Full Press Release Details
Earns $1.19 Per Share for 2011 Fourth Quarter
Net Income Increases by over 13% (non-GAAP)
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--February 2, 2012--MEDNAX, Inc.
(NYSE: MD), the national medical group specializing in neonatal,
maternal-fetal, pediatric cardiology, other pediatric subspecialties and
anesthesia physician services, today reported earnings per share of
$1.19 for the three months ended December 31, 2011.
MEDNAX's results from operations for the 2011 fourth quarter include
revenue growth of 9.9 percent and operating income growth of 6.6 percent
compared to the prior-year period.
During 2011, MEDNAX invested $161.4 million to complete 10 physician
group practice acquisitions, including two anesthesia practices acquired
during the 2011 fourth quarter, as well as to make contingent purchase
price payments for previously completed acquisitions.
"We produced solid results from operations and had a productive year
adding physician groups, despite the uncertainty around the current
healthcare environment. This reflects a Company that continues its
successful, methodical execution on a proven growth strategy that
attracts physicians to our national group practice and delivers ongoing
value and efficiencies," said Roger J. Medel, M.D., Chief Executive
Officer of MEDNAX. "We are successfully integrating these
recently acquired practices into our Pediatrix Medical Group and
American Anesthesiology national group practices, identifying ways to
improve the operations of these practices, and bringing the clinical
quality tools that allow physicians to focus on improving patient care."
For the three months ended December 31, 2011, MEDNAX generated net
patient service revenue of $404.9 million, up 9.9 percent from $368.5
million for the comparable prior-year period.
MEDNAX's revenue growth was largely driven by contributions from
acquisitions completed since October 2010, as well as same-unit growth.
Overall same-unit growth for the 2011 fourth quarter was 2.7 percent.
Same-unit revenue growth from net reimbursement-related factors was 2.3
percent. This was principally due to continued modest improvements in
reimbursements received from third-party commercial payors as a result
of the Company's ongoing contract renewal processes, and an increase in
the administrative fees received from our hospital partners due to the
expansion of our services as a result of internal growth initiatives.
The percentage of services reimbursed under government programs remained
essentially flat for the 2011 fourth quarter, when compared with the
prior-year period. On a sequential basis, same-unit payor mix shifted
favorably by 20 basis points toward a lower percentage of services
reimbursed under government programs.
Same-unit revenue attributable to patient volume grew slightly by four
tenths of one percent for the 2011 fourth quarter when compared to the
prior-year period, driven by growth across anesthesiology, pediatric
cardiology, maternal-fetal medicine and other pediatric physician
services, partially offset by a decline in patient volume for the
Company's neonatal services. For the 2011 fourth quarter, same-unit
neonatal intensive care unit (NICU) patient days decreased by 1.2
percent when compared to the prior-year period.
Operating income for the 2011 fourth quarter was $91.5 million, up 6.6
percent from $85.9 million for the prior-year period. General and
administrative expenses were 10.6 percent of revenue for the 2011 fourth
quarter, an improvement of 14 basis points from 10.7 percent, for the
comparable 2010 period.
Operating margin decreased to 22.6 percent for the 2011 fourth quarter,
from 23.3 percent for the prior-year period, due to the mix of practices
acquired since October 2010.
MEDNAX generated net income of $58.4 million for the 2011 fourth
quarter, or $1.19 per share based on a weighted average 49.1 million
shares outstanding. This compares with net income of $53.8 million, or
$1.12 per share for the 2010 fourth quarter, based on a weighted average
48 million shares outstanding.
MEDNAX believes that comparisons of its net income and earnings per
share for the twelve months ended December 31, 2011, to the 2010 period
are more meaningful if the full year 2010 GAAP net income and earnings
per share are presented on a non-GAAP basis by increasing the income tax
provision (and decreasing net income) by $10.9 million, to exclude the
impact in 2010 from the favorable resolution of certain tax matters. For
the 12 months ended December 31, 2011, MEDNAX reported revenue of $1.6
billion, up 13.3 percent from $1.4 billion for the comparable prior-year
period. Operating income for 2011 was $355.4 million, up 13.6 percent,
from $312.9 million for the prior year.
MEDNAX's net income for 2011 was $218.0 million, or $4.47 per share
based on a weighted average 48.8 million shares outstanding. This
compares to 2010 when MEDNAX earned non-GAAP net income of $191.8
million, or $4.03 per share based on a weighted average 47.6 million
shares outstanding. GAAP net income was $202.7 million, or $4.26 per
share for the full year 2010.
At December 31, 2011, MEDNAX had cash and cash equivalents of $18.6
million and net accounts receivable were $230.4 million. The Company had
$29.0 million outstanding on its $500 million revolving credit facility
at December 31, 2011.
For 2011, MEDNAX generated cash flow from operations of $271.0 million,
which included cash flow from operations of $90.1 million for the 2011
2012 First Quarter Outlook
For the 2012 first quarter, MEDNAX expects earnings will be in a range
of $0.96 to $1.02 per share. This outlook assumes that total same-unit
revenue for the three months ended March 31, 2012 will grow by 2.5
percent to 4.5 percent from the prior-year period. This same-unit growth
forecast is expected to be evenly divided between patient volume growth
across all MEDNAX physician specialties and net reimbursement growth,
including improvements from commercial contract rates as well as
variability in the mix of services reimbursed under commercial and
government payor programs.
MEDNAX expects to invest approximately $300 million to complete practice
acquisitions across all MEDNAX physician specialties throughout all of
2012, one-third of which we expect to invest in the Pediatrix Medical
Group division, and the remainder in our American Anesthesiology
MEDNAX's results from operations for the 2012 first quarter, when