UNIVERSAL HEALTH SERVICES, INC. ANNOUNCES 2024 SECOND QUARTER FINANCIAL RESULTS, INCREASES 2024 FULL YEAR OPERATING RESULTS FORECAST AND ANNOUNCES $1 BILLION INCREASE TO STOCK REPURCHASE PROGRAM AUTHORIZATION
Consolidated Results of Operations, As Reported and As Adjusted – Three-month periods ended June 30, 2024 and 2023:
KING OF PRUSSIA, Pa., July 24, 2024 /PRNewswire/ — Universal Health Services, Inc. (NYSE: UHS) announced today that its reported net income attributable to UHS was $289.2 million, or $4.26 per diluted share, during the second quarter of 2024, as compared to $171.3 million, or $2.42 per diluted share, during the second quarter of 2023. Net revenues increased by 10.1% to $3.908 billion during the second quarter of 2024, as compared to $3.548 billion during the second quarter of 2023.
As reflected on the Schedule of Non-GAAP Supplemental Information (“Supplemental Schedule”), our adjusted net income attributable to UHS during the second quarter of 2024 was $292.6 million, or $4.31 per diluted share, as compared to $179.4 million, or $2.53 per diluted share, during the second quarter of 2023.
Included in our reported and adjusted net income attributable to UHS during the second quarter of 2024, were net incremental reimbursements (net of related provider taxes) aggregating to approximately $34.5 million, or $.38 per diluted share, recorded in connection with the following: (i) $18.8 million, or $.21 per diluted share, applicable to the period of January 1, 2024 through June 30, 2024, resulting from a recently expanded state directed payment program in Washington, and; (ii) $15.7 million, or $.17 per diluted share, applicable to the period of July 1, 2023 through June 30, 2024, resulting from additional net reimbursements from an existing supplemental Medicaid program in Idaho.
As reflected on the Supplemental Schedule, included in our reported results during the second quarter of 2024 were: (i) an unrealized after-tax loss of $5.9 million, or $.09 per diluted share ($7.7 million pre-tax), resulting from a decrease in the market value of certain equity securities (included in “Other (income) expense, net”), and; (ii) a favorable after-tax impact of $2.5 million, or $.04 per diluted share, resulting from the tax benefit recorded in connection with employee share-based payments (pursuant to “ASU 2016-09”, Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting). Our reported results during the second quarter of 2023 included an unrealized after-tax loss of $8.1 million, or $.11 per diluted share, ($10.5 million pre-tax) resulting from a decrease in the market value of certain equity securities.
As calculated on the attached Supplemental Schedule, our earnings before interest, taxes, depreciation & amortization (“EBITDA net of NCI”, NCI is net income attributable to noncontrolling interests), was $573.2 million, or 14.7% of net revenues, during the second quarter of 2024, as compared to $419.3 million, or 11.8% of net revenues, during the second quarter of 2023. Our adjusted earnings before interest, taxes, depreciation & amortization (“Adjusted EBITDA net of NCI”), which excludes the impact of other (income) expense, net, was $578.7 million, or 14.8% of net revenues, during the second quarter of 2024, as compared to $425.9 million, or 12.0% of net revenues, during the second quarter of 2023.
Consolidated Results of Operations, As Reported and As Adjusted – Six-month periods ended June 30, 2024 and 2023:
Reported net income attributable to UHS was $551.0 million, or $8.08 per diluted share, during the first six months of 2024, as compared to $334.4 million, or $4.70 per diluted share, during the first six months 2023. Net revenues increased by 10.5% to $7.751 billion during the first six months of 2024, as compared to $7.016 billion during the comparable period of 2023.
As reflected on the Supplemental Schedule, our adjusted net income attributable to UHS during the first six months of 2024 was $545.7 million, or $8.00 per diluted share, as compared to $346.9 million, or $4.87 per diluted share, during the comparable period of 2023.
As reflected on the Supplemental Schedule, included in our reported results during the first six months of 2024 were: (i) an unrealized after-tax loss of $6.3 million, or $.09 per diluted share ($8.2 million pre-tax), resulting from a decrease in the market value of certain equity securities (included in “Other (income) expense, net”), and; (ii) a favorable after-tax impact of $11.6 million, or $.17 per diluted share, resulting from the tax benefit recorded in connection with ASU 2016-09. Our reported results during the first six months of 2023 included an unrealized after-tax loss of $12.5 million, or $.17 per diluted share, ($16.3 million pre-tax) resulting from a decrease in the market value of certain equity securities.
As calculated on the attached Supplemental Schedule, our EBITDA net of NCI, was $1.099 billion, or 14.2% of net revenues, during the first six months of 2024, as compared to $826.6 million, or 11.8% of net revenues, during the first six months of 2023. Our Adjusted EBITDA net of NCI, which excludes the impact of other (income) expense, net, was $1.104 billion, or 14.2% of net revenues, during the first six months of 2024, as compared to $846.9 million, or 12.1% of net revenues, during the comparable period of 2023.
Acute Care Services – Three and six-month periods ended June 30, 2024 and 2023:
During the second quarter of 2024, at our acute care hospitals owned during both periods (“same facility basis”), adjusted admissions (adjusted for outpatient activity) increased by 3.4% while adjusted patient days increased by 1.6%, as compared to the second quarter of 2023. At these facilities, during the second quarter of 2024, net revenue per adjusted admission increased by 3.5% while net revenue per adjusted patient day increased by 5.3%, as compared to the second quarter of 2023. Net revenues generated from our acute care services, on a same facility basis, increased by 6.6% during the second quarter of 2024, as compared to the second quarter of 2023.
During the six-month period ended June 30, 2024, at our acute care hospitals on a same facility basis, adjusted admissions increased by 3.9% while adjusted patient days increased by 2.5%, as compared to the first six months of 2023. At these facilities, during the first six months of 2024, net revenue per adjusted admission increased by 4.0% while net revenue per adjusted patient day increased by 5.5%, as compared to the first six months of 2023. Net revenues generated from our acute care services, on a same facility basis, increased by 8.1% during the first six months of 2024, as compared to the comparable period of 2023.
Behavioral Health Care Services – Three and six-month periods ended June 30, 2024 and 2023:
During the second quarter of 2024, at our behavioral health care facilities on a same facility basis, adjusted admissions decreased by 0.4% while adjusted patient days increased by 1.4%, as compared to the second quarter of 2023. At these facilities, during the second quarter of 2024, net revenue per adjusted admission increased by 11.2% and net revenue per adjusted patient day increased by 9.3%, as compared to the second quarter of 2023. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 11.0% during the second quarter of 2024, as compared to the second quarter of 2023.
During the six-month period ended June 30, 2024, at our behavioral health care facilities on a same facility basis, adjusted admissions decreased by 0.6% while adjusted patient days increased by 1.7%, as compared to the first six months of 2023. At these facilities, during the first six months of 2024, net revenue per adjusted admission increased by 11.2% and net revenue per adjusted patient day increased by 8.7%, as compared to the first six months of 2023. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 10.7% during the first six months of 2024, as compared to the comparable period of 2023.
Net Cash Provided by Operating Activities and Liquidity:
Net Cash Provided by Operating Activities:
During the six-month period ended June 30, 2024, our net cash provided by operating activities was $1.076 billion as compared to $654 million during the first six months of 2023. The $422 million net increase in our net cash provided by operating activities consisted of: (i) a favorable change of $237 million resulting from an increase in net income plus/minus depreciation and amortization expense, stock-based compensation expense and gains on sales of assets and businesses; (ii) a favorable change of $148 million in accounts receivable; (iii) a favorable change of $60 million in accrued and deferred income taxes; (iv) an unfavorable change of $36 million in other assets and deferred charges, and; (v) $13 million of other combined net favorable changes.
Liquidity:
As of June 30, 2024, we had $1.02 billion of aggregate available borrowing capacity pursuant to our $1.2 billion revolving credit facility, net of outstanding borrowings and letters of credit.
Increased Authorization to Stock Repurchase Program:
On July 24, 2024, our Board of Directors authorized a $1.0 billion increase to our stock repurchase program. Pursuant to this program, which including today’s increased authorization has a current aggregate available repurchase authorization of $1.228 billion, shares of our Class B Common Stock may be repurchased, from time to time as conditions allow, on the open market or in negotiated private transactions.
During the second quarter of 2024, we have repurchased 373,000 shares at an aggregate cost of approximately $70.0 million (approximately $187 per share) pursuant to the program. During the first six months of 2024, we have repurchased 1.073 million shares at an aggregate cost of approximately $195.1 million (approximately $182 per share) pursuant to the program.
Revised 2024 Operating Results Forecasts:
Based upon the operating trends and financial results experienced during the first six months of 2024, as indicated on the Revised Forecast table below, we are increasing our operating results forecast range for consolidated net revenues; adjusted earnings before interest, taxes, depreciation & amortization, and the impacts of other income/expense and net income attributable to noncontrolling interests (“Adjusted EBITDA, net of NCI”), and adjusted net income attributable to UHS per diluted share (“Adjusted EPS-diluted”) for the year ended December 31, 2024.
The tables below include our revised full year 2024 operating results forecasts as well as our original 2024 operating results forecast, which was previously disclosed on February 27, 2024.
Revised Forecast
Original Forecast
For the Year Ended
For the Year Ended
December 31, 2024
December 31, 2024
Low
High
Low
High
Net revenues
$15.565 billion
$15.753 billion
$15.411 billion
$15.706 billion
Adjusted EBITDA, net of NCI
$2.154 billion
$2.226 billion
$1.931 billion
$2.019 billion
Adjusted EPS – diluted
$15.40 per share
$16.20 per share
$13.00 per share
$14.00 per share
Our revised 2024 forecasted net revenues are estimated to be approximately $15.565 billion to $15.753 billion, representing increases of 1.0% to 0.3% over our original 2024 forecasted net revenues. Our revised 2024 forecasted Adjusted EBITDA, net of NCI, is estimated to be approximately $2.154 billion to $2.226 billion, representing increases of 11.5% to 10.3% over our original 2024 forecasted Adjusted EBITDA, net of NCI.Our revised 2024 forecasted Adjusted EPS-diluted is estimated to be $15.40 per share to $16.20 per share, representing increases of 18.5% to 15.7% over our original 2024 forecasted Adjusted EPS-diluted.
Our 2024 forecasted range of net income attributable to UHS, and EPS-diluted, exclude certain items as described below because we do not believe we can forecast those items with sufficient accuracy. Adjusted EBITDA net of NCI, is a non-GAAP financial measure and should not be considered a measure of financial performance under GAAP. We believe Adjusted EBITDA net of NCI is helpful to our investors as a measure of our operating performance. Please see the Supplemental Non-GAAP Disclosures – 2024 Revised Operating Results Forecast schedule as included herein for additional information and a reconciliation of our 2024 revised forecasted range of net income attributable to UHS to our 2024 revised forecasted range of Adjusted EBITDA net of NCI.
The revised 2024 forecasted amounts exclude the impact of future items, if applicable, that are nonrecurring or non-operational in nature including items such as pre-tax unrealized gains/losses resulting from changes in the market value of shares of certain equity securities, and other potential material items including, but not limited to, reserves for various matters including settlements, legal judgments and lawsuits, potential impacts of non-ordinary course acquisitions, divestitures, joint ventures or other strategic transactions, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, long-lived and intangible assets, other amounts that may be reflected in the current financial statements that relate to prior periods, and the impact of share repurchases that differ from our forecasted assumptions. It is also subject to certain conditions including those as set forth below in General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures.
Conference call information:
We will hold a conference call for investors and analysts at 9:00 a.m. eastern time on July 25, 2024. A live webcast of the call will be available on our website at www.uhs.com. To participate via telephone, please register in advance at this link.
Upon registration, all telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number along with a unique passcode and registrant ID that can be used to access the call. A replay of the call will be available for one full year following the live call.
General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures:
One of the nation’s largest and most respected providers of hospital and healthcare services, Universal Health Services, Inc. (the “Company”) has built an impressive record of achievement and performance. Growing steadily since our inception into an esteemed Fortune 500 corporation, our annual revenues during 2023 were $14.282 billion. UHS ranked #299 on the Fortune 500; and #399 on Forbes’ list of America’s Largest Public Companies. UHS was again recognized as one of the World’s Most Admired Companies by Fortune.
Our operating philosophy is as effective today as it was upon the Company’s founding in 1979, enabling us to provide compassionate care to our patients and their loved ones. Our strategy includes building or acquiring high quality hospitals in rapidly growing markets, investing in the people and equipment needed to allow each facility to thrive, and becoming the leading healthcare provider in each community we serve.
Headquartered in King of Prussia, PA, UHS has approximately 96,700 employees and, through its subsidiaries, operates 27 inpatient acute care hospitals, 332 inpatient behavioral health facilities, 48 outpatient facilities and ambulatory care access points, an insurance offering, a physician network and various related services located in 39 states, Washington, D.C., the United Kingdom and Puerto Rico. It acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust (NYSE:UHT). For additional information visit www.uhs.com.
This press release contains forward-looking statements based on current management expectations. Numerous factors, including those disclosed herein, those related to healthcare industry trends and those detailed in our filings with the Securities and Exchange Commission (as set forth in Item 2-Forward Looking Statements and Risk Factors in our Form 10-Q for the quarter ended March 31, 2024 and in Item 1A-Risk Factors, and Item 7-Forward-Looking Statements and Risk Factors, in our Form 10-K for the year ended December 31, 2023), may cause the results to differ materially from those anticipated in the forward-looking statements. These statements are subject to risks and uncertainties and therefore actual results may differ materially. Readers should not place undue reliance on such forward-looking statements which reflect management’s view only as of the date hereof. We undertake 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.
Many of the factors that could affect our future results are beyond our control or ability to predict, including, but not limited to:
A significant portion of our revenues are derived from federal and state government programs including the Medicare and Medicaid programs. Payments from these programs are subject to statutory and regulatory changes, administrative rulings, interpretations and determinations, requirements for utilization review, and federal and state funding restrictions. Changes to these programs, if adopted, could materially affect program payments which could materially impact our results of operations.The increase in interest rates has substantially increased our borrowings costs and reduced our ability to access the capital markets on favorable terms. Additional increases in interest rates could have a significant unfavorable impact on our future results of operations and the resulting effect on the capital markets could adversely affect our ability to carry out our strategy.The outcome of known and unknown litigation, liabilities and other claims asserted against us and/or our subsidiaries, including, but not limited to, the March 28, 2024, jury award (of compensatory damages of $60 million and punitive damages of $475 million) against The Pavilion Behavioral Health System (the “Pavilion), an indirect subsidiary of the Company, as previously disclosed on Form 8-K, as filed with the Securities and Exchange Commission on April 1, 2024. While the Pavilion has professional liability insurance to cover a portion of these amounts, the resolution of this matter may have a material adverse effect on the Company.
We believe that adjusted net income attributable to UHS, adjusted net income attributable to UHS per diluted share, EBITDA net of NCI and Adjusted EBITDA net of NCI, which are non-GAAP financial measures (“GAAP” is Generally Accepted Accounting Principles in the United States of America), are helpful to our investors as measures of our operating performance. In addition, we believe that, when applicable, comparing and discussing our financial results based on these measures, as calculated, is helpful to our investors since it neutralizes the effect of material items impacting our net income attributable to UHS, such as, changes in the market value of shares of certain equity securities, the impact of ASU 2016-09 and other potential material items that are nonrecurring or non-operational in nature including, but not limited to, impairments of goodwill, long-lived and intangible assets, reserves for various matters including settlements, legal judgments and lawsuits, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, potential impacts of non-ordinary acquisitions, divestitures, joint ventures or other strategic transactions, and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. To obtain a complete understanding of our financial performance these measures should be examined in connection with net income attributable to UHS, as determined in accordance with GAAP, and as presented in the condensed consolidated financial statements and notes thereto in this report or in our other filings with the Securities and Exchange Commission including our Report on Form 10-Q for the quarter ended March 31, 2024 and our Report on Form 10-K for the year ended December 31, 2023. Since the items included or excluded from these measures are significant components in understanding and assessing financial performance under GAAP, these measures should not be considered to be alternatives to net income as a measure of our operating performance or profitability. Since these measures, as presented, are not determined in accordance with GAAP and are thus susceptible to varying calculations, they may not be comparable to other similarly titled measures of other companies. Investors are encouraged to use GAAP measures when evaluating our financial performance.
Universal Health Services, Inc.
Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
Three months
Six months
ended June 30,
ended June 30,
2024
2023
2024
2023
Net revenues
$3,907,604
$3,548,138
$7,751,186
$7,015,656
Operating charges:
Salaries, wages and benefits
1,856,372
1,770,271
3,698,996
3,523,606
Other operating expenses
1,043,116
938,314
2,075,286
1,817,265
Supplies expense
388,063
380,294
791,636
760,283
Depreciation and amortization
147,480
143,744
288,483
285,365
Lease and rental expense
36,175
35,387
71,625
70,309
3,471,206
3,268,010
6,926,026
6,456,828
Income from operations
436,398
280,128
825,160
558,828
Interest expense, net
48,899
48,831
101,725
99,707
Other (income) expense, net
5,493
6,602
5,343
20,325
Income before income taxes
382,006
224,695
718,092
438,796
Provision for income taxes
87,676
55,393
157,940
107,119
Net income
294,330
169,302
560,152
331,677
Less: Net income (loss) attributable to
noncontrolling interests (“NCI”)
5,178
(2,011)
9,166
(2,751)
Net income attributable to UHS
$289,152
$171,313
$550,986
$334,428
Basic earnings per share attributable to UHS (a)
$4.32
$2.44
$8.22
$4.75
Diluted earnings per share attributable to UHS (a)
$4.26
$2.42
$8.08
$4.70
Universal Health Services, Inc.
Footnotes to Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
Three months
Six months
(a) Earnings per share calculation:
ended June 30,
ended June 30,
2024
2023
2024
2023
Basic and diluted:
Net income attributable to UHS
$289,152
$171,313
$550,986
$334,428
Less: Net income attributable to unvested restricted share grants
(5)
(61)
(50)
(190)
Net income attributable to UHS – basic and diluted
$289,147
$171,252
$550,936
$334,238
Weighted average number of common shares – basic
66,878
70,073
67,041
70,304
Basic earnings per share attributable to UHS:
$4.32
$2.44
$8.22
$4.75
Weighted average number of common shares
66,878
70,073
67,041
70,304
Add: Other share equivalents
1,042
766
1,160
859
Weighted average number of common shares and equiv. – diluted
67,920
70,839
68,201
71,163
Diluted earnings per share attributable to UHS:
$4.26
$2.42
$8.08
$4.70
Universal Health Services, Inc.
Schedule of Non-GAAP Supplemental Information (“Supplemental Schedule”)
For the Three Months ended June 30, 2024 and 2023
(in thousands, except per share amounts)
(unaudited)
Calculation of Earnings/Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
(“EBITDA/Adjusted EBITDA net of NCI”)
Three months ended
% Net
Three months ended
% Net
June 30, 2024
revenues
June 30, 2023
revenues
Net income attributable to UHS
$289,152
$171,313
Depreciation and amortization
147,480
143,744
Interest expense, net
48,899
48,831
Provision for income taxes
87,676
55,393
EBITDA net of NCI
$573,207
14.7 %
$419,281
11.8 %
Other (income) expense, net
5,493
6,602
Adjusted EBITDA net of NCI
$578,700
14.8 %
$425,883
12.0 %
Net revenues
$3,907,604
$3,548,138
Calculation of Adjusted Net Income Attributable to UHS
Three months ended
Three months ended
June 30, 2024
June 30, 2023
Per
Per
Amount
Diluted Share
Amount
Diluted Share
Net income attributable to UHS
$289,152
$4.26
$171,313
$2.42
Plus/minus after-tax adjustments:
Unrealized loss on equity securities
5,869
0.09
8,051
0.11
Impact of ASU 2016-09
(2,456)
(0.04)
–
–
Subtotal adjustments
3,413
0.05
8,051
0.11
Adjusted net income attributable to UHS
$292,565
$4.31
$179,364
$2.53
Universal Health Services, Inc.
Schedule of Non-GAAP Supplemental Information (“Supplemental Schedule”)
For the Six Months ended June 30, 2024 and 2023
(in thousands, except per share amounts)
(unaudited)
Calculation of Earnings/Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
(“EBITDA/Adjusted EBITDA net of NCI”)
Six months ended
% Net
Six months ended
% Net
June 30, 2024
revenues
June 30, 2023
revenues
Net income attributable to UHS
$550,986
$334,428
Depreciation and amortization
288,483
285,365
Interest expense, net
101,725
99,707
Provision for income taxes
157,940
107,119
EBITDA net of NCI
$1,099,134
14.2 %
$826,619
11.8 %
Other (income) expense, net
5,343
20,325
Adjusted EBITDA net of NCI
$1,104,477
14.2 %
$846,944
12.1 %
Net revenues
$7,751,186
$7,015,656
Calculation of Adjusted Net Income Attributable to UHS
Six months ended
Six months ended
June 30, 2024
June 30, 2023
Per
Per
Amount
Diluted Share
Amount
Diluted Share
Net income attributable to UHS
$550,986
$8.08
$334,428
$4.70
Plus/minus after-tax adjustments:
Unrealized loss on equity securities
6,313
0.09
12,512
0.17
Impact of ASU 2016-09
(11,612)
(0.17)
–
–
Subtotal adjustments
(5,299)
(0.08)
12,512
0.17
Adjusted net income attributable to UHS
$545,687
$8.00
$346,940
$4.87
Universal Health Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
June 30,
December 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
128,786
$
119,439
Accounts receivable, net
2,156,811
2,238,265
Supplies
218,780
216,988
Other current assets
236,317
236,658
Total current assets
2,740,694
2,811,350
Property and equipment
12,239,814
11,777,047
Less: accumulated depreciation
(5,905,061)
(5,652,518)
6,334,753
6,124,529
Other assets:
Goodwill
3,942,372
3,932,407
Deferred income taxes
107,963
85,626
Right of use assets-operating leases
425,407
433,962
Deferred charges
6,858
6,974
Other
513,381
572,754
Total Assets
$
14,071,428
$
13,967,602
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt
$
127,508
$
126,686
Accounts payable and other liabilities
1,926,295
1,813,015
Operating lease liabilities
71,982
71,600
Federal and state taxes
23,422
2,046
Total current liabilities
2,149,207
2,013,347
Other noncurrent liabilities
569,687
584,007
Operating lease liabilities noncurrent
379,580
382,559
Long-term debt
4,416,731
4,785,783
Redeemable noncontrolling interest
5,418
5,191
UHS common stockholders’ equity
6,485,372
6,149,001
Noncontrolling interest
65,433
47,714
Total equity
6,550,805
6,196,715
Total Liabilities and Stockholders’ Equity
$
14,071,428
$
13,967,602
Universal Health Services, Inc.
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Six months
ended June 30,
2024
2023
Cash Flows from Operating Activities:
Net income
$560,152
$331,677
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation & amortization
288,483
285,365
Gains on sale of assets and businesses
(3,725)
(6,250)
Stock-based compensation expense
46,162
43,062
Changes in assets & liabilities, net of effects from
acquisitions and dispositions:
Accounts receivable
66,174
(82,078)
Accrued interest
3,310
(107)
Accrued and deferred income taxes
26,970
(32,695)
Other working capital accounts
39,686
20,216
Medicare accelerated payments and deferred CARES Act and other grants
0
2,741
Other assets and deferred charges
(3,030)
32,746
Other
14,277
15,471
Accrued insurance expense, net of commercial premiums paid
102,222
95,157
Payments made in settlement of self-insurance claims
(64,994)
(51,604)
Net cash provided by operating activities
1,075,687
653,701
Cash Flows from Investing Activities:
Property and equipment additions
(449,933)
(336,664)
Proceeds received from sales of assets and businesses
5,428
23,688
Acquisition of businesses and property
0
(3,728)
Inflows (outflows) from foreign exchange contracts that hedge our net U.K. investment
6,830
(31,305)
Decrease in capital reserves of commercial insurance subsidiary
196
0
Net cash used in investing activities
(437,479)
(348,009)
Cash Flows from Financing Activities:
Repayments of long-term debt
(382,675)
(93,557)
Additional borrowings
12,038
0
Financing costs
0
(293)
Repurchase of common shares
(237,987)
(209,756)
Dividends paid
(27,006)
(28,263)
Issuance of common stock
7,227
6,598
Profit distributions to noncontrolling interests
(5,089)
(4,735)
Sale of ownership interests to minority members
5,025
407
Net cash used in financing activities
(628,467)
(329,599)
Effect of exchange rate changes on cash, cash equivalents and restricted cash
(392)
2,377
Increase (decrease) in cash, cash equivalents and restricted cash
9,349
(21,530)
Cash, cash equivalents and restricted cash, beginning of period
214,470
200,837
Cash, cash equivalents and restricted cash, end of period
$223,819
$179,307
Supplemental Disclosures of Cash Flow Information:
Interest paid
$95,902
$97,297
Income taxes paid, net of refunds
$131,499
$133,840
Noncash purchases of property and equipment
$108,260
$100,461
Universal Health Services, Inc.
Supplemental Statistical Information
(unaudited)
% Change
% Change
3 Months ended
6 Months ended
Same Facility:
6/30/2024
6/30/2024
Acute Care Hospitals
Revenues
6.6 %
8.1 %
Adjusted Admissions
3.4 %
3.9 %
Adjusted Patient Days
1.6 %
2.5 %
Revenue Per Adjusted Admission
3.5 %
4.0 %
Revenue Per Adjusted Patient Day
5.3 %
5.5 %
Behavioral Health Hospitals
Revenues
11.0 %
10.7 %
Adjusted Admissions
-0.4 %
-0.6 %
Adjusted Patient Days
1.4 %
1.7 %
Revenue Per Adjusted Admission
11.2 %
11.2 %
Revenue Per Adjusted Patient Day
9.3 %
8.7 %
UHS Consolidated
Second Quarter Ended
Six Months Ended
6/30/2024
6/30/2023
6/30/2024
6/30/2023
Revenues
$3,907,604
$3,548,138
$7,751,186
$7,015,656
EBITDA net of NCI
$573,207
$419,281
$1,099,134
$826,619
EBITDA Margin net of NCI
14.7 %
11.8 %
14.2 %
11.8 %
Adjusted EBITDA net of NCI
$578,700
$425,883
$1,104,477
$846,944
Adjusted EBITDA Margin net of NCI
14.8 %
12.0 %
14.2 %
12.1 %
Cash Flow From Operations
$679,281
$362,948
$1,075,687
$653,701
Capital Expenditures
$241,394
$167,912
$449,933
$336,664
Days Sales Outstanding
51
54
Debt
$4,544,239
$4,716,432
UHS’ Shareholders Equity
$6,485,372
$6,087,182
Debt / Total Capitalization
41.2 %
43.7 %
Debt / EBITDA net of NCI (1)
2.29
2.83
Debt / Adjusted EBITDA net of NCI (1)
2.27
2.70
Debt / Cash From Operations (1)
2.69
4.03
(1) Latest 4 quarters.
Universal Health Services, Inc.
Acute Care Hospital Services
For the Three and Six months ended
June 30, 2024 and 2023
(in thousands)
(unaudited)
Same Facility Basis – Acute Care Hospital Services
Three months ended
Three months ended
Six months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Net revenues
$2,099,912
100.0 %
$1,969,566
100.0 %
$4,207,346
100.0 %
$3,892,030
100.0 %
Operating charges:
Salaries, wages and benefits
855,432
40.7 %
835,904
42.4 %
1,716,108
40.8 %
1,662,879
42.7 %
Other operating expenses
579,082
27.6 %
555,883
28.2 %
1,156,158
27.5 %
1,060,500
27.2 %
Supplies expense
331,708
15.8 %
327,761
16.6 %
678,803
16.1 %
653,132
16.8 %
Depreciation and amortization
94,190
4.5 %
94,202
4.8 %
184,310
4.4 %
187,209
4.8 %
Lease and rental expense
24,313
1.2 %
24,021
1.2 %
48,106
1.1 %
48,016
1.2 %
Subtotal-operating expenses
1,884,725
89.8 %
1,837,771
93.3 %
3,783,485
89.9 %
3,611,736
92.8 %
Income from operations
215,187
10.2 %
131,795
6.7 %
423,861
10.1 %
280,294
7.2 %
Interest expense, net
986
0.0 %
(503)
(0.0) %
2,286
0.1 %
(1,080)
(0.0) %
Other (income) expense, net
(677)
(0.0) %
0
0.0 %
(758)
(0.0) %
6,213
0.2 %
Income before income taxes
$214,878
10.2 %
$132,298
6.7 %
$422,333
10.0 %
$275,161
7.1 %
All Acute Care Hospital Services
Three months ended
Three months ended
Six months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Net revenues
$2,173,409
100.0 %
$2,003,079
100.0 %
$4,358,490
100.0 %
$3,976,611
100.0 %
Operating charges:
Salaries, wages and benefits
856,020
39.4 %
836,331
41.8 %
1,717,567
39.4 %
1,680,291
42.3 %
Other operating expenses
654,931
30.1 %
590,616
29.5 %
1,309,914
30.1 %
1,134,916
28.5 %
Supplies expense
331,684
15.3 %
327,650
16.4 %
678,688
15.6 %
655,710
16.5 %
Depreciation and amortization
94,214
4.3 %
94,304
4.7 %
184,526
4.2 %
187,630
4.7 %
Lease and rental expense
24,315
1.1 %
24,035
1.2 %
48,148
1.1 %
48,189
1.2 %
Subtotal-operating expenses
1,961,164
90.2 %
1,872,936
93.5 %
3,938,843
90.4 %
3,706,736
93.2 %
Income from operations
212,245
9.8 %
130,143
6.5 %
419,647
9.6 %
269,875
6.8 %
Interest expense, net
986
0.0 %
(503)
(0.0) %
2,286
0.1 %
(1,080)
(0.0) %
Other (income) expense, net
(461)
(0.0) %
119
0.0 %
173
0.0 %
7,132
0.2 %
Income before income taxes
$211,720
9.7 %
$130,527
6.5 %
$417,188
9.6 %
$263,823
6.6 %
We believe that providing our results on a “Same Facility” basis (which is a non-GAAP measure), which includes the operating results for facilities and businesses operated in both the current year and prior year periods, is helpful to our investors as a measure of our operating performance. Our Same Facility results also neutralize (if applicable), the effect of material items that are nonrecurring or non-operational in nature including items such as, but not limited to, reserves for various matters, settlements, legal judgments and lawsuits, cost related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, long-lived and intangible assets and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. Our Same Facility basis results exclude from net revenues and other operating expenses, provider tax assessments incurred in each period. However, these provider tax assessments are included in net revenues and other operating expenses as reflected in the table under All Acute Care Hospital Services. The provider tax assessments had no impact on the income before income taxes as reflected on the above tables since the amounts offset between net revenues and other operating expenses. To obtain a complete understanding of our financial performance, the Same Facility results should be examined in connection with our net income as determined in accordance with GAAP and as presented herein and the condensed consolidated financial statements and notes thereto as contained in our Form 10-K for the year ended December 31, 2023 and our Form 10-Q for the quarter ended March 31, 2024 .
The All Acute Care Hospital Services table summarizes the results of operations for all our acute care operations during the periods presented. These amounts include: (i) our acute care results on a same facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the last twelve months.
Universal Health Services, Inc.
Behavioral Health Care Services
For the Three and Six months ended
June 30, 2024 and 2023
(in thousands)
(unaudited)
Same Facility – Behavioral Health Care Services
Three months ended
Three months ended
Six months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Net revenues
$1,683,847
100.0 %
$1,517,051
100.0 %
$3,300,159
100.0 %
$2,980,774
100.0 %
Operating charges:
Salaries, wages and benefits
894,627
53.1 %
843,229
55.6 %
1,763,503
53.4 %
1,652,167
55.4 %
Other operating expenses
308,420
18.3 %
296,261
19.5 %
620,705
18.8 %
574,983
19.3 %
Supplies expense
57,105
3.4 %
53,774
3.5 %
113,871
3.5 %
106,259
3.6 %
Depreciation and amortization
49,911
3.0 %
46,554
3.1 %
97,019
2.9 %
91,886
3.1 %
Lease and rental expense
11,656
0.7 %
11,203
0.7 %
23,102
0.7 %
21,801
0.7 %
Subtotal-operating expenses
1,321,719
78.5 %
1,251,021
82.5 %
2,618,200
79.3 %
2,447,096
82.1 %
Income from operations
362,128
21.5 %
266,030
17.5 %
681,959
20.7 %
533,678
17.9 %
Interest expense, net
1,008
0.1 %
993
0.1 %
2,035
0.1 %
2,203
0.1 %
Other (income) expense, net
(871)
(0.1) %
(733)
(0.0) %
(1,547)
(0.0) %
(1,309)
(0.0) %
Income before income taxes
$361,991
21.5 %
$265,770
17.5 %
$681,471
20.6 %
$532,784
17.9 %
All Behavioral Health Care Services
Three months ended
Three months ended
Six months ended
Six months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Amount
% of Net
Revenues
Net revenues
$1,731,309
100.0 %
$1,542,194
100.0 %
$3,387,376
100.0 %
$3,032,683
100.0 %
Operating charges:
Salaries, wages and benefits
898,621
51.9 %
844,308
54.7 %
1,770,817
52.3 %
1,654,094
54.5 %
Other operating expenses
352,408
20.4 %
322,518
20.9 %
699,676
20.7 %
627,750
20.7 %
Supplies expense
57,277
3.3 %
53,837
3.5 %
114,201
3.4 %
106,325
3.5 %
Depreciation and amortization
50,625
2.9 %
46,778
3.0 %
98,497
2.9 %
92,397
3.0 %
Lease and rental expense
11,761
0.7 %
11,255
0.7 %
23,279
0.7 %
21,923
0.7 %
Subtotal-operating expenses
1,370,692
79.2 %
1,278,696
82.9 %
2,706,470
79.9 %
2,502,489
82.5 %
Income from operations
360,617
20.8 %
263,498
17.1 %
680,906
20.1 %
530,194
17.5 %
Interest expense, net
1,008
0.1 %
993
0.1 %
2,035
0.1 %
2,204
0.1 %
Other (income) expense, net
(871)
(0.1) %
(1,188)
(0.1) %
(1,547)
(0.0) %
(2,059)
(0.1) %
Income before income taxes
$360,480
20.8 %
$263,693
17.1 %
$680,418
20.1 %
$530,049
17.5 %
We believe that providing our results on a “Same Facility” basis (which is a non-GAAP measure), which includes the operating results for facilities and businesses operated in both the current year and prior year periods, is helpful to our investors as a measure of our operating performance. Our Same Facility results also neutralize (if applicable), the effect of material items that are nonrecurring or non-operational in nature including items such as, but not limited to, reserves for various matters, settlements, legal judgments and lawsuits, cost related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, long-lived and intangible assets and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. Our Same Facility basis results exclude from net revenues and other operating expenses, provider tax assessments incurred in each period. However, these provider tax assessments are included in net revenues and other operating expenses as reflected in the table under All Behavioral Health Care Services. The provider tax assessments had no impact on the income before income taxes as reflected on the above tables since the amounts offset between net revenues and other operating expenses. To obtain a complete understanding of our financial performance, the Same Facility results should be examined in connection with our net income as determined in accordance with GAAP and as presented herein and the condensed consolidated financial statements and notes thereto as contained in our Form 10-K for the year ended December 31, 2023 and our Form 10-Q for the quarter ended March 31, 2024.
The All Behavioral Health Care Services table summarizes the results of operations for all our behavioral health care facilities during the periods presented. These amounts include: (i) our behavioral health results on a same facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the last twelve months.
Universal Health Services, Inc.
Selected Hospital Statistics
For the Three Months ended
June 30, 2024 and 2023
(unaudited)
AS REPORTED:
ACUTE
BEHAVIORAL HEALTH
6/30/24
6/30/23
% change
6/30/24
6/30/23
% change
Hospitals owned and leased
27
27
0.0 %
332
331
0.3 %
Average licensed beds
6,657
6,624
0.5 %
24,419
24,189
1.0 %
Average available beds
6,485
6,452
0.5 %
24,319
24,089
1.0 %
Patient days
390,433
384,373
1.6 %
1,619,085
1,588,575
1.9 %
Average daily census
4,290.5
4,223.8
1.6 %
17,792.1
17,456.9
1.9 %
Occupancy-licensed beds
64.5 %
63.8 %
1.1 %
72.9 %
72.2 %
1.0 %
Occupancy-available beds
66.2 %
65.5 %
1.1 %
73.2 %
72.5 %
1.0 %
Admissions
81,858
79,100
3.5 %
119,798
119,656
0.1 %
Length of stay
4.8
4.9
-1.8 %
13.5
13.3
1.8 %
Inpatient revenue
$12,334,730
$10,960,845
12.5 %
$2,785,485
$2,670,370
4.3 %
Outpatient revenue
8,633,892
7,515,780
14.9 %
286,550
281,036
2.0 %
Total patient revenue
20,968,622
18,476,625
13.5 %
3,072,035
2,951,406
4.1 %
Other revenue
234,351
240,899
-2.7 %
82,201
73,926
11.2 %
Gross revenue
21,202,973
18,717,524
13.3 %
3,154,236
3,025,332
4.3 %
Total deductions
19,029,564
16,714,445
13.9 %
1,422,927
1,483,138
-4.1 %
Net revenue
$2,173,409
$2,003,079
8.5 %
$1,731,309
$1,542,194
12.3 %
SAME FACILITY:
ACUTE
BEHAVIORAL HEALTH
6/30/24
6/30/23
% change
6/30/24
6/30/23
% change
Hospitals owned and leased
27
27
0.0 %
330
330
0.0 %
Average licensed beds
6,657
6,624
0.5 %
24,165
24,063
0.4 %
Average available beds
6,485
6,452
0.5 %
24,065
23,963
0.4 %
Patient days
390,433
384,373
1.6 %
1,604,758
1,578,277
1.7 %
Average daily census
4,290.5
4,223.8
1.6 %
17,634.7
17,343.7
1.7 %
Occupancy-licensed beds
64.5 %
63.8 %
1.1 %
73.0 %
72.1 %
1.2 %
Occupancy-available beds
66.2 %
65.5 %
1.1 %
73.3 %
72.4 %
1.2 %
Admissions
81,858
79,100
3.5 %
118,702
118,778
-0.1 %
Length of stay
4.8
4.9
-1.8 %
13.5
13.3
1.7 %
Universal Health Services, Inc.
Selected Hospital Statistics
For the Six Months ended
June 30, 2024 and 2023
(unaudited)
AS REPORTED:
ACUTE
BEHAVIORAL HEALTH
6/30/24
6/30/23
% change
6/30/24
6/30/23
% change
Hospitals owned and leased
27
27
0.0 %
332
331
0.3 %
Average licensed beds
6,657
6,711
-0.8 %
24,400
24,210
0.8 %
Average available beds
6,485
6,539
-0.8 %
24,300
24,110
0.8 %
Patient days
805,759
788,626
2.2 %
3,228,077
3,161,147
2.1 %
Average daily census
4,427.2
4,357.0
1.6 %
17,736.7
17,464.9
1.6 %
Occupancy-licensed beds
66.5 %
64.9 %
2.4 %
72.7 %
72.1 %
0.8 %
Occupancy-available beds
68.3 %
66.6 %
2.5 %
73.0 %
72.4 %
0.8 %
Admissions
165,439
159,226
3.9 %
239,728
240,216
-0.2 %
Length of stay
4.9
5.0
-2.0 %
13.5
13.2
2.6 %
Inpatient revenue
$25,244,832
$22,362,336
12.9 %
$5,540,169
$5,298,360
4.6 %
Outpatient revenue
16,980,181
14,811,896
14.6 %
565,078
553,407
2.1 %
Total patient revenue
42,225,013
37,174,232
13.6 %
6,105,247
5,851,767
4.3 %
Other revenue
480,602
462,892
3.8 %
162,412
139,244
16.6 %
Gross revenue
42,705,615
37,637,124
13.5 %
6,267,659
5,991,011
4.6 %
Total deductions
38,347,125
33,660,513
13.9 %
2,880,283
2,958,328
-2.6 %
Net revenue
$4,358,490
$3,976,611
9.6 %
$3,387,376
$3,032,683
11.7 %
SAME FACILITY:
ACUTE
BEHAVIORAL HEALTH
6/30/24
6/30/23
% change
6/30/24
6/30/23
% change
Hospitals owned and leased
27
27
0.0 %
330
330
0.0 %
Average licensed beds
6,657
6,617
0.6 %
24,145
24,084
0.3 %
Average available beds
6,485
6,445
0.6 %
24,045
23,984
0.3 %
Patient days
805,759
782,354
3.0 %
3,201,198
3,140,422
1.9 %
Average daily census
4,427.2
4,322.4
2.4 %
17,589.0
17,350.4
1.4 %
Occupancy-licensed beds
66.5 %
65.3 %
1.8 %
72.8 %
72.0 %
1.1 %
Occupancy-available beds
68.3 %
67.1 %
1.8 %
73.2 %
72.3 %
1.1 %
Admissions
165,439
158,163
4.6 %
237,599
238,393
-0.3 %
Length of stay
4.9
4.9
0.0 %
13.5
13.2
2.3 %
Universal Health Services, Inc.
Supplemental Non-GAAP Disclosures
2024 Revised Operating Results Forecast
(in thousands, except per share amounts)
Revised Forecast For The Year Ending December 31, 2024
% Net
% Net
Low
revenues
High
revenues
Net revenues
$15,565,000
$15,753,000
Net income attributable to UHS (a)
$1,045,080
$1,099,563
Depreciation and amortization
592,455
592,455
Interest expense
195,664
195,664
Other (income) expense, net
(10,954)
(10,954)
Provision for income taxes
331,837
349,137
Adjusted EBITDA net of NCI (b)
$2,154,082
13.8 %
$2,225,865
14.1 %
Net income attributable to UHS, per diluted share (a)
$15.40
$16.20
Shares used in computing diluted earnings per share
67,869
67,869
(a) Revised forecasted net income attributable to UHS/per diluted share exclude the following items because we do not believe we can forecast these items with sufficient accuracy. Such items include: the impact of future items, if applicable, that are nonrecurring or non-operational in nature including items such as pre-tax unrealized gains/losses resulting from changes in the market value of shares of certain equity securities, and other potential material items including, but not limited to, reserves for various matters including settlements, legal judgments and lawsuits, potential impacts of non-ordinary course acquisitions, divestitures, joint ventures or other strategic transactions, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, impairments of goodwill, long-lived and intangible assets, other amounts that may be reflected in the current financial statements that relate to prior periods, and the impact of share repurchases that differ from our forecasted assumptions. Forecasted net income attributable to UHS/per diluted share is also subject to certain conditions including those as set forth in General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures.
(b) Adjusted EBITDA net of NCI is a non-GAAP financial measure and should not be considered a measure of financial performance under GAAP. We believe Adjusted EBITDA net of NCI is helpful to our investors as a measure of operating performance.
SOURCE Universal Health Services, Inc.
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