Net Operating Revenues: Achieved $5.4 billion in the first quarter of 2024.
Consolidated Adjusted EBITDA: $1.02 billion, marking a 23% increase over the first quarter of 2023.
Adjusted EBITDA Margin: Reached 19.1%.
USPI Adjusted EBITDA: Grew to $394 million, a 16% increase year-over-year.
Hospital Segment Adjusted EBITDA: Expanded 28% to $630 million.
Same-store Hospital Admissions: Grew by 4.2%.
Revenue per Adjusted Admission: Increased by 8.8% over the prior year.
Future Guidance
2024 Net Operating Revenue Forecast: Set in the range of $20 billion to $20.4 billion.
2024 Adjusted EBITDA Guidance: Raised to a range of $3.5 billion to $3.7 billion, reflecting a $215 million or 6% increase at the midpoint over prior guidance.
Second Quarter Adjusted EBITDA Projection: Anticipated to be between $835 million and $885 million.
USPI’s EBITDA Contribution Q2: Expected to represent 23.5% to 25% of the full-year USPI EBITDA guidance at the midpoint.
2024 Free Cash Flow Outlook: Predicted to be in the range of $950 million to $1.2 billion.
Trends, Market Conditions, Sentiment
Strategic Portfolio Transformation: Tenet has significantly accelerated its strategic transformation, focusing on becoming a more capital-efficient, profitable, and value-based care enterprise.
Market Expansion and Investments: Tenet has expanded USPI to over 535 centers, addressing market fragmentation and investing in new centers to promote lower-cost access while achieving attractive returns.
High Acuity Specialty Services: Continuous investment in high acuity specialty services has been a focus, alongside opening new capacities in strategic markets.
Operational Efficiency: Demonstrated efficient cost control and expense management amidst strong revenue and acuity growth, especially in high-demand service areas.
Cybersecurity Incident Response: Successfully managed the operational impact of a cybersecurity incident, ensuring continued strong performance.
Debt Retirement and Leverage Ratio Improvement: Retired $2.1 billion in debt, significantly lowering the leverage ratio, and improving the balance sheet and financial flexibility.
Optimism for Continued Growth: management expresses confidence in sustaining demand across their network and the strategic initiatives underway to bolster future company performance.
Notable Quotes
”We are essentially a new company… Our repositioned portfolio of businesses is more predictable and capital efficient with attractive margins and free cash flow.” - Saumya Sutaria, CEO.
”We are early in the year… We are very pleased with the demand that we are seeing in our network, and we’ll address this component of our expectations for the full year in the future.” - Saumya Sutaria, CEO.
”We generated $346 million of free cash flow in the first quarter… We are well positioned with a high degree of financial flexibility and cash flow generation to support our capital allocation priorities in the years to come.” - Sun Park, Executive VP and CFO.
”Our capital deployment priorities have not changed for 2024… First, we will continue to prioritize capital investments to grow USPI through M&A.” - Sun Park, Executive VP and CFO.
