Full Press Release Details
Reports 2013 Second Quarter EPS of $1.37
Authorizes Share Repurchase Program
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--July 30, 2013--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 of $1.37 per
share for the three months ended June 30, 2013 that was the result of
strong revenue growth, primarily from recent acquisitions.
"Our consistently strong operating results reflect the solid progress we
are making in strategically building our national anesthesia group
practice platform while successfully and methodically executing 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 continue to manage a
very full and robust acquisition pipeline, and are confident in our
ability to continue growing through acquisitions across all of our
physician specialties."
MEDNAX also announced today that its Board of Directors has authorized
the repurchase of shares of the Company's common stock up to an amount
sufficient to offset the dilutive impact from the issuance of shares
under the Company's equity programs. As a result of the share repurchase
program, earnings per share for the Company will be positively impacted
in future periods. The share repurchase program is effective immediately
and permits the Company to make open market purchases from time-to-time
based upon general economic and market conditions and trading
"The authorization of this share repurchase program reflects our
confidence in the national group practice business model and our ongoing
commitment to enhance shareholder value," said Roger J. Medel, M.D.,
Chief Executive Officer of MEDNAX. "We continue to achieve solid
financial results, have a strong balance sheet, and remain very
optimistic about our prospects for continued growth. Our primary use of
cash will continue to be focused on the pursuit of acquisitions across
all of our physician specialties. At the same time, we believe that with
the combination of our ongoing cash flow from operations and our
available line of credit, we have sufficient access to capital to
continue our acquisition growth strategy while moving forward with this
share repurchase program."
MEDNAX's net patient service revenue for the three months ended June 30,
2013, increased by 17.7 percent, to $529.2 million, from $449.5 million
for the comparable prior-year period, largely driven by contributions
from acquisitions completed since April 2012.
During the three months ended June 30, 2013, MEDNAX started to receive
parity payments from a few of the states that are now paying at the
Medicare rate for Medicaid services as a result of the Patient
Protection and Affordable Care Act. MEDNAX's second quarter results
include approximately $2.5 million in revenue from parity payments that
contributed approximately $0.02 to its net income per diluted share,
reflecting the impacts from incentive compensation and income taxes.
MEDNAX's revenue growth attributable to contributions from recently
acquired practices was 16.0 percent, while overall same-unit revenue
grew by 1.7 percent when compared to the prior year period.
Same-unit growth from net reimbursement-related factors was 2.0 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.
For the first time in five quarters, on a sequential basis same-unit
payor mix showed a positive shift of 100 basis points toward a higher
percentage of services reimbursed from commercial payors as compared to
government programs.
Same-unit revenue attributable to patient volume decreased by 0.3
percent for the 2013 second quarter when compared to the prior-year
period, driven by declines in our hospital-based neonatal and anesthesia
practices, and our office-based pediatric cardiology services, partially
offset by increases in our maternal-fetal medicine and other pediatric
physician services, primarily newborn nursery and pediatric intensive
care services. For the 2013 second quarter, compared to the 2012 period,
same-unit neonatal intensive care unit (NICU) patient days were down by
Operating income for the 2013 second quarter was $113.4 million, up 13.7
percent from $99.7 million for the prior-year period. Operating margin
was 21.4 percent for the 2013 second quarter, as compared to 22.2
percent for the prior-year period. The decrease of 77 basis points was
primarily the result of the variability in margins due to the mix of
practices acquired since April 2012.
For the 2013 second quarter, general and administrative expenses were
$54.6 million, as compared to $48.2 million in the prior-year period, a
growth rate of 13.3 percent, which is considerably lower than the rate
of revenue growth. General and administrative expenses as a percentage
of net patient service revenue was 10.3 percent for the three months
ended June 30, 2013 as compared to 10.7 percent for the three months
ended June 30, 2012.
MEDNAX generated net income of $69.2 million for the 2013 second
quarter, or $1.37 per share based on a weighted average 50.5 million
shares outstanding. This compares with net income of $60.5 million, or
$1.22 cents per share for the 2012 second quarter, based on a weighted
average 49.5 million shares outstanding.
Through the first half of 2013, MEDNAX has generated revenue of $1.03
billion, up 18.3 percent from $872.1 million for the prior-year period.
Operating income for the six months ended June 30, 2013, grew by 14.4
percent to $204.9 million, up from $179.1 million for the first half of
2012. MEDNAX earned net income of $124.6 million, or $2.47 per share
through June 30, 2013, based on a weighted average 50.5 million shares
outstanding, which compares to net income of $108.9 million, or $2.20
per share based on a weighted average 49.5 million shares outstanding
for the first half of 2012.
At June 30, 2013, MEDNAX had cash and cash equivalents of $13.2 million
and net accounts receivable were $269.8 million. The Company had $153.8
million drawn on its $800 million revolving credit facility at June 30,
During the 2013 second quarter, MEDNAX generated cash flow from
operations of $127.2 million, as compared to $117.1 for the 2012 second
MEDNAX also used $120.9 million of its cash during the 2013 second