Consolidating Financial Statements (Tables)

9 Months Ended

Sep. 30, 2018

Consolidating Financial Statements

Schedule of Consolidating Balance Sheets

	September 30, 2018
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Assets
Current assets:
Accounts receivable, less allowance for doubtful accounts	$	83,533	$	13,633	$	—	$	97,166
Due from affiliates		25,584		—		(25,584)		—
Inventories		4,515		6,742		—		11,257
Other current assets		6,058		870		—		6,928
Total current assets		119,690		21,245		(25,584)		115,351
Property and equipment:
Medical equipment		596,406		70,088		—		666,494
Property and office equipment		99,850		13,750		—		113,600
Accumulated depreciation		(514,800)		(57,600)		—		(572,400)
Total property and equipment, net		181,456		26,238		—		207,694
Other long-term assets:
Goodwill		283,141		63,027		—		346,168
Investment in subsidiary		80,966		—		(80,966)		—
Other intangibles, net		134,375		11,761		—		146,136
Other		9,163		1,626		—		10,789
Total assets	$	808,791	$	123,897	$	(106,550)	$	826,138
Liabilities and (Deficit) Equity
Current liabilities:
Current portion of long-term debt	$	4,044	$	1,722	$	—	$	5,766
Book overdrafts		1,762		(198)		—		1,564
Due to affiliates		—		25,584		(25,584)		—
Accounts payable		26,257		7,221		—		33,478
Accrued compensation		22,759		3,496		—		26,255
Accrued interest		6,406		—		—		6,406
Other accrued expenses		19,148		823		—		19,971
Total current liabilities		80,376		38,648		(25,584)		93,440
Long-term debt, less current portion		688,211		3,440		—		691,651
Pension and other long-term liabilities		10,717		9		—		10,726
Deferred income taxes, net		34,912		669		—		35,581
Commitments and contingencies
(Deficit) Equity
Common stock		—		—		—		—
Additional paid-in capital		251,484		76,003		(76,018)		251,469
Accumulated deficit		(255,855)		4,948		—		(250,907)
Accumulated loss in subsidiary		4,948		—		(4,948)		—
Accumulated other comprehensive loss		(6,002)		—		—		(6,002)
Total Universal Hospital Services, Inc. and Subsidiaries  (deficit) equity		(5,425)		80,951		(80,966)		(5,440)
Noncontrolling interest		—		180		—		180
Total (deficit) equity		(5,425)		81,131		(80,966)		(5,260)
Total liabilities and (deficit) equity	$	808,791	$	123,897	$	(106,550)	$	826,138

	December 31, 2017
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Assets
Current assets:
Accounts receivable, less allowance for doubtful accounts	$	76,093	$	13,544	$	—	$	89,637
Due from affiliates		31,590		—		(31,590)		—
Inventories		3,800		5,960		—		9,760
Other current assets		6,127		709		—		6,836
Total current assets		117,610		20,213		(31,590)		106,233
Property and equipment:
Medical equipment		564,316		64,877		—		629,193
Property and office equipment		92,414		12,927		—		105,341
Accumulated depreciation		(485,960)		(50,560)		—		(536,520)
Total property and equipment, net		170,770		27,244		—		198,014
Other long-term assets:
Goodwill		283,141		63,027		—		346,168
Investment in subsidiary		76,606		—		(76,606)		—
Other intangibles, net		136,563		15,358		—		151,921
Other		2,411		698		—		3,109
Total assets	$	787,101	$	126,540	$	(108,196)	$	805,445
Liabilities and (Deficit) Equity
Current liabilities:
Current portion of long-term debt	$	3,451	$	1,592	$	—	$	5,043
Book overdrafts		5,345		22		—		5,367
Due to affiliates		—		31,590		(31,590)		—
Accounts payable		29,842		6,847		—		36,689
Accrued compensation		18,696		2,802		—		21,498
Accrued interest		18,671		—		—		18,671
Other accrued expenses		16,018		1,745		—		17,763
Total current liabilities		92,023		44,598		(31,590)		105,031
Long-term debt, less current portion		694,171		3,894		—		698,065
Pension and other long-term liabilities		11,384		1		—		11,385
Deferred income taxes, net		34,126		1,216		—		35,342
Commitments and contingencies
(Deficit) Equity
Common stock		—		—		—		—
Additional paid-in capital		250,033		76,003		(76,018)		250,018
Accumulated deficit		(288,586)		588		—		(287,998)
Accumulated loss in subsidiary		588		—		(588)		—
Accumulated other comprehensive loss		(6,638)		—		—		(6,638)
Total Universal Hospital Services, Inc. and Subsidiaries (deficit) equity		(44,603)		76,591		(76,606)		(44,618)
Noncontrolling interest		—		240		—		240
Total (deficit) equity		(44,603)		76,831		(76,606)		(44,378)
Total liabilities and (deficit) equity	$	787,101	$	126,540	$	(108,196)	$	805,445

Schedule of Consolidating Statements of Operations

	Three Months Ended September 30, 2018
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Revenue	$	112,511	$	25,602	$	—	$	138,113
Cost of revenue		74,746		17,179		—		91,925
Gross margin		37,765		8,423		—		46,188
Selling, general and administrative		28,336		6,023		—		34,359
Gain on legal settlement		(2,817)		—		—		(2,817)
Operating income		12,246		2,400		—		14,646
Equity in earnings of subsidiary		(1,271)		—		1,271		—
Interest expense		12,584		556		—		13,140
Income before income taxes and noncontrolling interest		933		1,844		(1,271)		1,506
(Benefit) provision for income taxes		(439)		573		—		134
Consolidated net income		1,372		1,271		(1,271)		1,372
Net income attributable to noncontrolling interest		—		75		—		75
Net income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	1,372	$	1,196	$	(1,271)	$	1,297

	Three Months Ended September 30, 2017
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Revenue	$	100,024	$	23,748	$	—	$	123,772
Cost of revenue		69,220		15,188		—		84,408
Gross margin		30,804		8,560		—		39,364
Selling, general and administrative		22,486		6,118		—		28,604
Operating income		8,318		2,442		—		10,760
Equity in earnings of subsidiary		(1,020)		—		1,020		—
Interest expense		12,867		607		—		13,474
(Loss) income before income taxes and noncontrolling interest		(3,529)		1,835		(1,020)		(2,714)
(Benefit) provision for income taxes		(422)		815		—		393
Consolidated net (loss) income		(3,107)		1,020		(1,020)		(3,107)
Net income attributable to noncontrolling interest		—		125		—		125
Net (loss) income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	(3,107)	$	895	$	(1,020)	$	(3,232)

	Nine Months Ended September 30, 2018
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Revenue	$	343,497	$	77,678	$	—	$	421,175
Cost of revenue		221,842		51,480				273,322
Gross margin		121,655		26,198		—		147,853
Selling, general and administrative		82,911		19,227		—		102,138
Gain on legal settlement		(26,291)		—		—		(26,291)
Operating income		65,035		6,971		—		72,006
Equity in earnings of subsidiary		(3,699)		—		3,699		—
Interest expense		38,504		1,624		—		40,128
Income before income taxes and noncontrolling interest		30,230		5,347		(3,699)		31,878
(Benefit) provision for income taxes		(881)		1,648		—		767
Consolidated net income		31,111		3,699		(3,699)		31,111
Net income attributable to noncontrolling interest		—		241		—		241
Net income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	31,111	$	3,458	$	(3,699)	$	30,870

	Nine Months Ended September 30, 2017
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Revenue	$	312,758	$	69,875	$		$	382,633
Cost of revenue		210,408		45,089		—		255,497
Gross margin		102,350		24,786		—		127,136
Selling, general and administrative		74,432		18,740		—		93,172
Operating income		27,918		6,046		—		33,964
Equity in earnings of subsidiary		(2,362)		—		2,362		—
Interest expense		38,581		1,785		—		40,366
(Loss) income before income taxes and noncontrolling interest		(8,301)		4,261		(2,362)		(6,402)
(Benefit) provision for income taxes		(1,011)		1,899		—		888
Consolidated net (loss) income		(7,290)		2,362		(2,362)		(7,290)
Net income attributable to noncontrolling interest		—		295		—		295
Net (loss) income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	(7,290)	$	2,067	$	(2,362)	$	(7,585)

Schedule of Consolidating Statements of Comprehensive Income (Loss)

	Three Months Ended September 30, 2018								Nine Months Ended September 30, 2018
	Parent		Subsidiary						Parent		Subsidiary
	Issuer		Guarantors		Consolidating				Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated		UHS		SS & RES		Adjustments		Consolidated
Consolidated net income	$	1,372	$	1,271	$	(1,271)	$	1,372	$	31,111	$	3,699	$	(3,699)	$	31,111
Other comprehensive income:
Gain on minimum pension liability, net of tax		212		—		—		212		636		—		—		636
Total other comprehensive income		212		—		—		212		636		—		—		636
Comprehensive income		1,584		1,271		(1,271)		1,584		31,747		3,699		(3,699)		31,747
Comprehensive income attributable to noncontrolling interest		—		75		—		75		—		241		—		241
Comprehensive income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	1,584	$	1,196	$	(1,271)	$	1,509	$	31,747	$	3,458	$	(3,699)	$	31,506

	Three Months Ended September 30, 2017								Nine Months Ended September 30, 2017
	Parent		Subsidiary						Parent		Subsidiary
	Issuer		Guarantors		Consolidating				Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated		UHS		Surgical Services		Adjustments		Consolidated
Consolidated net (loss) income	$	(3,107)	$	1,020	$	(1,020)	$	(3,107)	$	(7,290)	$	2,362	$	(2,362)	$	(7,290)
Other comprehensive income:
Gain on minimum pension liability, net of tax		185		—		—		185		556		—		—		556
Total other comprehensive income		185		—		—		185		556		—		—		556
Comprehensive (loss) income		(2,922)		1,020		(1,020)		(2,922)		(6,734)		2,362		(2,362)		(6,734)
Comprehensive income attributable to noncontrolling interest		—		125		—		125		—		295		—		295
Comprehensive (loss) income attributable to Universal Hospital Services, Inc. and Subsidiaries	$	(2,922)	$	895	$	(1,020)	$	(3,047)	$	(6,734)	$	2,067	$	(2,362)	$	(7,029)

Schedule of Consolidating Statements of Cash Flows

	Nine Months Ended September 30, 2018
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Cash flows from operating activities:
Consolidated net income	$	31,111	$	3,699	$	(3,699)	$	31,111
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		44,104		7,431		—		51,535
Gain on legal settlement		(23,391)		—		—		(23,391)
Amortization of intangibles, contract costs, deferred financing costs and bond premium		3,595		3,774		—		7,369
Equity in earnings of subsidiary		(3,699)		—		3,699		—
Provision for doubtful accounts		1,485		169		—		1,654
Provision for inventory obsolescence		(65)		(58)		—		(123)
Non-cash share-based compensation expense		1,883		377		—		2,260
Gain on sales and disposals of equipment		(1,840)		(66)		—		(1,906)
Deferred income taxes		786		(547)		—		239
Interest on note receivable		(34)		—		—		(34)
Changes in operating assets and liabilities:
Accounts receivable		(8,925)		(258)		—		(9,183)
Due from affiliates		6,383		—		(6,383)		—
Inventories		(650)		(724)		—		(1,374)
Other operating assets		104		98		—		202
Accounts payable		912		2,797		—		3,709
Other operating liabilities		(7,174)		(58)		—		(7,232)
Net cash provided by operating activities		44,585		16,634		(6,383)		54,836
Cash flows from investing activities:
Medical equipment purchases		(26,473)		(7,634)		—		(34,107)
Property and office equipment purchases		(5,418)		(157)		—		(5,575)
Proceeds from disposition of property and equipment		2,711		200		—		2,911
Issuance of note receivable from officer		(581)		—		—		(581)
Net cash used in investing activities		(29,761)		(7,591)		—		(37,352)
Cash flows from financing activities:
Proceeds under senior secured credit facility		160,448		—		—		160,448
Payments under senior secured credit facility		(167,648)		—		—		(167,648)
Payments of principal under capital lease obligations		(3,232)		(1,515)		—		(4,747)
Holdback payment related to acquisition		—		(624)		—		(624)
Distributions to noncontrolling interests		—		(301)		—		(301)
Proceeds from exercise of parent company stock options		340		—		—		340
Shares forfeited for taxes		(1,149)		—		—		(1,149)
Due to affiliates		—		(6,383)		6,383		—
Change in book overdrafts		(3,583)		(220)		—		(3,803)
Net cash used in financing activities		(14,824)		(9,043)		6,383		(17,484)
Net change in cash and cash equivalents		—		—		—		—
Cash and cash equivalents at the beginning of period		—		—		—		—
Cash and cash equivalents at the end of period	$	—	$	—	$	—	$	—

	Nine Months Ended September 30, 2017
	Parent		Subsidiary
	Issuer		Guarantors		Consolidating
	UHS		SS & RES		Adjustments		Consolidated
Cash flows from operating activities:
Consolidated net (loss) income	$	(7,290)	$	2,362	$	(2,362)	$	(7,290)
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation		46,791		6,298		—		53,089
Amortization of intangibles, deferred financing costs and bond premium		3,841		3,851		—		7,692
Equity in earnings of subsidiary		(2,362)		—		2,362		—
Provision for doubtful accounts		221		(14)		—		207
Provision for inventory obsolescence		192		130		—		322
Non-cash share-based compensation expense		1,965		371		—		2,336
Gain on sales and disposals of equipment		(1,827)		58		—		(1,769)
Deferred income taxes		1,308		(983)		—		325
Interest on note receivable		(20)		—		—		(20)
Changes in operating assets and liabilities:
Accounts receivable		(807)		529		—		(278)
Due from affiliates		(4,418)		—		4,418		—
Inventories		(97)		366		—		269
Other operating assets		451		(304)		—		147
Accounts payable		(1,230)		(1,029)		—		(2,259)
Other operating liabilities		(17,667)		(1,370)		—		(19,037)
Net cash provided by operating activities		19,051		10,265		4,418		33,734
Cash flows from investing activities:
Medical equipment purchases		(28,024)		(6,528)		—		(34,552)
Property and office equipment purchases		(4,558)		(164)		—		(4,722)
Proceeds from disposition of property and equipment		3,105		27		—		3,132
Issuance of note receivable from officer		(936)		—		—		(936)
Acquisition and refund of escrow		3,717		(5,613)		—		(1,896)
Net cash used in investing activities		(26,696)		(12,278)		—		(38,974)
Cash flows from financing activities:
Proceeds under senior secured credit facility		130,223		—		—		130,223
Payments under senior secured credit facility		(112,942)		—		—		(112,942)
Payments of principal under capital lease obligations		(3,734)		(1,181)		—		(4,915)
Distributions to noncontrolling interests		—		(229)		—		(229)
Proceeds from exercise of parent company stock options		66		—		—		66
Contribution from Parent		1,900		—				1,900
Due to affiliates		—		4,418		(4,418)		—
Change in book overdrafts		(7,868)		(995)		—		(8,863)
Net cash provided by financing activities		7,645		2,013		(4,418)		5,240
Net change in cash and cash equivalents		—		—		—		—
Cash and cash equivalents at the beginning of period		—		—		—		—
Cash and cash equivalents at the end of period	$	—	$	—	$	—	$	—