Menu
iPMI Magazine Is Proudly Sponsored By:
For a healthier journey.

HCA Reports Fourth Quarter 2017 Results, Initiates Quarterly Dividend, Increases Capital Spending

Revenues in the fourth quarter totaled $11.562 billion, compared to $10.641 billion in the fourth quarter of 2016. Net income attributable to HCA Healthcare, Inc. totaled $474 million, or $1.30 per diluted share, compared to $920 million, or $2.39 per diluted share, in the fourth quarter of 2016. Results for the fourth quarter of 2017 include a non-cash increase in the Company’s provision for income taxes of $301 million, or $0.83 per diluted share, related to the estimated impact of the Tax Cuts and Jobs Act on our deferred tax assets and liabilities. This estimate may be refined as further information becomes available.

During the fourth quarter of 2016, the Company recognized gains on sales of facilities of $15 million, or $0.04 per diluted share, and legal claim benefits of $279 million, or $0.46 per diluted share. The Company recognized a tax benefit of $2 million, or $0.01 per diluted share, in the fourth quarter of 2017 compared to a $33 million tax benefit, or $0.09 per diluted share, in the fourth quarter of 2016 for excess tax benefits related to employee equity award settlements recorded as a component of the provision for income taxes.

Adjusted EBITDA for the fourth quarter of 2017 increased 7.1 percent to $2.362 billion from $2.206 billion in the prior year period. Adjusted EBITDA is a non-GAAP financial measure. A table providing supplemental information on Adjusted EBITDA and reconciling net income attributable to HCA Healthcare, Inc. to Adjusted EBITDA is included in this release.

Fourth quarter revenue growth was primarily driven by an increase of 2.3 percent in same facility equivalent admissions and an increase of 3.5 percent in same facility revenue per equivalent admission compared to the fourth quarter of 2016. Same facility admissions increased 1.4 percent in the fourth quarter of 2017 compared to the prior year period while same facility emergency room visits increased 3.4 percent in the fourth quarter of 2017 compared to the prior year period.

During the fourth quarter of 2017, same facility inpatient surgeries increased 0.6 percent while same facility outpatient surgeries increased 0.8 percent compared to the prior year period.

The Company’s same facility operating expense per equivalent admission increased 3.3 percent from the prior year’s fourth quarter. During the fourth quarter of 2017, salaries and benefits, supplies and other operating expenses totaled $9.209 billion, or 79.7 percent of revenues, compared to $8.445 billion, or 79.4 percent of revenues, in the fourth quarter of 2016.

Year Ended December 31, 2017

Revenues for the year ended December 31, 2017 totaled $43.614 billion compared to $41.490 billion for 2016. Net income attributable to HCA Healthcare, Inc. for 2017 was $2.216 billion, or $5.95 per diluted share, compared to $2.890 billion, or $7.30 per diluted share, for the year ended December 31, 2016. Results for the year ended December 31, 2017 include a non-cash increase in the Company’s provision for income taxes of $301 million, or $0.81 per diluted share, related to the estimated impact of the Tax Cuts and Jobs Act on our deferred tax assets and liabilities. This estimate may be refined as further information becomes available. Results for the year ended December 31, 2017 also include gains on sales of facilities of $8 million, or $0.01 per diluted share, and losses on retirement of debt of $39 million, or $0.06 per diluted share.

In 2017, the Company incurred additional expenses and experienced losses of revenues estimated at approximately $140 million, or $0.24 per diluted share, associated with Hurricanes Harvey and Irma’s impact on our Corpus Christi, Houston, Florida, Georgia and South Carolina facilities. This amount is prior to any insurance recoveries which the Company may receive.

The Company recognized an $82 million, or $0.22 per diluted share, tax benefit in 2017 compared to a $162 million tax benefit, or $0.41 per diluted share, during 2016 for excess tax benefits related to employee equity award settlements recorded as a component of the provision for income taxes. For 2016, the Company also recognized a reduction in the provision for income taxes of $51 million, or $0.13 per diluted share, resulting from the completion of the IRS examination of HCA’s 2011 and 2012 federal income tax returns. Results for 2016 also included gains on sales of facilities of $23 million, or $0.05 per diluted share, and legal claims benefits of $246 million, or $0.39 per diluted share. Adjusted EBITDA for 2017 increased to $8.233 billion compared to $8.218 billion in 2016.

Balance Sheet and Cash Flow

As of December 31, 2017, HCA Healthcare, Inc.’s balance sheet reflected cash and cash equivalents of $732 million, total debt of $33.058 billion, and total assets of $36.593 billion. During the fourth quarter of 2017, capital expenditures totaled $982 million, excluding acquisitions. The Company repurchased 7.2 million shares of its common stock at a cost of $576 million in the fourth quarter and had $1.802 billion remaining on its $2 billion October 2017 authorization as of December 31, 2017. For 2017, the Company repurchased 25.1 million shares of its common stock at a cost of $2.051 billion. At December 31, 2017, the Company had 350.092 million shares outstanding compared to 370.536 million shares outstanding as of December 31, 2016. Net cash provided by operating activities in the fourth quarter of 2017 totaled $1.734 billion compared to $1.699 billion in the prior year’s fourth quarter.

Today, the Company is also announcing a planned increase in its 3-year capital expenditures program to pursue growth opportunities in its existing markets. The updated capital investment program is expected to approximate $10.5 billion over the next three years, up from the previous 3-year spend of approximately $8.2 billion.

As of December 31, 2017, HCA operated 179 hospitals and 120 freestanding surgery centers and numerous other healthcare facilities.

Dividend

HCA today announced that its Board of Directors declared a quarterly cash dividend of $0.35 per share on the Company’s common stock. The dividend will be paid on March 30, 2018 to stockholders of record at the close of business on March 1, 2018.

“The initiation of a quarterly dividend demonstrates our confidence in the financial strength of our Company and the cash flow it generates,” stated R. Milton Johnson, Chairman and Chief Executive Officer of HCA. “We believe our cash flow from operations will allow us to continue to invest in our existing markets, and pursue acquisition opportunities, while also returning capital to stockholders. The announcement today reinforces our commitment to delivering value to stockholders while investing for future growth.”

The declaration and payment of any future dividend will be subject to the discretion of the Board of Directors and will depend on a variety of factors, including the Company’s financial condition and results of operations and contractual restrictions. Future dividends are expected to be funded by cash balances and future cash flows from operations.

back to top