Tenet announces revisions to its outlook for 2009

Tenet Healthcare Corporation (NYSE: THC) today announced revisions to its outlook for 2009 Adjusted EBITDA to a new range of $900 million to $950 million. The prior outlook range was $810 million to $875 million. This new range corresponds to an outlook for net income attributable to shareholders in a range of $76 million to $141 million. Adjusted EBITDA is a non-GAAP term defined and reconciled to GAAP net income below.

“Our third quarter results through August were stronger than anticipated and extended the improving trend evident in our second quarter,” said Trevor Fetter, president and chief executive officer. “Since the summer months typically represent a seasonal slowdown in our business, this strength warrants raising our outlook for the balance of the year. In the last few months we have seen trends in payer and patient mix, bad debt expense, and volume growth that are favorable relative to our prior expectations. Our pricing trends remain positive and consistent with prior expectations.”

Adjusted EBITDA in the third and fourth quarters of 2009 is expected to be approximately equal. The Company’s revised 2009 outlook continues to make allowances for potential deterioration in bad debt expense and adverse trends in business mix in the remaining months of 2009. Additional details on revised 2009 outlook assumptions are provided in Table #1 below.

The Company also provided interim admissions statistics for the period July 1 to September 8, a time period which represents the first complete 10 weeks, or 70 days, of the third quarter. Comparing volumes in 2009 to the same 70-day period of 2008: admissions grew by 0.2 percent, paying admissions were flat, and commercial managed care admissions declined by 4.1 percent. Charity and uninsured admissions grew by 3.5 percent.

For the period July 1 to August 31, total same-hospital outpatient visits grew by 3.8 percent, paying outpatient visits grew by 4.4 percent, and commercial managed care outpatient visits increased by 0.8 percent. Charity and uninsured outpatient visits declined by 1.0 percent. The July 1 to August 31 time period included 44 weekdays and 18 weekend days in both 2008 and 2009. The reporting period for outpatient visits differs from the time period for inpatient data due to the complexity of assembling interim outpatient volume data related to our various non-hospital outpatient businesses.

The Company expects Adjusted Free Cash Flow from Continuing Operations to be in the range of negative $45 million to positive $40 million and Adjusted Net Cash Provided by Operating Activities from Continuing Operations of $380 million to $440 million for the full year 2009. The Company’s year end cash balance is expected to be in the range of $500 million to $635 million. Adjusted Free Cash Flow from Continuing Operations and Adjusted Net Cash Provided by Operating Activities from Continuing Operations are non-GAAP terms defined and reconciled to GAAP net cash provided by operating activities in Table # 7 below.

Tenet Healthcare Corporation, through its subsidiaries, owns and operates acute care hospitals and related ancillary health care businesses, which include ambulatory surgery centers and diagnostic imaging centers. Tenet’s hospitals and related health care facilities are committed to providing high quality care to patients in the communities we serve. For more information, please visit www.tenethealth.com.