IASIS Healthcare second-quarter net revenue up 7.9% to $624.5 million

IASIS Healthcare® LLC ("IASIS") today announced financial and operating results for the fiscal second quarter and six months ended March 31, 2010.

Net revenue for the second quarter totaled $624.5 million, an increase of 7.9%, compared to $578.7 million in the prior year quarter. Adjusted EBITDA for the second quarter totaled $79.6 million, compared to $86.3 million in the prior year quarter. A table describing adjusted EBITDA and reconciling net earnings from continuing operations to adjusted EBITDA is included in this press release in the attached Supplemental Consolidated Statements of Operations Information. Net earnings from continuing operations for the second quarter totaled $22.1 million, compared to $28.4 million in the prior year quarter.

Adjusted EBITDA was negatively affected by a $3.7 million decline at Health Choice, the Company's Medicaid and Medicare managed health plan in Arizona. In addition, the prior year quarter included a reduction in other operating expenses of $4.0 million as a result of changes in prior period estimates for professional and general liability and workers' compensation reserves, compared to only $1.0 million in the current year quarter. Adjusted EBITDA at Health Choice has been impacted by a slight decline in overall premium revenue on a per member per month basis, resulting in large part from changes in Medicaid funding by the state of Arizona, and rising medical costs, compared to the prior year quarter.

Admissions increased 0.8% and adjusted admissions decreased 0.4%, respectively, in the second quarter, compared to the prior year quarter. Net patient revenue per adjusted admission increased 4.7% in the second quarter, compared to the prior year quarter.

In commenting on quarterly results, David R. White, chairman and chief executive officer of IASIS Healthcare, said, "While we recognize the second quarter included certain challenges, we continue to believe we are well positioned for the future. In the midst of economic headwinds, including high unemployment and state budgetary issues, our solid track record of effective cost management has helped to maintain strong operating cash flows and strengthen our financial position. We believe these characteristics, along with the strategic use of capital over the recent past, will help us to navigate the uncertainty of a challenging economic environment."

Net revenue for the six months ended March 31, 2010, totaled $1.3 billion, an increase of 9.9%, compared to $1.1 billion in the prior year period. Adjusted EBITDA for the six months ended March 31, 2010, totaled $151.4 million, compared to $153.1 million in the prior year period. Net earnings from continuing operations for the six months ended March 31, 2010, totaled $41.5 million, compared to $42.3 million in the prior year period.

Admissions and adjusted admissions increased 2.6% and 1.4%, respectively, in the six months ended March 31, 2010, compared to the prior year period. Net patient revenue per adjusted admission increased 4.2% in the six months ended March 31, 2010, compared to the prior year period.