Capella Health

Franklin, Tennessee.  March 21, 2013 – Capella Healthcare has announced financial and operating results for the year ended December 31, 2012.

Highlights included:

•  Revenue for the year ended December 31, 2012 totaled $747.8 million, an increase of 9.3%, compared to $683.9 million in the prior year.  Adjusted EBITDA for the year ended December 2012 totaled $105.2 million compared to $95.9 million in the prior year.

• Same-facility admissions and adjusted admissions for the year increased 2.8% and 5.4%, respectively, compared to the prior year.  Consolidated revenue per adjusted admission for the year ended December 31, 2012 increased 1.5% compared to the prior year period.  Same-facility revenue per adjusted admission for the year ended December 31, 2012 increased 2.2% compared to the prior year.

Commenting on the results, Dan Slipkovich, Capella’s Chairman and Chief Executive Officer said, “This past year has been a solid year for Capella, with impressive growth in both volumes and revenues. We’ve expanded services with four acquisitions, including two outpatient imaging centers, a cancer center and a hospital, in addition to finalizing a landmark joint venture partnership with Saint Thomas Health. We were especially pleased with our ranking on Modern Healthcare’s inaugural listing of the country’s fastest growing healthcare companies, for which we give full credit to the dedicated employees, physicians and volunteers who serve our patients.”

Michael Wiechart, SVP and Chief Operating Officer, discussed how well Capella’s hospitals have performed.  “We experienced progress in all of our key initiatives, most importantly in improving quality of care and patient satisfaction. In fact, our HCAHPS results are some of the highest in our peer group and reflect our priority focus and leadership investments.  These strong quality results have been translated into awards and recognition.  For example, Capital Medical Center was awarded The Joint Commission’s Gold Seal of Approval for their spinal surgery program as well as their knee and hip replacement programs, making them the first hospital in Southwest Washington to earn this distinction. Saint Mary’s Regional Medical Center located in Russellville, Arkansas, was an awarded an A rating for hospital safety the LeapFrog Group.  Only three facilities in the State of Arkansas earned this rating. These are just a few of the many accolades our facilities have earned in area of quality and patient care excellence.  We are extremely proud of our leaders in the field.

“Organically, we’ve grown by introducing new services and expanding existing services at a number of our facilities over the past year. These services include interventional cardiology at Saint Mary’s, upgrades to the Cardiac Catheterization Lab at River Park, a new geropsychiatry unit at Willamette Valley, an imaging center at Capital Medical Center, and behavioral health services at Saint Mary’s and National Park.”

Wiechart also discussed Capella’s investments in technology:  “We continue to make progress on our technology initiatives to support our commitment to patient care excellence and value-based purchasing.  Examples of this include our expanded investment in the Crimson Clinical Advantage Informatics Platform.  Additionally, we have moved to more concurrent data reporting in MEDITECH 6.0 Electronic Health Record (EHR) which includes enterprise-wide standard order sets.  We are confident that these industry-best tools, along with the dedication and focus of our hospital leaders, will allow us to outperform our peers in quality and value-based purchasing.”

Denise Warren, SVP and Chief Financial Officer, commented on the company’s financial performance. “2012 was a solid year for us.  Our adjusted EBITDA was at an all-time high.  Adjusted EBITDA shows the true performance of our facilities, with which we were very pleased.  We use EBITDA to service our debt and to make capital investments in our facilities.  In fact, all of our operating cash flow is reinvested into our facilities every year.  Preparing for the future requires investments – in technology, new services, infrastructure, leadership and staff development, as well as in new partnerships to continue broadening access and improving quality for the communities we serve.”

Slipkovich commended staff and addressed the future:  “I want to commend our hospital leaders who are doing an excellent job focusing on our strategic initiatives, delivering high quality care and outstanding constituency satisfaction for their communities. As we embrace the challenges of the future, we will continue investing in our facilities, our leadership and our communities, as well as focusing on creative and collaborative approaches, as we pursue new ways to improve access and quality while lowering the costs of care.”

About Capella Healthcare

Based in Franklin, Tennessee, Capella Healthcare owns and/or operates 14 general acute-care and specialty facilities in six states.  With the philosophy that all health care is local, Capella collaborates with each hospital’s medical staff, board and community leadership to take care to the next level.  Capella has access to significant leadership and financial resources, reinvesting in its family of hospitals to strengthen and expand services and facilities.  .

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Certain statements contained in this release may constitute forward-looking statements that involve risks and uncertainties.  These forward-looking statements include all statements that are not historical statements of fact and those statements regarding Capella Healthcare’s or management’s intent, belief or expectations, including statements about ultimate creation of this proposed joint venture and future operational plans of the proposed joint venture.  Actual future events or results may differ materially from these statements. No assurance can be given that the parties will enter into a definitive agreement or that the proposed joint venture will be formed. Readers also should refer to the documents filed by Capella Healthcare, Inc. with the Securities and Exchange Commission, specifically the most recent filings which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including execution of growth, acquisition and business strategies. These and other applicable risks are summarized under the caption Risk Factors in Capella Healthcare’s Securities and Exchange Commission filings. We make no promise to update any forward-looking statement, whether as a result of changes in underlying factors, new information, future events or otherwise.

Investor Contact:
Denise Wilder Warren, SVP, Chief Financial Officer
I[email protected]
(615) 764-3013

News Media Contact:
Beth B. Wright, VP-Corporate Communications
[email protected]
(615)-764-3010