Rising admissions continue to lead the way for the Nashville-based for-profit hospital operator, resulting in revenue growth and a revised financial outlook.
Just like in Q2, HCA Healthcare experienced revenue growth exceeding 7% year-over-year thanks to rising admissions, according to its Q3 earnings report released Tuesday morning.
HCA recorded revenues of $11.5 billion, up 7.1% compared to Q3 2017, along with cash flows from operations that reached $1.7 billion. Additionally, net income totalled $759 million, far surpassing the $426 million HCA reported this time last year.
The driving force behind HCA's success has been the continued rise of admissions, with same facility admissions up 3.1% and same facility revenue per equivalent admission up 3.9%. In the same period of time, same facility ER visits dropped slightly by 0.4%.
Related: HCA Q2 Revenues Exceed $11.5B, Cash Flows $1.5B
Due to the company's strong performance to start the second half of 2018, HCA is revising its year-end financial outlook from a range of $9 to $9.40, to a range of $9.05 to $9.45. HCA's stock also reacted well to the earnings report, trading up 1.4% during the early morning session on Wall Street.
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Tuesday's earnings marked HCA's first report since CEO Milton Johnson announced his retirement and subsequently named successors in early September. Q3 also saw HCA move to buy nonprofit system Mission Health for $1.5 billion in late August. The company stated that it intends to spend more than $400 million on capital improvements over five years once the deal closes.
Related: HCA Announces CEO R. Milton Johnson's Retirement, Names Successors
Related: HCA to Buy Nonprofit Mission Health for $1.5B
ADDITIONAL HCA Q3 EARNINGS REPORT HIGHLIGHTS:
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HCA experienced a $70 million reduction in reserves for professional liability risks.
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The company's financials were aided by a tax benefit of $132 million due to the implementation of the federal tax reform bill last year, up from the $121 million due in Q2.
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HCA also repurchased $302 million worth of common stock in Q3, leaving it with $670 million left in its current repurchase authorization.
For complete financial information, review HCA's filing with the Securities and Exchange Commission.
Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.
KEY TAKEAWAYS
HCA's $11.5 billion in revenues represented a 7.1% increase year-over-year.
Same facility admissions increased by 3.1%, aiding with revenue growth.
The hospital operator raised its guidance by $0.05 to a range of $9.05 to $9.45 per share.