TORONTO, May 15, 2014 /CNW/ - Medical Facilities Corporation ("Medical Facilities" or the "Company") (TSX: DR), today reported its financial results for the three-month period ended March 31, 2014. All amounts are expressed in U.S. dollars unless indicated otherwise.
First Quarter 2014 Summary
- Revenue of $72.9 million, consistent with Q1 2013
- Income from operations1 of $18.1 million, down 11.5% as compared with $20.4 million in Q1 2013
- Cash available for distribution1 of Cdn$9.0 million, up 3.5% as compared with Cdn$8.7 million in Q1 2013
- Payout ratio1 of 98.3% as compared with 92.2% in Q1 2013
"In the first quarter of 2014, we recorded revenue of $72.9 million which remained in line with results from one year ago. Our Black Hills facility recorded an increase in revenue and income from operations as a result of growth in surgical cases and pain management procedures as well as urgent care revenue," said Dr. Donald Schellpfeffer, CEO of Medical Facilities. "Additionally, a significant milestone was achieved as we proudly celebrated our 10-year anniversary as a public company while providing our patients with a unique experience by integrating hospitality into healthcare," concluded Dr. Schellpfeffer.
Three months ended March 31, 2014
The Company generated cash available for distribution ("CAFD") of Cdn$9.0 million, or Cdn$0.286 per common share, and declared dividends of Cdn$8.8 million, or Cdn$0.281 per common share, representing a payout ratio of 98.3% for the quarter compared to 92.2% for the same quarter last year. In U.S.-dollar terms, CAFD decreased by US$0.5 million compared to the same quarter in 2013 as weaker operating performance of the Centers, higher corporate expenses and losses on foreign currency were partially offset by lower maintenance capital expenditures, interest expense on convertible debentures and provision for current income taxes.
Consolidated facility service revenue ("revenue") of $72.9 million remained consistent with the first quarter of 2013 as the revenue increase from urgent care operations, pain management procedures and an increase in the number of higher revenue orthopaedic cases was offset by the decline in total surgical cases and a less favourable payor mix. Lower surgical case counts at four of the Company's hospitals are reflective of normal fluctuations in volume.
Consolidated operating expenses, including salaries and benefits, drugs and supplies, and general and administrative costs, ("consolidated expenses") totalled $54.8 million, or 75.2% of revenue, compared with consolidated expenses of $52.5 million, or 72.0% of revenue, a year ago. The increase in these expenses in absolute dollars and as a percentage of revenue was primarily related to an increase in the case volume at Black Hills Surgical Hospital and changes in case and payor mix at the other specialty surgical hospitals.
Consolidated income from operations was $18.1 million, or 24.8% of revenue, a $2.3 million or 11.5% decrease from consolidated income from operations of $20.4 million, or 28.0% of revenue, a year ago.
Total net loss and comprehensive loss was $2.0 million, or a loss of $0.273 per share (basic and fully diluted) compared with a total net income and comprehensive income of $0.2 million, or a loss of $0.258 per share (basic and fully diluted), for the same period last year. The decrease of $2.2 million in total net income and comprehensive income was primarily attributable to a weaker performance of the Centers and an increase in the value of exchangeable interest liability.
As at March 31, 2014, the Company had consolidated net working capital of $38.8 million, including cash and cash equivalents and short-term and long-term investments of $45.1 million and accounts receivable of $40.8 million, compared with net working capital of $48.4 million, including cash and cash equivalents and short-term and long-term investments of $48.7 million and accounts receivable of $50.3 million, as at December 31, 2013. Long-term debt at the Centers' level, including the current portion, was $41.1 million as at March 31, 2014 compared with $42.4 million as at December 31, 2013.
Medical Facilities' complete first quarter 2014 financial statements and management's discussion and analysis will be issued and filed on SEDAR at www.sedar.com on Thursday, May 15, 2014 and will be available on the same day on Medical Facilities' website at www.medicalfacilitiescorp.ca.
Normal Course Issuer Bid ("NCIB")
The Company repurchases its common shares in the open market. By repurchasing and cancelling its common shares, Medical Facilities reduces the total amount of dividends payable, resulting in cash savings for the Company. The remaining shareholders also benefit from the NCIB as the distributable cash per share increases. During the quarter ending March 31, 2014, the Company did not repurchase any of its common shares under the current NCIB.
As at March 31, 2014, the Company had 31,366,750 common shares outstanding.
Notice of Conference Call
Management of Medical Facilities will host a conference call today, Thursday, May 15, 2014 at 9:00 am ET to discuss its first quarter 2014 financial results. You can join the call by dialing 647.427.7450 or 1.888.231.8191. A taped replay of the conference call will be available from May 15, 2014 at 12:00 pm ET until May 22, 2014 at 11:59 pm ET by calling 416.849.0833 or 1.855.859.2056, reference number 30809599.
To view Medical Facilities Q1 2014 financial statements and notes, please click here: http://files.newswire.ca/940/MedicalFacilities.pdf
About Medical Facilities
Medical Facilities owns controlling interests in five specialty surgical hospitals located in South Dakota, Arkansas and Oklahoma, as well as an ambulatory surgery center in California. The specialty hospitals perform scheduled surgical, imaging, diagnostic and other procedures, including urgent and primary care, and derive their revenue from the fees charged for the use of their facilities. The ambulatory surgery center specializes in outpatient surgical procedures, with patient stays of less than 24 hours. Medical Facilities is structured so that a majority of its free cash flow from operations is distributed to the holders of its common shares in the form of dividends. For more information, please visit www.medicalfacilitiescorp.ca.
Caution concerning forward-looking statements
Statements made in this news release, other than those concerning historical financial information, may be forward-looking and therefore subject to various risks and uncertainties. Some forward-looking statements may be identified by words like "may", "will", "anticipate", "estimate", "expect", "intend", or "continue" or the negative thereof or similar variations. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. Factors that could cause results to vary include those identified in Medical Facilities' filings with Canadian securities regulatory authorities such as legislative or regulatory developments, intensifying competition, technological change and general economic conditions. All forward-looking statements presented herein should be considered in conjunction with such filings. Medical Facilities does not undertake to update any forward-looking statements; such statements speak only as of the date made.
1Cash available for distribution, income from operations and payout ratio are non-IFRS measures. While Medical Facilities believes that these measures are useful for the evaluation and assessment of its performance, they do not have any standard meaning prescribed by IFRS, are unlikely to be comparable to similar measures presented by other issuers, and should not be considered as alternatives to comparable measures determined in accordance with IFRS. For further information on these non-IFRS measures, including a reconciliation of each of these non-IFRS measures to the most directly comparable measure calculated in accordance with IFRS, please refer to Medical Facilities' most recently filed management's discussion and analysis, available on SEDAR at www.sedar.com.
SOURCE: Medical Facilities Corporation
For further information:
Chief Financial Officer
Medical Facilities Corporation
416.848.7380 or 1.877.402.7162
416.815.0700 or 1.800.385.5451 ext. 258