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Tenet Healthcare 8-K Report, Financial Results (Jul 24, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed July 24, 2024
Period End
July 24, 2024
Security
THC
In the record · 2016–202610-K1110-Q338-K176

THC filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 176 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Jan ’19Jan ’19
  2. Deal closed8-K · Dec ’20Dec ’20
  3. Leadership change8-K · Oct ’22Oct ’22
  4. Material agreement8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed July 24, 2024. Cited figures are marked; the original filing is the authoritative source.

Tenet Healthcare Corporation (NYSE: THC) reported second quarter 2024 results on July 24, 2024, in a press release furnished as Exhibit 99.1 under Item 2.02.

Net income available to Tenet common shareholders was $259 milliona, or $2.64 per diluted share, versus $123 million, or $1.15 per diluted share, in second quarter 2023. Adjusted EBITDA was $945 million compared with $843 million a year earlier, and adjusted diluted earnings per share were $2.31 versus $1.44. Net operating revenues were $5,103 million versus $5,082 million.

For the six months ended June 30, 2024, net income available to common shareholders was $2,410 millionb, which includes net gains on sales, consolidation and deconsolidation of facilities of $2,558 million. The company raised its full-year 2024 outlook. Adjusted EBITDA is now expected to be $3.825 billion to $3.975 billion, which the company describes as a $300 million increase, and free cash flow is now expected to be $1.100 billion to $1.350 billion, a $150 million increase.

The Board authorized a new $1.5 billionc share repurchase program after completing the prior $1 billion program in the first half of 2024. Net debt to Adjusted EBITDA was 2.61x at June 30, 2024, down from 2.79x at March 31, 2024 and 3.89x at December 31, 2023. By segment, the Ambulatory Care business (USPI) grew Adjusted EBITDA 20.8% year over year to $447 million, driven by net revenue per case growth, while same-facility surgical cases were essentially flat at 0.2% growth.

The Hospital Operations and Services segment's Adjusted EBITDA rose to $498 milliond from $473 million, with same-hospital admissions up 5.2%, although segment net operating revenues declined 4.3% due to hospital divestitures. The filing also notes a $30 million favorable pre-tax impact from additional Texas Medicaid supplemental revenues related to prior years.

02—Key points

Key Highlights

  1. Net income available to Tenet common shareholders of $259 million, or $2.64 per diluted share, in Q2 2024, versus $123 million, or $1.15 per diluted share, in Q2 2023
  2. Adjusted EBITDA of $945 million in Q2 2024 versus $843 million in Q2 2023; adjusted diluted EPS of $2.31 versus $1.44
  3. Full-year 2024 Adjusted EBITDA outlook raised to $3.825 billion to $3.975 billion (a $300 million increase); free cash flow outlook raised to $1.100 billion to $1.350 billion (a $150 million increase)
  4. New $1.5 billion share repurchase program authorized; the prior $1 billion program was completed in the first half of 2024, with $270 million repurchased in Q2 2024
  5. Net debt to Adjusted EBITDA improved to 2.61x at June 30, 2024, from 2.79x at March 31, 2024 and 3.89x at December 31, 2023
  6. Ambulatory Care Adjusted EBITDA rose 20.8% to $447 million, while Hospital segment Adjusted EBITDA increased to $498 million from $473 million
  7. Six-month net income available to common shareholders of $2,410 million includes $2,558 million of net gains on sales, consolidation and deconsolidation of facilities

03—Questions

Frequently Asked Questions

  1. How did Tenet perform in the second quarter of 2024?

    Net income available to Tenet common shareholders was $259 million, or $2.64 per diluted share, compared with $123 million, or $1.15 per diluted share, in the second quarter of 2023. Net operating revenues were $5,103 million, up slightly from $5,082 million, and Adjusted EBITDA was $945 million, up from $843 million.

  2. What changed in Tenet's 2024 financial outlook?

    Full-year 2024 Adjusted EBITDA is now expected to be $3.825 billion to $3.975 billion, a $300 million increase, and free cash flow is now expected to be $1.100 billion to $1.350 billion, a $150 million increase. The outlook reflects the sale of three Coastal South Carolina hospitals on January 31, 2024 and six California hospitals on March 31, 2024.

  3. What capital return actions did Tenet announce?

    The Board authorized a $1.5 billion share repurchase program, to be executed at management's discretion in the open market or through privately negotiated transactions, subject to market conditions. In the second quarter, Tenet repurchased 1,990,227 shares for $270 million, completing the prior $1 billion program in the first half of 2024.

  4. What drove the results in the Ambulatory and Hospital segments?

    In Ambulatory Care, Adjusted EBITDA increased 20.8% to $447 million, driven by strong net revenue per case growth, cost discipline, and contributions from acquisitions and de novo facilities. In Hospital Operations, Adjusted EBITDA rose to $498 million from $473 million on strong same-hospital admission growth of 5.2% and improved contract labor costs, although segment net operating revenues declined 4.3% due to hospital divestitures.

04—Continue

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