TORONTO, March 22, 2018 /CNW/ - Medical Facilities
Corporation ("Medical Facilities," "MFC," or the "Company") (TSX:
DR), reported its financial results today for the three-month and
full year periods ended December 31, 2017. All amounts
are expressed in U.S. dollars unless indicated otherwise.
Q4 2017 Summary
(compared to three months ended
December 31, 2016)
- Revenue increased by 3.0% to $111.3
million from $108.0
million
- Surgical cases increased by 3.1%
- Income from operations decreased by 34.6% to $16.6 million, reflecting the impact of a
non-cash, $8.4 million goodwill
impairment charge
- Adjusted EBITDA1 decreased by 0.6% to $32.1 million from $32.3
million
- Cash available for distribution1 decreased by 6.5%
to Cdn$16.7 million, from
Cdn$17.8 million
- Payout ratio1 of 52.3% as compared with 49.0%
Year 2017 Summary
(compared to the year ended
December 31, 2016)
- Increased revenue by 13.5% to $385.3
million from $339.5
million
- Income from operations decreased by 14.1% to $58.5 million, reflecting the impact of a
non-cash, $8.4 million goodwill
impairment charge and the CEO transition charge of $2.0 million
- Adjusted EBITDA1 increased by 4.3% to $94.6 million from $90.7
million
- Cash available for distribution1 increased by 2.1%
to Cdn$51.7 million, from
Cdn$50.7 million
- Payout ratio1 was 67.5% as compared with 69.0%
- Paid monthly dividends of C$0.09375 per share, or C$1.125 per share on an annualized basis
Subsequent to the year end
- On February 1, 2018, MFC
completed the acquisition of seven ambulatory surgical centers for
US$46.5 million through partnership
with NueHealth LLC.
"In 2017, our Facilities continued to perform at a high
standard, generating growth in surgery volume and achieving record
levels of revenue and growth in adjusted EBITDA. As well, we
continued to execute on our strategy to grow both organically and
through acquisition, with progress on all fronts," said
Robert O. Horrar, President and CEO
of Medical Facilities. "In addition, we took some important
measures to better position MFC for future growth. One was
initiating our joint venture with NueHealth LLC, completed in
February 2018. Our combined skills of
facility management, acquisition and valuation provide us with a
strong platform for growth. Also, a goodwill impairment of
$8.4 million was charged relating to
Unity Hospital and our IMD hospital service business. This non-cash
charge does not affect our cash balances, liquidity or operating
cash flows. Notwithstanding this charge, management continues to
believe that strategies are in place to deliver improved
results."
As at December 31, 2017, the
Company had consolidated net working capital of $33.8 million, including cash and cash
equivalents and short-term investments of $65.0 million and accounts receivable of
$63.5 million, compared with 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,
as at December 31, 2016. Long-term
debt at the Centers' level, including the current portion, was
$65.1 million and the corporate
credit facility was $47.8 million as
at December 31, 2017 compared with
$76.9 million of total long-term debt
at the Centers' level and the corporate credit facility of
$47.8 million as at
December 31, 2016.
Medical Facilities' complete fourth quarter 2017 financial
statements and management's discussion and analysis will be issued
and filed on SEDAR at www.sedar.com on Thursday, March
22, 2018 and will be available on the same day on Medical
Facilities' website at www.medicalfacilitiescorp.ca.
Notice of Conference Call
Management of Medical Facilities will host a conference call
today, Thursday, March 22, 2018 at 8:30 am ET to
discuss its fourth quarter 2017 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
29, 2018 by calling 416.849.0833 or 1.855.859.2056, reference
number 3992817. A live audio webcast of the call will be available
at http://bit.ly/2HYxkCA.
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1
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EBITDA, adjusted
EBITDA, 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
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For the three
months ended
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For the year
ended
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December
31
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December
31
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(thousands of U.S.
dollars, except per share amounts and where otherwise
noted)
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2017
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% change
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2016
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2017
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%change
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2016
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Facility service
revenue
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111,266
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3.0%
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107,994
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385,329
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13.5%
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339,472
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Consolidated
operating expenses
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94,710
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14.5%
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82,691
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326,828
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20.4%
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271,399
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Income from
operations
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16,556
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(34.6%)
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25,303
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58,501
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(14.1%)
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68,073
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Finance costs (net
interest expense)
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1,213
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30.5%
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1,745
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5,892
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38.4%
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4,258
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Finance costs
(changes in values of derivative instruments and gain/loss on
foreign currency)
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(4,733)
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(80.1%)
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(23,737)
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(505)
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(102.0%)
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25,121
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Income tax expense
(recovery)
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2,525
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8,584
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6,535
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(994)
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Income (loss) for the
period from continuing operations
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17,551
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(54.7%)
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38,711
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46,579
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17.4%
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39,688
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Attributable
to:
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Owners of the
Corporation
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10,545
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(62.5%)
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28,111
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20,637
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111.7%
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9,750
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Non-controlling
interest
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7,006
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(33.9%)
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10,600
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25,942
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(13.3%)
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29,938
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Earnings per
share
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Basic
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0.34
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0.91
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0.67
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0.31
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Diluted
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0.20
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0.31
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0.54
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0.30
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Cash available for
distribution (C$)
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16,654
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(6.5%)
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17,805
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51,710
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2.1%
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50,655
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Distributions
(C$)
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8,705
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(0.3%)
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8,732
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34,881
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(0.1%)
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34,929
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Cash available for
distribution per common share (C$)
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0.54
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(5.3%)
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0.57
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1.67
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2.5%
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1.63
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Distributions per
common share (C$)
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0.28
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0.28
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1.13
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1.13
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Payout
ratio
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52.3%
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6.7%
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49.0%
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67.5%
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(2.2%)
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69.0%
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Income (loss) for the
period from continuing operations
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17,551
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(54.7%)
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38,711
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46,579
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17.4%
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39,688
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Income tax expense
(recovery)
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2,525
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8,584
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6,535
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(994)
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Finance
costs
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(3,520)
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(21,992)
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5,387
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29,379
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Depreciation and
amortization
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7,123
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6,961
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27,746
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22,631
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EBITDA
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23,679
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(26.6%)
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32,264
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86,247
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(4.9%)
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90,704
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Goodwill
impairment
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8,400
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8,400
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Adjusted
EBITDA
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32,079
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(0.6%)
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32,264
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94,647
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4.3%
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90,704
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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, 2017, the
Corporation purchased 95,600 of its common shares for Cdn$1.4 million. The Corporation did not purchase
any of its common shares during the three-month period ended
December 31, 2017.
As at December 31, 2017, the Company had 30,950,345
common shares outstanding.
To view Medical Facilities Q4 2017 financial statements and
notes, please click here:
http://files.newswire.ca/940/MFC_FS_IFRS_YE_2017.pdf
About Medical Facilities
Medical Facilities, in
partnership with physicians, owns surgical facilities in
the United States. Medical
Facilities' portfolio includes controlling interest in five
specialty surgical hospitals located in Arkansas, Indiana, Oklahoma, and South
Dakota, and an ambulatory surgery center located in
California. In addition, through a
partnership with NueHealth LLC, Medical Facilities owns majority
interest in seven ambulatory surgery centers located in
Arkansas, Michigan, Missouri, Nebraska, Ohio, Oregon,
and Pennsylvania. The specialty
surgical 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 centers specialize 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