8 ASC Company Q1 Financial Results: Stormy, but Promising Start to 2014
Severe weather late into the first quarter also paid a toll on financial performance, but companies demonstrated resilience and a readiness to take on the rest of 2014. Here are first quarter financial results for eight publicly traded ambulatory surgery center companies.
AmSurg's revenue crept up 2 percent from $258.2 million in the first quarter of 2013 to $263.1 million, but same-center revenues declined 2 percent. "AmSurg's results for the first quarter of 2014, which reflected a 2 percent decline in same-center revenues, were affected materially more by severe weather throughout the quarter than we anticipated in the guidance we established in late February," said CEO Christopher Holden, in a news release. Despite a slow financial start, the company completed the first quarter with seven letters of intent and a de novo center under development. As of March 31, AmSurg owned and operated 242 centers.
Foundation Healthcare reported $22.1 million in net revenues for the first quarter of this year, up 18 percent from $18.7 million in the first quarter of 2013. Patient services revenue rose 23 percent to $19.5 million, which was due to an increase in outpatient surgical cases and inpatient spine cases, according to a news release. "In addition to growing volumes at our existing hospitals, we are actively pursuing opportunities to add ancillary services through hospital outpatient departments at our hospitals including outpatient surgery centers, imaging, oncology and pain management," said Foundation Healthcare CEO Stanton Nelson in the report.
Hospital Corporation of America
HCA reported 0.9 percent growth in net income for the first quarter, a total of $347 million. The company's total revenue increased 4.6 percent to $8.83 billion. "We are pleased with results for the first quarter. As expected, healthcare reform had minimal impact on the company's first quarter results; however, we remain optimistic regarding the potential long-term benefits," said HCA President and CEO Milton Johnson in a news release.
Medical Facilities Corporation
MFC reported $72.9 million in revenue, consistent with revenue reported in the first quarter of 2013. "Our Black Hills facility recorded an increase in revenue and income from operations as a result of growth in surgical cases and pain management procedures, as well as urgent care revenue," said Donald Schellpfeffer, MD, CEO of MFC, in a news release. Income from operations was $18.1 million, down 11.5 percent from $20.4 million in same period last year. As of March 31, MFC owned controlling interests in five specialty surgical hospitals and an ambulatory surgery center.
Northstar reported net patient service revenue of $12.1 million, up 194.1 percent from $4.1 million in the first quarter of 2013. The company reported a total of 1,499 cases performed in the first quarter, up 43.6 percent from the 1,044 cases performed in the first quarter of 2013. "We have exceeded our internal revenue estimated by 8 percent in the first quarter," said Northstar Healthcare CFO Harry Fleming in a news release. The increase in patient service revenue was offset by a rise in operating and administrative expenses. The company invested in growth and diversification. As of March 31, the company owned interest in and managed four ASCs, two imaging centers and one urgent care clinic.
Surgical Care Affiliates
SCA's total net operating revenues, excluding facilities in which the company does not own a controlling interest, increased 2.1 percent from $192 million to $196 million. System-wide net operating revenues, including all facilities in which SCA has an ownership, increased 8.7 percent. "We continue to have success in our efforts to develop new ambulatory surgery centers with our existing health system partners. We have also had continued success in adding additional health system and physician partners and look forward to the growth that we expect to result from these new relationships," said SCA President and CEO Andrew Hayek, according to the report. Despite the harsh weather of the first quarter, SCA expects its previous guidance to remain the same, which places EBITDA less NCI in the range of $154 million to $158 million. As of March 31, SCA operated 175 surgical facilities.
For the first quarter of 2014, the company reported $133.97 million in revenue compared to $130.38 million in the first quarter of 2013. Operating income was $21.34 million, up 3.8 percent from $20.56 million in the first quarter of 2013. Symbion facilities performed 51,970 cases during the first quarter of 2014, up from 51,906 in the same period in 2013. Revenue per case grew 4.3 percent from $2,602 to $2,713. Symbion acquired an additional 13.6 percent ownership stake in an Idaho Falls, Idaho surgical hospital for $24.4 million. As of March 31, the company owned a 61.7 percent stake in the facility. The company also plans to sell two facilities, one in Lynbrook, N.Y., and one in Worcester, Mass.
United Surgical Partners International
USPI reported consolidated net revenues of $145.3 million, compared to $145.1 million during the same period in 2013. "This was a challenging start to 2014 for USPI, with a combination of severe weather in certain markets and continuing change in insurance plan design impacting first quarter volumes," said USPI CEO William Wilcox in a news release. Cash flow from operating activities was $61 million this quarter, compared to $38.6 million in the prior year period. Despite a slow start to the year, USPI demonstrated active development plans. The company acquired two facilities in the first quarter and completed an additional acquisition after the close of the first quarter. USPI owns and operates 216 facilities, 148 of which are joint ventures with not-for-profit healthcare systems.
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