Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 30, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | SELECT MEDICAL HOLDINGS CORP | |
Entity Central Index Key | 1,320,414 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 134,061,769 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents | $ 119,683 | $ 122,549 |
Accounts receivable | 806,391 | 691,732 |
Prepaid income taxes | 21,270 | 31,387 |
Other current assets | 93,997 | 75,158 |
Total Current Assets | 1,041,341 | 920,826 |
Property and equipment, net | 973,483 | 912,591 |
Goodwill | 3,318,611 | 2,782,812 |
Identifiable intangible assets, net | 424,647 | 326,519 |
Other assets | 210,561 | 184,418 |
Total Assets | 5,968,643 | 5,127,166 |
Current Liabilities: | ||
Overdrafts | 21,547 | 29,463 |
Current portion of long-term debt and notes payable | 22,499 | 22,187 |
Accounts payable | 138,436 | 128,194 |
Accrued payroll | 135,561 | 160,562 |
Accrued vacation | 105,325 | 92,875 |
Accrued interest | 28,588 | 19,885 |
Accrued other | 163,141 | 143,166 |
Income taxes payable | 10,634 | 9,071 |
Total Current Liabilities | 625,731 | 605,403 |
Long-term debt, net of current portion | 3,478,021 | 2,677,715 |
Non-current deferred tax liability | 125,020 | 124,917 |
Other non-current liabilities | 167,120 | 145,709 |
Total Liabilities | 4,395,892 | 3,553,744 |
Commitments and contingencies (Note 10) | ||
Redeemable non-controlling interests | 607,474 | 640,818 |
Stockholders’ Equity: | ||
Common stock | 134 | 134 |
Capital in excess of par | 468,885 | 463,499 |
Retained earnings (accumulated deficit) | 383,581 | 359,735 |
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 852,600 | 823,368 |
Non-controlling interests | 112,677 | 109,236 |
Total Equity | 965,277 | 932,604 |
Total Liabilities and Equity | 5,968,643 | 5,127,166 |
Select Medical Corporation | ||
Current Assets: | ||
Cash and cash equivalents | 119,683 | 122,549 |
Accounts receivable | 806,391 | 691,732 |
Prepaid income taxes | 21,270 | 31,387 |
Other current assets | 93,997 | 75,158 |
Total Current Assets | 1,041,341 | 920,826 |
Property and equipment, net | 973,483 | 912,591 |
Goodwill | 3,318,611 | 2,782,812 |
Identifiable intangible assets, net | 424,647 | 326,519 |
Other assets | 210,561 | 184,418 |
Total Assets | 5,968,643 | 5,127,166 |
Current Liabilities: | ||
Overdrafts | 21,547 | 29,463 |
Current portion of long-term debt and notes payable | 22,499 | 22,187 |
Accounts payable | 138,436 | 128,194 |
Accrued payroll | 135,561 | 160,562 |
Accrued vacation | 105,325 | 92,875 |
Accrued interest | 28,588 | 19,885 |
Accrued other | 163,141 | 143,166 |
Income taxes payable | 10,634 | 9,071 |
Total Current Liabilities | 625,731 | 605,403 |
Long-term debt, net of current portion | 3,478,021 | 2,677,715 |
Non-current deferred tax liability | 125,020 | 124,917 |
Other non-current liabilities | 167,120 | 145,709 |
Total Liabilities | 4,395,892 | 3,553,744 |
Commitments and contingencies (Note 10) | ||
Redeemable non-controlling interests | 607,474 | 640,818 |
Stockholders’ Equity: | ||
Common stock | 0 | 0 |
Capital in excess of par | 952,825 | 947,370 |
Retained earnings (accumulated deficit) | (100,225) | (124,002) |
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 852,600 | 823,368 |
Non-controlling interests | 112,677 | 109,236 |
Total Equity | 965,277 | 932,604 |
Total Liabilities and Equity | $ 5,968,643 | $ 5,127,166 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 700,000,000 | 700,000,000 |
Common stock, shares issued (in shares) | 134,104,286 | 134,114,715 |
Common stock, shares outstanding (in shares) | 134,104,286 | 134,114,715 |
Select Medical Corporation | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (in shares) | 100 | 100 |
Common stock, shares outstanding (in shares) | 100 | 100 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Net operating revenues | $ 1,252,964 | $ 1,091,517 |
Costs and expenses: | ||
Cost of services | 1,065,813 | 929,138 |
General and administrative | 31,782 | 28,075 |
Depreciation and amortization | 46,771 | 42,539 |
Total costs and expenses | 1,144,366 | 999,752 |
Income (loss) from operations | 108,598 | 91,765 |
Other income and expense: | ||
Loss on early retirement of debt | (10,255) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 4,697 | 5,521 |
Non-operating gain (loss) | 399 | (49) |
Interest expense | (47,163) | (40,853) |
Income (loss) before income taxes | 56,276 | 36,665 |
Income tax expense | 12,294 | 13,202 |
Net income | 43,982 | 23,463 |
Less: Net income attributable to non-controlling interests | 10,243 | 7,593 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | $ 33,739 | $ 15,870 |
Income per common share: | ||
Basic (in dollars per share) | $ 0.25 | $ 0.12 |
Diluted (in dollars per share) | $ 0.25 | $ 0.12 |
Weighted average shares outstanding: | ||
Basic (in shares) | 129,691 | 128,464 |
Diluted (in shares) | 129,816 | 128,628 |
Select Medical Corporation | ||
Net operating revenues | $ 1,252,964 | $ 1,091,517 |
Costs and expenses: | ||
Cost of services | 1,065,813 | 929,138 |
General and administrative | 31,782 | 28,075 |
Depreciation and amortization | 46,771 | 42,539 |
Total costs and expenses | 1,144,366 | 999,752 |
Income (loss) from operations | 108,598 | 91,765 |
Other income and expense: | ||
Loss on early retirement of debt | (10,255) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 4,697 | 5,521 |
Non-operating gain (loss) | 399 | (49) |
Interest expense | (47,163) | (40,853) |
Income (loss) before income taxes | 56,276 | 36,665 |
Income tax expense | 12,294 | 13,202 |
Net income | 43,982 | 23,463 |
Less: Net income attributable to non-controlling interests | 10,243 | 7,593 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | $ 33,739 | $ 15,870 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Changes in Equity and Income - 3 months ended Mar. 31, 2018 - USD ($) $ in Thousands | Total | Select Medical Corporation | Common Stock | Common StockSelect Medical Corporation | Capital in Excess of Par | Capital in Excess of ParSelect Medical Corporation | Retained Earnings (Accumulated Deficit) | Retained Earnings (Accumulated Deficit)Select Medical Corporation | Total Stockholders’ Equity | Total Stockholders’ EquitySelect Medical Corporation | Non-controlling Interests | Non-controlling InterestsSelect Medical Corporation |
Balance at Dec. 31, 2017 | $ 640,818 | $ 640,818 | ||||||||||
Redeemable Non-controlling Interests | ||||||||||||
Net income attributable to non-controlling interests | 5,743 | 5,743 | ||||||||||
Exchange of interests | 163,659 | 163,659 | ||||||||||
Distributions to non-controlling interests | (203,972) | (203,972) | ||||||||||
Redemption adjustment on non-controlling interests | 1,051 | 1,051 | ||||||||||
Other | 175 | 175 | ||||||||||
Balance at Mar. 31, 2018 | $ 607,474 | $ 607,474 | ||||||||||
Balance (in shares) at Dec. 31, 2017 | 134,114,715 | 100 | 134,115,000 | 0 | ||||||||
Balance at Dec. 31, 2017 | $ 932,604 | $ 932,604 | $ 134 | $ 0 | $ 463,499 | $ 947,370 | $ 359,735 | $ (124,002) | $ 823,368 | $ 823,368 | $ 109,236 | $ 109,236 |
Increase (Decrease) in Stockholders' Equity | ||||||||||||
Net income | 33,739 | 33,739 | 33,739 | 33,739 | 33,739 | 33,739 | ||||||
Net income attributable to non-controlling interests | 4,500 | 4,500 | 4,500 | 4,500 | ||||||||
Issuance of restricted stock (in shares) | 4,000 | |||||||||||
Issuance of restricted stock | 0 | $ 0 | 0 | |||||||||
Forfeitures of unvested restricted stock (in shares) | (88,000) | |||||||||||
Forfeitures of unvested restricted stock | 0 | $ 0 | 0 | |||||||||
Vesting of restricted stock | 4,717 | 4,717 | 4,717 | |||||||||
Repurchase of common shares (in shares) | (7,000) | |||||||||||
Repurchase of common shares | (122) | $ 0 | (69) | (53) | (122) | |||||||
Exercise of stock options (in shares) | 80,000 | |||||||||||
Exercise of stock options | 738 | $ 0 | 738 | 738 | ||||||||
Additional investment by Holdings | 738 | 738 | 738 | |||||||||
Dividends declared and paid to Holdings | (122) | (122) | (122) | |||||||||
Contribution related to restricted stock award issuances by Holdings | 4,717 | 4,717 | 4,717 | |||||||||
Exchange of interests | 74,341 | 74,341 | 74,341 | 74,341 | 74,341 | 74,341 | ||||||
Distributions to non-controlling interests | (84,327) | (84,327) | (83,233) | (83,233) | (83,233) | (83,233) | (1,094) | (1,094) | ||||
Redemption adjustment on non-controlling interests | (1,051) | (1,051) | (1,051) | (1,051) | (1,051) | (1,051) | ||||||
Other | $ 138 | $ 138 | 103 | 103 | 103 | 103 | 35 | 35 | ||||
Balance (in shares) at Mar. 31, 2018 | 134,104,286 | 100 | 134,104,000 | 0 | ||||||||
Balance at Mar. 31, 2018 | $ 965,277 | $ 965,277 | $ 134 | $ 0 | $ 468,885 | $ 952,825 | $ 383,581 | $ (100,225) | $ 852,600 | $ 852,600 | $ 112,677 | $ 112,677 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities | ||
Net income | $ 43,982 | $ 23,463 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 1,364 | 4,911 |
Depreciation and amortization | 46,771 | 42,539 |
Provision for bad debts | 85 | 781 |
Equity in earnings of unconsolidated subsidiaries | (4,697) | (5,521) |
Loss on extinguishment of debt | 412 | 6,527 |
Gain on sale of assets and businesses | (513) | (4,609) |
Stock compensation expense | 4,927 | 4,586 |
Amortization of debt discount, premium and issuance costs | 3,136 | 3,422 |
Deferred income taxes | 78 | (3,425) |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (45,811) | (118,269) |
Other current assets | (8,945) | (7,621) |
Other assets | 16,633 | (48) |
Accounts payable | (6,552) | 412 |
Accrued expenses | (11,981) | (18,429) |
Income taxes | 11,838 | 15,420 |
Net cash provided by (used in) operating activities | 50,727 | (55,861) |
Investing activities | ||
Business combinations, net of cash acquired | (515,359) | (9,566) |
Purchases of property and equipment | (39,617) | (50,653) |
Investment in businesses | (1,754) | (500) |
Proceeds from sale of assets and businesses | 691 | 19,512 |
Net cash provided by (used in) investing activities | (556,039) | (41,207) |
Financing activities | ||
Borrowings on revolving facilities | 165,000 | 530,000 |
Payments on revolving facilities | (150,000) | (415,000) |
Proceeds from term loans | 779,904 | 1,139,822 |
Payments on term loans | (2,875) | (1,170,817) |
Revolving facility debt issuance costs | (1,333) | (3,887) |
Borrowings of other debt | 11,600 | 6,571 |
Principal payments on other debt | (5,909) | (5,275) |
Repurchase of common stock | (122) | (156) |
Dividends paid to Holdings | 0 | 0 |
Proceeds from exercise of stock options | 738 | 617 |
Equity investment by Holdings | 0 | 0 |
Decrease in overdrafts | (7,916) | (17,062) |
Proceeds from issuance of non-controlling interests | 0 | 2,094 |
Distributions to non-controlling interests | (286,641) | (3,657) |
Net cash provided by (used in) financing activities | 502,446 | 63,250 |
Net increase (decrease) in cash and cash equivalents | (2,866) | (33,818) |
Cash and cash equivalents at beginning of period | 122,549 | 99,029 |
Cash and cash equivalents at end of period | 119,683 | 65,211 |
Supplemental Information | ||
Cash paid for interest | 35,233 | 38,565 |
Cash paid for taxes | 376 | 1,207 |
Non-cash equity exchange for acquisition of U.S. HealthWorks | 238,000 | 0 |
Select Medical Corporation | ||
Operating activities | ||
Net income | 43,982 | 23,463 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 1,364 | 4,911 |
Depreciation and amortization | 46,771 | 42,539 |
Provision for bad debts | 85 | 781 |
Equity in earnings of unconsolidated subsidiaries | (4,697) | (5,521) |
Loss on extinguishment of debt | 412 | 6,527 |
Gain on sale of assets and businesses | (513) | (4,609) |
Stock compensation expense | 4,927 | 4,586 |
Amortization of debt discount, premium and issuance costs | 3,136 | 3,422 |
Deferred income taxes | 78 | (3,425) |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (45,811) | (118,269) |
Other current assets | (8,945) | (7,621) |
Other assets | 16,633 | (48) |
Accounts payable | (6,552) | 412 |
Accrued expenses | (11,981) | (18,429) |
Income taxes | 11,838 | 15,420 |
Net cash provided by (used in) operating activities | 50,727 | (55,861) |
Investing activities | ||
Business combinations, net of cash acquired | (515,359) | (9,566) |
Purchases of property and equipment | (39,617) | (50,653) |
Investment in businesses | (1,754) | (500) |
Proceeds from sale of assets and businesses | 691 | 19,512 |
Net cash provided by (used in) investing activities | (556,039) | (41,207) |
Financing activities | ||
Borrowings on revolving facilities | 165,000 | 530,000 |
Payments on revolving facilities | (150,000) | (415,000) |
Proceeds from term loans | 779,904 | 1,139,822 |
Payments on term loans | (2,875) | (1,170,817) |
Revolving facility debt issuance costs | (1,333) | (3,887) |
Borrowings of other debt | 11,600 | 6,571 |
Principal payments on other debt | (5,909) | (5,275) |
Repurchase of common stock | 0 | 0 |
Dividends paid to Holdings | (122) | (156) |
Proceeds from exercise of stock options | 0 | 0 |
Equity investment by Holdings | 738 | 617 |
Decrease in overdrafts | (7,916) | (17,062) |
Proceeds from issuance of non-controlling interests | 0 | 2,094 |
Distributions to non-controlling interests | (286,641) | (3,657) |
Net cash provided by (used in) financing activities | 502,446 | 63,250 |
Net increase (decrease) in cash and cash equivalents | (2,866) | (33,818) |
Cash and cash equivalents at beginning of period | 122,549 | 99,029 |
Cash and cash equivalents at end of period | 119,683 | 65,211 |
Supplemental Information | ||
Cash paid for interest | 35,233 | 38,565 |
Cash paid for taxes | 376 | 1,207 |
Non-cash equity exchange for acquisition of U.S. HealthWorks | $ 238,000 | $ 0 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements of Select Medical Holdings Corporation (“Holdings”) include the accounts of its wholly owned subsidiary, Select Medical Corporation (“Select”). Holdings conducts substantially all of its business through Select and its subsidiaries. Holdings and Select and its subsidiaries are collectively referred to as the “Company.” The unaudited condensed consolidated financial statements of the Company as of March 31, 2018 , and for the three month periods ended March 31, 2017 and 2018 , have been prepared pursuant to the rules and regulations of the Securities Exchange Commission (the “SEC”) for interim reporting and accounting principles generally accepted in the United States of America (“GAAP”). Accordingly, certain information and disclosures required by GAAP, which are normally included in the notes to consolidated financial statements, have been condensed or omitted pursuant to those rules and regulations, although the Company believes the disclosure is adequate to make the information presented not misleading. In the opinion of management, such information contains all adjustments, which are normal and recurring in nature, necessary for a fair statement of the financial position, results of operations and cash flow for such periods. All significant intercompany transactions and balances have been eliminated. The results of operations for the three months ended March 31, 2018 , are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2018 . These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2017 , contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 22, 2018. |
Accounting Policies
Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Accounting Policies | Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingencies, at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements Leases In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016‑02, Leases . This ASU includes a lessee accounting model that recognizes two types of leases: finance and operating. This ASU requires that a lessee recognize on the balance sheet assets and liabilities for all leases with lease terms of more than twelve months. Lessees will need to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained the dual model, requiring leases to be classified as either operating or finance. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend on its classification as finance or operating lease. For short‑term leases of twelve months or less, lessees are permitted to make an accounting election by class of underlying asset not to recognize right-of-use assets or lease liabilities. If the alternative is elected, lease expense would be recognized generally on the straight‑line basis over the respective lease term. The amendments in ASU 2016-02 will take effect for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted as of the beginning of an interim or annual reporting period. A modified retrospective approach is required for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Upon adoption, the Company will recognize significant assets and liabilities on the consolidated balance sheets as a result of the operating lease obligations of the Company. Operating lease expense will still be recognized as rent expense on a straight‑line basis over the respective lease terms in the consolidated statements of operations. The Company will implement the new standard beginning January 1, 2019. The Company’s implementation efforts are focused on designing accounting processes, disclosure processes, and internal controls in order to account for its leases under the new standard. Recently Adopted Accounting Pronouncements Revenue from Contracts with Customers Beginning in May 2014, the FASB issued several Accounting Standards Updates which established Topic 606, Revenue from Contracts with Customers (the “standard”). This standard supersedes existing revenue recognition requirements and seeks to eliminate most industry-specific guidance under current GAAP. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the new standard on January 1, 2018, using the full retrospective transition method. Adoption of the revenue recognition standard impacted the Company’s reported results as follows: Three Months Ended March 31, 2017 As Reported As Adjusted (1) Adoption Impact (in thousands) Condensed Consolidated Statements of Operations Net operating revenues $ 1,111,361 $ 1,091,517 $ (19,844 ) Bad debt expense 20,625 781 (19,844 ) Condensed Consolidated Statements of Cash Flows Provision for bad debts 20,625 781 (19,844 ) Changes in accounts receivable (138,113 ) (118,269 ) 19,844 _____________________________________________________________ (1) Bad debt expense is now included in cost of services on the condensed consolidated statements of operations. December 31, 2017 As Reported As Adjusted Adoption Impact (in thousands) Condensed Consolidated Balance Sheets Accounts receivable $ 767,276 $ 691,732 $ (75,544 ) Allowance for doubtful accounts 75,544 — (75,544 ) Accounts receivable $ 691,732 $ 691,732 $ — The Company has presented the applicable disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers in Note 7. Income Taxes In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740), and Intra-Entity Transfers of Assets Other Than Inventory. Previous GAAP prohibited the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. The ASU requires an entity to recognize the income tax consequences of an intra‑entity transfer of an asset other than inventory when the transfer occurs. The Company adopted the guidance effective January 1, 2018. Adoption of the guidance did not have a material impact on the Company’s consolidated financial statements. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions U.S. HealthWorks Acquisition On February 1, 2018, Concentra Inc. (“Concentra”) acquired all of the issued and outstanding shares of stock of U.S. HealthWorks, Inc. (“U.S. HealthWorks”), an occupational medicine and urgent care service provider, pursuant to the terms of an Equity Purchase and Contribution Agreement (the “Purchase Agreement”) dated as of October 22, 2017, by and among Concentra, U.S. HealthWorks, Concentra Group Holdings, LLC (“Concentra Group Holdings”), Concentra Group Holdings Parent, LLC (“Concentra Group Holdings Parent”) and Dignity Health Holding Corporation (“DHHC”). For the three months ended March 31, 2018, the Company recognized $2.9 million of U.S. HealthWorks acquisition costs which are included in general and administrative expense. In connection with the closing of the transaction, Concentra Group Holdings made distributions to its equity holders and redeemed certain of its outstanding equity interests from existing minority equity holders. Subsequently, Concentra Group Holdings and a wholly owned subsidiary of Concentra Group Holdings Parent merged, with Concentra Group Holdings surviving the merger and becoming a wholly owned subsidiary of Concentra Group Holdings Parent. As a result of the merger, the equity interests of Concentra Group Holdings outstanding after the redemption described above were exchanged for membership interests in Concentra Group Holdings Parent. Concentra acquired U.S. HealthWorks for $753.0 million . The Purchase Agreement provides for certain post-closing adjustments for cash, indebtedness, transaction expenses, and working capital. DHHC, a subsidiary of Dignity Health, was issued a 20% equity interest in Concentra Group Holdings Parent, which was valued at $238.0 million . The remainder of the purchase price was paid in cash. Select retained a majority voting interest in Concentra Group Holdings Parent following the closing of the transaction. For the U.S. HealthWorks acquisition, the Company allocated the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their preliminary estimated fair values in accordance with the provisions of Accounting Standards Codification Topic 805, Business Combinations . The Company is in the process of completing its assessment of the acquisition-date fair values of the assets acquired and the liabilities assumed and determining the estimated useful lives of long-lived assets and finite-lived intangible assets; therefore, the values set forth below are subject to adjustment during the measurement period. The amount of these potential adjustments could be significant. The Company expects to complete its purchase price allocation activities by December 31, 2018. The following table reconciles the preliminary allocation of estimated fair value to identifiable net assets and goodwill to the consideration given for the acquired business (in thousands): Identifiable tangible assets $ 184,357 Identifiable intangible assets 105,000 Goodwill 535,595 Total assets 824,952 Total liabilities 71,952 Consideration given $ 753,000 A preliminary estimate for goodwill of $535.6 million has been recognized for the business combination, representing the excess of the consideration given over the fair value of identifiable net assets acquired. The value of goodwill is derived from U.S. HealthWorks’ future earnings potential and its assembled workforce. Goodwill has been assigned to the Concentra reporting unit and is not deductible for tax purposes. However, prior to its acquisition by the Company, U.S. HealthWorks completed certain acquisitions that resulted in tax deductible goodwill with an estimated value of $83.1 million , which the Company will deduct through 2032. For the period February 1, 2018 through March 31, 2018, U.S. HealthWorks had net operating revenues of $89.9 million which is reflected in the Company’s consolidated statements of operations. Due to the integrated nature of our operations, it is not practicable to separately identify earnings of U.S. HealthWorks on a stand-alone basis. Pro Forma Results The following pro forma unaudited results of operations have been prepared assuming the acquisition of U.S. HealthWorks occurred on January 1, 2017. These results are not necessarily indicative of results of future operations nor of the results that would have occurred had the acquisition been consummated on the aforementioned date. Three Months Ended March 31, 2017 2018 (in thousands, except per share amounts) Net revenue $ 1,228,484 $ 1,300,544 Net income 17,685 45,677 Net income attributable to the Company 7,827 34,538 Income per common share: Basic $ 0.06 $ 0.26 Diluted $ 0.06 $ 0.26 The pro forma financial information is based on the preliminary allocation of the purchase price of the U.S. HealthWorks acquisition and is therefore subject to adjustment upon finalizing the purchase price allocation, as described above, during the measurement period. The net income tax impact was calculated at a statutory rate, as if U.S. HealthWorks had been a subsidiary of the Company as of January 1, 2017. For the three months ended March 31, 2017 , pro forma results were adjusted to include the U.S. HealthWorks acquisition costs recognized by the Company during 2017 and 2018, which were approximately $5.8 million . For the three months ended March 31, 2018 , pro forma results were adjusted to exclude approximately $2.9 million of U.S. HealthWorks acquisition costs which were recognized by the Company during the period. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Goodwill The following table shows changes in the carrying amounts of goodwill by reporting unit for the three months ended March 31, 2018 : Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Total (in thousands) Balance as of December 31, 2017 $ 1,045,220 $ 415,528 $ 647,522 $ 674,542 $ 2,782,812 Acquired — — 345 535,595 535,940 Sold — — (141 ) — (141 ) Balance as of March 31, 2018 $ 1,045,220 $ 415,528 $ 647,726 $ 1,210,137 $ 3,318,611 See Note 3 for details of the goodwill acquired during the period. Identifiable Intangible Assets The following table provides the gross carrying amounts, accumulated amortization, and net carrying amounts for the Company’s identifiable intangible assets: December 31, 2017 March 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in thousands) Indefinite-lived intangible assets: Trademarks $ 166,698 $ — $ 166,698 $ 166,698 $ — $ 166,698 Certificates of need 19,155 — 19,155 19,159 — 19,159 Accreditations 1,895 — 1,895 1,895 — 1,895 Finite-lived intangible assets: Trademarks — — — 5,000 (417 ) 4,583 Customer relationships 143,953 (38,281 ) 105,672 243,969 (43,886 ) 200,083 Favorable leasehold interests 13,295 (4,319 ) 8,976 13,279 (4,742 ) 8,537 Non-compete agreements 28,023 (3,900 ) 24,123 28,130 (4,438 ) 23,692 Total identifiable intangible assets $ 373,019 $ (46,500 ) $ 326,519 $ 478,130 $ (53,483 ) $ 424,647 The Company’s accreditations and indefinite-lived trademarks have renewal terms and the costs to renew these intangible assets are expensed as incurred. At March 31, 2018 , the accreditations and indefinite-lived trademarks have a weighted average time until next renewal of 1.5 years and 8.9 years , respectively. The Company’s customer relationships, non-compete agreements, and U.S. HealthWorks trademarks amortize over their estimated useful lives. Amortization expense was $4.4 million and $6.4 million for the three months ended March 31, 2017 and 2018 , respectively. The Company’s leasehold interests have finite lives and are amortized to rent expense over the remaining term of their respective leases to reflect a market rent per period based upon the market conditions present at the acquisition date. |
Long-Term Debt and Notes Payabl
Long-Term Debt and Notes Payable | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Notes Payable | Long-Term Debt and Notes Payable For purposes of this indebtedness footnote, references to Select exclude Concentra because the Concentra credit facilities are non-recourse to Holdings and Select. As of March 31, 2018 , the Company’s long-term debt and notes payable are as follows (in thousands): Principal Outstanding Unamortized Premium (Discount) Unamortized Issuance Costs Carrying Value Fair Value Select: 6.375% senior notes $ 710,000 $ 721 $ (6,074 ) $ 704,647 $ 720,650 Credit facilities: Revolving facility 245,000 — — 245,000 225,400 Term loans 1,138,500 (11,883 ) (11,946 ) 1,114,671 1,151,308 Other 43,268 — (519 ) 42,749 42,749 Total Select debt 2,136,768 (11,162 ) (18,539 ) 2,107,067 2,140,107 Concentra: Credit facilities: Term loans 1,414,175 (3,498 ) (23,021 ) 1,387,656 1,427,384 Other 5,797 — — 5,797 5,797 Total Concentra debt 1,419,972 (3,498 ) (23,021 ) 1,393,453 1,433,181 Total debt $ 3,556,740 $ (14,660 ) $ (41,560 ) $ 3,500,520 $ 3,573,288 Principal maturities of the Company’s long-term debt and notes payable are approximately as follows (in thousands): 2018 2019 2020 2021 2022 Thereafter Total Select: 6.375% senior notes $ — $ — $ — $ 710,000 $ — $ — $ 710,000 Credit facilities: Revolving facility — — — — 245,000 — 245,000 Term loans 8,625 11,500 11,500 11,500 11,500 1,083,875 1,138,500 Other 9,218 3,207 25,285 221 — 5,337 43,268 Total Select debt 17,843 14,707 36,785 721,721 256,500 1,089,212 2,136,768 Concentra: Credit facilities: Term loans — — 5,719 12,365 1,156,091 240,000 1,414,175 Other 1,170 304 322 320 308 3,373 5,797 Total Concentra debt 1,170 304 6,041 12,685 1,156,399 243,373 1,419,972 Total debt $ 19,013 $ 15,011 $ 42,826 $ 734,406 $ 1,412,899 $ 1,332,585 $ 3,556,740 As of December 31, 2017 , the Company’s long-term debt and notes payable are as follows (in thousands): Principal Outstanding Unamortized Premium (Discount) Unamortized Issuance Costs Carrying Value Fair Value Select: 6.375% senior notes $ 710,000 $ 778 $ (6,553 ) $ 704,225 $ 727,750 Credit facilities: Revolving facility 230,000 — — 230,000 211,600 Term loans 1,141,375 (12,445 ) (12,500 ) 1,116,430 1,154,215 Other 36,877 — (533 ) 36,344 36,344 Total Select debt 2,118,252 (11,667 ) (19,586 ) 2,086,999 2,129,909 Concentra: Credit facilities: Term loans 619,175 (2,257 ) (10,668 ) 606,250 625,173 Other 6,653 — — 6,653 6,653 Total Concentra debt 625,828 (2,257 ) (10,668 ) 612,903 631,826 Total debt $ 2,744,080 $ (13,924 ) $ (30,254 ) $ 2,699,902 $ 2,761,735 Select Credit Facilities On March 22, 2018, Select entered into Amendment No. 1 to the senior secured credit agreement (the “Select credit agreement”) dated March 6, 2017. The Select credit agreement originally provided for $1.6 billion in senior secured credit facilities comprised of $1.15 billion in term loans (the “Select term loans”) and a $450.0 million revolving credit facility (the “Select revolving facility” and together with the Select term loans, the “Select credit facilities”), including a $75.0 million sublimit for the issuance of standby letters of credit. Amendment No. 1 (i) decreases the applicable interest rate on the Select term loans from the Adjusted LIBO Rate (as defined in the Select credit agreement and subject to an Adjusted LIBO floor of 1.00% ) plus 3.50% to the Adjusted LIBO Rate plus a percentage ranging from 2.50% to 2.75% , or from the Alternative Base Rate (as defined in the Select credit agreement and subject to an Alternate Base Rate floor of 2.00% ) plus 2.50% to the Alternative Base Rate plus a percentage ranging from 1.50% to 1.75% , in each case based on Select’s total net leverage ratio (as defined in the Select credit agreement); (ii) decreases the applicable interest rate on the loans outstanding under the Select revolving credit facility from the Adjusted LIBO Rate plus a percentage ranging from 3.00% to 3.25% to the Adjusted LIBO Rate plus a percentage ranging from 2.50% to 2.75% , or from the Alternative Base Rate plus a percentage ranging from 2.00% to 2.25% to the Alternative Base Rate plus a percentage ranging from 1.50% to 1.75% , in each case based on Select’s total net leverage ratio; (iii) extends the maturity date for the Select term loans from March 6, 2024 to March 6, 2025; and (iv) makes certain other technical amendments to the Select credit agreement as set forth therein. Concentra Credit Facilities Concentra First Lien Credit Agreement On February 1, 2018, Concentra entered into an amendment to its first lien credit agreement (the “Concentra first lien credit agreement”), dated June 1, 2015, by and among Concentra, as the borrower, Concentra Holdings, Inc., a subsidiary of Concentra Group Holdings Parent, JPMorgan Chase Bank, N.A., as the administrative agent and the collateral agent, and the other lenders party thereto. Concentra used borrowings under the Concentra first lien credit agreement and the Concentra second lien credit agreement, as described below, together with cash on hand, to pay the purchase price for all of the issued and outstanding stock of U.S. HealthWorks to DHHC and to finance the redemption and reorganization transactions executed under the Purchase Agreement (as described in Note 3), as well as to pay fees and expenses associated with the financing. Concentra amended the Concentra first lien credit agreement to, among other things, provide for (i) an additional $555.0 million in tranche B term loans that, along with the existing tranche B term loans under the Concentra first lien credit agreement, have a maturity date of June 1, 2022 (collectively, the “Concentra first lien term loan”) and (ii) an additional $25.0 million to the $50.0 million , five -year revolving credit facility under the terms of the existing Concentra first lien credit agreement. The tranche B term loans bear interest at a rate equal to the Adjusted LIBO Rate (as defined in the Concentra first lien credit agreement) plus 2.75% (subject to an Adjusted LIBO Rate floor of 1.00% ) for Eurodollar Borrowings (as defined in the Concentra first lien credit agreement), or Alternate Base Rate (as defined in the Concentra first lien credit agreement) plus 1.75% (subject to an Alternate Base Rate floor of 2.00% ) for ABR Borrowings (as defined in the Concentra first lien credit agreement). All other material terms and conditions applicable to the original tranche B term loan commitments are applicable to the additional tranche B term loans created under the Concentra first lien credit agreement. Concentra Second Lien Credit Agreement On February 1, 2018, Concentra entered into a second lien credit agreement (the “Concentra second lien credit agreement” and, together with the Concentra first lien credit agreement, the “Concentra credit facilities”) with Concentra Holdings, Inc., Wells Fargo Bank, National Association, as the administrative agent and the collateral agent, and the other lenders party thereto. The Concentra second lien credit agreement provides for $240.0 million in term loans (the “Concentra second lien term loan” and, together with the Concentra first lien term loan, the “Concentra term loans”) with a maturity date of June 1, 2023. Borrowings under the Concentra second lien credit agreement bear interest at a rate equal to the Adjusted LIBO Rate (as defined in the Concentra second lien credit agreement) plus 6.50% (subject to an Adjusted LIBO Rate floor of 1.00% ), or Alternate Base Rate (as defined in the Concentra second lien credit agreement) plus 5.50% (subject to an Alternate Base Rate floor of 2.00% ). In the event that, on or prior to February 1, 2019, Concentra prepays any of the Concentra second lien term loan to refinance such term loans, Concentra shall pay a premium of 2.00% of the aggregate principal amount of the Concentra second lien term loan prepaid. If Concentra prepays any of the Concentra second lien term loan to refinance such term loans on or prior to February 1, 2020, Concentra shall pay a premium of 1.00% of the aggregate principal amount of the Concentra second lien term loan prepaid. Concentra will be required to prepay borrowings under the Concentra second lien term loan with (i) 100% of the net cash proceeds received from non-ordinary course asset sales or other dispositions, or as a result of a casualty or condemnation, subject to reinvestment provisions and other customary carveouts and the payment of certain indebtedness secured by liens, (ii) 100% of the net cash proceeds received from the issuance of debt obligations other than certain permitted debt obligations, and (iii) 50% of excess cash flow (as defined in the Concentra second lien credit agreement) if Concentra’s leverage ratio is greater than 4.25 to 1.00 and 25% of excess cash flow if Concentra’s leverage ratio is less than or equal to 4.25 to 1.00 and greater than 3.75 to 1.00 , in each case, reduced by the aggregate amount of term loans and certain debt optionally prepaid during the applicable fiscal year and the aggregate amount of senior revolving commitments reduced permanently during the applicable fiscal year (other than in connection with a refinancing). Concentra will not be required to prepay borrowings with excess cash flow if Concentra’s leverage ratio is less than or equal to 3.75 to 1.00 . The Concentra second lien credit agreement also contains a number of affirmative and restrictive covenants, including limitations on mergers, consolidations and dissolutions; sales of assets; investments and acquisitions; indebtedness; liens; affiliate transactions; and dividends and restricted payments. The Concentra second lien credit agreement contains events of default for non-payment of principal and interest when due (subject to a grace period for interest), cross-default and cross-acceleration provisions and an event of default that would be triggered by a change of control. The borrowings under the Concentra second lien term loan are guaranteed, on a second lien basis, by Concentra Holdings, Inc., Concentra, and certain domestic subsidiaries of Concentra and will be guaranteed by Concentra’s future domestic subsidiaries (other than Excluded Subsidiaries and Consolidated Practices, each as defined in the Concentra second lien credit agreement). The borrowings under the Concentra second lien term loan are secured by substantially all of Concentra’s and its domestic subsidiaries’ existing and future property and assets and by a pledge of Concentra’s capital stock, the capital stock of certain of Concentra’s domestic subsidiaries and up to 65% of the voting capital stock and 100% of the non-voting capital stock of Concentra’s foreign subsidiaries, if any. Loss on Early Retirement of Debt The amendments to the Select credit facilities and Concentra credit facilities resulted in losses on early retirement of debt totaling $10.3 million for the three months ended March 31, 2018. The losses on early retirement of debt consisted of $0.4 million of debt extinguishment losses and $9.9 million of debt modification losses during the three months ended March 31, 2018. Fair Value The Company considers the inputs in the valuation process to be Level 2 in the fair value hierarchy for Select’s 6.375% senior notes and for its credit facilities. Level 2 in the fair value hierarchy is defined as inputs that are observable for the asset or liability, either directly or indirectly, which includes quoted prices for identical assets or liabilities in markets that are not active. The fair values of the Select credit facilities and the Concentra credit facilities were based on quoted market prices for this debt in the syndicated loan market. The fair value of Select’s 6.375% senior notes was based on quoted market prices. The carrying amount of other debt, principally short-term notes payable, approximates fair value. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company identifies its operating segments according to how the chief operating decision maker evaluates financial performance and allocates resources. During the year ended December 31, 2017, the Company changed its internal segment reporting structure which is reflective of how the Company now manages its business operations, reviews operating performance, and allocates resources. The Company’s reportable segments include long term acute care, inpatient rehabilitation, outpatient rehabilitation, and Concentra. Prior year results for the three months ended March 31, 2017, presented herein have been recast to conform to the current presentation. The Company previously disclosed financial information for the following reportable segments: specialty hospitals, outpatient rehabilitation, and Concentra. Other activities include the Company’s corporate shared services and certain other non-consolidating joint ventures and minority investments in other healthcare related businesses. The Company evaluates performance of the segments based on Adjusted EBITDA. Adjusted EBITDA is defined as earnings excluding interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, acquisition costs associated with U.S. HealthWorks, non-operating gain (loss), and equity in earnings (losses) of unconsolidated subsidiaries. The Company has provided additional information regarding its reportable segments, such as total assets, which contributes to the understanding of the Company and provides useful information to the users of the consolidated financial statements. The following tables summarize selected financial data for the Company’s reportable segments. The segment results of Holdings are identical to those of Select. Three Months Ended March 31, 2017 2018 (in thousands) Net operating revenues: (1) Long term acute care $ 445,123 $ 464,676 Inpatient rehabilitation 144,825 174,774 Outpatient rehabilitation 250,371 257,381 Concentra 250,589 356,116 Other 609 17 Total Company $ 1,091,517 $ 1,252,964 Adjusted EBITDA: Long term acute care $ 72,337 $ 72,972 Inpatient rehabilitation 16,328 26,776 Outpatient rehabilitation 31,351 30,525 Concentra 42,592 57,797 Other (23,718 ) (24,838 ) Total Company $ 138,890 $ 163,232 Total assets: Long term acute care $ 1,978,226 $ 1,862,791 Inpatient rehabilitation 643,994 877,750 Outpatient rehabilitation 980,261 973,122 Concentra 1,297,672 2,143,405 Other 102,784 111,575 Total Company $ 5,002,937 $ 5,968,643 Purchases of property and equipment, net: Long term acute care $ 10,943 $ 10,472 Inpatient rehabilitation 21,414 12,917 Outpatient rehabilitation 6,673 7,338 Concentra 8,686 6,621 Other 2,937 2,269 Total Company $ 50,653 $ 39,617 A reconciliation of Adjusted EBITDA to income before income taxes is as follows: Three Months Ended March 31, 2017 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Other Total (in thousands) Adjusted EBITDA $ 72,337 $ 16,328 $ 31,351 $ 42,592 $ (23,718 ) Depreciation and amortization (13,042 ) (5,458 ) (6,340 ) (16,123 ) (1,576 ) Stock compensation expense — — — (306 ) (4,280 ) Income (loss) from operations $ 59,295 $ 10,870 $ 25,011 $ 26,163 $ (29,574 ) $ 91,765 Loss on early retirement of debt (19,719 ) Equity in earnings of unconsolidated subsidiaries 5,521 Non-operating loss (49 ) Interest expense (40,853 ) Income before income taxes $ 36,665 Three Months Ended March 31, 2018 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Other Total (in thousands) Adjusted EBITDA $ 72,972 $ 26,776 $ 30,525 $ 57,797 $ (24,838 ) Depreciation and amortization (11,058 ) (5,722 ) (6,637 ) (21,147 ) (2,207 ) Stock compensation expense — — — (211 ) (4,716 ) U.S. HealthWorks acquisition costs — — — (2,936 ) — Income (loss) from operations $ 61,914 $ 21,054 $ 23,888 $ 33,503 $ (31,761 ) $ 108,598 Loss on early retirement of debt (10,255 ) Equity in earnings of unconsolidated subsidiaries 4,697 Non-operating gain 399 Interest expense (47,163 ) Income before income taxes $ 56,276 _______________________________________________________________________________ (1) Net operating revenues were retrospectively conformed to reflect the adoption Topic 606, Revenue from Contracts with Customers. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Net operating revenues consist primarily of patient service revenues generated from services provided to patients and other revenues for services provided to healthcare institutions under contractual arrangements. The following tables disaggregate the Company’s net operating revenues by operating segment for the three months ended March 31, 2017 and 2018 : Three Months Ended March 31, 2017 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra (in thousands) Patient service revenues: Medicare $ 236,437 $ 57,504 $ 36,698 $ 545 Non-Medicare 206,625 47,243 183,803 247,801 Total patient services revenues 443,062 104,747 220,501 248,346 Other revenues 2,061 40,078 29,870 2,243 Total net operating revenues $ 445,123 $ 144,825 $ 250,371 $ 250,589 Three Months Ended March 31, 2018 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra (in thousands) Patient service revenues: Medicare $ 240,992 $ 72,841 $ 38,190 $ 628 Non-Medicare 220,006 61,902 188,900 353,252 Total patient services revenues 460,998 134,743 227,090 353,880 Other revenues 3,678 40,031 30,291 2,236 Total net operating revenues $ 464,676 $ 174,774 $ 257,381 $ 356,116 Patient Services Revenue Patient services revenue is recognized when obligations under the terms of the contract are satisfied; generally, this occurs as the Company provides healthcare services, as each service provided is distinct and future services rendered are not dependent on previously rendered services. Patient service revenues are recognized at an amount equal to the consideration the Company expects to receive in exchange for providing healthcare services to its patients. These amounts are due from patients; third-party payors, including health insurers and government programs; and other payors. Medicare : Medicare is a federal program that provides medical insurance benefits to persons age 65 and over, some disabled persons, and persons with end stage renal disease. Amounts we receive for treatment of patients covered by the Medicare program are generally less than the standard billing rates; accordingly, the Company recognizes revenue based on amounts which are reimbursable by Medicare under prospective payment systems and provisions of cost-reimbursement and other payment methods. The amount reimbursed is derived based on the type of services provided. Non-Medicare : The Company is reimbursed for healthcare services provided from various other payor sources which include insurance companies, workers’ compensation programs, health maintenance organizations, preferred provider organizations, other managed care companies and employers, as well as patients. The Company is reimbursed by these payors using a variety of payment methodologies and the amounts the Company receives are generally less than the standard billing rates. In the long term acute care and inpatient rehabilitation segments, the Company recognizes revenue based on known contractual provisions associated with the specific payor or, where the Company has a relatively homogeneous patient population, the Company will monitor individual payors’ historical reimbursement rates to derive a per diem rate which is used to determine the amount of revenue to be recognized for services rendered. In the outpatient rehabilitation and Concentra segments, the Company recognizes revenue from payors based on known contractual provisions, negotiated amounts, or usual and customary amounts associated with the specific payor. The Company performs provision testing, using internally developed systems, whereby the Company monitors a payors’ historical reimbursement rates and compares them against the associated gross charges for the service provided. The percentage of historical reimbursed claims to gross charges is utilized to determine the amount of revenue to be recognized for services rendered. The Company is subject to potential retrospective adjustments to net operating revenues in future periods for matters related to claims processing and other price concessions. These adjustments, which are estimated based on an analysis of historical experience by payor source, are accounted for as a constraint to the amount of revenue recognized by the Company in the period services are rendered. Other Revenues The Company recognizes revenue for services provided to healthcare institutions, principally management and employee leasing services, under contractual arrangements with related parties affiliated through the Company’s equity investments and other third-party healthcare institutions. Revenue is recognized when obligations under the terms of the contract are satisfied. Revenues from these services are measured as the amount of consideration the Company expects to receive for those services. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In December 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law which made significant changes to the Internal Revenue Code. These changes included a corporate tax rate decrease from 35.0% to 21.0% effective after December 31, 2017. Reconciliations of the statutory federal income tax rate to the effective income tax rate are as follows: Three Months Ended March 31, 2017 2018 Federal income tax at statutory rate 35.0 % 21.0 % State and local income taxes, less federal income tax benefit 3.9 4.7 Permanent differences 0.8 1.5 Valuation allowance (0.7 ) 0.8 Uncertain tax positions 0.2 0.3 Non-controlling interest (2.4 ) (2.7 ) Stock-based compensation (0.7 ) (5.4 ) Other (0.1 ) 1.6 Total effective income tax rate 36.0 % 21.8 % |
Income per Common Share
Income per Common Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Income per Common Share | Income per Common Share Holdings applies the two-class method for calculating and presenting income per common share. The two-class method is an earnings allocation formula that determines earnings per share for each class of stock participation rights in undistributed earnings. The following table sets forth the calculation of income per share in Holdings’ condensed consolidated statements of operations and the differences between basic weighted average shares outstanding and diluted weighted average shares outstanding used to compute basic and diluted earnings per share, respectively. Three Months Ended March 31, 2017 2018 (in thousands, except per share amounts) Numerator: Net income attributable to Select Medical Holdings Corporation $ 15,870 $ 33,739 Less: Earnings allocated to unvested restricted stockholders 507 1,111 Net income available to common stockholders $ 15,363 $ 32,628 Denominator: Weighted average shares—basic 128,464 129,691 Effect of dilutive securities: Stock options 164 125 Weighted average shares—diluted 128,628 129,816 Basic income per common share: $ 0.12 $ 0.25 Diluted income per common share: $ 0.12 $ 0.25 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation The Company is a party to various legal actions, proceedings, and claims (some of which are not insured), and regulatory and other governmental audits and investigations in the ordinary course of its business. The Company cannot predict the ultimate outcome of pending litigation, proceedings, and regulatory and other governmental audits and investigations. These matters could potentially subject the Company to sanctions, damages, recoupments, fines, and other penalties. The Department of Justice, Centers for Medicare & Medicaid Services (“CMS”), or other federal and state enforcement and regulatory agencies may conduct additional investigations related to the Company’s businesses in the future that may, either individually or in the aggregate, have a material adverse effect on the Company’s business, financial position, results of operations, and liquidity. To address claims arising out of the Company’s operations, the Company maintains professional malpractice liability insurance and general liability insurance coverages through a number of different programs that are dependent upon such factors as the state where the Company is operating and whether the operations are wholly owned or are operated through a joint venture. For the Company’s wholly owned operations, the Company maintains insurance coverages under a combination of policies with a total annual aggregate limit of $35.0 million . The Company’s insurance for the professional liability coverage is written on a “claims-made” basis, and its commercial general liability coverage is maintained on an “occurrence” basis. These coverages apply after a self-insured retention limit is exceeded. For the Company’s joint venture operations, the Company has numerous programs that are designed to respond to the risks of the specific joint venture. The annual aggregate limit under these programs ranges from $5.0 million to $20.0 million . The policies are generally written on a “claims-made” basis. Each of these programs has either a deductible or self-insured retention limit. The Company reviews its insurance program annually and may make adjustments to the amount of insurance coverage and self-insured retentions in future years. The Company also maintains umbrella liability insurance covering claims which, due to their nature or amount, are not covered by or not fully covered by the Company’s other insurance policies. These insurance policies also do not generally cover punitive damages and are subject to various deductibles and policy limits. Significant legal actions, as well as the cost and possible lack of available insurance, could subject the Company to substantial uninsured liabilities. In the Company’s opinion, the outcome of these actions, individually or in the aggregate, will not have a material adverse effect on its financial position, results of operations, or cash flows. Healthcare providers are subject to lawsuits under the qui tam provisions of the federal False Claims Act. Qui tam lawsuits typically remain under seal (hence, usually unknown to the defendant) for some time while the government decides whether or not to intervene on behalf of a private qui tam plaintiff (known as a relator) and take the lead in the litigation. These lawsuits can involve significant monetary damages and penalties and award bounties to private plaintiffs who successfully bring the suits. The Company is and has been a defendant in these cases in the past, and may be named as a defendant in similar cases from time to time in the future. Evansville Litigation. On October 19, 2015, the plaintiff‑relators filed a Second Amended Complaint in United States of America, ex rel. Tracy Conroy, Pamela Schenk and Lisa Wilson v. Select Medical Corporation, Select Specialty Hospital-Evansville, LLC (“SSH‑Evansville”), Select Employment Services, Inc., and Dr. Richard Sloan. The case is a civil action filed in the United States District Court for the Southern District of Indiana by private plaintiff‑relators on behalf of the United States under the federal False Claims Act. The plaintiff‑relators are the former CEO and two former case managers at SSH‑Evansville, and the defendants currently include the Company, SSH‑Evansville, a subsidiary of the Company serving as common paymaster for its employees, and a physician who practices at SSH‑Evansville. The plaintiff‑relators allege that SSH‑Evansville discharged patients too early or held patients too long, improperly discharged patients to and readmitted them from short stay hospitals, up‑coded diagnoses at admission, and admitted patients for whom long‑term acute care was not medically necessary. They also allege that the defendants engaged in retaliation in violation of federal and state law. The Second Amended Complaint replaced a prior complaint that was filed under seal on September 28, 2012 and served on the Company on February 15, 2013, after a federal magistrate judge unsealed it on January 8, 2013. All deadlines in the case had been stayed after the seal was lifted in order to allow the government time to complete its investigation and to decide whether or not to intervene. On June 19, 2015, the United States Department of Justice notified the District Court of its decision not to intervene in the case. In December 2015, the defendants filed a Motion to Dismiss the Second Amended Complaint on multiple grounds, including that the action is disallowed by the False Claims Act’s public disclosure bar, which disqualifies qui tam actions that are based on fraud already publicly disclosed through enumerated sources, unless the relator is an original source, and that the plaintiff‑relators did not plead their claims with sufficient particularity, as required by the Federal Rules of Civil Procedure. Thereafter, the United States filed a notice asserting a veto of the defendants’ use of the public disclosure bar for claims arising from conduct from and after March 23, 2010, which was based on certain statutory changes to the public disclosure bar language included in the Affordable Care Act. On September 30, 2016, the District Court partially granted and partially denied the defendants’ Motion to Dismiss. It ruled that the plaintiff‑relators alleged substantially the same conduct as had been publicly disclosed and that the plaintiff relators are not original sources, so that the public disclosure bar requires dismissal of all non‑retaliation claims arising from conduct before March 23, 2010. The District Court also ruled that the statutory changes to the public disclosure bar gave the United States the power to veto its applicability to claims arising from conduct on and after March 23, 2010, and therefore did not dismiss those claims based on the public disclosure bar. However, the District Court ruled that the plaintiff‑relators did not plead certain of their claims relating to interrupted stay manipulation and premature discharging of patients with the requisite particularity, and dismissed those claims. The District Court declined to dismiss the plaintiff relators’ claims arising from conduct from and after March 23, 2010 relating to delayed discharging of patients and up-coding and the plaintiff relators’ retaliation claims. The plaintiff-relators then proposed a case management plan seeking nationwide discovery involving all of the Company’s LTCHs for the period from March 23, 2010 through the present and allowing discovery that would facilitate the use of statistical sampling to prove liability, which the defendants opposed. In April 2018, a U.S. magistrate judge ruled that plaintiff‑relators’ discovery will be limited to only SSH-Evansville for the period from March 23, 2010 through September 30, 2016, and that the plaintiff‑relators will be required to prove the fraud that they allege on a claim-by-claim basis, rather than using statistical sampling. The plaintiff-relators have appealed this decision to the District Judge. The Company intends to vigorously defend this action, but at this time the Company is unable to predict the timing and outcome of this matter. Knoxville Litigation. On July 13, 2015, the United States District Court for the Eastern District of Tennessee unsealed a qui tam Complaint in Armes v. Garman, et al, No. 3:14‑cv‑00172‑TAV‑CCS, which named as defendants Select, Select Specialty Hospital-Knoxville, Inc. (“SSH‑Knoxville”), Select Specialty Hospital-North Knoxville, Inc. and ten current or former employees of these facilities. The Complaint was unsealed after the United States and the State of Tennessee notified the court on July 13, 2015 that each had decided not to intervene in the case. The Complaint is a civil action that was filed under seal on April 29, 2014 by a respiratory therapist formerly employed at SSH‑Knoxville. The Complaint alleges violations of the federal False Claims Act and the Tennessee Medicaid False Claims Act based on extending patient stays to increase reimbursement and to increase average length of stay; artificially prolonging the lives of patients to increase Medicare reimbursements and decrease inspections; admitting patients who do not require medically necessary care; performing unnecessary procedures and services; and delaying performance of procedures to increase billing. The Complaint was served on some of the defendants during October 2015. In November 2015, the defendants filed a Motion to Dismiss the Complaint on multiple grounds. The defendants first argued that False Claims Act’s first‑to‑file bar required dismissal of plaintiff‑relator’s claims. Under the first‑to‑file bar, if a qui tam case is pending, no person may bring a related action based on the facts underlying the first action. The defendants asserted that the plaintiff‑relator’s claims were based on the same underlying facts as were asserted in the Evansville litigation, discussed above. The defendants also argued that the plaintiff‑relator’s claims must be dismissed under the public disclosure bar, and because the plaintiff‑relator did not plead his claims with sufficient particularity. In June 2016, the District Court granted the defendants’ Motion to Dismiss and dismissed with prejudice the plaintiff‑relator’s lawsuit in its entirety. The District Court ruled that the first‑to‑file bar precludes all but one of the plaintiff‑relator’s claims, and that the remaining claim must also be dismissed because the plaintiff‑relator failed to plead it with sufficient particularity. In July 2016, the plaintiff‑relator filed a Notice of Appeal to the United States Court of Appeals for the Sixth Circuit. Then, on October 11, 2016, the plaintiff‑relator filed a Motion to Remand the case to the District Court for further proceedings, arguing that the September 30, 2016 decision in the Evansville litigation, discussed above, undermines the basis for the District Court’s dismissal. After the Court of Appeals denied the Motion to Remand, the plaintiff‑relator then sought an indicative ruling from the District Court that it would vacate its prior dismissal ruling and allow plaintiff‑relator to supplement his Complaint, but the District Court denied such request. In December 2017, the Court of Appeals, relying on the public disclosure bar, denied the appeal of the plaintiff‑relator and affirmed the judgment of the District Court. In February 2018, the Court of Appeals denied a petition for rehearing that the plaintiff-relator filed in January 2018. The Company intends to vigorously defend this action, but at this time the Company is unable to predict the timing and outcome of this matter. Wilmington Litigation. On January 19, 2017, the United States District Court for the District of Delaware unsealed a qui tam Complaint in United States of America and State of Delaware ex rel. Theresa Kelly v. Select Specialty Hospital-Wilmington, Inc. (“SSH‑Wilmington”), Select Specialty Hospitals, Inc., Select Employment Services, Inc., Select Medical Corporation, and Crystal Cheek, No. 16‑347‑LPS. The Complaint was initially filed under seal in May 2016 by a former chief nursing officer at SSH‑Wilmington and was unsealed after the United States filed a Notice of Election to Decline Intervention in January 2017. The corporate defendants were served in March 2017. In the complaint, the plaintiff‑relator alleges that the Select defendants and an individual defendant, who is a former health information manager at SSH‑Wilmington, violated the False Claims Act and the Delaware False Claims and Reporting Act based on allegedly falsifying medical practitioner signatures on medical records and failing to properly examine the credentials of medical practitioners at SSH‑Wilmington. In response to the Select defendants’ motion to dismiss the Complaint, in May 2017 the plaintiff-relator filed an Amended Complaint asserting the same causes of action. The Select defendants filed a Motion to Dismiss the Amended Complaint based on numerous grounds, including that the Amended Complaint did not plead any alleged fraud with sufficient particularity, failed to plead that the alleged fraud was material to the government’s payment decision, failed to plead sufficient facts to establish that the Select defendants knowingly submitted false claims or records, and failed to allege any reverse false claim. In March 2018, the District Court dismissed the plaintiff‑relator’s claims related to the alleged failure to properly examine medical practitioners’ credentials, her reverse false claims allegations, and her claim that defendants violated the Delaware False Claims and Reporting Act. It denied the defendant’s motion to dismiss claims that the allegedly falsified medical practitioner signatures violated the False Claims Act. Separately, the District Court dismissed the individual defendant due to plaintiff-relator’s failure to timely serve the amended complaint upon her. In March 2017, the plaintiff-relator initiated a second action by filing a Complaint in the Superior Court of the State of Delaware in Theresa Kelly v. Select Medical Corporation, Select Employment Services, Inc., and SSH‑Wilmington, C.A. No. N17C-03-293 CLS. The Delaware Complaint alleges that the defendants retaliated against her in violation of the Delaware Whistleblowers’ Protection Act for reporting the same alleged violations that are the subject of the federal Amended Complaint. The defendants filed a motion to dismiss, or alternatively to stay, the Delaware Complaint based on the pending federal Amended Complaint and the failure to allege facts to support a violation of the Delaware Whistleblowers’ Protection Act. In January 2018, the Court stayed the Delaware Complaint pending the outcome of the federal case. The Company intends to vigorously defend these actions, but at this time the Company is unable to predict the timing and outcome of this matter. Contract Therapy Subpoena On May 18, 2017, the Company received a subpoena from the U.S. Attorney’s Office for the District of New Jersey seeking various documents principally relating to the Company’s contract therapy division, which contracted to furnish rehabilitation therapy services to residents of skilled nursing facilities (“SNFs”) and other providers. The Company operated its contract therapy division through a subsidiary until March 31, 2016, when the Company sold the stock of the subsidiary. The subpoena seeks documents that appear to be aimed at assessing whether therapy services were furnished and billed in compliance with Medicare SNF billing requirements, including whether therapy services were coded at inappropriate levels and whether excessive or unnecessary therapy was furnished to justify coding at higher paying levels. The Company does not know whether the subpoena has been issued in connection with a qui tam lawsuit or in connection with possible civil, criminal or administrative proceedings by the government. The Company is producing documents in response to the subpoena and intends to fully cooperate with this investigation. At this time, the Company is unable to predict the timing and outcome of this matter. Northern District of Alabama Investigation On October 30, 2017, the Company was contacted by the U.S. Attorney’s Office for the Northern District of Alabama to request cooperation in connection with an investigation that may involve Medicare billing compliance at certain of the Company’s Physiotherapy outpatient rehabilitation clinics. In March 2018, the U.S. Attorney’s Office for the Northern District of Alabama informed the Company that it has closed its investigation. |
Condensed Consolidating Financi
Condensed Consolidating Financial Information | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure Text Block Supplement [Abstract] | |
Condensed Consolidating Financial Information | Condensed Consolidating Financial Information Select’s 6.375% senior notes are fully and unconditionally and jointly and severally guaranteed, except for customary limitations, on a senior basis by all of Select’s wholly owned subsidiaries (the “Subsidiary Guarantors”). The Subsidiary Guarantors are defined as subsidiaries where Select, or a subsidiary of Select, holds all of the outstanding ownership interests. Certain of Select’s subsidiaries did not guarantee the 6.375% senior notes (the “Non-Guarantor Subsidiaries” and Concentra Group Holdings Parent and its subsidiaries, the “Non-Guarantor Concentra”). Select conducts a significant portion of its business through its subsidiaries. Presented below is condensed consolidating financial information for Select, the Subsidiary Guarantors, the Non-Guarantor Subsidiaries, and Non-Guarantor Concentra. The equity method has been used by Select with respect to investments in subsidiaries. The equity method has been used by Subsidiary Guarantors with respect to investments in Non-Guarantor Subsidiaries. Separate financial statements for Subsidiary Guarantors are not presented. Certain reclassifications have been made to prior reported amounts in order to conform to the current year guarantor structure. Select Medical Corporation Condensed Consolidating Balance Sheet March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Assets Current Assets: Cash and cash equivalents $ 73 $ 5,502 $ 3,749 $ 110,359 $ — $ 119,683 Accounts receivable — 474,559 139,693 192,139 — 806,391 Intercompany receivables — 1,575,611 58,914 — (1,634,525 ) (a) — Prepaid income taxes 18,382 — — 2,888 — 21,270 Other current assets 18,732 30,119 12,389 32,757 — 93,997 Total Current Assets 37,187 2,085,791 214,745 338,143 (1,634,525 ) 1,041,341 Property and equipment, net 37,668 622,253 82,697 230,865 — 973,483 Investment in affiliates 4,534,700 130,556 — — (4,665,256 ) (b)(c) — Goodwill — 2,108,474 — 1,210,137 — 3,318,611 Identifiable intangible assets, net 3 103,335 5,192 316,117 — 424,647 Other assets 33,702 104,140 34,907 48,143 (10,331 ) (e) 210,561 Total Assets $ 4,643,260 $ 5,154,549 $ 337,541 $ 2,143,405 $ (6,310,112 ) $ 5,968,643 Liabilities and Equity Current Liabilities: Overdrafts $ 21,547 $ — $ — $ — $ — $ 21,547 Current portion of long-term debt and notes payable 19,372 623 1,298 1,206 — 22,499 Accounts payable 13,235 81,563 16,998 26,640 — 138,436 Intercompany payables 1,575,611 58,914 — — (1,634,525 ) (a) — Accrued payroll 5,248 81,902 2,338 46,073 — 135,561 Accrued vacation 4,368 60,577 13,363 27,017 — 105,325 Accrued interest 16,594 7 13 11,974 — 28,588 Accrued other 39,010 61,671 14,262 48,198 — 163,141 Income taxes payable 2,417 — — 8,217 — 10,634 Total Current Liabilities 1,697,402 345,257 48,272 169,325 (1,634,525 ) 625,731 Long-term debt, net of current portion 2,055,664 108 30,002 1,392,247 — 3,478,021 Non-current deferred tax liability — 89,619 774 44,958 (10,331 ) (e) 125,020 Other non-current liabilities 37,594 58,098 8,584 62,844 — 167,120 Total Liabilities 3,790,660 493,082 87,632 1,669,374 (1,644,856 ) 4,395,892 Redeemable non-controlling interests — — — 19,619 587,855 (d) 607,474 Stockholders’ Equity: Common stock 0 — — — — 0 Capital in excess of par 952,825 — — — — 952,825 Retained earnings (accumulated deficit) (100,225 ) 1,441,767 (27,180 ) (4,059 ) (1,410,528 ) (c)(d) (100,225 ) Subsidiary investment — 3,219,700 277,089 454,301 (3,951,090 ) (b)(d) — Total Select Medical Corporation Stockholders’ Equity 852,600 4,661,467 249,909 450,242 (5,361,618 ) 852,600 Non-controlling interests — — — 4,170 108,507 (d) 112,677 Total Equity 852,600 4,661,467 249,909 454,412 (5,253,111 ) 965,277 Total Liabilities and Equity $ 4,643,260 $ 5,154,549 $ 337,541 $ 2,143,405 $ (6,310,112 ) $ 5,968,643 _______________________________________________________________________________ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclassification of equity attributable to non-controlling interests. (e) Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Net operating revenues $ 17 $ 701,764 $ 195,067 $ 356,116 $ — $ 1,252,964 Costs and expenses: Cost of services 726 604,247 162,310 298,530 — 1,065,813 General and administrative 28,807 39 — 2,936 — 31,782 Depreciation and amortization 2,207 19,409 4,008 21,147 — 46,771 Total costs and expenses 31,740 623,695 166,318 322,613 — 1,144,366 Income (loss) from operations (31,723 ) 78,069 28,749 33,503 — 108,598 Other income and expense: Intercompany interest and royalty fees 8,119 (4,146 ) (3,780 ) (193 ) — — Intercompany management fees 60,732 (49,574 ) (11,158 ) — — — Loss on early retirement of debt (2,229 ) — — (8,026 ) — (10,255 ) Equity in earnings of unconsolidated subsidiaries — 4,684 13 — — 4,697 Non-operating gain — 399 — — — 399 Interest expense (31,071 ) (62 ) (156 ) (15,874 ) — (47,163 ) Income before income taxes 3,828 29,370 13,668 9,410 — 56,276 Income tax expense (benefit) 514 11,848 180 (248 ) — 12,294 Equity in earnings of consolidated subsidiaries 30,425 8,267 — — (38,692 ) (a) — Net income 33,739 25,789 13,488 9,658 (38,692 ) 43,982 Less: Net income attributable to non-controlling interests — — 4,666 5,577 — 10,243 Net income attributable to Select Medical Corporation $ 33,739 $ 25,789 $ 8,822 $ 4,081 $ (38,692 ) $ 33,739 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Operating activities Net income $ 33,739 $ 25,789 $ 13,488 $ 9,658 $ (38,692 ) (a) $ 43,982 Adjustments to reconcile net income to net cash provided by operating activities: Distributions from unconsolidated subsidiaries — 1,334 30 — — 1,364 Depreciation and amortization 2,207 19,409 4,008 21,147 — 46,771 Provision for bad debts — 42 — 43 — 85 Equity in earnings of unconsolidated subsidiaries — (4,684 ) (13 ) — — (4,697 ) Equity in earnings of consolidated subsidiaries (30,425 ) (8,267 ) — — 38,692 (a) — Loss on extinguishment of debt 115 — — 297 — 412 Loss (gain) on sale of assets and businesses — (516 ) — 3 — (513 ) Stock compensation expense 4,716 — — 211 — 4,927 Amortization of debt discount, premium and issuance costs 1,837 — — 1,299 — 3,136 Deferred income taxes (503 ) 1,383 (5 ) (797 ) — 78 Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — (28,661 ) (13,414 ) (3,736 ) — (45,811 ) Other current assets (5,890 ) (572 ) 1,304 (3,787 ) — (8,945 ) Other assets 3,788 (562 ) 599 12,808 — 16,633 Accounts payable 731 (3,550 ) (870 ) (2,863 ) — (6,552 ) Accrued expenses (10,370 ) (2,366 ) 434 321 — (11,981 ) Income taxes 6,897 4,513 (111 ) 539 — 11,838 Net cash provided by operating activities 6,842 3,292 5,450 35,143 — 50,727 Investing activities Business combinations, net of cash acquired — (321 ) (22 ) (515,016 ) — (515,359 ) Purchases of property and equipment (2,269 ) (23,851 ) (6,876 ) (6,621 ) — (39,617 ) Investment in businesses — (1,749 ) — (5 ) — (1,754 ) Proceeds from sale of assets and businesses — 691 — — — 691 Net cash used in investing activities (2,269 ) (25,230 ) (6,898 ) (521,642 ) — (556,039 ) Financing activities Borrowings on revolving facilities 165,000 — — — — 165,000 Payments on revolving facilities (150,000 ) — — — — (150,000 ) Proceeds from term loans (financing costs) (11 ) — — 779,915 — 779,904 Payments on term loans (2,875 ) — — — — (2,875 ) Revolving facility debt issuance costs (837 ) — — (496 ) — (1,333 ) Borrowings of other debt 5,549 — 5,326 725 — 11,600 Principal payments on other debt (3,226 ) (145 ) (957 ) (1,581 ) — (5,909 ) Dividends paid to Holdings (122 ) — — — — (122 ) Equity investment by Holdings 738 — — — — 738 Intercompany (10,873 ) 22,729 (2,467 ) (9,389 ) — — Decrease in overdrafts (7,916 ) — — — — (7,916 ) Distributions to non-controlling interests — — (1,266 ) (285,375 ) — (286,641 ) Net cash provided by (used in) financing activities (4,573 ) 22,584 636 483,799 — 502,446 Net increase (decrease) in cash and cash equivalents — 646 (812 ) (2,700 ) — (2,866 ) Cash and cash equivalents at beginning of period 73 4,856 4,561 113,059 — 122,549 Cash and cash equivalents at end of period $ 73 $ 5,502 $ 3,749 $ 110,359 $ — $ 119,683 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Balance Sheet December 31, 2017 Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Assets Current Assets: Cash and cash equivalents $ 73 $ 4,856 $ 4,561 $ 113,059 $ — $ 122,549 Accounts receivable — 445,942 126,279 119,511 — 691,732 Intercompany receivables — 1,595,692 62,990 — (1,658,682 ) (a) — Prepaid income taxes 22,704 5,703 31 2,949 — 31,387 Other current assets 13,021 29,547 13,693 18,897 — 75,158 Total Current Assets 35,798 2,081,740 207,554 254,416 (1,658,682 ) 920,826 Property and equipment, net 39,836 622,445 79,653 170,657 — 912,591 Investment in affiliates 4,521,865 128,319 — — (4,650,184 ) (b)(c) — Goodwill — 2,108,270 — 674,542 — 2,782,812 Identifiable intangible assets, net — 103,913 5,200 217,406 — 326,519 Other assets 36,494 98,492 35,523 23,898 (9,989 ) (e) 184,418 Total Assets $ 4,633,993 $ 5,143,179 $ 327,930 $ 1,340,919 $ (6,318,855 ) $ 5,127,166 Liabilities and Equity Current Liabilities: Overdrafts $ 29,463 $ — $ — $ — $ — $ 29,463 Current portion of long-term debt and notes payable 16,635 740 2,212 2,600 — 22,187 Accounts payable 12,504 85,096 17,868 12,726 — 128,194 Intercompany payables 1,595,692 62,990 — — (1,658,682 ) (a) — Accrued payroll 16,736 98,834 4,872 40,120 — 160,562 Accrued vacation 4,083 58,043 12,607 18,142 — 92,875 Accrued interest 17,479 7 6 2,393 — 19,885 Accrued other 39,219 57,121 12,856 33,970 — 143,166 Income taxes payable — 1,190 142 7,739 — 9,071 Total Current Liabilities 1,731,811 364,021 50,563 117,690 (1,658,682 ) 605,403 Long-term debt, net of current portion 2,042,555 127 24,730 610,303 — 2,677,715 Non-current deferred tax liability — 88,376 780 45,750 (9,989 ) (e) 124,917 Other non-current liabilities 36,259 56,718 8,141 44,591 — 145,709 Total Liabilities 3,810,625 509,242 84,214 818,334 (1,668,671 ) 3,553,744 Redeemable non-controlling interests — — — 16,270 624,548 (d) 640,818 Stockholders’ Equity: Common stock 0 — — — — 0 Capital in excess of par 947,370 — — — — 947,370 Retained earnings (accumulated deficit) (124,002 ) 1,415,978 (33,368 ) 64,626 (1,447,236 ) (c)(d) (124,002 ) Subsidiary investment — 3,217,959 277,084 437,779 (3,932,822 ) (b)(d) — Total Select Medical Corporation Stockholders’ Equity 823,368 4,633,937 243,716 502,405 (5,380,058 ) 823,368 Non-controlling interests — — — 3,910 105,326 (d) 109,236 Total Equity 823,368 4,633,937 243,716 506,315 (5,274,732 ) 932,604 Total Liabilities and Equity $ 4,633,993 $ 5,143,179 $ 327,930 $ 1,340,919 $ (6,318,855 ) $ 5,127,166 _______________________________________________________________________________ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclassification of equity attributable to non-controlling interests. (e) Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2017 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Net operating revenues $ 608 $ 678,415 $ 161,905 $ 250,589 $ — $ 1,091,517 Costs and expenses: Cost of services 532 581,993 138,310 208,303 — 929,138 General and administrative 28,036 39 — — — 28,075 Depreciation and amortization 1,575 21,340 3,501 16,123 — 42,539 Total costs and expenses 30,143 603,372 141,811 224,426 — 999,752 Income (loss) from operations (29,535 ) 75,043 20,094 26,163 — 91,765 Other income and expense: Intercompany interest and royalty fees 8,700 (4,844 ) (3,856 ) — — — Intercompany management fees 61,698 (52,634 ) (9,064 ) — — — Loss on early retirement of debt (19,719 ) — — — — (19,719 ) Equity in earnings of unconsolidated subsidiaries — 5,493 28 — — 5,521 Non-operating loss — (49 ) — — — (49 ) Interest income (expense) (33,404 ) 89 (39 ) (7,499 ) — (40,853 ) Income (loss) before income taxes (12,260 ) 23,098 7,163 18,664 — 36,665 Income tax expense 126 5,936 304 6,836 — 13,202 Equity in earnings of consolidated subsidiaries 28,256 5,575 — — (33,831 ) (a) — Net income 15,870 22,737 6,859 11,828 (33,831 ) 23,463 Less: Net income attributable to non-controlling interests — — 1,069 6,524 — 7,593 Net income attributable to Select Medical Corporation $ 15,870 $ 22,737 $ 5,790 $ 5,304 $ (33,831 ) $ 15,870 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2017 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Operating activities Net income $ 15,870 $ 22,737 $ 6,859 $ 11,828 $ (33,831 ) (a) $ 23,463 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — 4,893 18 — — 4,911 Depreciation and amortization 1,575 21,340 3,501 16,123 — 42,539 Provision for bad debts — 770 — 11 — 781 Equity in earnings of unconsolidated subsidiaries — (5,493 ) (28 ) — — (5,521 ) Equity in earnings of consolidated subsidiaries (28,256 ) (5,575 ) — — 33,831 (a) — Loss on extinguishment of debt 6,527 — — — — 6,527 Loss (gain) on sale of assets and businesses — 62 (4,671 ) — — (4,609 ) Stock compensation expense 4,280 — — 306 — 4,586 Amortization of debt discount, premium and issuance costs 2,590 — — 832 — 3,422 Deferred income taxes 1,005 — — (4,430 ) — (3,425 ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — (83,078 ) (23,563 ) (11,628 ) — (118,269 ) Other current assets (5,761 ) (1,126 ) (1,514 ) 780 — (7,621 ) Other assets (3,753 ) (11,531 ) 15,072 164 — (48 ) Accounts payable 2,574 764 (5,480 ) 2,554 — 412 Accrued expenses (13,406 ) (5,075 ) 5,342 (5,290 ) — (18,429 ) Income taxes 4,256 — — 11,164 — 15,420 Net cash provided by (used in) operating activities (12,499 ) (61,312 ) (4,464 ) 22,414 — (55,861 ) Investing activities Business combinations, net of cash acquired — (445 ) — (9,121 ) — (9,566 ) Purchases of property and equipment (2,937 ) (29,325 ) (9,705 ) (8,686 ) — (50,653 ) Investment in businesses — (500 ) — — — (500 ) Proceeds from sale of assets and businesses — 7 19,505 — — 19,512 Net cash provided by (used in) investing activities (2,937 ) (30,263 ) 9,800 (17,807 ) — (41,207 ) Financing activities Borrowings on revolving facilities 530,000 — — — — 530,000 Payments on revolving facilities (415,000 ) — — — — (415,000 ) Proceeds from term loans 1,139,822 — — — — 1,139,822 Payments on term loans (1,147,752 ) — — (23,065 ) — (1,170,817 ) Revolving facility debt issuance costs (3,887 ) — — — — (3,887 ) Borrowings of other debt 6,571 — — — — 6,571 Principal payments on other debt (3,704 ) (80 ) (695 ) (796 ) — (5,275 ) Dividends paid to Holdings (156 ) — — — — (156 ) Equity investment by Holdings 617 — — — — 617 Intercompany (85,012 ) 92,074 (7,062 ) — — — Decrease in overdrafts (17,062 ) — — — — (17,062 ) Proceeds from issuance of non-controlling interests — — 2,094 — — 2,094 Distributions to non-controlling interests — (50 ) (1,324 ) (2,283 ) — (3,657 ) Net cash provided by (used in) financing activities 4,437 91,944 (6,987 ) (26,144 ) — 63,250 Net increase (decrease) in cash and cash equivalents (10,999 ) 369 (1,651 ) (21,537 ) — (33,818 ) Cash and cash equivalents at beginning of period 11,071 6,467 5,056 76,435 — 99,029 Cash and cash equivalents at end of period $ 72 $ 6,836 $ 3,405 $ 54,898 $ — $ 65,211 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingencies, at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Recent and Recently Adopted Accounting Pronouncements | Recent Accounting Pronouncements Leases In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016‑02, Leases . This ASU includes a lessee accounting model that recognizes two types of leases: finance and operating. This ASU requires that a lessee recognize on the balance sheet assets and liabilities for all leases with lease terms of more than twelve months. Lessees will need to recognize almost all leases on the balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained the dual model, requiring leases to be classified as either operating or finance. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend on its classification as finance or operating lease. For short‑term leases of twelve months or less, lessees are permitted to make an accounting election by class of underlying asset not to recognize right-of-use assets or lease liabilities. If the alternative is elected, lease expense would be recognized generally on the straight‑line basis over the respective lease term. The amendments in ASU 2016-02 will take effect for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted as of the beginning of an interim or annual reporting period. A modified retrospective approach is required for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Upon adoption, the Company will recognize significant assets and liabilities on the consolidated balance sheets as a result of the operating lease obligations of the Company. Operating lease expense will still be recognized as rent expense on a straight‑line basis over the respective lease terms in the consolidated statements of operations. The Company will implement the new standard beginning January 1, 2019. The Company’s implementation efforts are focused on designing accounting processes, disclosure processes, and internal controls in order to account for its leases under the new standard. Recently Adopted Accounting Pronouncements Revenue from Contracts with Customers Beginning in May 2014, the FASB issued several Accounting Standards Updates which established Topic 606, Revenue from Contracts with Customers (the “standard”). This standard supersedes existing revenue recognition requirements and seeks to eliminate most industry-specific guidance under current GAAP. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the new standard on January 1, 2018, using the full retrospective transition method. Adoption of the revenue recognition standard impacted the Company’s reported results as follows: Three Months Ended March 31, 2017 As Reported As Adjusted (1) Adoption Impact (in thousands) Condensed Consolidated Statements of Operations Net operating revenues $ 1,111,361 $ 1,091,517 $ (19,844 ) Bad debt expense 20,625 781 (19,844 ) Condensed Consolidated Statements of Cash Flows Provision for bad debts 20,625 781 (19,844 ) Changes in accounts receivable (138,113 ) (118,269 ) 19,844 _____________________________________________________________ (1) Bad debt expense is now included in cost of services on the condensed consolidated statements of operations. December 31, 2017 As Reported As Adjusted Adoption Impact (in thousands) Condensed Consolidated Balance Sheets Accounts receivable $ 767,276 $ 691,732 $ (75,544 ) Allowance for doubtful accounts 75,544 — (75,544 ) Accounts receivable $ 691,732 $ 691,732 $ — The Company has presented the applicable disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers in Note 7. Income Taxes In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740), and Intra-Entity Transfers of Assets Other Than Inventory. Previous GAAP prohibited the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. The ASU requires an entity to recognize the income tax consequences of an intra‑entity transfer of an asset other than inventory when the transfer occurs. The Company adopted the guidance effective January 1, 2018. Adoption of the guidance did not have a material impact on the Company’s consolidated financial statements. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of effects on financial statement lines for adoption of new standard | The Company adopted the new standard on January 1, 2018, using the full retrospective transition method. Adoption of the revenue recognition standard impacted the Company’s reported results as follows: Three Months Ended March 31, 2017 As Reported As Adjusted (1) Adoption Impact (in thousands) Condensed Consolidated Statements of Operations Net operating revenues $ 1,111,361 $ 1,091,517 $ (19,844 ) Bad debt expense 20,625 781 (19,844 ) Condensed Consolidated Statements of Cash Flows Provision for bad debts 20,625 781 (19,844 ) Changes in accounts receivable (138,113 ) (118,269 ) 19,844 _____________________________________________________________ (1) Bad debt expense is now included in cost of services on the condensed consolidated statements of operations. December 31, 2017 As Reported As Adjusted Adoption Impact (in thousands) Condensed Consolidated Balance Sheets Accounts receivable $ 767,276 $ 691,732 $ (75,544 ) Allowance for doubtful accounts 75,544 — (75,544 ) Accounts receivable $ 691,732 $ 691,732 $ — |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Acquisitions | |
Schedule of pro forma unaudited results of operations | The following pro forma unaudited results of operations have been prepared assuming the acquisition of U.S. HealthWorks occurred on January 1, 2017. These results are not necessarily indicative of results of future operations nor of the results that would have occurred had the acquisition been consummated on the aforementioned date. Three Months Ended March 31, 2017 2018 (in thousands, except per share amounts) Net revenue $ 1,228,484 $ 1,300,544 Net income 17,685 45,677 Net income attributable to the Company 7,827 34,538 Income per common share: Basic $ 0.06 $ 0.26 Diluted $ 0.06 $ 0.26 |
U.S. HealthWorks | |
Acquisitions | |
Schedule of reconciliation of preliminary allocation of fair value to identifiable net assets and goodwill acquired to the consideration given for the acquired business | The following table reconciles the preliminary allocation of estimated fair value to identifiable net assets and goodwill to the consideration given for the acquired business (in thousands): Identifiable tangible assets $ 184,357 Identifiable intangible assets 105,000 Goodwill 535,595 Total assets 824,952 Total liabilities 71,952 Consideration given $ 753,000 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of carrying amount of goodwill | The following table shows changes in the carrying amounts of goodwill by reporting unit for the three months ended March 31, 2018 : Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Total (in thousands) Balance as of December 31, 2017 $ 1,045,220 $ 415,528 $ 647,522 $ 674,542 $ 2,782,812 Acquired — — 345 535,595 535,940 Sold — — (141 ) — (141 ) Balance as of March 31, 2018 $ 1,045,220 $ 415,528 $ 647,726 $ 1,210,137 $ 3,318,611 |
Schedule of carrying value and amortization of identifiable intangible assets | The following table provides the gross carrying amounts, accumulated amortization, and net carrying amounts for the Company’s identifiable intangible assets: December 31, 2017 March 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in thousands) Indefinite-lived intangible assets: Trademarks $ 166,698 $ — $ 166,698 $ 166,698 $ — $ 166,698 Certificates of need 19,155 — 19,155 19,159 — 19,159 Accreditations 1,895 — 1,895 1,895 — 1,895 Finite-lived intangible assets: Trademarks — — — 5,000 (417 ) 4,583 Customer relationships 143,953 (38,281 ) 105,672 243,969 (43,886 ) 200,083 Favorable leasehold interests 13,295 (4,319 ) 8,976 13,279 (4,742 ) 8,537 Non-compete agreements 28,023 (3,900 ) 24,123 28,130 (4,438 ) 23,692 Total identifiable intangible assets $ 373,019 $ (46,500 ) $ 326,519 $ 478,130 $ (53,483 ) $ 424,647 |
Long-Term Debt and Notes Paya22
Long-Term Debt and Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Company's long-term debt and notes payable | As of March 31, 2018 , the Company’s long-term debt and notes payable are as follows (in thousands): Principal Outstanding Unamortized Premium (Discount) Unamortized Issuance Costs Carrying Value Fair Value Select: 6.375% senior notes $ 710,000 $ 721 $ (6,074 ) $ 704,647 $ 720,650 Credit facilities: Revolving facility 245,000 — — 245,000 225,400 Term loans 1,138,500 (11,883 ) (11,946 ) 1,114,671 1,151,308 Other 43,268 — (519 ) 42,749 42,749 Total Select debt 2,136,768 (11,162 ) (18,539 ) 2,107,067 2,140,107 Concentra: Credit facilities: Term loans 1,414,175 (3,498 ) (23,021 ) 1,387,656 1,427,384 Other 5,797 — — 5,797 5,797 Total Concentra debt 1,419,972 (3,498 ) (23,021 ) 1,393,453 1,433,181 Total debt $ 3,556,740 $ (14,660 ) $ (41,560 ) $ 3,500,520 $ 3,573,288 As of December 31, 2017 , the Company’s long-term debt and notes payable are as follows (in thousands): Principal Outstanding Unamortized Premium (Discount) Unamortized Issuance Costs Carrying Value Fair Value Select: 6.375% senior notes $ 710,000 $ 778 $ (6,553 ) $ 704,225 $ 727,750 Credit facilities: Revolving facility 230,000 — — 230,000 211,600 Term loans 1,141,375 (12,445 ) (12,500 ) 1,116,430 1,154,215 Other 36,877 — (533 ) 36,344 36,344 Total Select debt 2,118,252 (11,667 ) (19,586 ) 2,086,999 2,129,909 Concentra: Credit facilities: Term loans 619,175 (2,257 ) (10,668 ) 606,250 625,173 Other 6,653 — — 6,653 6,653 Total Concentra debt 625,828 (2,257 ) (10,668 ) 612,903 631,826 Total debt $ 2,744,080 $ (13,924 ) $ (30,254 ) $ 2,699,902 $ 2,761,735 |
Schedule of principal maturities of the Company's long-term debt and notes payable | Principal maturities of the Company’s long-term debt and notes payable are approximately as follows (in thousands): 2018 2019 2020 2021 2022 Thereafter Total Select: 6.375% senior notes $ — $ — $ — $ 710,000 $ — $ — $ 710,000 Credit facilities: Revolving facility — — — — 245,000 — 245,000 Term loans 8,625 11,500 11,500 11,500 11,500 1,083,875 1,138,500 Other 9,218 3,207 25,285 221 — 5,337 43,268 Total Select debt 17,843 14,707 36,785 721,721 256,500 1,089,212 2,136,768 Concentra: Credit facilities: Term loans — — 5,719 12,365 1,156,091 240,000 1,414,175 Other 1,170 304 322 320 308 3,373 5,797 Total Concentra debt 1,170 304 6,041 12,685 1,156,399 243,373 1,419,972 Total debt $ 19,013 $ 15,011 $ 42,826 $ 734,406 $ 1,412,899 $ 1,332,585 $ 3,556,740 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of selected financial data for the Company's reportable segments | The following tables summarize selected financial data for the Company’s reportable segments. The segment results of Holdings are identical to those of Select. Three Months Ended March 31, 2017 2018 (in thousands) Net operating revenues: (1) Long term acute care $ 445,123 $ 464,676 Inpatient rehabilitation 144,825 174,774 Outpatient rehabilitation 250,371 257,381 Concentra 250,589 356,116 Other 609 17 Total Company $ 1,091,517 $ 1,252,964 Adjusted EBITDA: Long term acute care $ 72,337 $ 72,972 Inpatient rehabilitation 16,328 26,776 Outpatient rehabilitation 31,351 30,525 Concentra 42,592 57,797 Other (23,718 ) (24,838 ) Total Company $ 138,890 $ 163,232 Total assets: Long term acute care $ 1,978,226 $ 1,862,791 Inpatient rehabilitation 643,994 877,750 Outpatient rehabilitation 980,261 973,122 Concentra 1,297,672 2,143,405 Other 102,784 111,575 Total Company $ 5,002,937 $ 5,968,643 Purchases of property and equipment, net: Long term acute care $ 10,943 $ 10,472 Inpatient rehabilitation 21,414 12,917 Outpatient rehabilitation 6,673 7,338 Concentra 8,686 6,621 Other 2,937 2,269 Total Company $ 50,653 $ 39,617 |
Schedule of reconciliation of Adjusted EBITDA to income before income taxes | A reconciliation of Adjusted EBITDA to income before income taxes is as follows: Three Months Ended March 31, 2017 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Other Total (in thousands) Adjusted EBITDA $ 72,337 $ 16,328 $ 31,351 $ 42,592 $ (23,718 ) Depreciation and amortization (13,042 ) (5,458 ) (6,340 ) (16,123 ) (1,576 ) Stock compensation expense — — — (306 ) (4,280 ) Income (loss) from operations $ 59,295 $ 10,870 $ 25,011 $ 26,163 $ (29,574 ) $ 91,765 Loss on early retirement of debt (19,719 ) Equity in earnings of unconsolidated subsidiaries 5,521 Non-operating loss (49 ) Interest expense (40,853 ) Income before income taxes $ 36,665 Three Months Ended March 31, 2018 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra Other Total (in thousands) Adjusted EBITDA $ 72,972 $ 26,776 $ 30,525 $ 57,797 $ (24,838 ) Depreciation and amortization (11,058 ) (5,722 ) (6,637 ) (21,147 ) (2,207 ) Stock compensation expense — — — (211 ) (4,716 ) U.S. HealthWorks acquisition costs — — — (2,936 ) — Income (loss) from operations $ 61,914 $ 21,054 $ 23,888 $ 33,503 $ (31,761 ) $ 108,598 Loss on early retirement of debt (10,255 ) Equity in earnings of unconsolidated subsidiaries 4,697 Non-operating gain 399 Interest expense (47,163 ) Income before income taxes $ 56,276 _______________________________________________________________________________ (1) Net operating revenues were retrospectively conformed to reflect the adoption Topic 606, Revenue from Contracts with Customers. |
Revenue from Contracts with C24
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Net Operating Revenues by Operating Segment | The following tables disaggregate the Company’s net operating revenues by operating segment for the three months ended March 31, 2017 and 2018 : Three Months Ended March 31, 2017 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra (in thousands) Patient service revenues: Medicare $ 236,437 $ 57,504 $ 36,698 $ 545 Non-Medicare 206,625 47,243 183,803 247,801 Total patient services revenues 443,062 104,747 220,501 248,346 Other revenues 2,061 40,078 29,870 2,243 Total net operating revenues $ 445,123 $ 144,825 $ 250,371 $ 250,589 Three Months Ended March 31, 2018 Long Term Acute Care Inpatient Rehabilitation Outpatient Rehabilitation Concentra (in thousands) Patient service revenues: Medicare $ 240,992 $ 72,841 $ 38,190 $ 628 Non-Medicare 220,006 61,902 188,900 353,252 Total patient services revenues 460,998 134,743 227,090 353,880 Other revenues 3,678 40,031 30,291 2,236 Total net operating revenues $ 464,676 $ 174,774 $ 257,381 $ 356,116 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of reconciliations of the statutory federal income tax rate to the effective income tax rate | Reconciliations of the statutory federal income tax rate to the effective income tax rate are as follows: Three Months Ended March 31, 2017 2018 Federal income tax at statutory rate 35.0 % 21.0 % State and local income taxes, less federal income tax benefit 3.9 4.7 Permanent differences 0.8 1.5 Valuation allowance (0.7 ) 0.8 Uncertain tax positions 0.2 0.3 Non-controlling interest (2.4 ) (2.7 ) Stock-based compensation (0.7 ) (5.4 ) Other (0.1 ) 1.6 Total effective income tax rate 36.0 % 21.8 % |
Income per Common Share (Tables
Income per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted earnings per share | The following table sets forth the calculation of income per share in Holdings’ condensed consolidated statements of operations and the differences between basic weighted average shares outstanding and diluted weighted average shares outstanding used to compute basic and diluted earnings per share, respectively. Three Months Ended March 31, 2017 2018 (in thousands, except per share amounts) Numerator: Net income attributable to Select Medical Holdings Corporation $ 15,870 $ 33,739 Less: Earnings allocated to unvested restricted stockholders 507 1,111 Net income available to common stockholders $ 15,363 $ 32,628 Denominator: Weighted average shares—basic 128,464 129,691 Effect of dilutive securities: Stock options 164 125 Weighted average shares—diluted 128,628 129,816 Basic income per common share: $ 0.12 $ 0.25 Diluted income per common share: $ 0.12 $ 0.25 |
Condensed Consolidating Finan27
Condensed Consolidating Financial Information (Tables) - Select Medical Corporation | 3 Months Ended |
Mar. 31, 2018 | |
Condensed Financial Statements, Captions [Line Items] | |
Schedule of Condensed Consolidating Balance Sheet | Select Medical Corporation Condensed Consolidating Balance Sheet March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Assets Current Assets: Cash and cash equivalents $ 73 $ 5,502 $ 3,749 $ 110,359 $ — $ 119,683 Accounts receivable — 474,559 139,693 192,139 — 806,391 Intercompany receivables — 1,575,611 58,914 — (1,634,525 ) (a) — Prepaid income taxes 18,382 — — 2,888 — 21,270 Other current assets 18,732 30,119 12,389 32,757 — 93,997 Total Current Assets 37,187 2,085,791 214,745 338,143 (1,634,525 ) 1,041,341 Property and equipment, net 37,668 622,253 82,697 230,865 — 973,483 Investment in affiliates 4,534,700 130,556 — — (4,665,256 ) (b)(c) — Goodwill — 2,108,474 — 1,210,137 — 3,318,611 Identifiable intangible assets, net 3 103,335 5,192 316,117 — 424,647 Other assets 33,702 104,140 34,907 48,143 (10,331 ) (e) 210,561 Total Assets $ 4,643,260 $ 5,154,549 $ 337,541 $ 2,143,405 $ (6,310,112 ) $ 5,968,643 Liabilities and Equity Current Liabilities: Overdrafts $ 21,547 $ — $ — $ — $ — $ 21,547 Current portion of long-term debt and notes payable 19,372 623 1,298 1,206 — 22,499 Accounts payable 13,235 81,563 16,998 26,640 — 138,436 Intercompany payables 1,575,611 58,914 — — (1,634,525 ) (a) — Accrued payroll 5,248 81,902 2,338 46,073 — 135,561 Accrued vacation 4,368 60,577 13,363 27,017 — 105,325 Accrued interest 16,594 7 13 11,974 — 28,588 Accrued other 39,010 61,671 14,262 48,198 — 163,141 Income taxes payable 2,417 — — 8,217 — 10,634 Total Current Liabilities 1,697,402 345,257 48,272 169,325 (1,634,525 ) 625,731 Long-term debt, net of current portion 2,055,664 108 30,002 1,392,247 — 3,478,021 Non-current deferred tax liability — 89,619 774 44,958 (10,331 ) (e) 125,020 Other non-current liabilities 37,594 58,098 8,584 62,844 — 167,120 Total Liabilities 3,790,660 493,082 87,632 1,669,374 (1,644,856 ) 4,395,892 Redeemable non-controlling interests — — — 19,619 587,855 (d) 607,474 Stockholders’ Equity: Common stock 0 — — — — 0 Capital in excess of par 952,825 — — — — 952,825 Retained earnings (accumulated deficit) (100,225 ) 1,441,767 (27,180 ) (4,059 ) (1,410,528 ) (c)(d) (100,225 ) Subsidiary investment — 3,219,700 277,089 454,301 (3,951,090 ) (b)(d) — Total Select Medical Corporation Stockholders’ Equity 852,600 4,661,467 249,909 450,242 (5,361,618 ) 852,600 Non-controlling interests — — — 4,170 108,507 (d) 112,677 Total Equity 852,600 4,661,467 249,909 454,412 (5,253,111 ) 965,277 Total Liabilities and Equity $ 4,643,260 $ 5,154,549 $ 337,541 $ 2,143,405 $ (6,310,112 ) $ 5,968,643 _______________________________________________________________________________ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclassification of equity attributable to non-controlling interests. (e) Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. Select Medical Corporation Condensed Consolidating Balance Sheet December 31, 2017 Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Assets Current Assets: Cash and cash equivalents $ 73 $ 4,856 $ 4,561 $ 113,059 $ — $ 122,549 Accounts receivable — 445,942 126,279 119,511 — 691,732 Intercompany receivables — 1,595,692 62,990 — (1,658,682 ) (a) — Prepaid income taxes 22,704 5,703 31 2,949 — 31,387 Other current assets 13,021 29,547 13,693 18,897 — 75,158 Total Current Assets 35,798 2,081,740 207,554 254,416 (1,658,682 ) 920,826 Property and equipment, net 39,836 622,445 79,653 170,657 — 912,591 Investment in affiliates 4,521,865 128,319 — — (4,650,184 ) (b)(c) — Goodwill — 2,108,270 — 674,542 — 2,782,812 Identifiable intangible assets, net — 103,913 5,200 217,406 — 326,519 Other assets 36,494 98,492 35,523 23,898 (9,989 ) (e) 184,418 Total Assets $ 4,633,993 $ 5,143,179 $ 327,930 $ 1,340,919 $ (6,318,855 ) $ 5,127,166 Liabilities and Equity Current Liabilities: Overdrafts $ 29,463 $ — $ — $ — $ — $ 29,463 Current portion of long-term debt and notes payable 16,635 740 2,212 2,600 — 22,187 Accounts payable 12,504 85,096 17,868 12,726 — 128,194 Intercompany payables 1,595,692 62,990 — — (1,658,682 ) (a) — Accrued payroll 16,736 98,834 4,872 40,120 — 160,562 Accrued vacation 4,083 58,043 12,607 18,142 — 92,875 Accrued interest 17,479 7 6 2,393 — 19,885 Accrued other 39,219 57,121 12,856 33,970 — 143,166 Income taxes payable — 1,190 142 7,739 — 9,071 Total Current Liabilities 1,731,811 364,021 50,563 117,690 (1,658,682 ) 605,403 Long-term debt, net of current portion 2,042,555 127 24,730 610,303 — 2,677,715 Non-current deferred tax liability — 88,376 780 45,750 (9,989 ) (e) 124,917 Other non-current liabilities 36,259 56,718 8,141 44,591 — 145,709 Total Liabilities 3,810,625 509,242 84,214 818,334 (1,668,671 ) 3,553,744 Redeemable non-controlling interests — — — 16,270 624,548 (d) 640,818 Stockholders’ Equity: Common stock 0 — — — — 0 Capital in excess of par 947,370 — — — — 947,370 Retained earnings (accumulated deficit) (124,002 ) 1,415,978 (33,368 ) 64,626 (1,447,236 ) (c)(d) (124,002 ) Subsidiary investment — 3,217,959 277,084 437,779 (3,932,822 ) (b)(d) — Total Select Medical Corporation Stockholders’ Equity 823,368 4,633,937 243,716 502,405 (5,380,058 ) 823,368 Non-controlling interests — — — 3,910 105,326 (d) 109,236 Total Equity 823,368 4,633,937 243,716 506,315 (5,274,732 ) 932,604 Total Liabilities and Equity $ 4,633,993 $ 5,143,179 $ 327,930 $ 1,340,919 $ (6,318,855 ) $ 5,127,166 _______________________________________________________________________________ (a) Elimination of intercompany balances. (b) Elimination of investments in consolidated subsidiaries. (c) Elimination of investments in consolidated subsidiaries’ earnings. (d) Reclassification of equity attributable to non-controlling interests. (e) Reclassification of non-current deferred tax asset to report net non-current deferred tax liability in consolidation. |
Schedule of Condensed Consolidating Statement of Operations | Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Net operating revenues $ 17 $ 701,764 $ 195,067 $ 356,116 $ — $ 1,252,964 Costs and expenses: Cost of services 726 604,247 162,310 298,530 — 1,065,813 General and administrative 28,807 39 — 2,936 — 31,782 Depreciation and amortization 2,207 19,409 4,008 21,147 — 46,771 Total costs and expenses 31,740 623,695 166,318 322,613 — 1,144,366 Income (loss) from operations (31,723 ) 78,069 28,749 33,503 — 108,598 Other income and expense: Intercompany interest and royalty fees 8,119 (4,146 ) (3,780 ) (193 ) — — Intercompany management fees 60,732 (49,574 ) (11,158 ) — — — Loss on early retirement of debt (2,229 ) — — (8,026 ) — (10,255 ) Equity in earnings of unconsolidated subsidiaries — 4,684 13 — — 4,697 Non-operating gain — 399 — — — 399 Interest expense (31,071 ) (62 ) (156 ) (15,874 ) — (47,163 ) Income before income taxes 3,828 29,370 13,668 9,410 — 56,276 Income tax expense (benefit) 514 11,848 180 (248 ) — 12,294 Equity in earnings of consolidated subsidiaries 30,425 8,267 — — (38,692 ) (a) — Net income 33,739 25,789 13,488 9,658 (38,692 ) 43,982 Less: Net income attributable to non-controlling interests — — 4,666 5,577 — 10,243 Net income attributable to Select Medical Corporation $ 33,739 $ 25,789 $ 8,822 $ 4,081 $ (38,692 ) $ 33,739 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2017 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Net operating revenues $ 608 $ 678,415 $ 161,905 $ 250,589 $ — $ 1,091,517 Costs and expenses: Cost of services 532 581,993 138,310 208,303 — 929,138 General and administrative 28,036 39 — — — 28,075 Depreciation and amortization 1,575 21,340 3,501 16,123 — 42,539 Total costs and expenses 30,143 603,372 141,811 224,426 — 999,752 Income (loss) from operations (29,535 ) 75,043 20,094 26,163 — 91,765 Other income and expense: Intercompany interest and royalty fees 8,700 (4,844 ) (3,856 ) — — — Intercompany management fees 61,698 (52,634 ) (9,064 ) — — — Loss on early retirement of debt (19,719 ) — — — — (19,719 ) Equity in earnings of unconsolidated subsidiaries — 5,493 28 — — 5,521 Non-operating loss — (49 ) — — — (49 ) Interest income (expense) (33,404 ) 89 (39 ) (7,499 ) — (40,853 ) Income (loss) before income taxes (12,260 ) 23,098 7,163 18,664 — 36,665 Income tax expense 126 5,936 304 6,836 — 13,202 Equity in earnings of consolidated subsidiaries 28,256 5,575 — — (33,831 ) (a) — Net income 15,870 22,737 6,859 11,828 (33,831 ) 23,463 Less: Net income attributable to non-controlling interests — — 1,069 6,524 — 7,593 Net income attributable to Select Medical Corporation $ 15,870 $ 22,737 $ 5,790 $ 5,304 $ (33,831 ) $ 15,870 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. |
Schedule of Condensed Consolidating Statement of Cash Flows | Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2018 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Operating activities Net income $ 33,739 $ 25,789 $ 13,488 $ 9,658 $ (38,692 ) (a) $ 43,982 Adjustments to reconcile net income to net cash provided by operating activities: Distributions from unconsolidated subsidiaries — 1,334 30 — — 1,364 Depreciation and amortization 2,207 19,409 4,008 21,147 — 46,771 Provision for bad debts — 42 — 43 — 85 Equity in earnings of unconsolidated subsidiaries — (4,684 ) (13 ) — — (4,697 ) Equity in earnings of consolidated subsidiaries (30,425 ) (8,267 ) — — 38,692 (a) — Loss on extinguishment of debt 115 — — 297 — 412 Loss (gain) on sale of assets and businesses — (516 ) — 3 — (513 ) Stock compensation expense 4,716 — — 211 — 4,927 Amortization of debt discount, premium and issuance costs 1,837 — — 1,299 — 3,136 Deferred income taxes (503 ) 1,383 (5 ) (797 ) — 78 Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — (28,661 ) (13,414 ) (3,736 ) — (45,811 ) Other current assets (5,890 ) (572 ) 1,304 (3,787 ) — (8,945 ) Other assets 3,788 (562 ) 599 12,808 — 16,633 Accounts payable 731 (3,550 ) (870 ) (2,863 ) — (6,552 ) Accrued expenses (10,370 ) (2,366 ) 434 321 — (11,981 ) Income taxes 6,897 4,513 (111 ) 539 — 11,838 Net cash provided by operating activities 6,842 3,292 5,450 35,143 — 50,727 Investing activities Business combinations, net of cash acquired — (321 ) (22 ) (515,016 ) — (515,359 ) Purchases of property and equipment (2,269 ) (23,851 ) (6,876 ) (6,621 ) — (39,617 ) Investment in businesses — (1,749 ) — (5 ) — (1,754 ) Proceeds from sale of assets and businesses — 691 — — — 691 Net cash used in investing activities (2,269 ) (25,230 ) (6,898 ) (521,642 ) — (556,039 ) Financing activities Borrowings on revolving facilities 165,000 — — — — 165,000 Payments on revolving facilities (150,000 ) — — — — (150,000 ) Proceeds from term loans (financing costs) (11 ) — — 779,915 — 779,904 Payments on term loans (2,875 ) — — — — (2,875 ) Revolving facility debt issuance costs (837 ) — — (496 ) — (1,333 ) Borrowings of other debt 5,549 — 5,326 725 — 11,600 Principal payments on other debt (3,226 ) (145 ) (957 ) (1,581 ) — (5,909 ) Dividends paid to Holdings (122 ) — — — — (122 ) Equity investment by Holdings 738 — — — — 738 Intercompany (10,873 ) 22,729 (2,467 ) (9,389 ) — — Decrease in overdrafts (7,916 ) — — — — (7,916 ) Distributions to non-controlling interests — — (1,266 ) (285,375 ) — (286,641 ) Net cash provided by (used in) financing activities (4,573 ) 22,584 636 483,799 — 502,446 Net increase (decrease) in cash and cash equivalents — 646 (812 ) (2,700 ) — (2,866 ) Cash and cash equivalents at beginning of period 73 4,856 4,561 113,059 — 122,549 Cash and cash equivalents at end of period $ 73 $ 5,502 $ 3,749 $ 110,359 $ — $ 119,683 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. Select Medical Corporation Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2017 (unaudited) Select (Parent Company Only) Subsidiary Guarantors Non-Guarantor Subsidiaries Non-Guarantor Concentra Consolidating and Eliminating Adjustments Consolidated Select Medical Corporation (in thousands) Operating activities Net income $ 15,870 $ 22,737 $ 6,859 $ 11,828 $ (33,831 ) (a) $ 23,463 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Distributions from unconsolidated subsidiaries — 4,893 18 — — 4,911 Depreciation and amortization 1,575 21,340 3,501 16,123 — 42,539 Provision for bad debts — 770 — 11 — 781 Equity in earnings of unconsolidated subsidiaries — (5,493 ) (28 ) — — (5,521 ) Equity in earnings of consolidated subsidiaries (28,256 ) (5,575 ) — — 33,831 (a) — Loss on extinguishment of debt 6,527 — — — — 6,527 Loss (gain) on sale of assets and businesses — 62 (4,671 ) — — (4,609 ) Stock compensation expense 4,280 — — 306 — 4,586 Amortization of debt discount, premium and issuance costs 2,590 — — 832 — 3,422 Deferred income taxes 1,005 — — (4,430 ) — (3,425 ) Changes in operating assets and liabilities, net of effects of business combinations: Accounts receivable — (83,078 ) (23,563 ) (11,628 ) — (118,269 ) Other current assets (5,761 ) (1,126 ) (1,514 ) 780 — (7,621 ) Other assets (3,753 ) (11,531 ) 15,072 164 — (48 ) Accounts payable 2,574 764 (5,480 ) 2,554 — 412 Accrued expenses (13,406 ) (5,075 ) 5,342 (5,290 ) — (18,429 ) Income taxes 4,256 — — 11,164 — 15,420 Net cash provided by (used in) operating activities (12,499 ) (61,312 ) (4,464 ) 22,414 — (55,861 ) Investing activities Business combinations, net of cash acquired — (445 ) — (9,121 ) — (9,566 ) Purchases of property and equipment (2,937 ) (29,325 ) (9,705 ) (8,686 ) — (50,653 ) Investment in businesses — (500 ) — — — (500 ) Proceeds from sale of assets and businesses — 7 19,505 — — 19,512 Net cash provided by (used in) investing activities (2,937 ) (30,263 ) 9,800 (17,807 ) — (41,207 ) Financing activities Borrowings on revolving facilities 530,000 — — — — 530,000 Payments on revolving facilities (415,000 ) — — — — (415,000 ) Proceeds from term loans 1,139,822 — — — — 1,139,822 Payments on term loans (1,147,752 ) — — (23,065 ) — (1,170,817 ) Revolving facility debt issuance costs (3,887 ) — — — — (3,887 ) Borrowings of other debt 6,571 — — — — 6,571 Principal payments on other debt (3,704 ) (80 ) (695 ) (796 ) — (5,275 ) Dividends paid to Holdings (156 ) — — — — (156 ) Equity investment by Holdings 617 — — — — 617 Intercompany (85,012 ) 92,074 (7,062 ) — — — Decrease in overdrafts (17,062 ) — — — — (17,062 ) Proceeds from issuance of non-controlling interests — — 2,094 — — 2,094 Distributions to non-controlling interests — (50 ) (1,324 ) (2,283 ) — (3,657 ) Net cash provided by (used in) financing activities 4,437 91,944 (6,987 ) (26,144 ) — 63,250 Net increase (decrease) in cash and cash equivalents (10,999 ) 369 (1,651 ) (21,537 ) — (33,818 ) Cash and cash equivalents at beginning of period 11,071 6,467 5,056 76,435 — 99,029 Cash and cash equivalents at end of period $ 72 $ 6,836 $ 3,405 $ 54,898 $ — $ 65,211 _______________________________________________________________________________ (a) Elimination of equity in earnings of consolidated subsidiaries. |
Accounting Policies (Details)
Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net operating revenues | $ 1,252,964 | $ 1,091,517 | |
Provision for bad debts | 85 | 781 | |
Changes in accounts receivable | (45,811) | (118,269) | |
Accounts receivable | $ 691,732 | ||
Allowance for doubtful accounts | 0 | ||
Accounts receivable | $ 806,391 | 691,732 | |
As Reported | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net operating revenues | 1,111,361 | ||
Provision for bad debts | 20,625 | ||
Changes in accounts receivable | (138,113) | ||
Accounts receivable | 767,276 | ||
Allowance for doubtful accounts | 75,544 | ||
Accounts receivable | 691,732 | ||
Accounting Standards Update 2014-09 | Adoption Impact | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net operating revenues | (19,844) | ||
Provision for bad debts | (19,844) | ||
Changes in accounts receivable | $ 19,844 | ||
Accounts receivable | (75,544) | ||
Allowance for doubtful accounts | (75,544) | ||
Accounts receivable | $ 0 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Thousands | Feb. 01, 2018 | Mar. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Acquisitions | |||||
Non-cash equity exchange for acquisition of U.S. HealthWorks | $ 238,000 | $ 238,000 | $ 0 | ||
Consideration given and net cash paid for identifiable net assets and goodwill acquired | |||||
Goodwill | 3,318,611 | 3,318,611 | $ 2,782,812 | ||
U.S. HealthWorks | |||||
Acquisitions | |||||
U.S. HealthWorks acquisition costs | $ 2,900 | ||||
Total consideration (net of cash acquired) | $ 753,000 | ||||
Estimated value of goodwill, deductible for tax purposes | 83,100 | ||||
Net revenues of acquiree | $ 89,900 | ||||
Consideration given and net cash paid for identifiable net assets and goodwill acquired | |||||
Identifiable tangible assets | 184,357 | ||||
Identifiable intangible assets | 105,000 | ||||
Goodwill | 535,595 | ||||
Total assets | 824,952 | ||||
Total liabilities | 71,952 | ||||
Consideration given | $ 753,000 | ||||
Concentra Group Holdings Parent, LLC | U.S. HealthWorks | |||||
Acquisitions | |||||
Equity interest issued (percent) | 20.00% | ||||
Non-cash equity exchange for acquisition of U.S. HealthWorks | $ 238,000 |
Acquisitions - Proforma Results
Acquisitions - Proforma Results and Other Acquisitions (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Pro Forma | ||
Pro forma results of operations | ||
Net revenue | $ 1,300,544 | $ 1,228,484 |
Net income | 45,677 | 17,685 |
Net income attributable to the Company | $ 34,538 | $ 7,827 |
Basic income per common share (in dollars per share) | $ 0.26 | $ 0.06 |
Diluted income per common share (in dollars per share) | $ 0.26 | $ 0.06 |
U.S. HealthWorks | ||
Acquisition costs | ||
U.S. HealthWorks acquisition costs | $ 2,900 | |
U.S. HealthWorks | Pro Forma | ||
Acquisition costs | ||
U.S. HealthWorks acquisition costs | $ (2,900) | $ 5,800 |
Intangible Assets - Carrying Am
Intangible Assets - Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Goodwill | |
December 31, 2017 | $ 2,782,812 |
Acquired | 535,940 |
Sold | (141) |
March 31, 2018 | 3,318,611 |
Long Term Acute Care | |
Goodwill | |
December 31, 2017 | 1,045,220 |
Acquired | 0 |
Sold | 0 |
March 31, 2018 | 1,045,220 |
Inpatient Rehabilitation | |
Goodwill | |
December 31, 2017 | 415,528 |
Acquired | 0 |
Sold | 0 |
March 31, 2018 | 415,528 |
Outpatient Rehabilitation | |
Goodwill | |
December 31, 2017 | 647,522 |
Acquired | 345 |
Sold | (141) |
March 31, 2018 | 647,726 |
Concentra | |
Goodwill | |
December 31, 2017 | 674,542 |
Acquired | 535,595 |
Sold | 0 |
March 31, 2018 | $ 1,210,137 |
Intangible Assets - Carrying Va
Intangible Assets - Carrying Value and Amortization of Identifiable Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Total identifiable intangible assets, Gross Carrying Amount | $ 478,130 | $ 373,019 | |
Accumulated Amortization | (53,483) | (46,500) | |
Total identifiable intangible assets, Net (Excluding Goodwill), Total | 424,647 | 326,519 | |
Trademarks | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 5,000 | 0 | |
Accumulated Amortization | (417) | 0 | |
Net Carrying Amount | 4,583 | 0 | |
Customer relationships | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 243,969 | 143,953 | |
Accumulated Amortization | (43,886) | (38,281) | |
Net Carrying Amount | 200,083 | 105,672 | |
Favorable leasehold interests | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 13,279 | 13,295 | |
Accumulated Amortization | (4,742) | (4,319) | |
Net Carrying Amount | 8,537 | 8,976 | |
Non-compete agreements | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount | 28,130 | 28,023 | |
Accumulated Amortization | (4,438) | (3,900) | |
Net Carrying Amount | 23,692 | 24,123 | |
Customer relationships, non-compete agreements, and U.S. Health Works trademarks | |||
Amortized intangible assets: | |||
Amortization expense | 6,400 | $ 4,400 | |
Trademarks | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Carrying amount | $ 166,698 | 166,698 | |
Amortized intangible assets: | |||
Weighted average time until next renewal | 8 years 6 months 145 days | ||
Certificates of need | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Carrying amount | $ 19,159 | 19,155 | |
Accreditations | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Carrying amount | $ 1,895 | $ 1,895 | |
Amortized intangible assets: | |||
Weighted average time until next renewal | 1 year 6 months |
Long-Term Debt and Notes Paya33
Long-Term Debt and Notes Payable - Components of Long-Term Debt And Notes Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Long-term debt and notes payable | ||
Principal Outstanding | $ 3,556,740 | $ 2,744,080 |
Unamortized Premium (Discount) | (14,660) | (13,924) |
Unamortized Issuance Costs | (41,560) | (30,254) |
Carrying Value | 3,500,520 | 2,699,902 |
Fair Value | 3,573,288 | 2,761,735 |
Select Excluding Concentra | ||
Long-term debt and notes payable | ||
Principal Outstanding | 2,136,768 | 2,118,252 |
Unamortized Premium (Discount) | (11,162) | (11,667) |
Unamortized Issuance Costs | (18,539) | (19,586) |
Carrying Value | 2,107,067 | 2,086,999 |
Fair Value | $ 2,140,107 | $ 2,129,909 |
Select Excluding Concentra | Senior notes | 6.375% Senior Notes Due June 2021 | ||
Long-term debt and notes payable | ||
Interest rate of debt (as a percent) | 6.375% | 6.375% |
Principal Outstanding | $ 710,000 | $ 710,000 |
Unamortized Premium (Discount) | 721 | 778 |
Unamortized Issuance Costs | (6,074) | (6,553) |
Carrying Value | 704,647 | 704,225 |
Fair Value | 720,650 | 727,750 |
Select Excluding Concentra | Other | ||
Long-term debt and notes payable | ||
Principal Outstanding | 43,268 | 36,877 |
Unamortized Premium (Discount) | 0 | 0 |
Unamortized Issuance Costs | (519) | (533) |
Carrying Value | 42,749 | 36,344 |
Fair Value | 42,749 | 36,344 |
Select Excluding Concentra | Revolving facility | Credit facility | ||
Long-term debt and notes payable | ||
Principal Outstanding | 245,000 | 230,000 |
Unamortized Premium (Discount) | 0 | 0 |
Unamortized Issuance Costs | 0 | 0 |
Carrying Value | 245,000 | 230,000 |
Fair Value | 225,400 | 211,600 |
Select Excluding Concentra | Term loan | Credit facility | ||
Long-term debt and notes payable | ||
Principal Outstanding | 1,138,500 | 1,141,375 |
Unamortized Premium (Discount) | (11,883) | (12,445) |
Unamortized Issuance Costs | (11,946) | (12,500) |
Carrying Value | 1,114,671 | 1,116,430 |
Fair Value | 1,151,308 | 1,154,215 |
Concentra Inc | ||
Long-term debt and notes payable | ||
Principal Outstanding | 1,419,972 | 625,828 |
Unamortized Premium (Discount) | (3,498) | (2,257) |
Unamortized Issuance Costs | (23,021) | (10,668) |
Carrying Value | 1,393,453 | 612,903 |
Fair Value | 1,433,181 | 631,826 |
Concentra Inc | Other | ||
Long-term debt and notes payable | ||
Principal Outstanding | 5,797 | 6,653 |
Unamortized Premium (Discount) | 0 | 0 |
Unamortized Issuance Costs | 0 | 0 |
Carrying Value | 5,797 | 6,653 |
Fair Value | 5,797 | 6,653 |
Concentra Inc | Term loan | Credit facility | ||
Long-term debt and notes payable | ||
Principal Outstanding | 1,414,175 | 619,175 |
Unamortized Premium (Discount) | (3,498) | (2,257) |
Unamortized Issuance Costs | (23,021) | (10,668) |
Carrying Value | 1,387,656 | 606,250 |
Fair Value | $ 1,427,384 | $ 625,173 |
Long-Term Debt and Notes Paya34
Long-Term Debt and Notes Payable - Principal Maturities Of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Long-term debt and notes payable | ||
2,018 | $ 19,013 | |
2,019 | 15,011 | |
2,020 | 42,826 | |
2,021 | 734,406 | |
2,022 | 1,412,899 | |
Thereafter | 1,332,585 | |
Total | 3,556,740 | $ 2,744,080 |
Select Excluding Concentra | ||
Long-term debt and notes payable | ||
2,018 | 17,843 | |
2,019 | 14,707 | |
2,020 | 36,785 | |
2,021 | 721,721 | |
2,022 | 256,500 | |
Thereafter | 1,089,212 | |
Total | 2,136,768 | 2,118,252 |
Select Excluding Concentra | Credit facility | Revolving facility | ||
Long-term debt and notes payable | ||
2,018 | 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 245,000 | |
Thereafter | 0 | |
Total | 245,000 | 230,000 |
Select Excluding Concentra | Credit facility | Term loan | ||
Long-term debt and notes payable | ||
2,018 | 8,625 | |
2,019 | 11,500 | |
2,020 | 11,500 | |
2,021 | 11,500 | |
2,022 | 11,500 | |
Thereafter | 1,083,875 | |
Total | $ 1,138,500 | $ 1,141,375 |
Select Excluding Concentra | Senior notes | 6.375% Senior Notes Due June 2021 | ||
Long-term debt and notes payable | ||
Interest rate of debt (as a percent) | 6.375% | 6.375% |
2,018 | $ 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 710,000 | |
2,022 | 0 | |
Thereafter | 0 | |
Total | 710,000 | $ 710,000 |
Select Excluding Concentra | Other | ||
Long-term debt and notes payable | ||
2,018 | 9,218 | |
2,019 | 3,207 | |
2,020 | 25,285 | |
2,021 | 221 | |
2,022 | 0 | |
Thereafter | 5,337 | |
Total | 43,268 | 36,877 |
Concentra Inc | ||
Long-term debt and notes payable | ||
2,018 | 1,170 | |
2,019 | 304 | |
2,020 | 6,041 | |
2,021 | 12,685 | |
2,022 | 1,156,399 | |
Thereafter | 243,373 | |
Total | 1,419,972 | 625,828 |
Concentra Inc | Credit facility | Term loan | ||
Long-term debt and notes payable | ||
2,018 | 0 | |
2,019 | 0 | |
2,020 | 5,719 | |
2,021 | 12,365 | |
2,022 | 1,156,091 | |
Thereafter | 240,000 | |
Total | 1,414,175 | 619,175 |
Concentra Inc | Other | ||
Long-term debt and notes payable | ||
2,018 | 1,170 | |
2,019 | 304 | |
2,020 | 322 | |
2,021 | 320 | |
2,022 | 308 | |
Thereafter | 3,373 | |
Total | $ 5,797 | $ 6,653 |
Long-Term Debt and Notes Paya35
Long-Term Debt and Notes Payable - Select Credit Facilities (Details) - Select Excluding Concentra - Credit facility - USD ($) | Mar. 22, 2018 | Mar. 06, 2017 |
2017 Select Credit Facilities | ||
Long-term debt and notes payable | ||
Current borrowing capacity | $ 1,600,000,000 | |
Term loan | 2017 Select Credit Facilities | ||
Long-term debt and notes payable | ||
Aggregate principal amount | $ 1,150,000,000 | |
Term loan | 2017 Select Credit Facilities | Adjusted LIBO | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 3.50% | |
Term loan | 2017 Select Credit Facilities | Adjusted LIBO Rate floor | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 1.00% | |
Term loan | 2017 Select Credit Facilities | Alternate Base Rate | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.50% | |
Term loan | 2017 Select Credit Facilities | Alternate Base Rate floor | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.00% | |
Term loan | 2017 Select Credit Facilities Amendment | Adjusted LIBO | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.50% | |
Term loan | 2017 Select Credit Facilities Amendment | Adjusted LIBO | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.75% | |
Term loan | 2017 Select Credit Facilities Amendment | Alternate Base Rate | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 1.50% | |
Term loan | 2017 Select Credit Facilities Amendment | Alternate Base Rate | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 1.75% | |
Revolving facility | 2017 Select Credit Facilities | ||
Long-term debt and notes payable | ||
Current borrowing capacity | $ 450,000,000 | |
Revolving facility | 2017 Select Credit Facilities | Adjusted LIBO | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 3.00% | |
Revolving facility | 2017 Select Credit Facilities | Adjusted LIBO | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 3.25% | |
Revolving facility | 2017 Select Credit Facilities | Alternate Base Rate | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.00% | |
Revolving facility | 2017 Select Credit Facilities | Alternate Base Rate | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.25% | |
Revolving facility | 2017 Select Credit Facilities Amendment | Adjusted LIBO | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.50% | |
Revolving facility | 2017 Select Credit Facilities Amendment | Adjusted LIBO | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 2.75% | |
Revolving facility | 2017 Select Credit Facilities Amendment | Alternate Base Rate | Minimum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 1.50% | |
Revolving facility | 2017 Select Credit Facilities Amendment | Alternate Base Rate | Maximum | ||
Long-term debt and notes payable | ||
Interest rate margin (as a percent) | 1.75% | |
Letter of credit | 2017 Select Credit Facilities | ||
Long-term debt and notes payable | ||
Current borrowing capacity | $ 75,000,000 |
Long-Term Debt and Notes Paya36
Long-Term Debt and Notes Payable - Concentra Credit Facilities (Details) - Credit facility - Concentra Inc - USD ($) | Feb. 01, 2018 | Jun. 01, 2015 |
Revolving facility | ||
Line of Credit Facility [Line Items] | ||
Additional borrowing capacity | $ 25,000,000 | |
Maximum borrowing capacity | $ 50,000,000 | |
Debt instrument term (in years) | 5 years | |
Term loan | ||
Line of Credit Facility [Line Items] | ||
Additional borrowing capacity | $ 555,000,000 | |
Adjusted LIBO | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 2.75% | |
Adjusted LIBO Rate floor | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 1.00% | |
Alternate Base Rate | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 1.75% | |
Alternate Base Rate floor | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 2.00% | |
Concentra second lien term agreement | ||
Line of Credit Facility [Line Items] | ||
Percentage of net cash proceeds received from non-ordinary course asset sales or other dispositions, or as a result of a casualty or condemnation to be used for prepayment of debt | 100.00% | |
Percentage of net proceeds received from the issuance of debt obligations other than certain permitted debt obligations to be used for prepayment of debt | 100.00% | |
Voting capital stock of domestic subsidiaries pledged (as a percent) | 65.00% | |
Non-voting capital stock of foreign subsidiaries pledged (as a percent) | 100.00% | |
Concentra second lien term agreement | Term loan | ||
Line of Credit Facility [Line Items] | ||
Aggregate principal amount | $ 240,000,000 | |
Concentra second lien term agreement | On or prior to February 1, 2019 | Term loan | ||
Line of Credit Facility [Line Items] | ||
Prepayment premium rate | 2.00% | |
Concentra second lien term agreement | On or prior to February 1, 2020 | Term loan | ||
Line of Credit Facility [Line Items] | ||
Prepayment premium rate | 1.00% | |
Concentra second lien term agreement | Adjusted LIBO | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 6.50% | |
Concentra second lien term agreement | Adjusted LIBO Rate floor | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 1.00% | |
Concentra second lien term agreement | Alternate Base Rate | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 5.50% | |
Concentra second lien term agreement | Alternate Base Rate floor | Term loan | ||
Line of Credit Facility [Line Items] | ||
Interest rate margin (as a percent) | 2.00% | |
Concentra second lien term agreement | Leverage ratio greater than 4.25 to 1.00 | ||
Line of Credit Facility [Line Items] | ||
Percentage of excess cash flow to be used for prepayment of debt | 50.00% | |
Leverage ratio of financial maintenance covenant | 4.25 | |
Concentra second lien term agreement | Less than or equal to 4.25 to 1.00 and greater than 3.75 to 1.00 | ||
Line of Credit Facility [Line Items] | ||
Percentage of excess cash flow to be used for prepayment of debt | 25.00% | |
Concentra second lien term agreement | Leverage ratio less than or equal to 3.75 to 1.00 | ||
Line of Credit Facility [Line Items] | ||
Leverage ratio of financial maintenance covenant | 3.75 | |
Concentra second lien term agreement | Maximum | Less than or equal to 4.25 to 1.00 and greater than 3.75 to 1.00 | ||
Line of Credit Facility [Line Items] | ||
Leverage ratio of financial maintenance covenant | 4.25 | |
Concentra second lien term agreement | Minimum | Less than or equal to 4.25 to 1.00 and greater than 3.75 to 1.00 | ||
Line of Credit Facility [Line Items] | ||
Leverage ratio of financial maintenance covenant | 3.75 |
Long-Term Debt and Notes Paya37
Long-Term Debt and Notes Payable - Loss on Early Retirement of Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Line of Credit Facility [Line Items] | ||
Loss on early retirement of debt | $ 10,255 | $ 19,719 |
Credit facility | ||
Line of Credit Facility [Line Items] | ||
Loss on early retirement of debt | 10,300 | |
Loss on early retirement of debt, write off deferred debt issuance cost | 400 | |
Loss on early retirement of debt, debt modification losses | $ 9,900 |
Long-Term Debt and Notes Paya38
Long-Term Debt and Notes Payable - Fair Value (Details) | Mar. 31, 2018 | Dec. 31, 2017 |
Select Excluding Concentra | Senior notes | 6.375% Senior Notes Due June 2021 | ||
Long-term debt and notes payable | ||
Interest rate of debt (as a percent) | 6.375% | 6.375% |
Segment Information - Selected
Segment Information - Selected Financial Data (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Segment information | |||
Net operating revenues | $ 1,252,964 | $ 1,091,517 | |
Adjusted EBITDA | 163,232 | 138,890 | |
Total assets | 5,968,643 | 5,002,937 | $ 5,127,166 |
Purchases of property and equipment, net | 39,617 | 50,653 | |
Operating Segments | Long Term Acute Care | |||
Segment information | |||
Net operating revenues | 464,676 | 445,123 | |
Adjusted EBITDA | 72,972 | 72,337 | |
Total assets | 1,862,791 | 1,978,226 | |
Purchases of property and equipment, net | 10,472 | 10,943 | |
Operating Segments | Inpatient Rehabilitation | |||
Segment information | |||
Net operating revenues | 174,774 | 144,825 | |
Adjusted EBITDA | 26,776 | 16,328 | |
Total assets | 877,750 | 643,994 | |
Purchases of property and equipment, net | 12,917 | 21,414 | |
Operating Segments | Outpatient Rehabilitation | |||
Segment information | |||
Net operating revenues | 257,381 | 250,371 | |
Adjusted EBITDA | 30,525 | 31,351 | |
Total assets | 973,122 | 980,261 | |
Purchases of property and equipment, net | 7,338 | 6,673 | |
Operating Segments | Concentra | |||
Segment information | |||
Net operating revenues | 356,116 | 250,589 | |
Adjusted EBITDA | 57,797 | 42,592 | |
Total assets | 2,143,405 | 1,297,672 | |
Purchases of property and equipment, net | 6,621 | 8,686 | |
Other | |||
Segment information | |||
Net operating revenues | 17 | 609 | |
Adjusted EBITDA | (24,838) | (23,718) | |
Total assets | 111,575 | 102,784 | |
Purchases of property and equipment, net | $ 2,269 | $ 2,937 |
Segment Information - Reconcili
Segment Information - Reconciliation of Adjusted EBITDA to Income Before Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Segment information | ||
Adjusted EBITDA | $ 163,232 | $ 138,890 |
Depreciation and amortization | (46,771) | (42,539) |
Income (loss) from operations | 108,598 | 91,765 |
Loss on early retirement of debt | (10,255) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 4,697 | 5,521 |
Non-operating gain (loss) | 399 | (49) |
Interest expense | (47,163) | (40,853) |
Income (loss) before income taxes | 56,276 | 36,665 |
Operating Segments | Long Term Acute Care | ||
Segment information | ||
Adjusted EBITDA | 72,972 | 72,337 |
Depreciation and amortization | (11,058) | (13,042) |
Stock compensation expense | 0 | 0 |
U.S. HealthWorks acquisition costs | 0 | |
Income (loss) from operations | 61,914 | 59,295 |
Operating Segments | Inpatient Rehabilitation | ||
Segment information | ||
Adjusted EBITDA | 26,776 | 16,328 |
Depreciation and amortization | (5,722) | (5,458) |
Stock compensation expense | 0 | 0 |
U.S. HealthWorks acquisition costs | 0 | |
Income (loss) from operations | 21,054 | 10,870 |
Operating Segments | Outpatient Rehabilitation | ||
Segment information | ||
Adjusted EBITDA | 30,525 | 31,351 |
Depreciation and amortization | (6,637) | (6,340) |
Stock compensation expense | 0 | 0 |
U.S. HealthWorks acquisition costs | 0 | |
Income (loss) from operations | 23,888 | 25,011 |
Operating Segments | Concentra | ||
Segment information | ||
Adjusted EBITDA | 57,797 | 42,592 |
Depreciation and amortization | (21,147) | (16,123) |
Stock compensation expense | (211) | (306) |
U.S. HealthWorks acquisition costs | (2,936) | |
Income (loss) from operations | 33,503 | 26,163 |
Other | ||
Segment information | ||
Adjusted EBITDA | (24,838) | (23,718) |
Depreciation and amortization | (2,207) | (1,576) |
Stock compensation expense | (4,716) | (4,280) |
U.S. HealthWorks acquisition costs | 0 | |
Income (loss) from operations | $ (31,761) | $ (29,574) |
Revenue from Contracts with C41
Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Long Term Acute Care | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | $ 464,676 | $ 445,123 |
Long Term Acute Care | Patient services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 460,998 | 443,062 |
Long Term Acute Care | Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 240,992 | 236,437 |
Long Term Acute Care | Non-Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 220,006 | 206,625 |
Long Term Acute Care | Other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 3,678 | 2,061 |
Inpatient Rehabilitation | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 174,774 | 144,825 |
Inpatient Rehabilitation | Patient services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 134,743 | 104,747 |
Inpatient Rehabilitation | Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 72,841 | 57,504 |
Inpatient Rehabilitation | Non-Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 61,902 | 47,243 |
Inpatient Rehabilitation | Other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 40,031 | 40,078 |
Outpatient Rehabilitation | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 257,381 | 250,371 |
Outpatient Rehabilitation | Patient services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 227,090 | 220,501 |
Outpatient Rehabilitation | Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 38,190 | 36,698 |
Outpatient Rehabilitation | Non-Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 188,900 | 183,803 |
Outpatient Rehabilitation | Other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 30,291 | 29,870 |
Concentra | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 356,116 | 250,589 |
Concentra | Patient services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 353,880 | 248,346 |
Concentra | Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 628 | 545 |
Concentra | Non-Medicare | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | 353,252 | 247,801 |
Concentra | Other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total net operating revenues | $ 2,236 | $ 2,243 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal income tax at statutory rate | 21.00% | 35.00% |
State and local income taxes, less federal income tax benefit | 4.70% | 3.90% |
Permanent differences | 1.50% | 0.80% |
Valuation allowance | 0.80% | (0.70%) |
Uncertain tax positions | 0.30% | 0.20% |
Non-controlling interest | (2.70%) | (2.40%) |
Stock-based compensation | (5.40%) | (0.70%) |
Other | 1.60% | (0.10%) |
Total effective income tax rate | 21.80% | 36.00% |
Income per Common Share (Detail
Income per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Numerator: | ||
Net income attributable to Select Medical Holdings Corporation | $ 33,739 | $ 15,870 |
Less: Earnings allocated to unvested restricted stockholders | 1,111 | 507 |
Net income available to common stockholders | $ 32,628 | $ 15,363 |
Denominator: | ||
Weighted average shares—basic (in shares) | 129,691 | 128,464 |
Effect of dilutive securities: Stock options (in shares) | 125 | 164 |
Weighted average shares—diluted (in shares) | 129,816 | 128,628 |
Income per common share | ||
Basic income per common share: (in dollars per share) | $ 0.25 | $ 0.12 |
Diluted income per common share: (in dollars per share) | $ 0.25 | $ 0.12 |
Commitments and Contingencies -
Commitments and Contingencies - Litigation (Details) $ in Millions | Oct. 19, 2015hospital | Jul. 13, 2015hospital | Mar. 31, 2018USD ($) |
Select, SSH-Knoxville, and SSH-North Knoxville | |||
Commitments and Contingencies | |||
Number of current or former employees named as defendants | hospital | 10 | ||
Professional liability claims | |||
Commitments and Contingencies | |||
Self insurance retention limit | $ 35 | ||
Amended complaint | SSH-Evansville | |||
Commitments and Contingencies | |||
Number of case managers identified as plaintiff | hospital | 2 | ||
Minimum | Joint Venture Operations | Professional liability claims | |||
Commitments and Contingencies | |||
Self insurance retention limit | 5 | ||
Maximum | Joint Venture Operations | Professional liability claims | |||
Commitments and Contingencies | |||
Self insurance retention limit | $ 20 |
Condensed Consolidating Finan45
Condensed Consolidating Financial Information (Details) | Mar. 31, 2018 |
Senior notes | Select Medical Corporation | |
Condensed Consolidating Financial Information | |
Interest rate of debt (as a percent) | 6.375% |
Condensed Consolidating Finan46
Condensed Consolidating Financial Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||||
Cash and cash equivalents | $ 119,683 | $ 122,549 | $ 65,211 | $ 99,029 |
Accounts receivable | 806,391 | 691,732 | ||
Prepaid income taxes | 21,270 | 31,387 | ||
Other current assets | 93,997 | 75,158 | ||
Total Current Assets | 1,041,341 | 920,826 | ||
Property and equipment, net | 973,483 | 912,591 | ||
Goodwill | 3,318,611 | 2,782,812 | ||
Identifiable intangible assets, net | 424,647 | 326,519 | ||
Other assets | 210,561 | 184,418 | ||
Total Assets | 5,968,643 | 5,127,166 | 5,002,937 | |
Current Liabilities: | ||||
Overdrafts | 21,547 | 29,463 | ||
Current portion of long-term debt and notes payable | 22,499 | 22,187 | ||
Accounts payable | 138,436 | 128,194 | ||
Accrued payroll | 135,561 | 160,562 | ||
Accrued vacation | 105,325 | 92,875 | ||
Accrued interest | 28,588 | 19,885 | ||
Accrued other | 163,141 | 143,166 | ||
Income taxes payable | 10,634 | 9,071 | ||
Total Current Liabilities | 625,731 | 605,403 | ||
Long-term debt, net of current portion | 3,478,021 | 2,677,715 | ||
Non-current deferred tax liability | 125,020 | 124,917 | ||
Other non-current liabilities | 167,120 | 145,709 | ||
Total Liabilities | 4,395,892 | 3,553,744 | ||
Redeemable non-controlling interests | 607,474 | 640,818 | ||
Stockholders’ Equity: | ||||
Common stock | 134 | 134 | ||
Capital in excess of par | 468,885 | 463,499 | ||
Retained earnings (accumulated deficit) | 383,581 | 359,735 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 852,600 | 823,368 | ||
Non-controlling interests | 112,677 | 109,236 | ||
Total Equity | 965,277 | 932,604 | ||
Total Liabilities and Equity | 5,968,643 | 5,127,166 | ||
Consolidating and Eliminating Adjustments | ||||
Current Assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable | 0 | 0 | ||
Intercompany receivables | (1,634,525) | (1,658,682) | ||
Prepaid income taxes | 0 | 0 | ||
Other current assets | 0 | 0 | ||
Total Current Assets | (1,634,525) | (1,658,682) | ||
Property and equipment, net | 0 | 0 | ||
Investment in affiliates | (4,665,256) | (4,650,184) | ||
Goodwill | 0 | 0 | ||
Identifiable intangible assets, net | 0 | 0 | ||
Other assets | (10,331) | (9,989) | ||
Total Assets | (6,310,112) | (6,318,855) | ||
Current Liabilities: | ||||
Overdrafts | 0 | 0 | ||
Current portion of long-term debt and notes payable | 0 | 0 | ||
Accounts payable | 0 | 0 | ||
Intercompany payables | (1,634,525) | (1,658,682) | ||
Accrued payroll | 0 | 0 | ||
Accrued vacation | 0 | 0 | ||
Accrued interest | 0 | 0 | ||
Accrued other | 0 | 0 | ||
Income taxes payable | 0 | 0 | ||
Total Current Liabilities | (1,634,525) | (1,658,682) | ||
Long-term debt, net of current portion | 0 | 0 | ||
Non-current deferred tax liability | (10,331) | (9,989) | ||
Other non-current liabilities | 0 | 0 | ||
Total Liabilities | (1,644,856) | (1,668,671) | ||
Redeemable non-controlling interests | 587,855 | 624,548 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 0 | 0 | ||
Retained earnings (accumulated deficit) | (1,410,528) | (1,447,236) | ||
Subsidiary investment | (3,951,090) | (3,932,822) | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | (5,361,618) | (5,380,058) | ||
Non-controlling interests | 108,507 | 105,326 | ||
Total Equity | (5,253,111) | (5,274,732) | ||
Total Liabilities and Equity | (6,310,112) | (6,318,855) | ||
Select (Parent Company Only) | Reportable legal entities | ||||
Current Assets: | ||||
Cash and cash equivalents | 73 | 73 | 72 | 11,071 |
Accounts receivable | 0 | 0 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid income taxes | 18,382 | 22,704 | ||
Other current assets | 18,732 | 13,021 | ||
Total Current Assets | 37,187 | 35,798 | ||
Property and equipment, net | 37,668 | 39,836 | ||
Investment in affiliates | 4,534,700 | 4,521,865 | ||
Goodwill | 0 | 0 | ||
Identifiable intangible assets, net | 3 | 0 | ||
Other assets | 33,702 | 36,494 | ||
Total Assets | 4,643,260 | 4,633,993 | ||
Current Liabilities: | ||||
Overdrafts | 21,547 | 29,463 | ||
Current portion of long-term debt and notes payable | 19,372 | 16,635 | ||
Accounts payable | 13,235 | 12,504 | ||
Intercompany payables | 1,575,611 | 1,595,692 | ||
Accrued payroll | 5,248 | 16,736 | ||
Accrued vacation | 4,368 | 4,083 | ||
Accrued interest | 16,594 | 17,479 | ||
Accrued other | 39,010 | 39,219 | ||
Income taxes payable | 2,417 | 0 | ||
Total Current Liabilities | 1,697,402 | 1,731,811 | ||
Long-term debt, net of current portion | 2,055,664 | 2,042,555 | ||
Non-current deferred tax liability | 0 | 0 | ||
Other non-current liabilities | 37,594 | 36,259 | ||
Total Liabilities | 3,790,660 | 3,810,625 | ||
Redeemable non-controlling interests | 0 | 0 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 952,825 | 947,370 | ||
Retained earnings (accumulated deficit) | (100,225) | (124,002) | ||
Subsidiary investment | 0 | 0 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 852,600 | 823,368 | ||
Non-controlling interests | 0 | 0 | ||
Total Equity | 852,600 | 823,368 | ||
Total Liabilities and Equity | 4,643,260 | 4,633,993 | ||
Subsidiary Guarantors | Reportable legal entities | ||||
Current Assets: | ||||
Cash and cash equivalents | 5,502 | 4,856 | 6,836 | 6,467 |
Accounts receivable | 474,559 | 445,942 | ||
Intercompany receivables | 1,575,611 | 1,595,692 | ||
Prepaid income taxes | 0 | 5,703 | ||
Other current assets | 30,119 | 29,547 | ||
Total Current Assets | 2,085,791 | 2,081,740 | ||
Property and equipment, net | 622,253 | 622,445 | ||
Investment in affiliates | 130,556 | 128,319 | ||
Goodwill | 2,108,474 | 2,108,270 | ||
Identifiable intangible assets, net | 103,335 | 103,913 | ||
Other assets | 104,140 | 98,492 | ||
Total Assets | 5,154,549 | 5,143,179 | ||
Current Liabilities: | ||||
Overdrafts | 0 | 0 | ||
Current portion of long-term debt and notes payable | 623 | 740 | ||
Accounts payable | 81,563 | 85,096 | ||
Intercompany payables | 58,914 | 62,990 | ||
Accrued payroll | 81,902 | 98,834 | ||
Accrued vacation | 60,577 | 58,043 | ||
Accrued interest | 7 | 7 | ||
Accrued other | 61,671 | 57,121 | ||
Income taxes payable | 0 | 1,190 | ||
Total Current Liabilities | 345,257 | 364,021 | ||
Long-term debt, net of current portion | 108 | 127 | ||
Non-current deferred tax liability | 89,619 | 88,376 | ||
Other non-current liabilities | 58,098 | 56,718 | ||
Total Liabilities | 493,082 | 509,242 | ||
Redeemable non-controlling interests | 0 | 0 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 0 | 0 | ||
Retained earnings (accumulated deficit) | 1,441,767 | 1,415,978 | ||
Subsidiary investment | 3,219,700 | 3,217,959 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 4,661,467 | 4,633,937 | ||
Non-controlling interests | 0 | 0 | ||
Total Equity | 4,661,467 | 4,633,937 | ||
Total Liabilities and Equity | 5,154,549 | 5,143,179 | ||
Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Current Assets: | ||||
Cash and cash equivalents | 3,749 | 4,561 | 3,405 | 5,056 |
Accounts receivable | 139,693 | 126,279 | ||
Intercompany receivables | 58,914 | 62,990 | ||
Prepaid income taxes | 0 | 31 | ||
Other current assets | 12,389 | 13,693 | ||
Total Current Assets | 214,745 | 207,554 | ||
Property and equipment, net | 82,697 | 79,653 | ||
Investment in affiliates | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Identifiable intangible assets, net | 5,192 | 5,200 | ||
Other assets | 34,907 | 35,523 | ||
Total Assets | 337,541 | 327,930 | ||
Current Liabilities: | ||||
Overdrafts | 0 | 0 | ||
Current portion of long-term debt and notes payable | 1,298 | 2,212 | ||
Accounts payable | 16,998 | 17,868 | ||
Intercompany payables | 0 | 0 | ||
Accrued payroll | 2,338 | 4,872 | ||
Accrued vacation | 13,363 | 12,607 | ||
Accrued interest | 13 | 6 | ||
Accrued other | 14,262 | 12,856 | ||
Income taxes payable | 0 | 142 | ||
Total Current Liabilities | 48,272 | 50,563 | ||
Long-term debt, net of current portion | 30,002 | 24,730 | ||
Non-current deferred tax liability | 774 | 780 | ||
Other non-current liabilities | 8,584 | 8,141 | ||
Total Liabilities | 87,632 | 84,214 | ||
Redeemable non-controlling interests | 0 | 0 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 0 | 0 | ||
Retained earnings (accumulated deficit) | (27,180) | (33,368) | ||
Subsidiary investment | 277,089 | 277,084 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 249,909 | 243,716 | ||
Non-controlling interests | 0 | 0 | ||
Total Equity | 249,909 | 243,716 | ||
Total Liabilities and Equity | 337,541 | 327,930 | ||
Non-Guarantor Concentra | Reportable legal entities | ||||
Current Assets: | ||||
Cash and cash equivalents | 110,359 | 113,059 | 54,898 | 76,435 |
Accounts receivable | 192,139 | 119,511 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid income taxes | 2,888 | 2,949 | ||
Other current assets | 32,757 | 18,897 | ||
Total Current Assets | 338,143 | 254,416 | ||
Property and equipment, net | 230,865 | 170,657 | ||
Investment in affiliates | 0 | 0 | ||
Goodwill | 1,210,137 | 674,542 | ||
Identifiable intangible assets, net | 316,117 | 217,406 | ||
Other assets | 48,143 | 23,898 | ||
Total Assets | 2,143,405 | 1,340,919 | ||
Current Liabilities: | ||||
Overdrafts | 0 | 0 | ||
Current portion of long-term debt and notes payable | 1,206 | 2,600 | ||
Accounts payable | 26,640 | 12,726 | ||
Intercompany payables | 0 | 0 | ||
Accrued payroll | 46,073 | 40,120 | ||
Accrued vacation | 27,017 | 18,142 | ||
Accrued interest | 11,974 | 2,393 | ||
Accrued other | 48,198 | 33,970 | ||
Income taxes payable | 8,217 | 7,739 | ||
Total Current Liabilities | 169,325 | 117,690 | ||
Long-term debt, net of current portion | 1,392,247 | 610,303 | ||
Non-current deferred tax liability | 44,958 | 45,750 | ||
Other non-current liabilities | 62,844 | 44,591 | ||
Total Liabilities | 1,669,374 | 818,334 | ||
Redeemable non-controlling interests | 19,619 | 16,270 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 0 | 0 | ||
Retained earnings (accumulated deficit) | (4,059) | 64,626 | ||
Subsidiary investment | 454,301 | 437,779 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 450,242 | 502,405 | ||
Non-controlling interests | 4,170 | 3,910 | ||
Total Equity | 454,412 | 506,315 | ||
Total Liabilities and Equity | 2,143,405 | 1,340,919 | ||
Select Medical Corporation | ||||
Current Assets: | ||||
Cash and cash equivalents | 119,683 | 122,549 | $ 65,211 | $ 99,029 |
Accounts receivable | 806,391 | 691,732 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid income taxes | 21,270 | 31,387 | ||
Other current assets | 93,997 | 75,158 | ||
Total Current Assets | 1,041,341 | 920,826 | ||
Property and equipment, net | 973,483 | 912,591 | ||
Investment in affiliates | 0 | 0 | ||
Goodwill | 3,318,611 | 2,782,812 | ||
Identifiable intangible assets, net | 424,647 | 326,519 | ||
Other assets | 210,561 | 184,418 | ||
Total Assets | 5,968,643 | 5,127,166 | ||
Current Liabilities: | ||||
Overdrafts | 21,547 | 29,463 | ||
Current portion of long-term debt and notes payable | 22,499 | 22,187 | ||
Accounts payable | 138,436 | 128,194 | ||
Intercompany payables | 0 | 0 | ||
Accrued payroll | 135,561 | 160,562 | ||
Accrued vacation | 105,325 | 92,875 | ||
Accrued interest | 28,588 | 19,885 | ||
Accrued other | 163,141 | 143,166 | ||
Income taxes payable | 10,634 | 9,071 | ||
Total Current Liabilities | 625,731 | 605,403 | ||
Long-term debt, net of current portion | 3,478,021 | 2,677,715 | ||
Non-current deferred tax liability | 125,020 | 124,917 | ||
Other non-current liabilities | 167,120 | 145,709 | ||
Total Liabilities | 4,395,892 | 3,553,744 | ||
Redeemable non-controlling interests | 607,474 | 640,818 | ||
Stockholders’ Equity: | ||||
Common stock | 0 | 0 | ||
Capital in excess of par | 952,825 | 947,370 | ||
Retained earnings (accumulated deficit) | (100,225) | (124,002) | ||
Subsidiary investment | 0 | 0 | ||
Total Select Medical Holdings Corporation and Select Medical Corporation Stockholders’ Equity | 852,600 | 823,368 | ||
Non-controlling interests | 112,677 | 109,236 | ||
Total Equity | 965,277 | 932,604 | ||
Total Liabilities and Equity | $ 5,968,643 | $ 5,127,166 |
Condensed Consolidating Finan47
Condensed Consolidating Financial Information - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | $ 1,252,964 | $ 1,091,517 |
Costs and expenses: | ||
Cost of services | 1,065,813 | 929,138 |
General and administrative | 31,782 | 28,075 |
Depreciation and amortization | 46,771 | 42,539 |
Total costs and expenses | 1,144,366 | 999,752 |
Income (loss) from operations | 108,598 | 91,765 |
Other income and expense: | ||
Loss on early retirement of debt | (10,255) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 4,697 | 5,521 |
Non-operating gain (loss) | 399 | (49) |
Interest income (expense) | (47,163) | (40,853) |
Income (loss) before income taxes | 56,276 | 36,665 |
Income tax expense (benefit) | 12,294 | 13,202 |
Net income | 43,982 | 23,463 |
Less: Net income attributable to non-controlling interests | 10,243 | 7,593 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | 33,739 | 15,870 |
Consolidating and Eliminating Adjustments | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 0 | 0 |
Costs and expenses: | ||
Cost of services | 0 | 0 |
General and administrative | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Total costs and expenses | 0 | 0 |
Income (loss) from operations | 0 | 0 |
Other income and expense: | ||
Intercompany interest and royalty fees | 0 | 0 |
Intercompany management fees | 0 | 0 |
Loss on early retirement of debt | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Non-operating gain (loss) | 0 | 0 |
Interest income (expense) | 0 | 0 |
Income (loss) before income taxes | 0 | 0 |
Income tax expense (benefit) | 0 | 0 |
Equity in earnings (losses) of consolidated subsidiaries | (38,692) | (33,831) |
Net income | (38,692) | (33,831) |
Less: Net income attributable to non-controlling interests | 0 | 0 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | (38,692) | (33,831) |
Select (Parent Company Only) | Reportable legal entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 17 | 608 |
Costs and expenses: | ||
Cost of services | 726 | 532 |
General and administrative | 28,807 | 28,036 |
Depreciation and amortization | 2,207 | 1,575 |
Total costs and expenses | 31,740 | 30,143 |
Income (loss) from operations | (31,723) | (29,535) |
Other income and expense: | ||
Intercompany interest and royalty fees | 8,119 | 8,700 |
Intercompany management fees | 60,732 | 61,698 |
Loss on early retirement of debt | (2,229) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Non-operating gain (loss) | 0 | 0 |
Interest income (expense) | (31,071) | (33,404) |
Income (loss) before income taxes | 3,828 | (12,260) |
Income tax expense (benefit) | 514 | 126 |
Equity in earnings (losses) of consolidated subsidiaries | 30,425 | 28,256 |
Net income | 33,739 | 15,870 |
Less: Net income attributable to non-controlling interests | 0 | 0 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | 33,739 | 15,870 |
Subsidiary Guarantors | Reportable legal entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 701,764 | 678,415 |
Costs and expenses: | ||
Cost of services | 604,247 | 581,993 |
General and administrative | 39 | 39 |
Depreciation and amortization | 19,409 | 21,340 |
Total costs and expenses | 623,695 | 603,372 |
Income (loss) from operations | 78,069 | 75,043 |
Other income and expense: | ||
Intercompany interest and royalty fees | (4,146) | (4,844) |
Intercompany management fees | (49,574) | (52,634) |
Loss on early retirement of debt | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | 4,684 | 5,493 |
Non-operating gain (loss) | 399 | (49) |
Interest income (expense) | (62) | 89 |
Income (loss) before income taxes | 29,370 | 23,098 |
Income tax expense (benefit) | 11,848 | 5,936 |
Equity in earnings (losses) of consolidated subsidiaries | 8,267 | 5,575 |
Net income | 25,789 | 22,737 |
Less: Net income attributable to non-controlling interests | 0 | 0 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | 25,789 | 22,737 |
Non-Guarantor Subsidiaries | Reportable legal entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 195,067 | 161,905 |
Costs and expenses: | ||
Cost of services | 162,310 | 138,310 |
General and administrative | 0 | 0 |
Depreciation and amortization | 4,008 | 3,501 |
Total costs and expenses | 166,318 | 141,811 |
Income (loss) from operations | 28,749 | 20,094 |
Other income and expense: | ||
Intercompany interest and royalty fees | (3,780) | (3,856) |
Intercompany management fees | (11,158) | (9,064) |
Loss on early retirement of debt | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | 13 | 28 |
Non-operating gain (loss) | 0 | 0 |
Interest income (expense) | (156) | (39) |
Income (loss) before income taxes | 13,668 | 7,163 |
Income tax expense (benefit) | 180 | 304 |
Equity in earnings (losses) of consolidated subsidiaries | 0 | 0 |
Net income | 13,488 | 6,859 |
Less: Net income attributable to non-controlling interests | 4,666 | 1,069 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | 8,822 | 5,790 |
Non-Guarantor Concentra | Reportable legal entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 356,116 | 250,589 |
Costs and expenses: | ||
Cost of services | 298,530 | 208,303 |
General and administrative | 2,936 | 0 |
Depreciation and amortization | 21,147 | 16,123 |
Total costs and expenses | 322,613 | 224,426 |
Income (loss) from operations | 33,503 | 26,163 |
Other income and expense: | ||
Intercompany interest and royalty fees | (193) | 0 |
Intercompany management fees | 0 | 0 |
Loss on early retirement of debt | (8,026) | 0 |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Non-operating gain (loss) | 0 | 0 |
Interest income (expense) | (15,874) | (7,499) |
Income (loss) before income taxes | 9,410 | 18,664 |
Income tax expense (benefit) | (248) | 6,836 |
Equity in earnings (losses) of consolidated subsidiaries | 0 | 0 |
Net income | 9,658 | 11,828 |
Less: Net income attributable to non-controlling interests | 5,577 | 6,524 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | 4,081 | 5,304 |
Select Medical Corporation | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 1,252,964 | 1,091,517 |
Costs and expenses: | ||
Cost of services | 1,065,813 | 929,138 |
General and administrative | 31,782 | 28,075 |
Depreciation and amortization | 46,771 | 42,539 |
Total costs and expenses | 1,144,366 | 999,752 |
Income (loss) from operations | 108,598 | 91,765 |
Other income and expense: | ||
Intercompany interest and royalty fees | 0 | 0 |
Intercompany management fees | 0 | 0 |
Loss on early retirement of debt | (10,255) | (19,719) |
Equity in earnings of unconsolidated subsidiaries | 4,697 | 5,521 |
Non-operating gain (loss) | 399 | (49) |
Interest income (expense) | (47,163) | (40,853) |
Income (loss) before income taxes | 56,276 | 36,665 |
Income tax expense (benefit) | 12,294 | 13,202 |
Equity in earnings (losses) of consolidated subsidiaries | 0 | 0 |
Net income | 43,982 | 23,463 |
Less: Net income attributable to non-controlling interests | 10,243 | 7,593 |
Net income attributable to Select Medical Holdings Corporation and Select Medical Corporation | $ 33,739 | $ 15,870 |
Condensed Consolidating Finan48
Condensed Consolidating Financial Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities | ||
Net income | $ 43,982 | $ 23,463 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 1,364 | 4,911 |
Depreciation and amortization | 46,771 | 42,539 |
Provision for bad debts | 85 | 781 |
Equity in earnings of unconsolidated subsidiaries | (4,697) | (5,521) |
Loss on extinguishment of debt | 412 | 6,527 |
Loss (gain) on sale of assets and businesses | (513) | (4,609) |
Stock compensation expense | 4,927 | 4,586 |
Amortization of debt discount, premium and issuance costs | 3,136 | 3,422 |
Deferred income taxes | 78 | (3,425) |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (45,811) | (118,269) |
Other current assets | (8,945) | (7,621) |
Other assets | 16,633 | (48) |
Accounts payable | (6,552) | 412 |
Accrued expenses | (11,981) | (18,429) |
Income taxes | 11,838 | 15,420 |
Net cash provided by (used in) operating activities | 50,727 | (55,861) |
Investing activities | ||
Business combinations, net of cash acquired | (515,359) | (9,566) |
Purchases of property and equipment | (39,617) | (50,653) |
Investment in businesses | (1,754) | (500) |
Proceeds from sale of assets and businesses | 691 | 19,512 |
Net cash provided by (used in) investing activities | (556,039) | (41,207) |
Financing activities | ||
Borrowings on revolving facilities | 165,000 | 530,000 |
Payments on revolving facilities | (150,000) | (415,000) |
Proceeds from term loans (financing costs) | 779,904 | 1,139,822 |
Payments on term loans | (2,875) | (1,170,817) |
Revolving facility debt issuance costs | (1,333) | (3,887) |
Borrowings of other debt | 11,600 | 6,571 |
Principal payments on other debt | (5,909) | (5,275) |
Dividends paid to Holdings | 0 | 0 |
Equity investment by Holdings | 0 | 0 |
Decrease in overdrafts | (7,916) | (17,062) |
Proceeds from issuance of non-controlling interests | 0 | 2,094 |
Distributions to non-controlling interests | (286,641) | (3,657) |
Net cash provided by (used in) financing activities | 502,446 | 63,250 |
Net increase (decrease) in cash and cash equivalents | (2,866) | (33,818) |
Cash and cash equivalents at beginning of period | 122,549 | 99,029 |
Cash and cash equivalents at end of period | 119,683 | 65,211 |
Consolidating and Eliminating Adjustments | ||
Operating activities | ||
Net income | (38,692) | (33,831) |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Provision for bad debts | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Equity in earnings of consolidated subsidiaries | 38,692 | 33,831 |
Loss on extinguishment of debt | 0 | 0 |
Loss (gain) on sale of assets and businesses | 0 | 0 |
Stock compensation expense | 0 | 0 |
Amortization of debt discount, premium and issuance costs | 0 | 0 |
Deferred income taxes | 0 | 0 |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | 0 | 0 |
Other current assets | 0 | 0 |
Other assets | 0 | 0 |
Accounts payable | 0 | 0 |
Accrued expenses | 0 | 0 |
Income taxes | 0 | 0 |
Net cash provided by (used in) operating activities | 0 | 0 |
Investing activities | ||
Business combinations, net of cash acquired | 0 | 0 |
Purchases of property and equipment | 0 | 0 |
Investment in businesses | 0 | 0 |
Proceeds from sale of assets and businesses | 0 | 0 |
Net cash provided by (used in) investing activities | 0 | 0 |
Financing activities | ||
Borrowings on revolving facilities | 0 | 0 |
Payments on revolving facilities | 0 | 0 |
Proceeds from term loans (financing costs) | 0 | 0 |
Payments on term loans | 0 | 0 |
Revolving facility debt issuance costs | 0 | 0 |
Borrowings of other debt | 0 | 0 |
Principal payments on other debt | 0 | 0 |
Dividends paid to Holdings | 0 | 0 |
Equity investment by Holdings | 0 | 0 |
Intercompany | 0 | 0 |
Decrease in overdrafts | 0 | 0 |
Proceeds from issuance of non-controlling interests | 0 | |
Distributions to non-controlling interests | 0 | 0 |
Net cash provided by (used in) financing activities | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Select (Parent Company Only) | Reportable legal entities | ||
Operating activities | ||
Net income | 33,739 | 15,870 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 0 | 0 |
Depreciation and amortization | 2,207 | 1,575 |
Provision for bad debts | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Equity in earnings of consolidated subsidiaries | (30,425) | (28,256) |
Loss on extinguishment of debt | 115 | 6,527 |
Loss (gain) on sale of assets and businesses | 0 | 0 |
Stock compensation expense | 4,716 | 4,280 |
Amortization of debt discount, premium and issuance costs | 1,837 | 2,590 |
Deferred income taxes | (503) | 1,005 |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | 0 | 0 |
Other current assets | (5,890) | (5,761) |
Other assets | 3,788 | (3,753) |
Accounts payable | 731 | 2,574 |
Accrued expenses | (10,370) | (13,406) |
Income taxes | 6,897 | 4,256 |
Net cash provided by (used in) operating activities | 6,842 | (12,499) |
Investing activities | ||
Business combinations, net of cash acquired | 0 | 0 |
Purchases of property and equipment | (2,269) | (2,937) |
Investment in businesses | 0 | 0 |
Proceeds from sale of assets and businesses | 0 | 0 |
Net cash provided by (used in) investing activities | (2,269) | (2,937) |
Financing activities | ||
Borrowings on revolving facilities | 165,000 | 530,000 |
Payments on revolving facilities | (150,000) | (415,000) |
Proceeds from term loans (financing costs) | (11) | 1,139,822 |
Payments on term loans | (2,875) | (1,147,752) |
Revolving facility debt issuance costs | (837) | (3,887) |
Borrowings of other debt | 5,549 | 6,571 |
Principal payments on other debt | (3,226) | (3,704) |
Dividends paid to Holdings | (122) | (156) |
Equity investment by Holdings | 738 | 617 |
Intercompany | (10,873) | (85,012) |
Decrease in overdrafts | (7,916) | (17,062) |
Proceeds from issuance of non-controlling interests | 0 | |
Distributions to non-controlling interests | 0 | 0 |
Net cash provided by (used in) financing activities | (4,573) | 4,437 |
Net increase (decrease) in cash and cash equivalents | 0 | (10,999) |
Cash and cash equivalents at beginning of period | 73 | 11,071 |
Cash and cash equivalents at end of period | 73 | 72 |
Subsidiary Guarantors | Reportable legal entities | ||
Operating activities | ||
Net income | 25,789 | 22,737 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 1,334 | 4,893 |
Depreciation and amortization | 19,409 | 21,340 |
Provision for bad debts | 42 | 770 |
Equity in earnings of unconsolidated subsidiaries | (4,684) | (5,493) |
Equity in earnings of consolidated subsidiaries | (8,267) | (5,575) |
Loss on extinguishment of debt | 0 | 0 |
Loss (gain) on sale of assets and businesses | (516) | 62 |
Stock compensation expense | 0 | 0 |
Amortization of debt discount, premium and issuance costs | 0 | 0 |
Deferred income taxes | 1,383 | 0 |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (28,661) | (83,078) |
Other current assets | (572) | (1,126) |
Other assets | (562) | (11,531) |
Accounts payable | (3,550) | 764 |
Accrued expenses | (2,366) | (5,075) |
Income taxes | 4,513 | 0 |
Net cash provided by (used in) operating activities | 3,292 | (61,312) |
Investing activities | ||
Business combinations, net of cash acquired | (321) | (445) |
Purchases of property and equipment | (23,851) | (29,325) |
Investment in businesses | (1,749) | (500) |
Proceeds from sale of assets and businesses | 691 | 7 |
Net cash provided by (used in) investing activities | (25,230) | (30,263) |
Financing activities | ||
Borrowings on revolving facilities | 0 | 0 |
Payments on revolving facilities | 0 | 0 |
Proceeds from term loans (financing costs) | 0 | 0 |
Payments on term loans | 0 | 0 |
Revolving facility debt issuance costs | 0 | 0 |
Borrowings of other debt | 0 | 0 |
Principal payments on other debt | (145) | (80) |
Dividends paid to Holdings | 0 | 0 |
Equity investment by Holdings | 0 | 0 |
Intercompany | 22,729 | 92,074 |
Decrease in overdrafts | 0 | 0 |
Proceeds from issuance of non-controlling interests | 0 | |
Distributions to non-controlling interests | 0 | (50) |
Net cash provided by (used in) financing activities | 22,584 | 91,944 |
Net increase (decrease) in cash and cash equivalents | 646 | 369 |
Cash and cash equivalents at beginning of period | 4,856 | 6,467 |
Cash and cash equivalents at end of period | 5,502 | 6,836 |
Non-Guarantor Subsidiaries | Reportable legal entities | ||
Operating activities | ||
Net income | 13,488 | 6,859 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 30 | 18 |
Depreciation and amortization | 4,008 | 3,501 |
Provision for bad debts | 0 | 0 |
Equity in earnings of unconsolidated subsidiaries | (13) | (28) |
Equity in earnings of consolidated subsidiaries | 0 | 0 |
Loss on extinguishment of debt | 0 | 0 |
Loss (gain) on sale of assets and businesses | 0 | (4,671) |
Stock compensation expense | 0 | 0 |
Amortization of debt discount, premium and issuance costs | 0 | 0 |
Deferred income taxes | (5) | 0 |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (13,414) | (23,563) |
Other current assets | 1,304 | (1,514) |
Other assets | 599 | 15,072 |
Accounts payable | (870) | (5,480) |
Accrued expenses | 434 | 5,342 |
Income taxes | (111) | 0 |
Net cash provided by (used in) operating activities | 5,450 | (4,464) |
Investing activities | ||
Business combinations, net of cash acquired | (22) | 0 |
Purchases of property and equipment | (6,876) | (9,705) |
Investment in businesses | 0 | 0 |
Proceeds from sale of assets and businesses | 0 | 19,505 |
Net cash provided by (used in) investing activities | (6,898) | 9,800 |
Financing activities | ||
Borrowings on revolving facilities | 0 | 0 |
Payments on revolving facilities | 0 | 0 |
Proceeds from term loans (financing costs) | 0 | 0 |
Payments on term loans | 0 | 0 |
Revolving facility debt issuance costs | 0 | 0 |
Borrowings of other debt | 5,326 | 0 |
Principal payments on other debt | (957) | (695) |
Dividends paid to Holdings | 0 | 0 |
Equity investment by Holdings | 0 | 0 |
Intercompany | (2,467) | (7,062) |
Decrease in overdrafts | 0 | 0 |
Proceeds from issuance of non-controlling interests | 2,094 | |
Distributions to non-controlling interests | (1,266) | (1,324) |
Net cash provided by (used in) financing activities | 636 | (6,987) |
Net increase (decrease) in cash and cash equivalents | (812) | (1,651) |
Cash and cash equivalents at beginning of period | 4,561 | 5,056 |
Cash and cash equivalents at end of period | 3,749 | 3,405 |
Non-Guarantor Concentra | Reportable legal entities | ||
Operating activities | ||
Net income | 9,658 | 11,828 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 0 | 0 |
Depreciation and amortization | 21,147 | 16,123 |
Provision for bad debts | 43 | 11 |
Equity in earnings of unconsolidated subsidiaries | 0 | 0 |
Equity in earnings of consolidated subsidiaries | 0 | 0 |
Loss on extinguishment of debt | 297 | 0 |
Loss (gain) on sale of assets and businesses | 3 | 0 |
Stock compensation expense | 211 | 306 |
Amortization of debt discount, premium and issuance costs | 1,299 | 832 |
Deferred income taxes | (797) | (4,430) |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (3,736) | (11,628) |
Other current assets | (3,787) | 780 |
Other assets | 12,808 | 164 |
Accounts payable | (2,863) | 2,554 |
Accrued expenses | 321 | (5,290) |
Income taxes | 539 | 11,164 |
Net cash provided by (used in) operating activities | 35,143 | 22,414 |
Investing activities | ||
Business combinations, net of cash acquired | (515,016) | (9,121) |
Purchases of property and equipment | (6,621) | (8,686) |
Investment in businesses | (5) | 0 |
Proceeds from sale of assets and businesses | 0 | 0 |
Net cash provided by (used in) investing activities | (521,642) | (17,807) |
Financing activities | ||
Borrowings on revolving facilities | 0 | 0 |
Payments on revolving facilities | 0 | 0 |
Proceeds from term loans (financing costs) | 779,915 | 0 |
Payments on term loans | 0 | (23,065) |
Revolving facility debt issuance costs | (496) | 0 |
Borrowings of other debt | 725 | 0 |
Principal payments on other debt | (1,581) | (796) |
Dividends paid to Holdings | 0 | 0 |
Equity investment by Holdings | 0 | 0 |
Intercompany | (9,389) | 0 |
Decrease in overdrafts | 0 | 0 |
Proceeds from issuance of non-controlling interests | 0 | |
Distributions to non-controlling interests | (285,375) | (2,283) |
Net cash provided by (used in) financing activities | 483,799 | (26,144) |
Net increase (decrease) in cash and cash equivalents | (2,700) | (21,537) |
Cash and cash equivalents at beginning of period | 113,059 | 76,435 |
Cash and cash equivalents at end of period | 110,359 | 54,898 |
Select Medical Corporation | ||
Operating activities | ||
Net income | 43,982 | 23,463 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Distributions from unconsolidated subsidiaries | 1,364 | 4,911 |
Depreciation and amortization | 46,771 | 42,539 |
Provision for bad debts | 85 | 781 |
Equity in earnings of unconsolidated subsidiaries | (4,697) | (5,521) |
Equity in earnings of consolidated subsidiaries | 0 | 0 |
Loss on extinguishment of debt | 412 | 6,527 |
Loss (gain) on sale of assets and businesses | (513) | (4,609) |
Stock compensation expense | 4,927 | 4,586 |
Amortization of debt discount, premium and issuance costs | 3,136 | 3,422 |
Deferred income taxes | 78 | (3,425) |
Changes in operating assets and liabilities, net of effects of business combinations: | ||
Accounts receivable | (45,811) | (118,269) |
Other current assets | (8,945) | (7,621) |
Other assets | 16,633 | (48) |
Accounts payable | (6,552) | 412 |
Accrued expenses | (11,981) | (18,429) |
Income taxes | 11,838 | 15,420 |
Net cash provided by (used in) operating activities | 50,727 | (55,861) |
Investing activities | ||
Business combinations, net of cash acquired | (515,359) | (9,566) |
Purchases of property and equipment | (39,617) | (50,653) |
Investment in businesses | (1,754) | (500) |
Proceeds from sale of assets and businesses | 691 | 19,512 |
Net cash provided by (used in) investing activities | (556,039) | (41,207) |
Financing activities | ||
Borrowings on revolving facilities | 165,000 | 530,000 |
Payments on revolving facilities | (150,000) | (415,000) |
Proceeds from term loans (financing costs) | 779,904 | 1,139,822 |
Payments on term loans | (2,875) | (1,170,817) |
Revolving facility debt issuance costs | (1,333) | (3,887) |
Borrowings of other debt | 11,600 | 6,571 |
Principal payments on other debt | (5,909) | (5,275) |
Dividends paid to Holdings | (122) | (156) |
Equity investment by Holdings | 738 | 617 |
Intercompany | 0 | 0 |
Decrease in overdrafts | (7,916) | (17,062) |
Proceeds from issuance of non-controlling interests | 0 | 2,094 |
Distributions to non-controlling interests | (286,641) | (3,657) |
Net cash provided by (used in) financing activities | 502,446 | 63,250 |
Net increase (decrease) in cash and cash equivalents | (2,866) | (33,818) |
Cash and cash equivalents at beginning of period | 122,549 | 99,029 |
Cash and cash equivalents at end of period | $ 119,683 | $ 65,211 |