-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, En0L6POvwZ5XycfaMu7+zhiX0DYfoqe7bFabjKKgc/O2euUWDtYY7qPFTkVOTYox 4VBrZsHmwm/5Kn/v6GFuqg== 0000950144-04-010102.txt : 20041027 0000950144-04-010102.hdr.sgml : 20041027 20041027171512 ACCESSION NUMBER: 0000950144-04-010102 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20041027 DATE AS OF CHANGE: 20041027 EFFECTIVENESS DATE: 20041027 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROVINCE HEALTHCARE CO CENTRAL INDEX KEY: 0001044942 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-GENERAL MEDICAL & SURGICAL HOSPITALS, NEC [8062] IRS NUMBER: 621710772 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-31320 FILM NUMBER: 041100214 BUSINESS ADDRESS: STREET 1: 105 WESTPARK DR STREET 2: STE 400 CITY: BRENTWOOD STATE: TN ZIP: 37027 BUSINESS PHONE: 6153701377 MAIL ADDRESS: STREET 1: 105 WESTPARK DR STREET 2: SUITE 180 CITY: BRENTWOOD STATE: TN ZIP: 37207 DEFA14A 1 g91482defa14a.htm PROVINCE HEALTHCARE COMPANY - FORM DEFA14A PROVINCE HEALTHCARE COMPANY - FORM DEFA14A
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As filed with the Securities and Exchange Commission on October 27, 2004

SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [   ]

     
Check the appropriate box:
   
[   ] Preliminary Proxy Statement
  [   ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

[   ] Definitive Proxy Statement
[   ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Rule 14a-12

PROVINCE HEALTHCARE COMPANY
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

    Payment of Filing Fee (Check the appropriate box):

  [X]   No fee required.
  [   ]   Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)   Title of each class of securities to which transaction applies:________________________
  (2)   Aggregate number of securities to which transaction applies:________________________
  (3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):________________________
  (4)   Proposed maximum aggregate value of transaction:____________________________________
  (5)   Total fee paid:______________________________________
  [   ]   Fee paid previously with preliminary materials.
  [   ]   Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.________________________
  (1)   Amount previously paid:________________________
  (2)   Form, Schedule or Registration Statement No.:________________________
  (3)   Filing Party:________________________
  (4)   Date Filed:________________________

     Set forth below is the text of a press release issued by Province Healthcare Company on October 27, 2004.


TABLE OF CONTENTS

PROVINCE HEALTHCARE REPORTS THIRD QUARTER RESULTS:
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED STATEMENTS OF INCOME
CONSOLIDATED STATEMENTS OF INCOME
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
SELECTED OPERATING STATISTICS (Unaudited)
SELECTED OPERATING STATISTICS (Unaudited)


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(PROVINCE HEALTHCARE LOGO)

NEWS RELEASE
For Immediate Release

Contact: Pamela L. Hunter
Vice President, Investor Relations
(615) 370-1377

PROVINCE HEALTHCARE REPORTS THIRD QUARTER RESULTS:

     Brentwood, TN, October 27, 2004 — Province Healthcare Company (NYSE:PRV) today announced results for the third quarter ended September 30, 2004. Diluted earnings per share (EPS) from continuing operations for the third quarter increased to $0.23, compared to $0.21 in the prior year’s quarter.

     As previously announced, the Company has signed a definitive agreement to be acquired by LifePoint Hospitals, Inc. Completion of the transaction remains subject to the approval of each company’s stockholders, receipt of necessary financing and certain other conditions. The transaction is expected to close in the first quarter of 2005.

     Revenues from continuing operations for the third quarter of 2004 increased 27.3% to $235.3 million, compared with $184.8 million in the same quarter of last year. For the quarter, income from continuing operations was $11.9 million, compared with $10.2 million in the prior year’s quarter. Cash flow from operations for the third quarter increased 25.5% to $44.3 million, compared with $35.3 million in the same quarter of last year.

     During the quarter, two of the Company’s hospitals experienced disruption related to Hurricane Ivan. Vaughan Regional Medical Center in Selma, Alabama, and Teche Regional Medical Center in Morgan City, Louisiana, experienced a reduction in volumes as the communities braced for the impact of the storm, resulting in a decrease in adjusted admissions of 97. Additionally, Coastal Carolina Medical Center in Hardeeville, South Carolina, is now expected to open on or about December 1, 2004. As a result, the Company incurred higher than anticipated start-up expenses during the quarter. The effect on income from continuing operations due to the impact of Hurricane Ivan and the additional start-up expenses for Coastal Carolina Medical Center was $0.7 million, or $0.01 per diluted share.

     Revenues from continuing operations for the nine months ended September 30, 2004 increased 16.9% to $644.4 million, compared with $551.2 million in the same period of 2003. Income from continuing operations for the nine-month period was $35.9 million, compared with last year’s income from continuing

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operations of $30.0 million. Diluted earnings per share from continuing operations for the nine-month period increased 14.8% to $0.70 per diluted share, compared with $0.61 per diluted share in the prior year period.

     Province ended the third quarter of 2004 with 20 owned or leased hospitals, of which 19 are same-store hospitals. Memorial Medical Center in Las Cruces, New Mexico, acquired through a long-term lease effective June 1, 2004, is excluded from same-store results. On a same-store basis, net patient revenue for the quarter increased 5.5%, and net patient revenue per adjusted admission increased 4.8%. Same-store adjusted admissions increased 0.7% quarter over quarter, as a result of an increase in same-store outpatient revenue of 11.8% and a decline in same-store admissions. The specialist physicians drove the strong same-store surgery growth of 4.1% for the quarter. Same-store acuity, as measured by the Medicare case mix index, increased to 1.22 in the third quarter of 2004 from 1.20 in the third quarter of 2003. Same-store accounts receivable days outstanding remained stable at 55 days at September 30, 2004.

     Martin S. Rash, Chairman and Chief Executive Officer of Province Healthcare, said, “Our third quarter results were very positive. Cash flow from operations for the quarter was an outstanding $44.3 million, an increase of 25.5% over the prior year period. We continue to see strong outpatient revenue growth and surgery growth due to the successful recruitment of specialist physicians to our markets. Our bad debt expense as a percentage of net revenue for the quarter was above our previous guidance of the 10% range, due primarily to reductions of coverage in state Medicaid programs, particularly Texas, and our recent acquisition, Memorial Medical Center, whose bad debt expense level, as expected, is higher than our company average. Lastly, we have exceeded our physician recruitment goal of approximately 90 physicians for the year. To date, 104 new physicians will start to practice in our communities this year, and over two-thirds of these physicians are specialists.”

     Daniel S. Slipkovich, President and Chief Operating Officer of Province Healthcare, said, “We are exceptionally pleased with the operational performance of Memorial Medical Center in Las Cruces, New Mexico. We are ahead of our initial expectations for both volume and expense management. Our hospital management team has made great strides in working with the medical staff and new hospital board members to ensure that we are meeting the healthcare needs of Las Cruces and the surrounding communities.”

     A listen-only simulcast of Province Healthcare’s third quarter conference call will be available on-line at www.prhc.net on October 28, 2004, beginning at 11:00 a.m. Eastern Daylight Time.

     The Company owns or leases 20 general acute care hospitals in 12 states with a total of 2,492 licensed beds.

     Important Legal Information

     In connection with their proposed transaction, LifePoint Hospitals and Province Healthcare have filed with the Securities and Exchange Commission (the “SEC”) a joint proxy statement/prospectus, as part of a Registration

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Statement on Form S-4, and other relevant materials. The definitive joint proxy statement/prospectus will be mailed to the stockholders of LifePoint Hospitals and Province Healthcare. Investors and security holders are advised to read the joint proxy statement/prospectus and other relevant materials when they become available, as well as any amendments or supplements to those documents, because they will contain important information about LifePoint Hospitals, Province Healthcare and the proposed transaction. In addition, the joint proxy statement/prospectus and other relevant materials filed by LifePoint Hospitals or Province Healthcare with the SEC may be obtained free of charge at the SEC’s web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by LifePoint Hospitals by contacting Investor Relations, LifePoint Hospitals, Inc., 103 Powell Court, Suite 200, Brentwood, Tennessee, 37027, Phone: (615) 372-8500 and by Province Healthcare by contacting Investor Relations, Province Healthcare Company, 105 Westwood Place, Suite 400, Brentwood, Tennessee, 37027, Phone: (615) 370-1377.

     LifePoint Hospitals and Province Healthcare, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from their respective stockholders with respect to the transactions contemplated by the merger agreement. Information about the directors and executive officers of LifePoint Hospitals, and their interests in the transactions contemplated by the merger agreement, including their ownership of LifePoint Hospitals common stock, is set forth in the proxy statement for LifePoint Hospitals’ 2004 annual meeting, which was filed with the SEC on April 28, 2004. Information about the directors and executive officers of Province Healthcare, and their interests in the transactions contemplated by the merger agreement, including their ownership of Province Healthcare common stock, is set forth in the proxy statement for Province Healthcare’s 2004 annual meeting, which was filed with the SEC on April 20, 2004. Investors and security holders may obtain additional information regarding the interests of such potential participants by reading the joint proxy statement/prospectus and the other relevant documents filed with the SEC.

     Certain information contained in this release constitutes forward-looking statements. These statements are based only on our current estimates of future events. Forward-looking statements involve known and unknown risks and uncertainties which may cause our 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 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 and uncertainties are described in our most recent reports and filings with the Securities and Exchange Commission. You should not rely on the forward-looking statements contained in this release, as we cannot predict or control many of the factors that may cause future events or results to differ from those forecasted. We undertake no obligation to update any forward-looking statements on the basis of any information, future events or otherwise.

- TABLES TO FOLLOW -

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PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)

                 
    September 30,   December 31,
    2004
  2003(*)
ASSETS
               
Current assets:
               
Cash and cash equivalents
  $ 11,607     $ 46,117  
Accounts receivable, less allowance for doubtful accounts of $81,175 in 2004 and $66,835 in 2003
    138,751       110,335  
Inventories
    20,901       18,424  
Prepaid expenses and other
    15,502       14,614  
Assets of discontinued operations
    2,880       14,995  
 
   
 
     
 
 
 
    189,641       204,485  
Property and equipment, net
    562,782       459,843  
Goodwill
    388,957       309,191  
Other assets
    32,613       36,874  
 
   
 
     
 
 
 
  $ 1,173,993     $ 1,010,393  
 
   
 
     
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
Current liabilities:
               
Accounts payable
  $ 33,956     $ 16,083  
Accrued salaries and benefits
    31,660       27,852  
Accrued expenses
    34,832       14,241  
Current portion of long-term debt
    251       743  
Liabilities of discontinued operations
    355       5,156  
 
   
 
     
 
 
 
    101,054       64,075  
Long-term debt, less current portion
    514,477       447,956  
Other liabilities
    58,671       49,579  
Minority interests
    2,171       1,910  
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, 2004 and December 31, 2003, issued and outstanding 49,764,999 shares and 48,841,157 shares at September 30, 2004 and December 31, 2003, respectively
    498       488  
Additional paid-in-capital
    315,158       306,091  
Retained earnings
    182,474       141,186  
Accumulated other comprehensive loss
    (510 )     (892 )
 
   
 
     
 
 
Total stockholders’ equity
    497,620       446,873  
 
   
 
     
 
 
 
  $ 1,173,993     $ 1,010,393  
 
   
 
     
 
 


(*)   Derived from the audited consolidated financial statements of Province and its subsidiaries, contained in the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 14, 2004.

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PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)

                                 
    Three Months Ended September 30,
    2004
  2003
            % of           % of
    Amount
  Revenues
  Amount
  Revenues
Revenues:
                               
Net patient revenue
  $ 232,572             $ 182,229          
Other
    2,743               2,560          
 
   
 
             
 
         
 
    235,315       100.0 %     184,789       100.0 %
Expenses:
                               
Salaries, wages and benefits
    86,615       36.8       67,262       36.4  
Purchased services
    23,011       9.8       16,735       9.1  
Supplies
    30,530       13.0       24,035       13.0  
Provision for doubtful accounts
    26,537       11.3       18,773       10.2  
Other operating expenses
    26,174       11.1       22,417       12.1  
Rentals and leases
    3,072       1.3       2,198       1.2  
Depreciation and amortization
    12,561       5.3       9,317       5.0  
Interest expense
    7,618       3.2       6,989       3.8  
Minority interests
    201       0.1       52        
(Gain) loss on sale of assets
    (32 )           75        
Loss on early extinguishment of debt
                10        
 
   
 
     
 
     
 
     
 
 
Total expenses
    216,287       91.9       167,863       90.8  
 
   
 
     
 
     
 
     
 
 
Income before provision for income taxes
    19,028       8.1       16,926       9.2  
Income taxes
    7,137       3.0       6,725       3.7  
 
   
 
     
 
     
 
     
 
 
Income from continuing operations
    11,891       5.1 %     10,201       5.5 %
 
           
 
             
 
 
Discontinued operations, net of tax:
                               
Loss from operations
    (362 )             (394 )        
Net gain on divestitures
                           
 
   
 
             
 
         
Net income
  $ 11,529             $ 9,807          
 
   
 
             
 
         
Diluted earnings (loss) per common share:
                               
Continuing operations (a)
  $ 0.23             $ 0.21          
Discontinued operations:
                               
Loss from operations
    (0.01 )             (0.01 )        
Net gain on divestitures
                           
 
   
 
             
 
         
Net income
  $ 0.22             $ 0.20          
 
   
 
             
 
         


(a)   See calculation of diluted earnings per common share from continuing operations in the Selected Operating Statistics section (attached).

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PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)

                                 
    Nine Months Ended September 30,
    2004
  2003
            % of           % of
    Amount
  Revenues
  Amount
  Revenues
Revenues:
                               
Net patient revenue
  $ 636,699             $ 543,667          
Other
    7,727               7,500          
 
   
 
             
 
         
 
    644,426       100.0 %     551,167       100.0 %
Expenses:
                               
Salaries, wages and benefits
    236,192       36.7       209,043       37.9  
Purchased services
    61,953       9.6       50,876       9.2  
Supplies
    82,416       12.8       71,071       12.9  
Provision for doubtful accounts
    68,481       10.6       51,077       9.3  
Other operating expenses
    73,109       11.3       65,221       11.8  
Rentals and leases
    8,328       1.3       6,675       1.2  
Depreciation and amortization
    34,203       5.3       27,231       5.0  
Interest expense
    21,954       3.4       19,346       3.5  
Minority interests
    437       0.1       201        
(Gain) loss on sale of assets
    (14 )           75        
Loss on early extinguishment of debt
                487       0.1  
 
   
 
     
 
     
 
     
 
 
Total expenses
    587,059       91.1       501,303       90.9  
 
   
 
     
 
     
 
     
 
 
Income before provision for income taxes
    57,367       8.9       49,864       9.1  
Income taxes
    21,439       3.3       19,852       3.6  
 
   
 
     
 
     
 
     
 
 
Income from continuing operations
    35,928       5.6 %     30,012       5.5 %
 
           
 
             
 
 
Discontinued operations, net of tax:
                               
Loss from operations
    (1,302 )             (693 )        
Net gain on divestitures
    6,663                        
 
   
 
             
 
         
Net income
  $ 41,289             $ 29,319          
 
   
 
             
 
         
Diluted earnings (loss) per common share:
                               
Continuing operations (b)
  $ 0.70             $ 0.61          
Discontinued operations:
                               
Loss from operations
    (0.02 )             (0.01 )        
Net gain on divestitures
    0.11                        
 
   
 
             
 
         
Net income
  $ 0.79             $ 0.60          
 
   
 
             
 
         


(b)   See calculation of diluted earnings per common share from continuing operations in the Selected Operating Statistics section (attached).

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PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)

                 
    Three Months Ended September 30,
    2004
  2003
Cash flows from operating activities:
               
Income from continuing operations
  $ 11,891     $ 10,201  
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
               
Depreciation and amortization
    12,561       9,317  
Deferred income taxes
    3,607       314  
Provision for professional liability
    2,085       1,423  
Loss on early extinguishment of debt
          10  
(Gain) loss on sale of assets
    (32 )     75  
Changes in operating assets and liabilities, net of effects from acquisitions and disposals:
               
Accounts receivable
    (9,609 )     3,653  
Inventories
    207       248  
Prepaid expenses and other
    5,195       3,394  
Accounts payable and accrued expenses
    15,536       5,823  
Accrued salaries and benefits
    1,759       (570 )
Other
    1,088       1,400  
 
   
 
     
 
 
Net cash provided by operating activities
    44,288       35,288  
Cash flows from investing activities:
               
Purchase of property and equipment
    (23,601 )     (13,494 )
Escrow deposit on potential investment
          3,798  
Purchase of hospitals and healthcare entities
    (534 )     (94 )
 
   
 
     
 
 
Net cash used in investing activities
    (24,135 )     (9,790 )
Cash flows from financing activities:
               
Proceeds from long-term debt
    372        
Repayments of debt
    (10,882 )     (5,390 )
Issuance of common stock
    1,043       121  
 
   
 
     
 
 
Net cash used in financing activities
    (9,467 )     (5,269 )
 
   
 
     
 
 
Net cash provided by continuing operations
    10,686       20,229  
Net cash used in discontinued operations
    (1,066 )     (312 )
 
   
 
     
 
 
Increase in cash and cash equivalents
    9,620       19,917  
Cash and cash equivalents at beginning of period
    1,987       19,139  
 
   
 
     
 
 
Cash and cash equivalents at end of period
  $ 11,607     $ 39,056  
 
   
 
     
 
 

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PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)

                 
    Nine Months Ended September 30,
    2004
  2003
Cash flows from operating activities:
               
Income from continuing operations
  $ 35,928     $ 30,012  
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
               
Depreciation and amortization
    34,203       27,231  
Deferred income taxes
    14,139       3,469  
Provision for professional liability
    5,329       4,806  
Loss on early extinguishment of debt
          487  
(Gain) loss on sale of assets
    (14 )     75  
Changes in operating assets and liabilities, net of effects from acquisitions and disposals:
               
Accounts receivable
    (12,907 )     3,279  
Inventories
    8       677  
Prepaid expenses and other
    (5,395 )     813  
Accounts payable and accrued expenses
    20,682       10,914  
Accrued salaries and benefits
    (1,514 )     1,372  
Other
    2,638       5,549  
 
   
 
     
 
 
Net cash provided by operating activities
    93,097       88,684  
Cash flows from investing activities:
               
Purchase of property and equipment
    (61,313 )     (43,899 )
Purchase of hospitals and healthcare entities
    (153,317 )     (3,247 )
 
   
 
     
 
 
Net cash used in investing activities
    (214,630 )     (47,146 )
Cash flows from financing activities:
               
Proceeds from long-term debt
    110,372       194,212  
Repayments of debt
    (46,007 )     (212,664 )
Issuance of common stock
    8,307       1,356  
 
   
 
     
 
 
Net cash provided by (used in) financing activities
    72,672       (17,096 )
 
   
 
     
 
 
Net cash (used in) provided by continuing operations
    (48,861 )     24,442  
Net cash provided by (used in) discontinued operations
    14,351       (11 )
 
   
 
     
 
 
(Decrease) increase in cash and cash equivalents
    (34,510 )     24,431  
Cash and cash equivalents at beginning of period
    46,117       14,625  
 
   
 
     
 
 
Cash and cash equivalents at end of period
  $ 11,607     $ 39,056  
 
   
 
     
 
 

8


Table of Contents

PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
SELECTED OPERATING STATISTICS (Unaudited)

                                                 
    Actual
  Same Store(1)
    Three Months Ended   Three Months Ended
    September 30,
  September 30,
    2004
  2003
          2004
  2003
       
Consolidated Hospitals:
                                               
Number of hospitals at end of period
    20       19       5.3 %     19       19       %
Licensed beds at end of period
    2,492       2,208       12.9       2,206       2,208        
Beds in service at end of period
    2,116       1,933       9.5       1,920       1,933       (0.7 )
Inpatient admissions
    19,752       17,729       11.4       17,189       17,729       (3.0 )
Adjusted admissions (2)
    37,527       32,879       14.1       33,093       32,879       0.7  
Patient days
    83,167       72,935       14.0       71,640       72,935       (1.8 )
Adjusted patient days (3)
    158,019       135,269       16.8       137,930       135,269       2.0  
Average length of stay (days)
    4.2       4.1       2.4       4.2       4.1       2.4  
Net patient revenue
  $ 232,572     $ 182,229       27.6     $ 192,273     $ 182,208       5.5  
Net patient revenue:
                                               
Per inpatient admission
  $ 11,775     $ 10,279       14.6     $ 11,186     $ 10,277       8.8  
Per adjusted admission
  $ 6,197     $ 5,542       11.8     $ 5,810     $ 5,542       4.8  
Gross revenue:
                                               
Inpatient
  $ 265,760     $ 215,315       23.4     $ 222,337     $ 215,315       3.3  
Outpatient
    239,142       183,940       30.0       205,651       183,940       11.8  
 
   
 
     
 
             
 
     
 
         
 
  $ 504,902     $ 399,255       26.5     $ 427,988     $ 399,255       7.2  
 
   
 
     
 
             
 
     
 
         
Net Patient Revenue by Payor:
                                               
Medicare
    35.8 %     38.1 %             38.0 %     38.1 %        
Medicaid
    9.8       11.0               9.5       11.0          
Other
    54.4       50.9               52.5       50.9          
 
   
 
     
 
             
 
     
 
         
Total
    100.0 %     100.0 %             100.0 %     100.0 %        
 
   
 
     
 
             
 
     
 
         
                 
    Three Months Ended September 30,
    2004
  2003
Diluted Earnings Per Share Calculation:
               
Income from continuing operations
  $ 11,891     $ 10,201  
Add convertible notes interest, net of tax (4)
    1,901        
 
   
 
     
 
 
Adjusted net income
  $ 13,792     $ 10,201  
 
   
 
     
 
 
Basic shares plus stock options
    51,002       49,639  
Convertible shares (4)
    9,100        
 
   
 
     
 
 
Diluted shares outstanding
    60,102       49,639  
 
   
 
     
 
 
Diluted earnings per share
  $ 0.23     $ 0.21  
 
   
 
     
 
 


(1)   Represents 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-month periods ended September 30, 2003 and thus, are not included in the diluted earnings per share calculation for such period.

9


Table of Contents

PROVINCE HEALTHCARE COMPANY AND SUBSIDIARIES
SELECTED OPERATING STATISTICS (Unaudited)

                                                 
    Actual
  Same Store(1)
    Nine Months Ended   Nine Months Ended
    September 30,
  September 30,
    2004
  2003
          2004
  2003
       
Consolidated Hospitals:
                                               
Number of hospitals at end of period
    20       19       5.3 %     19       19       %
Licensed beds at end of period
    2,492       2,208       12.9       2,206       2,208        
Beds in service at end of period
    2,116       1,933       9.5       1,920       1,933       (0.7 )
Inpatient admissions
    56,469       54,032       4.5       53,065       54,032       (1.8 )
Adjusted admissions (2)
    105,075       98,131       7.1       99,103       98,131       1.0  
Patient days
    240,622       228,231       5.4       225,467       228,231       (1.2 )
Adjusted patient days (3)
    447,662       414,406       8.0       420,928       414,406       1.6  
Average length of stay (days)
    4.3       4.2       2.4       4.3       4.2       2.4  
Net patient revenue
  $ 636,699     $ 543,667       17.1     $ 583,930     $ 543,646       7.4  
Net patient revenue:
                                               
Per inpatient admission
  $ 11,275     $ 10,062       12.1     $ 11,004     $ 10,062       9.4  
Per adjusted admission
  $ 6,059     $ 5,540       9.4     $ 5,892     $ 5,540       6.4  
Gross revenue:
                                               
Inpatient
  $ 759,165     $ 662,921       14.5     $ 702,211     $ 662,921       5.9  
Outpatient
    653,428       541,020       20.8       608,492       541,020       12.5  
 
   
 
     
 
             
 
     
 
         
 
  $ 1,412,593     $ 1,203,941       17.3     $ 1,310,703     $ 1,203,941       8.9  
 
   
 
     
 
             
 
     
 
         
Net Patient Revenue by Payor:
                                               
Medicare
    37.7 %     38.7 %             39.0 %     38.7 %        
Medicaid
    9.7       10.8               9.5       10.8          
Other
    52.6       50.5               51.5       50.5          
 
   
 
     
 
             
 
     
 
         
Total
    100.0 %     100.0 %             100.0 %     100.0 %        
 
   
 
     
 
             
 
     
 
         
                 
    Nine Months Ended September 30,
    2004
  2003
Diluted Earnings Per Share Calculation:
               
Income from continuing operations
  $ 35,928     $ 30,012  
Add convertible notes interest, net of tax (4)
    5,698        
 
   
 
     
 
 
Adjusted net income
  $ 41,626     $ 30,012  
 
   
 
     
 
 
Basic shares plus stock options
    50,647       49,143  
Convertible shares (4)
    9,100        
 
   
 
     
 
 
Diluted shares outstanding
    59,747       49,143  
 
   
 
     
 
 
Diluted earnings per share
  $ 0.70     $ 0.61  
 
   
 
     
 
 


See accompanying footnotes on previous page.

10

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