Universal Health Services Inc. (NYSE:UHS) Q3 2019 Earnings Conference Call - Final Transcript

Oct 25, 2019 • 09:00 am ET

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Universal Health Services Inc. (NYSE:UHS) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by, and welcome to the third quarter earnings call. At this time, all participants are in a listen-only mode. [Operator Instructions]

I would now like to hand the conference over to your speaker today, CFO, Steve Filton. Thank you. Please go ahead.

Executive
Steve G. Filton

Good morning. Alan Miller, our CEO, is also joining us this morning. And we welcome you to this review of Universal Health Services results for the third quarter ended September 30, 2019.

During this conference call, Alan and I will be using words such as believes, expects, anticipates, estimates and similar words that represent forecasts, projections and forward-looking statements. For anyone not familiar with the risks and uncertainties inherent in these forward-looking statements, I recommend a careful reading of the section on Risk Factors and forward-looking statements and risk factors in our Form 10-K for the year ended December 31, 2018 and our Form 10-Q for the quarter ended June 30, 2019.

We'd like to highlight just a couple of developments and business trends before opening the call up to questions. As discussed in our press release last night, our reported net income attributable to UHS during the third quarter of 2019 was $97.2 million or $1.10 per diluted share. As calculated on the supplemental schedule, our adjusted net income attributable to UHS during the third quarter of 2019 was $176.3 million or $1.99 per diluted share. Excluded from our adjusted net income during the third quarter of 2019 was an aggregate unfavorable after-tax impact of $79.1 million or $0.89 per diluted share, most of which related to a provision for asset impairment recorded in connection with our Foundations Recovery Network business.

On a same-facility basis in our acute care division, revenues during the third quarter of 2019 increased 9.3% over last year's comparable quarter. The increased revenues resulted primarily from a 7.4% increase in adjusted admissions and a 1.6% increase in revenue per adjusted admission. On a same-facility basis, net revenues in our behavioral health division increased 2.1% during the third quarter of 2019 as compared to the third quarter of 2018. During this year's third quarter as compared to last year's, adjusted admissions to our behavioral health facilities owned for more than a year increased 0.5% and adjusted patient days increased 0.4%. Revenue per adjusted admission increased 2% and revenue per adjusted patient day increased 2.2% during the third quarter of 2019 as compared to the comparable prior year quarter.

Based upon the operating trends and financial results experienced during the first nine months of 2019, we are revising our estimated range of adjusted net income attributable to UHS for the year ended December 31, 2019 to $9.60 to $9.90 per diluted share from the previously provided range of $9.70 to $10.40 per diluted share. This revised estimated guidance range, which excludes the unfavorable impact of the Foundations asset impairment, the unfavorable impact of the current year increase in the Department of Justice reserve and related provision for income taxes