CHS estimates $131 million operating loss in Q2
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Community Health Systems posted a loss on continuing operations of $131 million in its second quarter as admissions at hospitals it has owned for at least a year slumped 2.5% and net revenue at those hospitals declined 1%, the hospital chain said in a preliminary earnings report Wednesday.
Franklin, Tenn.-based CHS, the nation's second-largest investor-owned hospital company, released its second-quarter estimates six days before it was scheduled to announce its formal numbers on Aug. 1. The company noted that its earnings are preliminary but did not say why it released them early.
The second-quarter results were laden with special expenses related to the chain's ongoing hospital divestiture plan to reduce its debt of $15 billion.
An impairment on the sale of hospitals cost CHS about 77 cents per share of the $1.22 per share operating loss the system suffered in the quarter.
CHS spokeswoman Tomi Galen declined to comment on why CHS announced preliminary results, except to say a complete update would be available when formal earnings are announced.
CHS' operating loss of $131 million in the second quarter compared with an operating loss of $1.43 billion in the year-earlier quarter. The year-ago results included a one-time $1.4 billion writedown of goodwill against the value of its hospitals.
CHS has been restructuring for more than a year, announcing the sale over that time of 30 hospitals and other assets to improve operations and cut debt.
The results of the 150 hospitals it still owns is reflected in adjusted earnings before interest, taxes, depreciation and amortization, which totaled $435 million in the second quarter versus $563 million in the year-earlier period.
Same-hospitals salaries and benefits dipped slightly in the quarter to 46.2% of net operating revenue from 46.3% in the year-earlier quarter.
And supply expenses held steady at 16.9% compared to the year-ago period, the company said.
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