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Lifepoint Hospitals Inc. (LPNT)
Q3 2008 Earnings Call
November 7, 2008 10:00 am ET
William F. Carpenter III – President and Chief Executive Officer
David M. Dill – Executive Vice President and Chief Financial Officer
Shelley Gnall – Goldman Sachs
John Ransom – Raymond James & Associates
Whit Mayo – Robert W. Baird & Co., Inc.
Adam Feinstein – Lehman Brothers
Tom Gallucci – Merrill Lynch
[Kevin Fishbank] – Lehman Brothers
Justin Lake – UBS
Erik Chiprich – BMO Capital Markets
Previous Statements by LPNT
» LifePoint Hospitals, Inc. Q4 2008 Earnings Call Transcript
» LifePoint Hospitals, Inc. Q2 2008 Earnings Call Transcript
» LifePoint Hospitals, Inc. Q1 2008 Earnings Call Transcript
On today's call Lifepoint will be making forward-looking statements based upon management's current expectations. Numerous factors could cause Lifepoint's results to differ from these expectations and Lifepoint has outlined these factors in its filings with the SEC. The company encourages you to review these filings. Lifepoint also asks that you please review the cautionary language under the caption Important Legal Information in the company's press release issued this morning.
The company undertakes no obligation to update or make any other forward-looking statements whether as a result of new information, future events or otherwise. Also, please visit Lifepoint's website for links to various information and filings.
(Operator Instructions). It's now my pleasure to turn the conference over to Mr. Bill Carpenter, President and Chief Executive Officer of Lifepoint Hospitals. Please go ahead, sir.
William F. Carpenter III
Welcome everyone to the Lifepoint Hospital's third quarter earnings call. By now I expect that you have reviewed the press release that we issued this morning covering our results for the quarter. I'd like to briefly touch upon our results which David will discuss in greater detail and then share with you some of the key elements of our strategy to improve operational and financial performance strategies that we recognize as working.
First, our third quarter results. Revenue is up 5.3%, EBITDA up 1%. EBITDA margins for the quarter were 16.2% and EPS for the quarter up 7%, including an approximately $0.03 negative impact from hurricanes that we experienced in the quarter. Notwithstanding what is clearly a challenging economic time, we have continued to do the things that we believe are needed to properly grow the company. Specifically, we stuck to our strategy of making disciplined investments in our existing assets and, as we'll talk about in a moment, we're continuing to see results from those investments.
We have also of course carefully managed our expenses. At the same time our decision not to unreasonably leverage the company in prior years puts us in an enviable position today with a strong balance sheet, ample liquidity and the ability to continue to make the investments necessary to execute our strategy to drive organic growth within our existing base of assets.
Rather than limiting our flexibility by incurring debt, we recognized that additional strategic investments in our hospitals would provide the greatest opportunities for growth. Our investments have enabled us to continue driving organic growth, further focusing our efforts to capture market share, enhancing corporate resources to better position our company to compete in an increasingly complex operating environment, recruiting and retaining physicians and other clinicians and improving quality metrics across our base of hospitals.
We'll continue these efforts to strengthen the competitive position of the company to enhance long-term shareholder value and to grow market share in each of our hospitals. I've spoken before about steps we've taken and will continue to take in connection with comprehensive and detailed reviews of some of our largest hospitals with respect to strategic opportunities.
These steps were designed to improve and expand the care available in those communities. I said last quarter that we were beginning to see traction from the steps we took as a result of these detailed reviews. We continued this quarter to perform well against our internal targets set for organic growth at these hospitals.
For example, our cardiovascular service lines in these facilities have shown approximately a 15% increase in volume over established baselines. Our imaging service lines, due to our implementation of new technology, have shown a 7% volume increase over initial baselines and we've seen our surgical volumes in these hospitals increase as well.
We're pleased with the initial results from these strategies. At the same time we know that we have more to do. Improving the quality of our hospitals and the care provided while at the same time making our operations more efficient is critical to our success. Doing so is good for our patients, the physicians who practice at our hospitals, our nurses and other clinicians and for the communities in which our hospitals operate. I firmly believe that what's good for our patients and communities is good for shareholder value.
I'd like to spend a few minutes talking about the quality improvements we're making and why a continued focus on this area is important. We've been working closely with the medical staffs at our hospitals, especially in the last year or so since Dr. Lenny Copeland joined as our Chief Medical Officer.
To improve the quality of healthcare provided and to further improve core measure scores at our hospitals, significant strides have been made as is reflected by our scores when compared to joint commission hospitals. Our aggregate scores in the four measure sets are consistently above 90%. This is a tremendous increase for us over the past year and translates into better patient outcomes and quality. This improvement is a result of Lifepoint's ongoing commitment to quality.
To drive even better quality results, we have engaged and involved our physicians in our strategic direction as never before. For example, Dr. Copeland and his team have worked together with our hospital leadership to create a physician leadership council. This important group, consisting of medical staff leaders from 12 of our hospitals, was formed to enhance the direct communication that our medical staffs can have with me and with other company leaders.
The insight hat we've received so far about how we can strengthen our hospitals, our physician relationships and our communities, is invaluable. About two weeks ago the physician leadership council held its first meeting here in Brentwood to develop a common understanding of our shared strategic and operational direction.