.), $0.49 (2nd
qtr.), $0.47 (3rd qtr.) and $0.54 (4th qtr.).
- - On January 1, 2006, the Company adopted SFAS No. 123(R), using the
modified prospective application transition method. For the year ending
December 31, 2006, the Company anticipates recognizing stock - based
compensation expense of approximately $20 million, or $0.13 per diluted
share as compared to $5 million, or $0.03 per diluted share recognized for
the year ended December 31, 2005 under APB No. 25. Thus, the 2006
projected results does include additional stock - based compensation
expense of $15 million, or $0.10 per diluted share.
- - Expressed as a percentage of net operating revenue, provision for bad
debts is projected to be approximately 10.2% to 10.5% for 2006.
- - Capital expenditures are as follows (in millions):
Actual Guidance
2005 2006
------ -------------
Total $ 200 $ 250 to $260
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CYH Announces First Quarter 2006 Results
Page 10
April 26, 2006
- - Expressed as a percent of net operating revenues, total depreciation and
amortization is projected to be approximately 4.2% to 4.6% for 2006;
however, this is a fixed cost and the percentages may vary as revenue
varies. The adoption of FASB Interpretation No. 45-3 (Entitled Minimum
Revenue Guarantees Granted to a Business or Its Owners), requiring the
Company to begin capitalizing and amortizing certain elements of its
physician recruitment costs, is not expected to have a material impact on
earnings during 2006.
- - Expressed as a percentage of income before income taxes, provision for
income tax is projected to be approximately 38.5% to 39.0% for 2006.
- - The Company is exposed to London Inter-Bank Offer Rate ("LIBOR") based
interest rates, which have been increasing over the past two years. The
following is a summary of the three-month LIBOR rates at various dates:
December 31, 2003 1.15188%
December 31, 2004 2.56438%
December 31, 2005 4.53625%
March 31, 2006 5.00000%
To partially offset the rise in LIBOR rates, the Company is currently a
party to ten separate interest swap agreements to limit the effect of
changes in interest rates on a portion of the Company's long-term
borrowings. On each of the swaps, the Company receives a variable rate of
interest based on the three-month LIBOR, in exchange for the payment by
the Company of a fixed rate of interest. Currently, the Company pays on a
quarterly basis a margin above LIBOR of 175 basis points for revolver
loans and term loans under the senior secured credit facility. For the
purpose of providing 2006 projection range guidance, the Company has
assumed that future LIBOR rates for borrowings under the Company's $1.625
billion Senior Secured Credit Facility will increase based on market
quotations of the forward yield curve and other economic forecasts.
- - The following table reconciles adjusted EBITDA, as defined, to the
Company's estimated net cash provided by operating activities as presented
in the guidance shown on page 9:
2005
Actual Results
Adjusted for Pro-
forma Stock-
Based 2006 Projection
Compensation Range
Expense (in millions)
------------------- ------------------
Adjusted EBITDA ............................. $ 556 $ 620 $ 645
Taxes and interest expense ............... (209) (226) (235)
Other non-cash expenses and net changes in
operating assets and liabilities ....... 64 36 40
------------------- ----- -----
Net cash provided by operating activities ... $ 411 $ 430 $ 450
=================== ===== =====
The projections set forth in this report constitute forward-looking
statements within the meaning of Section 27A of the Securities Act, Section 21E
of the Exchange Act and the Private Securities Litigation Reform Act of 1995.
Although the Company believes that these forward-looking statements are based on
reasonable assumptions, these assumptions are inherently subject to significant
economic and competitive uncertainties and contingencies, which are difficult or
impossible to predict accurately and are beyond the control of the Company.
Accordingly, the Company cannot give any assurance that its expectations will in
fact occur and cautions that actual results may differ materially from those in
the forward-looking statements. A number of factors could affect the future
results of the Company or the healthcare industry generally and could cause the
Company's expected results to differ materially from those expressed in this
filing.
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CYH Announces First Quarter 2006 Results
Page 11
April 26, 2006
These factors include, among other things:
- - general economic and business conditions, both nationally and in the
regions in which we operate;
- - demographic changes;
- - existing governmental regulations and changes in, or the failure to comply
with, governmental regulations;
- - legislative proposals for healthcare reform;
- - the impact of the Medicare Prescription Drug, Improvement and
Modernization Act of 2003, which includes specific reimbursement changes
for small urban and non-urban hospitals;
- - our ability, where appropriate, to enter into managed care provider
arrangements and the terms of these arrangements;
- - changes in inpatient or outpatient Medicare and Medicaid payment levels;
- - uncertainty regarding the application of the Health Insurance Portability
and Accountability Act of 1996 regulations;
- - increases in wages as a result of inflation or competition for highly
technical positions and rising supply cost due to market pressure from
pharmaceutical companies and new product releases;
- - liability and other claims asserted against us, including self-insured
malpractice claims;
- - competition;
- - our ability to attract and retain qualified personnel, key management,
physicians, nurses and other health care workers;
- - trends toward treatment of patients in less acute or specialty healthcare
settings, including ambulatory surgery centers or specialty hospitals;
- - changes in medical or other technology;
- - changes in generally accepted accounting principles;
- - the availability and terms of capital to fund additional acquisitions or
replacement facilities;
- - our ability to successfully acquire and integrate additional hospitals;
- - our ability to obtain adequate levels of general and professional
liability insurance;
- - potential adverse impact of known and unknown government investigations;
- - timeliness of reimbursement payments received under government programs;
and
- - the other risk factors set forth in our public filings with the Securities
and Exchange Commission.
The consolidated operating results for the quarter ended March 31, 2006,
are not necessarily indicative of the results that may be experienced for any
future quarter or for any future fiscal year, including this fiscal year.
The Company cautions that the projections for calendar year 2006 set forth
herein are given as of the date hereof based on currently available information.
The Company is not undertaking any obligation to update these projections as
conditions change or other information becomes available.
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