TORONTO, March 23, 2017 /CNW/ - Medical Facilities
Corporation ("Medical Facilities", or the "Company") (TSX: DR),
today reported its financial results for the three-month and full
year periods ended December 31, 2016. All amounts are
expressed in U.S. dollars unless indicated otherwise.
In 2016, Medical Facilities made two key acquisitions which
increased geographic diversity, overall capacity and patient care
access. The Company continues to use a strategy that builds on the
strengths and surrounding markets of its existing Centers and will
add new acquisitions to build scale.
2016 Highlights
- Acquired an indirect 62% interest in Unity Medical and Surgical
Hospital ("Unity"), a physician-owned medical and surgical hospital
located in Mishawaka, Indiana
- Acquired 100% of Prairie States Surgical Center located in
Sioux Falls, South Dakota, through
its subsidiary, Sioux Falls Specialty Hospital
- Increased revenue from continuing operations by 9.9% to
$339.5 million, as compared to
$308.8 million in 2015, due to 7.6%
higher surgical case volume compared to the prior year and
contributions from acquired facilities
- Income from operations of $68.1
million, down 8.9% as compared with $74.7 million in 2015. A higher proportion of
government payors and shifts in case type were the main causes of
the decline, along with increased operating expenses due to
acquisition activity
- Increased cash available for distribution1 by 10.5%
to C$50.7 million, as compared to
C$45.9 million in 2015
- Continued to pay monthly dividends of C$0.09375 per share, representing an annualized
dividend of C$1.125 per share. At
year end, the company has paid 153 consecutive dividends since
inception
- Payout ratio1 of 69.0% as compared with 76.7% in
2015
Q4 2016 Financial Highlights
- Increased revenue from continuing operations by 20.3% to
$108.0 million, as compared to
$89.8 million in Q4 2015, primarily
due to revenue from new acquisitions and higher case volume at
Company facilities
- Increased income from operations to $25.3 million, as compared to $25.1 million in Q4 2015 when adjusted for a
$2.7 million non-cash reversal of an
accrued rent liability at a Center in the prior year
- Payout ratio1 of 49.0% as compared with 69.7% in Q4
2015
"We are pleased with the initial progress we have made with
respect to acquisitions in 2016. Looking ahead, continued revenue
growth while controlling costs remains a key priority for our
hospital leadership and executive team. As our network expands, so
will our buying power as well as opportunities to share best
practices among Centers," said Britt T.
Reynolds, President and CEO of Medical Facilities. "I would
like to congratulate our local leadership for continuing to deliver
high-quality care and optimum patient outcomes. In 2017, they are
now supported by a well-defined strategy for growth that is
actively assessing both existing and new markets to identify and
act on accretive opportunities," concluded Mr. Reynolds.
_______________________________
1 Cash available for distribution and payout ratio
are non-IFRS financial 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 financial measures,
including a reconciliation of each of these non-IFRS financial
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.
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|
|
Financial
Results
|
For the three
months ended
December
31
|
For the year
ended
December
31
|
(thousands of U.S.
dollars, except per share amounts and where otherwise
noted)
|
2016
|
% change
|
2015
|
2016
|
% change
|
2015
|
Revenue from
continuing operations
|
107,994
|
20.3%
|
89,760
|
339,472
|
9.9%
|
308,778
|
Consolidated
operating expenses
|
82,691
|
33.4%
|
61,966
|
271,399
|
15.9%
|
234,086
|
Income from
operations
|
25,303
|
(9.0%)
|
27,794
|
68,073
|
(8.9%)
|
74,692
|
|
|
Finance costs (net
interest expense)
|
1,745
|
131.7%
|
753
|
4,258
|
40.8%
|
3,024
|
|
|
Finance costs
(changes in value of derivative
instruments and
gain/loss on foreign currency)
|
(23,737)
|
205.5%
|
(7,770)
|
25,121
|
(208.1%)
|
(23,230)
|
|
|
Income tax expenses
(recovery)
|
8,584
|
(9.6%)
|
9,500
|
(944)
|
(104.0%)
|
24,719
|
Consolidated income
from operations
|
38,711
|
52.9%
|
25,311
|
39,688
|
(43.4%)
|
70,179
|
|
Attributable
to:
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Owners of the
Corporation
|
28,111
|
106.8%
|
13,343
|
9,748
|
(73.7%)
|
37,018
|
|
|
Non-controlling
interest
|
10,600
|
(11.4%)
|
11,968
|
29,940
|
(9.7%)
|
33,161
|
|
|
|
|
|
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Earnings per
share
|
|
|
|
|
|
|
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Basic
|
0.91
|
116.3%
|
0.43
|
0.31
|
(73.7%)
|
1.18
|
|
|
Diluted
|
0.31
|
40.9%
|
0.22
|
0.30
|
(43.4%)
|
0.53
|
|
|
|
|
|
|
|
Cash available for
distribution (C$)
|
17,805
|
41.7%
|
12,566
|
50,655
|
10.5%
|
45,853
|
Distributions
(C$)
|
8,732
|
(0.4%)
|
8,766
|
34,929
|
(0.7%)
|
35,186
|
|
|
|
|
|
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Cash available for
distribution per common share (C$)
|
0.573
|
42.4%
|
0.403
|
1.631
|
11.3%
|
1.466
|
|
|
|
|
|
|
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Distributions per
common share (C$)
|
0.281
|
0.0%
|
0.281
|
1.125
|
0.0%
|
1.125
|
|
|
|
|
|
|
|
Payout
ratio
|
49.0%
|
(29.7%)
|
69.7%
|
69.0%
|
(7.7%)
|
76.7%
|
As at December 31, 2016, the
Company had consolidated net working capital of $74.0 million, including cash and cash
equivalents and short-term and long-term investments of
$67.6 million and accounts receivable
of $61.1 million, compared with net
working capital of $85.7 million,
including cash and cash equivalents and short-term investments of
$70.9 million, and accounts
receivable of $48.8 million, as at
December 31, 2015. Long-term debt at
the Centers' level, including the current portion, was $76.9 million and the Corporate credit facility
was $47.8 million as at December 31, 2016 compared with $35.4 million of total long-term debt at the
Centers' level as at December 31,
2015.
Medical Facilities' complete fourth quarter 2016 financial
statements and management's discussion and analysis will be issued
and filed on SEDAR at www.sedar.com on Thursday, March
23, 2017 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 year ended December 31, 2016, the Company purchased 67,500
of its common shares at an average price of Cdn$13.55 per share, for a total consideration of
Cdn$0.9 million. The Company did
not purchase any of its common shares during the three-month period
ended December 31, 2016.
As at December 31, 2016, the Company had 31,045,945
common shares outstanding.
Notice of Conference Call
Management of Medical Facilities will host a conference call
today, Thursday, March 23, 2017 at 8:30 am ET
to discuss its full year and fourth quarter 2016 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 until
Thursday, March 30, 2017 by calling 416.849.0833 or
1.855.859.2056, reference number 82018335. A live audio webcast of
the call will be available at http://bit.ly/2mm7iNS
To view Medical Facilities Q4 2016 financial statements and
notes, please click here:
http://files.newswire.ca/940/MedicalFacilitiesQ4.pdf
About Medical Facilities
Medical Facilities owns controlling interests in five specialty
surgical hospitals located in Arkansas, Indiana, Oklahoma and South
Dakota, as well as an ambulatory surgery center in
California. The specialty
hospitals perform scheduled surgical, imaging, diagnostic and other
procedures, including primary and urgent 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. In addition,
Medical Facilities owns controlling interest in a diversified
healthcare service company located in Oklahoma City that provides third-party
business solutions to healthcare entities such as physician
practices, facilities, and insurance companies. 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.
SOURCE Medical Facilities Corporation