-----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, FKM5zxbNSpbmwIOTk11jIiTrGrJ/Of/OhMcNObcTPOQcnwQaSbjjcbLZa7anqmm9 5mwe3TPdq0zE4ktV2wYKrA== 0000930661-98-001603.txt : 19980803 0000930661-98-001603.hdr.sgml : 19980803 ACCESSION NUMBER: 0000930661-98-001603 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980729 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980730 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: COLUMBIA HCA HEALTHCARE CORP/ CENTRAL INDEX KEY: 0000860730 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-GENERAL MEDICAL & SURGICAL HOSPITALS, NEC [8062] IRS NUMBER: 752497104 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 033-64105 FILM NUMBER: 98674440 BUSINESS ADDRESS: STREET 1: ONE PARK PLZ CITY: NASHVILLE STATE: TN ZIP: 37203 BUSINESS PHONE: 6153279551 FORMER COMPANY: FORMER CONFORMED NAME: COLUMBIA HEALTHCARE CORP DATE OF NAME CHANGE: 19930830 FORMER COMPANY: FORMER CONFORMED NAME: COLUMBIA HOSPITAL CORP DATE OF NAME CHANGE: 19930328 8-K 1 CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report July 29, 1998 (Date of Earliest Event Reported) COLUMBIA/HCA HEALTHCARE CORPORATION (Exact name of Registrant as specified in its Charter) DELAWARE (State of Incorporation) 001-11239 75-2497104 (Commission (I.R.S. Employer File Number) Identification No.) One Park Plaza, Nashville, Tennessee 37203 (Address of principal executive offices) (Zip Code) (615) 344-9551 (Registrant's telephone number, including area code) ITEM 5. OTHER EVENTS On July 29, 1998, Columbia/HCA Healthcare Corporation (the "Company") announced operating results for the second quarter ended June 30, 1998, including EPS from continuing operations, before restructuring and investigation related costs, of $0.30 per diluted share. The Company also announced that it has been authorized by its Board of Directors to repurchase up to $1 billion of its common stock. Also on July 29, 1998, the Company announced that its Board of Directors has approved the filing of a ruling request with the Internal Revenue Service for tax-free spin-offs to stockholders of its America and Pacific Groups. The America Group presently includes 22 rural hospitals and the Pacific Group includes 43 suburban or secondary market hospitals. The Company anticipates filing the ruling request in August. ITEM 7. EXHIBIT Exhibit 20 Copy of press release dated July 29, 1998 relating to second quarter earnings release and $1 billion share repurchase. SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. COLUMBIA/HCA HEALTHCARE CORPORATION /s/ JOHN M. FRANCK II - ----------------------------------------- John M. Franck II Corporate Secretary DATED: July 30, 1998 EX-20 2 PRESS RELEASE EXHIBIT 20 [Logo of Columbia/HCA appears here] NEWS FOR IMMEDIATE RELEASE INVESTOR CONTACT: MEDIA CONTACT: Mark Kimbrough 615-344-2688 Jeff Prescott 615-344-5708 COLUMBIA/HCA REPORTS SECOND QUARTER EPS OF $0.30 FROM CONTINUING OPERATIONS BEFORE RESTRUCTURING AND INVESTIGATION COSTS $1 BILLION SHARE REPURCHASE ANNOUNCED NASHVILLE, TENN., JULY 29, 1998---Columbia/HCA Healthcare Corporation (NYSE: COL) today announced operating results for the second quarter ended June 30, 1998, including EPS from continuing operations, before restructuring and investigation related costs, of $0.30 per diluted share. The Company also announced that it has been authorized by its Board of Directors to repurchase up to $1 billion of its common stock. The Company also announced today, that its Board of Directors has approved the filing of a ruling request with the Internal Revenue Service for tax-free spin- offs to stockholders of its America and Pacific Groups. The America Group presently includes 22 rural hospitals and the Pacific Group includes 43 suburban or secondary market hospitals. Columbia/HCA anticipates filing the ruling request in August. Thomas F. Frist, Jr. M.D., Chairman and CEO, stated, "We have accomplished a great deal during the past twelve months, including the repositioning of the Company to provide a more community-based, local focus for our hospitals. Also, significant progress has been made in the development of a new culture within the organization, defining the Company's mission and values, and focusing on "patients first." Everyone within the organization should be proud of our accomplishments, however, we recognize there still remains much to be accomplished." "We believe the future of this Company lies in returning to a focused strategy that concentrates on those communities where we have a major healthcare presence. Those hospitals and other service units which do not fit this profile are being repositioned into other organizations that can more effectively serve the needs of those local communities," Frist said. Frist added, "I am particularly pleased with the significant progress we have made this year in the restructuring of our assets; with the operational improvements we have achieved, despite anticipated weaker results from assets being sold; and with today's announced addition of a stock repurchase program to enhance our overall financial strategy." Since the beginning of 1998, the Company has announced or completed asset sales totaling approximately $2.7 billion. The divestitures include Value RX for approximately $409 million, Value Behavioral Health and Value Health Sciences for approximately $210 million, 33 surgery centers for approximately $500 million, 22 hospitals to a not-for-profit consortium for approximately $1.2 billion, homecare operations for approximately $100 million and an additional 15 hospitals in separate transactions for approximately $300 million. Revenues from continuing operations approximated $4.8 billion in both the second quarters ended June 30, 1998 and 1997. Net income from continuing operations, before restructuring and investigation related costs, totaled $191 million, or $0.30 per diluted share for the second quarter of 1998 compared to $385 million, or $0.58 per diluted share for the same period of 1997. Net income totaled $78 million, or $0.12 per diluted share for the second quarter of 1998 compared to $412 million, or $0.62 per diluted share for the second quarter of 1997. Revenues for the six months ended June 30, 1998 totaled $9.7 billion, compared to $9.8 billion in the first six months of 1997. Net income from continuing operations, before restructuring and investigation related costs, totaled $432 million, or $0.67 per diluted share in the first half of 1998 compared to $840 million, or $1.24 per diluted share for the six months ended June 30, 1997. Net income totaled $275 million, or $0.43 per diluted share in 1998, compared to $835 million, or $1.24 per diluted share in 1997. During the second quarter of 1998, the Company recognized an after-tax loss on the sale of Value RX and Value Behavioral Health of approximately $73 million, or $0.11 per diluted share. During the second quarter of 1998, same-facility admissions, excluding hospitals held for sale, increased by 0.4 percent. Additionally, second quarter 1998 satisfaction surveys of patients, physicians and employees at the Company's hospitals all reflected continued improvement from recent quarters. At June 30, 1998, the Company's balance sheet reflected total debt of approximately $8.4 billion, stockholders equity of approximately $7.6 billion and total assets of $21.0 billion. Debt was reduced by over $600 million during the second quarter of 1998. During the first six months of 1998 total debt was reduced by approximately $1.1 billion. The Company's debt-to-total capital improved during the second quarter of 1998, to approximately 50 percent, compared to 52 percent at March 31, 1998 and 54 percent at December 31, 1997. 2 Columbia/HCA expects to commence the $1 billion common stock buyback through a series of forward purchase contracts. The Company may conclude these efforts through open market purchases or privately negotiated transactions, from time to time, at management's discretion. A $1 billion share repurchase program at current trading prices would represent approximately 5 percent of the Company's $19 billion market capitalization. *** The above statements may include forward-looking statements based on current management expectations. Numerous factors exist which may cause results to differ from these expectations. Many of the factors that will determine the Company's future results are beyond the ability of the Company to control or predict. These statements are subject to risks and uncertainties and, therefore, actual results may differ materially. The Company undertakes no obligation to update any forward-looking statements, or to make any other forward looking statements, whether as a result of new information, future events or otherwise. This information involves risks and uncertainties as detailed from time to time in the Company's filings with the Securities and Exchange Commission. All references to "Company" and "Columbia/HCA" as used throughout this document refer to Columbia/HCA Healthcare Corporation and its affiliates. 3 COLUMBIA/HCA HEALTHCARE CORPORATION CONSOLIDATED OPERATING RESULTS SUMMARY (Dollars in millions, except per share amounts)
FOR THE SIX MONTHS SECOND QUARTER ENDED JUNE 30, ------------------- -------------------- 1998 1997 1998 1997 --------- -------- --------- --------- Revenues................................................................. $ 4,781 $ 4,845 $ 9,682 $ 9,833 Operating income (a)..................................................... $ 796 $ 1,119 $ 1,697 $ 2,335 Net income: Income from continuing operations, excluding restructuring of operations and investigation related costs............................ $ 191 $ 385 $ 432 $ 840 Restructuring of operations and investigation related costs (net of tax).......................................................... (18) - (40) - Discontinued operations: Income (loss) from operations of discontinued businesses (net of tax)......................................................... (22) 27 (44) 51 Loss on disposal of discontinued businesses (net of tax)......................................................... (73) - (73) - Cumulative effect of accounting change (net of tax).................... - - - (56) ------------------- -------------------- Net income............................................................. $ 78 $ 412 $ 275 $ 835 =================== =================== Diluted earnings per share: Income from continuing operations, excluding restructuring of operations and investigation related costs............................ $ 0.30 $ 0.58 $ 0.67 $ 1.24 Restructuring of operations and investigation related costs............ (0.03) - (0.06) - Discontinued operations: Income (loss) from operations of discontinued businesses.............. (0.04) 0.04 (0.07) 0.08 Loss on disposal of discontinued businesses........................... (0.11) - (0.11) - Cumulative effect of accounting change................................. - - - (0.08) ------------------- ------------------- Net income............................................................. $ 0.12 $ 0.62 $ 0.43 $ 1.24 =================== =================== Shares used in computing diluted earnings per share (000)................ 647,993 667,106 646,467 673,376
- --------------------------------------- (a) Income from continuing operations before depreciation and amortization, interest expense, restructuring of operations and investigation related costs, minority interests and income taxes. Certain prior year amounts have been reclassified to conform to current year presentation. 4 COLUMBIA/HCA HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF INCOME SECOND QUARTER (DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
1998 1997 ----------------------- -------------------- AMOUNT RATIO AMOUNT RATIO ------------ --------- ----------- ------- Revenues........................................ $ 4,781 100.0% $ 4,845 100.0% Salaries and benefits........................... 1,998 41.8 1,850 38.2 Supplies........................................ 719 15.0 658 13.6 Other operating expenses........................ 961 20.2 943 19.4 Provision for doubtful accounts................. 340 7.1 310 6.4 Equity in earnings of affiliates................ (33) (0.7) (35) (0.7) ---------------------- ------------------- 3,985 83.4 3,726 76.9 ---------------------- ------------------- EBDITA........................................ 796 16.6 1,119 23.1 Depreciation and amortization................... 311 6.4 308 6.4 Interest expense................................ 145 3.0 123 2.5 Restructuring of operations and investigation related costs................................. 31 0.7 - - ---------------------- ------------------- Income from continuing operations before minority interests and income taxes........... 309 6.5 688 14.2 Minority interests in earnings of consolidated entities...................................... 18 0.4 45 0.9 ---------------------- ------------------- Income from continuing operations before income taxes......................................... 291 6.1 643 13.3 Provision for income taxes...................... 118 2.5 258 5.4 ---------------------- ------------------- Income from continuing operations............... 173 3.6 385 7.9 Discontinued operations: Income (loss) from operations of discontinued businesses (net of tax)....................... (22) (0.5) 27 0.6 Loss on disposal of discontinued businesses (net of tax).................................. (73) (1.5) - - ---------------------- ------------------- Net income.................................... $ 78 1.6 $ 412 8.5 ====================== =================== Diluted earnings per share: Income from continuing operations, excluding restructuring of operations and investigation related costs............................... $ 0.30 $0.58 Restructuring of operations and investigation related costs............................... (0.03) - Discontinued operations: Income (loss) from operations of discontinued businesses................................ (0.04) 0.04 Loss on disposal of discontinued businesses. (0.11) - ------------- ------------ Net income.................................... $ 0.12 $0.62 ============= ============ Shares used in computing diluted earnings per share (000)................................... 647,993 667,106
Certain prior year amounts have been reclassified to conform to current year presentation. 5 COLUMBIA/HCA HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF INCOME FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
----------------------------- ----------------------- 1998 1997 ----------------------------- ----------------------- AMOUNT RATIO AMOUNT RATIO ------ ----- ------ ----- Revenues........................................ $ 9,682 100.0% $ 9,833 100.0% Salaries and benefits........................... 4,011 41.4 3,726 37.9 Supplies........................................ 1,465 15.1 1,357 13.8 Other operating expenses........................ 1,901 19.7 1,905 19.4 Provision for doubtful accounts................. 683 7.1 607 6.2 Equity in earnings of affiliates................ (75) (0.8) (97) (1.0) ----------------------------- ----------------------- 7,985 82.5 7,498 76.3 ----------------------------- ----------------------- EBDITA........................................ 1,697 17.5 2,335 23.7 Depreciation and amortization................... 620 6.4 604 6.1 Interest expense................................ 298 3.1 236 2.4 Restructuring of operations and investigation related costs................................. 69 0.7 - - ----------------------------- ----------------------- Income from continuing operations before minority interests and income taxes........... 710 7.3 1,495 15.2 Minority interests in earnings of consolidated entities........................................ 38 0.4 92 0.9 ----------------------------- ----------------------- Income from continuing operations before income taxes......................................... 672 6.9 1,403 14.3 Provision for income taxes...................... 280 2.8 563 5.7 ----------------------------- ----------------------- Income from continuing operations............... 392 4.1 840 8.6 Discontinued operations: Income (loss) from operations of discontinued businesses (net of tax)..................... (44) (0.5) 51 0.5 Loss on disposal of discontinued businesses (net of tax)................................ (73) (0.8) - - Cumulative effect of accounting change (net of tax)............................................ - - (56) (0.6) ----------------------------- ----------------------- Net income...................................... $ 275 2.8 $ 835 8.5 ============================= ======================= Diluted earnings per share: Income from continuing operations, excluding restructuring of operations and investigation related costs................................. $ 0.67 $ 1.24 Restructuring of operations and investigation related costs................................. (0.06) - Discontinued operations: Income (loss) from operations of discontinued businesses.................................. (0.07) 0.08 Loss on disposal of discontinued businesses.................................. (0.11) - Cumulative effect of accounting change.......... - (0.08) -------------- ------------- Net income.......................................... $ 0.43 $ 1.24 ============== ============= Shares used in computing diluted earnings per share (000)................................... 646,467 673,376
Certain prior year amounts have been reclassified to conform to current year presentation. 6 COLUMBIA/HCA HEALTHCARE CORPORATION CONSOLIDATED BALANCE SHEETS (DOLLARS IN MILLONS)
JUNE 30, MARCH 31, DECEMBER 31, 1998 1998 1997 -------------------- ------------------ ----------------- ASSETS Current assets: Cash and cash equivalents............................. $ 25 $ 128 $ 110 Accounts receivable, net.............................. 2,427 2,549 2,522 Other................................................. 1,594 1,348 1,791 -------------------- ------------------ ----------------- Total current assets............................... 4,046 4,025 4,423 Property and equipment, at cost.......................... 16,814 16,441 16,254 Accumulated depreciation................................ (6,442) (6,189) (6,024) -------------------- ------------------ ----------------- 10,372 10,252 10,230 Investments of insurance subsidiary...................... 1,508 1,490 1,422 Investments in and advances to affiliates................ 1,371 1,346 1,329 Intangible assets, net................................... 3,405 3,508 3,521 Net assets of discontinued operations.................... 141 789 841 Other.................................................... 205 220 236 -------------------- ------------------ ----------------- $21,048 $21,630 $22,002 ==================== ================== ================= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable...................................... $ 727 $ 862 $ 929 Other current liabilities............................. 1,623 1,569 1,712 Long-term debt due within one year.................... 2,669 242 132 -------------------- ------------------ ----------------- Total current liabilities.......................... 5,019 2,673 2,773 Long term debt........................................... 5,693 8,748 9,276 Professional liability risks, deferred taxes and other liabilities..................................... 1,926 1,893 1,867 Minority interests in equity of consolidated entities.... 830 823 836 Stockholders' equity..................................... 7,580 7,493 7,250 -------------------- ------------------ ----------------- $21,048 $21,630 $22,002 ==================== ================== ================= Current ratio............................................ 0.81 1.51 1.59 Ratio of debt to debt plus common and minority equity... 49.9% 51.9% 53.8%
7 COLUMBIA/HCA HEALTHCARE CORPORATION OPERATING STATISTICS FOR THE SECOND QUARTERS AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997
FOR THE SIX MONTHS SECOND QUARTER ENDED JUNE 30, ---------------------- ---------------------- 1998 1997 1998 1997 ---------- ---------- ---------- ---------- CONSOLIDATED HOSPITALS: - --------------------- Number of Hospitals 309 315 309 315 Weighted Average Licensed Beds 60,712 61,203 60,738 61,212 Licensed Beds at End of Period 60,418 61,275 60,418 61,275 Admissions 474,400 477,200 982,000 974,400 Equivalent Admissions 731,900 729,600 1,487,700 1,461,500 Patient Days 2,321,900 2,358,800 4,910,100 4,914,900 Equivalent Patient Days 3,584,900 3,609,800 7,438,800 7,372,300 Emergency Room Visits 1,415,600 1,379,700 2,827,700 2,742,900 Outpatient Revenues as a Percentage of Patient Revenues 38.2% 37.6% 37.0% 36.3% Average Length of Stay 4.9 4.9 5.0 5.0 Occupancy 42.0% 42.4% 44.7% 44.4% Equivalent Occupancy 64.8% 64.8% 67.7% 66.6% NUMBER OF CONSOLIDATED AND NON-CONSOLIDATED - ------------------------------------------- (50/50 EQUITY JOINT VENTURES) HOSPITALS: ---------------------------------------- Consolidated 309 315 Non-Consolidated (50/50 Equity Joint Ventures) 26 27 --------- --------- Total Number of Hospitals 335 342 ========= ========= Certain prior year amounts have been reclassified to conform to current year presentation.
8 -----END PRIVACY-ENHANCED MESSAGE-----