8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report: November 7, 2012

(Date of earliest event reported)

TENET HEALTHCARE CORPORATION

(Exact name of Registrant as specified in its charter)

Nevada	1-7293	95-2557091
(State of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

1445 Ross Avenue, Suite 1400

Dallas, Texas 75202

(Address of principal executive offices, including zip code)

(469) 893-2200

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02      Results of Operations and Financial Condition.

The information contained herein is being furnished pursuant to Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.”  This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On November 7, 2012, Tenet Healthcare Corporation (the “Company”) issued a press release reporting the financial results of the Company for the quarter ended September 30, 2012.  A copy of the press release is attached to this report as Exhibit 99.1 and incorporated herein by reference.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in the press release filed as an exhibit to this report constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  Such forward-looking statements are based on management’s current expectations and involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results to be materially different from those expressed or implied by such forward-looking statements.  Such factors include, among others, the following: the passage of health care reform legislation and the enactment of additional federal and state health care reform; other changes in federal, state and local laws and regulations affecting the health care industry; general economic and business conditions, both nationally and regionally; demographic changes; changes in, or the failure to comply with, laws and governmental regulations; the ability to enter into managed care provider arrangements on acceptable terms; changes in Medicare and Medicaid payments or reimbursement; liability and other claims asserted against the Company; competition, including the Company’s ability to attract patients to its hospitals; technological and pharmaceutical improvements that increase the cost of providing, or reduce the demand for, health care; changes in business strategy or development plans; the ability to attract and retain qualified personnel, including physicians, nurses and other health care professionals, and the impact on the Company’s labor expenses resulting from a shortage of nurses or other health care professionals; the significant indebtedness of the Company; the Company’s ability to integrate new businesses with its existing operations; the availability and terms of capital to fund the expansion of the Company’s business, including the acquisition of additional facilities; the creditworthiness of counterparties to the Company’s business transactions; adverse fluctuations in interest rates and other risks related to interest rate swaps or any other hedging activities the Company undertakes; the ability to continue to expand and realize earnings contributions from the revenue cycle management, health care information management, capitation management, and patient communications services businesses under our Conifer Health Solutions (“Conifer”) subsidiary by marketing these services to third party hospitals and other health care-related entities; and its ability to identify and execute on measures designed to save or control costs or streamline operations.  Such factors also include the positive and negative effects of health reform legislation on reimbursement and utilization and the future designs of provider networks and insurance plans, including pricing, provider participation, coverage and co-pays and deductibles, all of which contain significant uncertainty, and for which multiple models exist which may differ materially from the Company’s expectations.  Certain additional risks and uncertainties are discussed in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K and quarterly reports on Form 10-Q.  All information in this report and the press release is as of November 7, 2012.  The Company specifically disclaims any obligation to update any forward-looking statement, whether as a result of changes in underlying factors, new information, future events or otherwise.

2

NON-GAAP INFORMATION

The press release filed as an exhibit to this report includes certain financial measures, such as adjusted EBITDA, that are not calculated in accordance with generally accepted accounting principles (GAAP).  Management recommends that you focus on the GAAP numbers as the best indicator of financial performance.  These alternative measures are provided only as a supplement to aid in analysis of the Company.  Reconciliation between non-GAAP measures and related GAAP measures can be found at the end of the press release.

Item 9.01	Financial Statements and Exhibits.
(d)	Exhibits
	99.1	Press Release issued on November 7, 2012

3

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	TENET HEALTHCARE CORPORATION
	By:	/s/ Daniel J. Cancelmi
		Daniel J. Cancelmi
		Chief Financial Officer
Date: November 7, 2012

4

EXHIBIT INDEX

99.1        Press Release issued on November 7, 2012

5

EX-99.1

Exhibit 99.1

Tenet Reports Third Quarter Adjusted EBITDA Growth of 40% to $269 Million

5.8% Growth in Net Operating Revenues

1.4% Increase in Adjusted Admissions

6.3% Growth in Outpatient Surgeries

3.7% Increase in Net Patient revenue per Adjusted Admission

DALLAS — November 7, 2012 — Tenet Healthcare Corporation (NYSE:THC) today reported Adjusted EBITDA of $269 million for the third quarter ended September 30, 2012, an increase of $77 million, or 40 percent, as compared to Adjusted EBITDA of $192 million in the third quarter of 2011. Net income attributable to common shareholders was $40 million, or $0.37 per diluted share, compared to $6 million, or $0.05 per diluted share in the third quarter of 2011.

“Strong revenue growth and disciplined cost control continue to drive our solid financial performance,” said Trevor Fetter, president and chief executive officer. “Adjusted EBITDA increased 40 percent to create the Company’s strongest third quarter in the last ten years. Net revenues grew by 5.8 percent reflecting strong volume increases and continued pricing strength. Our volume growth was one of the strongest in the investor-owned healthcare provider sector, and we recorded our eighth consecutive quarter of positive growth in adjusted admissions. Volume growth was led by a 6.3 percent increase in outpatient surgeries. Cost control was excellent. Conifer Health Solutions, Tenet’s services business, reported another solid quarter contributing $24 million to Adjusted EBITDA.”

“As we look to the fourth quarter, state officials in California recently informed the hospital industry that the managed care portion of the California Provider Fee program is not likely to be approved in 2012,” said Mr. Fetter. “This program had been expected to contribute more than $40 million to Adjusted EBITDA in the fourth quarter. We now expect these earnings to be recognized in 2013. As a result of this delay and recent trends in volumes and payer mix, we now expect Adjusted EBITDA of approximately $1.2 billion for 2012.”

Discussion of Results  (Percentage changes compare Q3’12 to Q3’11, unless otherwise noted.)

In the third quarter, adjusted admissions increased by 1.4 percent, and total admissions declined by 0.5 percent. Outpatient surgeries extended their strong growth trend increasing by 6.3 percent and total emergency department visits increased by 4.9 percent.

Net operating revenues were $2.221 billion, an increase of $121 million, or 5.8 percent, compared to net operating revenues of $2.100 billion in the third quarter of 2011.

Bad debt expense as a percent of revenues was 8.5 percent, an increase of 20 basis points compared to 8.3 percent in the third quarter of 2011. The increase in bad debt expense was largely the result of the 7.9 percent increase in uninsured and charity outpatient visits.

Net patient revenue per adjusted admission was $11,579, an increase of 3.7 percent. This pricing increase primarily reflects improved terms in our contracts with commercial managed care payers.

Selected operating expenses, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased by only 1.5 percent on a per adjusted admission basis. This favorable cost performance exceeded the Company’s expectations for the quarter. Supply costs were extremely well-controlled, declining 2.2 percent per adjusted admission.

Cash and cash equivalents were $83 million at September 30, 2012 compared to $82 million at June 30, 2012. The balance on the Company’s bank line was $175 million at September 30, 2012, a reduction of $25 million as compared to a balance of $200 million as of June 30, 2012. Approximately $60 million of California Provider Fee program revenues have been recognized in Adjusted EBITDA in 2012 that have not yet been received.

Outlook for Adjusted EBITDA in Fourth Quarter 2012 and Full Year 2013

The outlook range for Adjusted EBITDA in the fourth quarter of 2012 is $313 million to $353 million. This range reflects the delayed recognition of the revenue from the managed care portion of the California Provider Fee program into 2013. The Company’s Outlook for 2013 Adjusted EBITDA is in a range of $1.325 billion to $1.425 billion, slightly above analyst consensus estimates.

Management’s Webcast Discussion of Third Quarter Results

Tenet management will discuss the Company’s third quarter 2012 results on a 9:00 AM (ET) webcast on November 7, 2012.  This webcast may be accessed through Tenet’s website at www.tenethealth.com/investors.

Additional information regarding Tenet’s quarterly results of operations, including detailed tabular operational data, is contained in its Form 10-Q report, which will be filed with the Securities and Exchange Commission and posted on the Tenet investor relations website before the webcast. This press release includes certain non-GAAP measures, such as Adjusted EBITDA. A reconciliation of Adjusted EBITDA to net income attributable to Tenet common shareholders is included in the financial tables at the end of this release.

Tenet Healthcare Corporation, a leading health care services company, through its subsidiaries operates 49 hospitals, over 100 free-standing outpatient centers and Conifer Health Solutions, a leader in business process solutions for health care providers that serves more than 500 hospital and health care entities nationwide.  Tenet’s hospitals and related health care facilities are committed to providing high quality care to patients in the communities they serve.  For more information, please visit www.tenethealth.com.

Media: Rick Black (469) 893-2647	Investors: Thomas Rice (469) 893-2522
Rick.Black@tenethealth.com	Thomas.Rice@tenethealth.com

# # #

This document contains “forward-looking statements” — that is, statements relating to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain.  Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include the factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended Dec. 31, 2011, our quarterly reports on Form 10-Q, periodic reports on Form 8-K and other filings with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking statements contained in this press release as a result of new information or future events or developments.

Tenet uses its company web site to provide important information to investors about the company including the posting of important announcements regarding financial performance and corporate developments.

2

TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended September 30,
(Dollars in millions except per share amounts)	2012			%		2011			%		Change
Net operating revenues:
Net operating revenues before provision for doubtful accounts	$	2,427				$	2,289				6.0	%
Less: Provision for doubtful accounts	206					189					9.0	%
Net operating revenues	2,221			100.0	%	2,100			100.0	%	5.8	%
Operating expenses:
Salaries, wages and benefits	1,050			47.3	%	1,002			47.7	%	4.8	%
Supplies	376			16.9	%	379			18.0	%	(0.8	)%
Other operating expenses, net	539			24.2	%	527			25.1	%	2.3	%
Electronic health record incentives	(13		)	(0.6	)%	—			—	%	(100.0	)%
Depreciation and amortization	110			5.0	%	100			4.8	%	10.0	%
Impairment of long-lived assets and goodwill, and restructuring charges, net	6			0.3	%	8			0.4	%
Litigation and investigation costs	—			—	%	5			0.2	%
Operating income	153			6.9	%	79			3.8	%
Interest expense	(103		)			(59		)
Investment earnings	1					1
Income from continuing operations, before income taxes	51					21
Income tax expense	(18		)			(4		)
Income from continuing operations, before discontinued operations	33					17
Discontinued operations:
Income (loss) from operations	4					(2		)
Net losses on sales of facilities	(1		)			—
Income tax expense	(4		)			—
Loss from discontinued operations	(1		)			(2		)
Net income	32					15
Less: Preferred stock dividends	1					6
Less: Net income (loss) attributable to noncontrolling interests	(9		)			3
Net income attributable to Tenet Healthcare Corporation common shareholders	$	40				$	6
Amounts attributable to Tenet Healthcare Corporation common shareholders
Income from continuing operations, net of tax	$	30				$	8
Income (loss) from discontinued operations, net of tax	10					(2		)
Net income attributable to Tenet Healthcare Corporation common shareholders	$	40				$	6
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders
Basic
Continuing operations	$	0.29				$	0.07
Discontinued operations	0.09					(0.02		)
	$	0.38				$	0.05
Diluted
Continuing operations	$	0.28				$	0.07
Discontinued operations	0.09					(0.02		)
	$	0.37				$	0.05
Weighted average shares and dilutive securities outstanding (in thousands):
Basic	104,244					117,188
Diluted	107,311					120,908

3

TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Nine Months Ended September 30,
(Dollars in millions except per share amounts)	2012			%		2011			%		Change
Net operating revenues:
Net operating revenues before provision for doubtful accounts	$	7,373				$	7,018				5.1	%
Less: Provision for doubtful accounts	585					536					9.1	%
Net operating revenues	6,788			100.0	%	6,482			100.0	%	4.7	%
Operating expenses:
Salaries, wages and benefits	3,166			46.7	%	3,001			46.3	%	5.5	%
Supplies	1,164			17.1	%	1,167			18.0	%	(0.3	)%
Other operating expenses, net	1,604			23.7	%	1,526			23.5	%	5.1	%
Electronic health record incentives	(13		)	(0.2	)%	(50		)	(0.8	)%	(74.0	)%
Depreciation and amortization	314			4.6	%	298			4.6	%	5.4	%
Impairment of long-lived assets and goodwill, and restructuring charges, net	12			0.2	%	18			0.3	%
Litigation and investigation costs	3			—	%	24			0.4	%
Operating income	538			7.9	%	498			7.7	%
Interest expense	(303		)			(275		)
Investment earnings	2					3
Income from continuing operations, before income taxes	237					226
Income tax expense	(90		)			(73		)
Income from continuing operations, before discontinued operations	147					153
Discontinued operations:
Income (loss) from operations	7					(17		)
Impairment of long-lived assets and goodwill, and restructuring charges, net	(100		)			—
Net gains on sales of facilities	1					—
Income tax benefit	24					24
Income (loss) from discontinued operations	(68		)			7
Net income	79					160
Less: Preferred stock dividends	11					18
Less: Net income (loss) attributable to noncontrolling interests	(24		)			8
Net income attributable to Tenet Healthcare Corporation common shareholders	$	92				$	134
Amounts attributable to Tenet Healthcare Corporation common shareholders
Income from continuing operations, net of tax	$	129				$	128
Income (loss) from discontinued operations, net of tax	(37		)			6
Net income attributable to Tenet Healthcare Corporation common shareholders	$	92				$	134
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders
Basic
Continuing operations	$	1.25				$	1.06
Discontinued operations	(0.36		)			0.05
	$	0.89				$	1.11
Diluted
Continuing operations	$	1.21				$	1.03
Discontinued operations	(0.35		)			0.05
	$	0.86				$	1.08
Weighted average shares and dilutive securities outstanding (in thousands):
Basic	103,613					120,204
Diluted	106,904					124,466

4

TENET HEALTHCARE CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30,			December 31,
(Dollars in millions)	2012			2011
ASSETS
Current assets:
Cash and cash equivalents	$	83		$	113
Accounts receivable, less allowance for doubtful accounts	1,338			1,278
Inventories of supplies, at cost	154			161
Income tax receivable	13			7
Current portion of deferred income taxes	394			418
Assets held for sale	—			2
Other current assets	502			378
Total current assets	2,484			2,357
Investments and other assets	126			156
Deferred income taxes, net of current portion	338			374
Property and equipment, at cost, less accumulated depreciation and amortization	4,173			4,350
Goodwill	771			736
Other intangible assets, at cost, less accumulated amortization	578			489
Total assets	$	8,470		$	8,462
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	243		$	66
Accounts payable	629			760
Accrued compensation and benefits	379			376
Professional and general liability reserves	72			75
Accrued interest payable	110			112
Accrued legal settlement costs	7			64
Other current liabilities	389			362
Total current liabilities	1,829			1,815
Long-term debt, net of current portion	4,508			4,294
Professional and general liability reserves	322			337
Accrued legal settlement costs	2			2
Other long-term liabilities	524			506
Total liabilities	7,185			6,954
Commitments and contingencies
Redeemable noncontrolling interests in equity of consolidated subsidiaries	16			16
Equity:
Shareholders’ equity:
Preferred stock	45			334
Common stock	7			7
Additional paid-in capital	4,437			4,427
Accumulated other comprehensive loss	(49		)	(52		)
Accumulated deficit	(1,337		)	(1,440		)
Common stock in treasury, at cost	(1,879		)	(1,853		)
Total shareholders’ equity	1,224			1,423
Noncontrolling interests	45			69
Total equity	1,269			1,492
Total liabilities and equity	$	8,470		$	8,462

5

TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
(Dollars in millions)	2012			2011
Net income	$	79		$	160
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	314			298
Provision for doubtful accounts	585			536
Deferred income tax expense	58			102
Stock-based compensation expense	24			17
Impairment of long-lived assets and goodwill, and restructuring charges, net	12			18
Litigation and investigation costs	3			24
Amortization of debt discount and debt issuance costs	16			23
Pre-tax loss from discontinued operations	92			17
Other items, net	(7		)	(10		)
Changes in cash from changes in operating assets and liabilities:
Accounts receivable	(653		)	(618		)
Inventories and other current assets	(106		)	(32		)
Income taxes	(2		)	(44		)
Accounts payable, accrued expenses and other current liabilities	(23		)	(96		)
Other long-term liabilities	20			(10		)
Payments against reserves for restructuring charges and litigation costs and settlements	(56		)	(27		)
Net cash used in operating activities from discontinued operations, excluding income taxes	(19		)	(34		)
Net cash provided by operating activities	337			324
Cash flows from investing activities:
Purchases of property and equipment—continuing operations	(358		)	(294		)
Purchases of property and equipment—discontinued operations	(2		)	(4		)
Purchases of businesses or joint venture interests	(38		)	(56		)
Proceeds from sales of facilities and other assets — discontinued operations	45			—
Proceeds from sales of marketable securities, long-term investments and other assets	9			31
Other items, net	(2		)	(1		)
Net cash used in investing activities	(346		)	(324		)
Cash flows from financing activities:
Repayments of borrowings under credit facility	(1,458		)	—
Proceeds from borrowings under credit facility	1,553			—
Repayments of other borrowings	(76		)	(4		)
Proceeds from other borrowings	292			—
Repurchases of preferred stock	(292		)	—
Deferred debt issuance costs	(3		)	—
Repurchases of common stock	(26		)	(196		)
Cash dividends on preferred stock	(13		)	(18		)
Distributions paid to noncontrolling interests	(9		)	(8		)
Other items, net	11			6
Net cash used in financing activities	(21		)	(220		)
Net decrease in cash and cash equivalents	(30		)	(220		)
Cash and cash equivalents at beginning of period	113			405
Cash and cash equivalents at end of period	$	83		$	185
Supplemental disclosures:
Interest paid, net of capitalized interest	$	(288	)	$	(255	)
Income tax (payments) refunds, net	$	(9	)	$	9

6

TENET HEALTHCARE CORPORATION

SELECTED STATISTICS – CONTINUING HOSPITALS

(Unaudited)

(Dollars in millions except per patient day, per	Three Months Ended September 30,									Nine Months Ended September 30,
admission and per visit amounts)	2012			2011			Change			2012			2011			Change
Net inpatient revenues	$	1,501		$	1,444		3.9	%		$	4,656		$	4,529		2.8	%
Net outpatient revenues	$	789		$	734		7.5	%		$	2,346		$	2,192		7.0	%
Number of acute care hospitals (at end of period)	49			49			—		*	49			49			—		*
Licensed beds (at end of period)	13,216			13,119			0.7	%		13,216			13,119			0.7	%
Average licensed beds	13,216			13,106			0.8	%		13,177			13,113			0.5	%
Utilization of licensed beds	47.8		%	49.1		%	(1.3	)%	*	49.5		%	50.9		%	(1.4	)%	*
Patient days	580,594			591,948			(1.9	)%		1,788,490			1,823,397			(1.9	)%
Adjusted patient days	911,233			909,960			0.1	%		2,778,244			2,770,685			0.3	%
Net inpatient revenue per patient day	$	2,585		$	2,439		6.0	%		$	2,603		$	2,484		4.8	%
Total admissions	124,869			125,458			(0.5	)%		381,195			382,487			(0.3	)%
Adjusted patient admissions	197,778			194,965			1.4	%		597,570			586,395			1.9	%
Net inpatient revenue per admission	$	12,021		$	11,510		4.4	%		$	12,214		$	11,841		3.2	%
Average length of stay (days)	4.65			4.72			(1.5	)%		4.69			4.77			(1.7	)%
Total surgeries	94,260			92,574			1.8	%		282,910			271,086			4.4	%
Outpatient visits	1,035,236			987,318			4.9	%		3,113,615			2,971,933			4.8	%
Net outpatient revenue per visit	$	762		$	743		2.6	%		$	753		$	738		2.0	%
Sources of net patient revenue
Medicare	22.1		%	22.5		%	(0.4	)%	*	23.8		%	23.1		%	0.7	%	*
Medicaid	7.7		%	8.0		%	(0.3	)%	*	8.4		%	9.1		%	(0.7	)%	*
Managed care	58.9		%	58.2		%	0.7	%	*	57.2		%	57.0		%	0.2	%	*
Indemnity, self-pay and other	11.3		%	11.3		%	—	%	*	10.6		%	10.8		%	(0.2	)%	*

*   This change is the difference between the 2012 and 2011 amounts shown

7

TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

Fiscal 2012 by Calendar Quarter

(Unaudited)

	Three Months Ended									Nine Months Ended
(Dollars in millions except per share amounts)	03/31/12			06/30/12			09/30/12			09/30/12
Net operating revenues:
Net operating revenues before provision for doubtful accounts	$	2,491		$	2,455		$	2,427		$	7,373
Less: Provision for doubtful accounts	189			190			206			585
Net operating revenues	2,302			2,265			2,221			6,788
Operating expenses:
Salaries, wages and benefits	1,062			1,054			1,050			3,166
Supplies	399			389			376			1,164
Other operating expenses, net	531			534			539			1,604
Electronic health record incentives	—			—			(13		)	(13		)
Depreciation and amortization	100			104			110			314
Impairment of long-lived assets and goodwill, and restructuring charges, net	3			3			6			12
Litigation and investigation costs	2			1			—			3
Operating income	205			180			153			538
Interest expense	(98		)	(102		)	(103		)	(303		)
Investment earnings	1			—			1			2
Income from continuing operations, before income taxes	108			78			51			237
Income tax expense	(42		)	(30		)	(18		)	(90		)
Income from continuing operations, before discontinued operations	66			48			33			147
Discontinued operations:
Income from operations	2			1			4			7
Impairment of long-lived assets and goodwill, and restructuring charges, net	—			(100		)	—			(100		)
Net gains (losses) on sales of facilities	—			2			(1		)	1
Income tax benefit (expense)	(1		)	29			(4		)	24
Income (loss) from discontinued operations	1			(68		)	(1		)	(68		)
Net income	67			(20		)	32			79
Less: Preferred stock dividends	6			4			1			11
Less: Net income (loss) attributable to noncontrolling interests	3			(18		)	(9		)	(24		)
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders	$	58		$	(6	)	$	40		$	92
Amounts attributable to Tenet Healthcare Corporation common shareholders
Income from continuing operations, net of tax	$	57		$	42		$	30		$	129
Income (loss) from discontinued operations, net of tax	1			(48		)	10			(37		)
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders	$	58		$	(6	)	$	40		$	92
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders
Basic
Continuing operations	$	0.55		$	0.40		$	0.29		$	1.25
Discontinued operations	0.01			(0.46		)	0.09			(0.36		)
	$	0.56		$	(0.06	)	$	0.38		$	0.89
Diluted
Continuing operations	$	0.52		$	0.39		$	0.28		$	1.21
Discontinued operations	0.01			(0.45		)	0.09			(0.35		)
	$	0.53		$	(0.06	)	$	0.37		$	0.86
Weighted average shares and dilutive securities outstanding (in thousands):
Basic	102,843			103,753			104,244			103,613
Diluted	121,218			106,927			107,311			106,904

8

TENET HEALTHCARE CORPORATION

SELECTED STATISTICS – CONTINUING HOSPITALS

(Unaudited)

										Nine Months
(Dollars in millions except per patient day, per	Three Months Ended									Ended
admission and per visit amounts)	03/31/12			06/30/12			09/30/12			09/30/12
Net inpatient revenues	$	1,607		$	1,548		$	1,501		$	4,656
Net outpatient revenues	$	766		$	791		$	789		$	2,346
Number of acute care hospitals (at end of period)	49			49			49			49
Licensed beds (at end of period)	13,175			13,176			13,216			13,216
Average licensed beds	13,138			13,176			13,216			13,177
Utilization of licensed beds	51.6		%	49.2		%	47.8		%	49.5		%
Patient days	617,459			590,437			580,594			1,788,490
Adjusted patient days	947,116			919,895			911,233			2,778,244
Net inpatient revenue per patient day	$	2,603		$	2,622		$	2,585		$	2,603
Total admissions	131,190			125,136			124,869			381,195
Adjusted patient admissions	202,860			196,932			197,778			597,570
Net inpatient revenue per admission	$	12,249		$	12,371		$	12,021		$	12,214
Average length of stay (days)	4.71			4.72			4.65			4.69
Total surgeries	93,228			95,422			94,260			282,910
Outpatient visits	1,031,611			1,046,768			1,035,236			3,113,615
Net outpatient revenue per visit	$	743		$	756		$	762		$	753
Sources of net patient revenue
Medicare	26.5		%	22.7		%	22.1		%	23.8		%
Medicaid	7.5		%	10.0		%	7.7		%	8.4		%
Managed care	55.9		%	56.8		%	58.9		%	57.2		%
Indemnity, self-pay and other	10.1		%	10.5		%	11.3		%	10.6		%

9

TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

Fiscal 2011 by Calendar Quarter

(Unaudited)

	Three Months Ended												Year Ended
(Dollars in millions except per share amounts)	03/31/11			06/30/11			09/30/11			12/31/11			12/31/11
Net operating revenues:
Net operating revenues before provision for doubtful accounts	$	2,429		$	2,300		$	2,289		$	2,353		$	9,371
Less: Provision for doubtful accounts	179			168			189			181			717
Net operating revenues	2,250			2,132			2,100			2,172			8,654
Operating expenses:
Salaries, wages and benefits	1,017			982			1,002			1,014			4,015
Supplies	396			392			379			381			1,548
Other operating expenses, net	491			508			527			494			2,020
Electronic health record incentives	(25		)	(25		)	—			(5		)	(55		)
Depreciation and amortization	98			100			100			100			398
Impairment of long-lived assets and goodwill, and restructuring charges, net	8			2			8			2			20
Litigation and investigation costs	11			8			5			31			55
Operating income	254			165			79			155			653
Interest expense	(118		)	(98		)	(59		)	(100		)	(375		)
Loss from early extinguishment of debt	—			—			—			(117		)	(117		)
Investment earnings	1			1			1			—			3
Income (loss) from continuing operations, before income taxes	137			68			21			(62		)	164
Income tax benefit (expense)	(50		)	(19		)	(4		)	12			(61		)
Income (loss) from continuing operations, before discontinued operations	87			49			17			(50		)	103
Discontinued operations:
Loss from operations	(10		)	(5		)	(2		)	(1		)	(18		)
Impairment of long-lived assets and goodwill, and restructuring charges, net	—			—			—			(6		)	(6		)
Litigation settlements, and investigation costs	—			—			—			(17		)	(17		)
Income tax benefit	5			19			—			8			32
Income (loss) from discontinued operations	(5		)	14			(2		)	(16		)	(9		)
Net income (loss)	82			63			15			(66		)	94
Less: Preferred stock dividends	6			6			6			6			24
Less: Net income attributable to noncontrolling interests	3			2			3			4			12
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders	$	73		$	55		$	6		$	(76	)	$	58
Amounts attributable to Tenet Healthcare Corporation common shareholders
Income (loss) from continuing operations, net of tax	$	80		$	40		$	8		$	(60	)	$	68
Income (loss) from discontinued operations, net of tax	(7		)	15			(2		)	(16		)	(10		)
Net income (loss) attributable to Tenet Healthcare Corporation common shareholders	$	73		$	55		$	6		$	(76	)	$	58
Earnings (loss) per share attributable to Tenet Healthcare Corporation common shareholders
Basic
Continuing operations	$	0.66		$	0.33		$	0.07		$	(0.55	)	$	0.58
Discontinued operations	(0.06		)	0.12			(0.02		)	(0.15		)	(0.09		)
	$	0.60		$	0.45		$	0.05		$	(0.70	)	$	0.49
Diluted
Continuing operations	$	0.61		$	0.32		$	0.07		$	(0.55	)	$	0.56
Discontinued operations	(0.05		)	0.12			(0.02		)	(0.15		)	(0.08		)
	$	0.56		$	0.44		$	0.05		$	(0.70	)	$	0.48
Weighted average shares and dilutive securities outstanding (in thousands):
Basic	121,726			121,699			117,188			108,114			117,182
Diluted	141,295			125,937			120,908			108,114			121,295

10

TENET HEALTHCARE CORPORATION

SELECTED STATISTICS — CONTINUING HOSPITALS

(Unaudited)

(Dollars in millions except per patient day, per	Three Months Ended												Year Ended
admission and per visit amounts)	03/31/11			06/30/11			09/30/11			12/31/11			12/31/11
Net inpatient revenues	$	1,619		$	1,466		$	1,444		$	1,499		$	6,028
Net outpatient revenues	$	720		$	738		$	734		$	736		$	2,928
Number of acute care hospitals (at end of period)	49			49			49			49			49
Licensed beds (at end of period)	13,123			13,086			13,119			13,119			13,119
Average licensed beds	13,123			13,111			13,106			13,119			13,115
Utilization of licensed beds	53.8		%	50.0		%	49.1		%	48.9		%	50.4		%
Patient days	635,463			595,986			591,948			589,848			2,413,245
Adjusted patient days	948,356			912,369			909,960			902,762			3,673,447
Net inpatient revenue per patient day	$	2,548		$	2,460		$	2,439		$	2,541		$	2,498
Total admissions	131,437			125,592			125,458			125,347			507,834
Adjusted patient admissions	197,459			193,971			194,965			193,631			780,026
Net inpatient revenue per admission	$	12,318		$	11,673		$	11,510		$	11,959		$	11,870
Average length of stay (days)	4.83			4.75			4.72			4.71			4.75
Total surgeries	87,507			91,005			92,574			91,200			362,286
Outpatient visits	990,411			994,204			987,318			982,083			3,954,016
Net outpatient revenue per visit	$	727		$	742		$	743		$	749		$	741
Sources of net patient revenue
Medicare	23.2		%	23.5		%	22.5		%	23.1		%	23.1		%
Medicaid	11.5		%	7.5		%	8.0		%	8.6		%	9.0		%
Managed care	54.6		%	58.2		%	58.2		%	58.1		%	57.2		%
Indemnity, self-pay and other	10.7		%	10.8		%	11.3		%	10.2		%	10.7		%

11

TENET HEALTHCARE CORPORATION

SEGMENT REPORTING

(Unaudited)

							September 30,			December 31,
							2012			2011
Assets
Hospital Operations and other							$	8,381		$	8,389
Conifer							89			73
Total							$	8,470		$	8,462
	Three Months EndedSeptember 30,						Nine Months EndedSeptember 30,
	2012			2011			2012			2011
Capital expenditures:
Hospital Operations and other	$	105		$	98		$	352		$	289
Conifer	3			2			8			9
Total	$	108		$	100		$	360		$	298
Net operating revenues:
Hospital Operations and other	$	2,193		$	2,076		$	6,725		$	6,425
Conifer
Tenet	94			68			274			192
Other customers	28			24			63			57
	2,315			2,168			7,062			6,674
Intercompany eliminations	(94		)	(68		)	(274		)	(192		)
Total	$	2,221		$	2,100		$	6,788		$	6,482
Adjusted EBITDA:
Hospital Operations and other	$	245		$	180		$	793		$	812
Conifer	24			12			74			26
Total	$	269		$	192		$	867		$	838
Depreciation and amortization:
Hospital Operations and other	$	108		$	98		$	307		$	292
Conifer	2			2			7			6
Total	$	110		$	100		$	314		$	298
Adjusted EBITDA	$	269		$	192		$	867		$	838
Depreciation and amortization	(110		)	(100		)	(314		)	(298		)
Interest expenses	(103		)	(59		)	(303		)	(275		)
Litigation and investigation costs	—			(5		)	(3		)	(24		)
Impairments of long-lived assets	(6		)	(8		)	(12		)	(18		)
Investment earnings	1			1			2			3
Income before income taxes	$	51		$	21		$	237		$	226

Due to the fact that Conifer’s revenues from providing services to Tenet’s hospitals were based on third-party billing terms in 2012 but not in 2011, the following table presents 2012 Adjusted EBITDA on a comparable basis to the 2011 presentation.

	Three Months EndedSeptember 30,				Nine Months EndedSeptember 30,
	2012		2011		2012		2011
Adjusted supplemental EBITDA:
Hospital Operations and other	$	260	$	180	$	840	$	812
Conifer	9		12		27		26
Total	$	269	$	192	$	867	$	838

12

(1) Reconciliation of Adjusted EBITDA

Adjusted EBITDA, a non-GAAP term, is defined by the Company as net income (loss) attributable to Tenet Healthcare Corporation common shareholders before (1) cumulative effect of changes in accounting principle, net of tax, (2) net income attributable to noncontrolling interests, (3) preferred stock dividends, (4) income (loss) from discontinued operations, net of tax, (5) income tax (expense) benefit, (6) investment earnings (loss), (7) gain (loss) from early extinguishment of debt, (8) net gain (loss) on sales of investments, (9) interest expense, (10) litigation and investigation (costs) benefit, net of insurance recoveries, (11) hurricane insurance recoveries, net of costs, (12) impairment of long-lived assets and goodwill and restructuring charges, net of insurance recoveries, and (13) depreciation and amortization. The Company’s Adjusted EBITDA may not be comparable to EBITDA reported by other companies.

The Company provides this information as a supplement to GAAP information to assist itself and investors in understanding the impact of various items on its financial statements, some of which are recurring or involve cash payments. The Company uses this information in its analysis of the performance of its business excluding items that it does not consider as relevant in the performance of its hospitals in continuing operations. In addition, from time to time we use this measure to define certain performance targets under our compensation programs. Adjusted EBITDA is not a measure of liquidity, but is a measure of operating performance that management uses in its business as an alternative to net income (loss) attributable to Tenet Healthcare Corporation common shareholders. Because Adjusted EBITDA excludes many items that are included in our financial statements, it does not provide a complete measure of our operating performance. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance.

The reconciliation of net income (loss) attributable to Tenet Healthcare Corporation common shareholders, the most comparable GAAP term, to Adjusted EBITDA, is set forth in the first table below for the three and nine months ended September 30, 2012 and 2011.

TENET HEALTHCARE CORPORATION

Additional Supplemental Non-GAAP Disclosures

Table #1 - Reconciliation of Adjusted EBITDA to Net Income Attributable to Tenet Healthcare Corporation Common Shareholders

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2012			2011			2012			2011
Net income attributable to Tenet Healthcare Corporation common shareholders	$	40		$	6		$	92		$	134
Less: Net (income) loss attributable to noncontrolling interests	9			(3		)	24			(8		)
Preferred stock dividends	(1		)	(6		)	(11		)	(18		)
Income (loss) from discontinued operations, net of tax	(1		)	(2		)	(68		)	7
Income from continuing operations	33			17			147			153
Income tax expense	(18		)	(4		)	(90		)	(73		)
Investment earnings	1			1			2			3
Interest expense	(103		)	(59		)	(303		)	(275		)
Operating income	153			79			538			498
Litigation and investigation costs	—			(5		)	(3		)	(24		)
Impairment of long-lived assets and goodwill, and restructuring charges, net	(6		)	(8		)	(12		)	(18		)
Depreciation and amortization	(110		)	(100		)	(314		)	(298		)
Adjusted EBITDA	$	269		$	192		$	867		$	838
Net operating revenues	$	2,221		$	2,100		$	6,788		$	6,482
Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin)	12.1		%	9.1		%	12.8		%	12.9		%

13

TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures

Table #2 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Net Income Attributable to Tenet Healthcare Corporation Common Shareholders

for Years Ending December 31, 2012 and 2013

(Unaudited)

	2012						2013
(Dollars in Millions)	Low			High			Low			High
Net Income Attributable to Common Shareholders	$	134		$	175		$	258		$	335
Less:
Net (income) loss attributable to noncontrolling interests	20			25			(15		)	(10		)
Preferred stock dividends	(12		)	(12		)	0			0
Loss from discontinued operations, net of tax	(75		)	(70		)	(5		)	0
Income from continuing operations	201			232			278			345
Income tax expense	(129		)	(148		)	(177		)	(220		)
Income from continuing operations, before income taxes	330			380			455			565
Investment earnings	0			0			0			0
Interest expense	(410		)	(390		)	(460		)	(420		)
Net loss from extinguishment of long-term debt	0			0			0			0
Operating income	740			770			915			985
Litigation and investigation costs	(10		)	(5		)	0			0
Impairment of long-lived assets and goodwill, and restructuring charges	(20		)	(15		)	0			0
Depreciation and amortization	(410		)	(430		)	(410		)	(440		)
Adjusted EBITDA	$	1,180		$	1,220		$	1,325		$	1,425

Table #3 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Normalized Income from Continuing Operations
for Years Ending December 31, 2012 and 2013

(Unaudited)

	2012						2013
(Dollars in Millions except per share amounts)	Low			High			Low			High
Adjusted EBITDA (from Table #1)	$	1,180		$	1,220		$	1,325		$	1,425
Depreciation and amortization	(410		)	(430		)	(410		)	(440		)
Interest expense	(410		)	(390		)	(460		)	(420		)
Normalized income from continuing operations before income taxes	$	360		$	400		$	455		$	565
Income tax expense (a)	(140		)	(156		)	(177		)	(220		)
Normalized income from continuing operations (a)	$	220		$	244		$	278		$	345
Preferred stock dividends	(12		)	(12		)	0			0
Net (income) loss attributable to noncontrolling interests	(12		)	(7		)	(15		)	(10		)
Normalized net income attributable to common shareholders (a)	$	196		$	225		$	263		$	335
Weighted average shares outstanding (in millions)	107			107			99			99
Normalized earnings per share - continuing operations (a)	1.83			2.10			2.66			3.38

(a) Uses tax rate of 39 percent excluding unusual adjustments.

14