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Analysis

HCA Revenues Top $12.2B, Admissions Continue to Rise

By Jack O'Brien  
   January 29, 2019

The Nashville-based for-profit hospital operator benefited from same facility admissions increasing by nearly 2% in Q4 2018.

HCA Healthcare posted total revenues of nearly $12.3 billion, a 6.2% increase year-over-year as admissions rose once again, according to its Q4 earnings report released Tuesday morning.

The company ended the year with total revenues of more than $46.7 billion, up from $43.6 billion in 2017, and a net income of $3.8 billion, well exceeding its $2.2 billion during the prior year.

The Nashville-based for-profit hospital operator rode rising admission rates to finish a strong year with an equally strong quarter.

Both same facility admissions and same facility equivalent admissions rose 1.9% during the quarter, as same facility inpatient surgeries nudged slightly higher at 0.1%.

Notably, same facility outpatient surgeries increased 0.8% and same facility revenue per equivalent admission increased 4.4% compared to Q4 2017. The only admissions metric that experienced a decline were same facility emergency room visits, which declined 2.1%.

Financially, HCA performed well in Q4, as cash and cash equivalents totalled $502 million, adjusted EBITDA peaked above $2.5 billion, and net income eclipsed $1 billion, all significant year-over-year increases.

HCA's stock also reacted well to the earnings report, trading up nearly 1.9% during the early morning session on Wall Street.

Related: Revenues and Admissions Rise for HCA in Q3 Earnings

Looking ahead to 2019, the company is once again revising its financial guidance, projecting diluted earnings per share in a range between $9.60 and $10.20, well above its 2018 guidance that peaked at $9.45 per share.

One of the upcoming moves that is key for HCA is an effort to buy nonprofit system Mission Health for $1.5 billion, which did not receive an objection from North Carolina Attorney General Josh Stein earlier this month. HCA expects the deal to close on January 31, according to its Q4 earnings report.

Additionally, the company is eyeing a larger footprint in New Hampshire, reportedly seeking a merger with Frisbie Memorial Hospital, based in Rochester.

ADDITIONAL HCA Q4 EARNINGS REPORT HIGHLIGHTS:

  • Excluding acquisitions, HCA saw its capital expenditures total $1.2 billion in Q4 2018.
  • The company repurchased $335 million worth of stock in Q4 and still has $272 million remaining under its repurchase agreement.  
  • HCA's board of directors has authorized an additional share repurchase program of nearly $2 billion. 
  • By the end of Q4 2018, HCA was operating 179 hospitals and 1,800 sites of care.

For complete financial information, review HCA Healthcare's filing with the Securities and Exchange Commission.

Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.

Photo credit: KONSKIE, POLAND - December 01, 2018: Hospital Corporation of America (HCA) logo displayed on smartphone - Image / Editorial credit: Piotr Swat / Shutterstock.com


KEY TAKEAWAYS

Revenues are on the rise at HCA, accruing at nearly $12.3 billion in Q4 2018.

Adjusted EBITDA also topped $2.5 billion, a 6.2% year-over-year increase.

Same facility revenue per equivalent admission and same facility admissions rose, while same facility emergency room visits declined.


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