Community Health Systems, Inc. Announces Third Quarter 2012 Results with Net Operating Revenues of $3.2 Billion

  Community Health Systems, Inc. Announces Third Quarter 2012 Results with Net
  Operating Revenues of $3.2 Billion

Business Wire

FRANKLIN, Tenn. -- October 30, 2012

Community Health Systems, Inc. (NYSE: CYH) (the “Company”) today announced
financial and operating results for the three and nine months ended September
30, 2012.

Net operating revenues for the three months ended September 30, 2012, totaled
$3.2 billion, a 9.0 percent increase compared with $2.9 billion for the same
period in 2011. Income from continuing operations decreased to $58.8 million,
or $0.49 per share (diluted), for the three months ended September 30, 2012,
compared with $95.8 million, or $0.86 per share (diluted), for the same period
in 2011. Net income attributable to Community Health Systems, Inc. common
stockholders was $0.49 per share (diluted) for the three months ended
September 30, 2012, compared with $0.83 per share (diluted) for the same
period in 2011. The results for the three months ended September 30, 2012,
include a $0.37 per share (diluted) loss from the early extinguishment of
debt. Excluding this item, both income from continuing operations and net
income attributable to Community Health Systems, Inc. common stockholders were
$0.86 per share (diluted) for the three months ended September 30, 2012.
Weighted-average shares outstanding (diluted) were 90.0 million for the three
months ended September 30, 2012, and 89.9 million for the three months ended
September 30, 2011.

Adjusted EBITDA for the three months ended September 30, 2012, was $477.3
million compared with $453.5million for the same period in 2011, representing
a 5.2 percent increase. Adjusted EBITDA is EBITDA adjusted to exclude
discontinued operations, loss from early extinguishment of debt and net income
attributable to non-controlling interests. The Company uses adjusted EBITDA as
a measure of liquidity. Net cash provided by operating activities for the
three months ended September 30, 2012, was $294.9 million compared with $235.6
million for the same period in 2011.

The consolidated operating results for the three months ended September 30,
2012, reflect a 5.0 percent increase in total admissions and a 6.3 percent
increase in total adjusted admissions compared with the same period in 2011.
On a same-store basis, admissions decreased 0.3 percent while adjusted
admissions increased 0.8 percent compared with the same period in 2011. On a
same-store basis, net operating revenues increased 4.0 percent compared with
the same period in 2011.

Net operating revenues for the nine months ended September 30, 2012, totaled
$9.8 billion, a 9.6 percent increase compared with $8.9 billion for the same
period in 2011. Income from continuing operations decreased to $260.6 million,
or $2.27 per share (diluted), for the nine months ended September 30, 2012,
compared with $280.3 million, or $2.49 per share (diluted), for the same
period in 2011. Net income attributable to Community Health Systems, Inc.
common stockholders was $2.27 per share (diluted) for the nine months ended
September 30, 2012, compared with $1.87 per share (diluted) for the same
period in 2011. The results for the nine months ended September 30, 2012,
include a $0.48 per share (diluted) net benefit from the resolution of an
industry wide governmental settlement and a payment update relating to prior
periods, a $0.10 per share (diluted) charge to establish reserves for certain
legal matters, and a $0.81 per share (diluted) loss from the early
extinguishment of debt. Excluding these previously mentioned items, both
income from continuing operations and net income attributable to Community
Health Systems, Inc. common stockholders were $2.70per share (diluted) for
the nine months ended September 30, 2012. Weighted-average shares outstanding
(diluted) were 89.5 million for the nine months ended September 30, 2012, and
91.3 million for the nine months ended September30, 2011.

Adjusted EBITDA for the nine months ended September 30, 2012, was $1.5 billion
compared with $1.4 billion for the same period in 2011, representing a 9.0
percent increase. Net cash provided by operating activities for the nine
months ended September 30, 2012, was $777.9 million compared with $820.2
million for the same period in 2011.

The consolidated operating results for the nine months ended September 30,
2012, reflect a 3.7 percent increase in total admissions and a 6.7 percent
increase in total adjusted admissions compared with the same period in 2011.
On a same-store basis, admissions decreased 1.6 percent while adjusted
admissions increased 1.3 percent compared with the same period in 2011. On a
same-store basis, net operating revenues increased 4.3 percent compared with
the same period in 2011.

Commenting on the results, Wayne T. Smith, chairman, president and chief
executive officer of Community Health Systems, Inc. said, “Community Health
Systems delivered another strong financial and operating performance in the
third quarter of 2012. Operating revenue increased nine percent and adjusted
EBITDA increased five percent over the prior year period. We continue to
demonstrate favorable results on a same-store basis with revenues up four
percent and volume trends stabilizing. Our standardized business platform has
enabled us to reduce costs, recruit qualified physicians and improve local
hospital services.

“We are also pleased that over the last several months we have extended almost
all of our long-term debt. We have laddered our maturities to 2017, 2018, 2019
and 2020,” added Smith.

Included on pages 14, 15 and 16 of this press release are tables setting forth
the Company’s updated 2012 annual earnings guidance.

Located in the Nashville, Tennessee, suburb of Franklin, Community Health
Systems, Inc. is one of the largest publicly-traded hospital companies in the
United States and a leading operator of general acute-care hospitals in
non-urban and mid-size markets throughout the country. Through its
subsidiaries, the Company currently owns, leases or operates 135 hospitals in
29 states with an aggregate of approximately 20,000 licensed beds. Its
hospitals offer a broad range of inpatient and surgical services, outpatient
treatment and skilled nursing care. In addition, through its subsidiary,
Quorum Health Resources, LLC, the Company provides management and consulting
services to non-affiliated general acute-care hospitals located throughout the
United States. Shares in Community Health Systems, Inc. are traded on the New
York Stock Exchange under the symbol “CYH.”

Community Health Systems, Inc. will hold a conference call on Wednesday,
October 31, 2012, at 11:00 a.m. Central, 12:00 p.m. Eastern, to review
financial and operating results for the third quarter ended September 30,
2012. Investors will have the opportunity to listen to a live internet
broadcast of the conference call by clicking on the Investor Relations link of
the Company’s website at www.chs.net, or at www.earnings.com. To listen to the
live call, please go to the website at least fifteen minutes early to
register, download and install any necessary audio software. For those who
cannot listen to the live broadcast, a replay will be available shortly after
the call and will continue to be available through November 30, 2012. Copies
of the Company’s current report on Form 8-K (including this press release) and
conference call slide show will be available on the Company’s website at
www.chs.net.

Forward-Looking Statements

Statements contained in this press release regarding expected operating
results, acquisition transactions or divestitures and other events are
forward-looking statements that involve risk and uncertainties. Actual future
events or results may differ materially from these statements. Readers are
referred to the documents filed by Community Health Systems, Inc. with the
Securities and Exchange Commission, including the Company’s annual report on
Form 10-K, current reports on Form 8-K and quarterly reports on Form 10-Q.
These filings identify important risk factors and other uncertainties that
could cause actual results to differ from those contained in the
forward-looking statements. The Company undertakes no obligation to revise or
update any forward-looking statements, or to make any other forward-looking
statements, whether as a result of new information, future events or
otherwise.






COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Financial Highlights (a)(b)
(in thousands, except per share amounts)
(Unaudited)

                  Three Months Ended           Nine Months Ended
                   September 30,                 September 30,
                   2012         2011            2012           2011
                                                                 
Net operating      $ 3,212,030   $ 2,945,477     $ 9,752,039     $ 8,900,387
revenues
Adjusted EBITDA      477,254       453,512         1,495,843       1,372,883
(c)
Income from
continuing
operations (d),      58,758        95,800          260,643         280,279
(e), (f), (g),
(h)
Net income
attributable to
Community Health     44,233        74,304          203,066         171,017
Systems, Inc.
stockholders
                                                                 
Basic earnings
(loss) per share
attributable to
Community Health
Systems, Inc.
common
stockholders
(j):
Continuing
operations (d),    $ 0.50        $ 0.87          $ 2.29          $ 2.51
(e), (f), (g),
(h)
Discontinued        -            (0.04     )    (0.01     )    (0.62     )
operations
Net income         $ 0.50        $ 0.83         $ 2.28         $ 1.89      
                                                                 
Diluted earnings
(loss) per share
attributable to
Community Health
Systems, Inc.
common
stockholders
(j):
Continuing
operations (d),    $ 0.49        $ 0.86          $ 2.27          $ 2.49
(e), (f), (g),
(h)
Discontinued        -            (0.04     )    (0.01     )    (0.61     )
operations
Net income         $ 0.49        $ 0.83         $ 2.27         $ 1.87      
                                                                 
Weighted-average
number of shares
outstanding (i):
Basic                89,260        89,412          89,028          90,514
Diluted              90,009        89,858          89,465          91,256
                                                                 
Net cash
provided by        $ 294,938     $ 235,550       $ 777,865       $ 820,235
operating
activities

_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (a)(b)
(in thousands, except per share amounts)
(Unaudited)

                        Three Months Ended September 30,
                         2012                       2011
                                         % of Net                    % of Net

                         Amount         Operating   Amount         Operating

                                         Revenues                    Revenues
Operating revenues
(net of contractual      $ 3,696,661                 $ 3,395,773
allowances and
discounts)
Provision for bad         484,631                  450,296      
debts
Net operating revenues    3,212,030    100.0  %     2,945,477    100.0  %
                                                                     
Operating costs and
expenses:
Salaries and benefits      1,525,111     47.5   %      1,393,151     47.3   %
Supplies                   484,212       15.1   %      459,146       15.6   %
Other operating            694,857       21.6   %      623,608       21.2   %
expenses
Electronic health
records incentive          (30,622   )   -1.0   %      (40,227   )   -1.4   %
reimbursement (f)
Rent                       68,637        2.1    %      64,481        2.2    %
Depreciation and          182,207      5.7    %     161,515      5.5    %
amortization
Total operating costs     2,924,402    91.0   %     2,661,674    90.4   %
and expenses
                                                                     
Income from operations     287,628       9.0    %      283,803       9.6    %
(f), (g), (h)
Interest expense, net      158,565       5.0    %      159,480       5.4    %
Loss from early            52,024        1.6    %      -             0.0    %
extinguishment of debt
Equity in earnings of
unconsolidated            (7,419    )   -0.2   %     (8,194    )   -0.3   %
affiliates
Income from continuing
operations before          84,458        2.6    %      132,517       4.5    %
income taxes
Provision for income      25,700       0.8    %     36,717       1.2    %
taxes
Income from continuing
operations (f), (g),      58,758       1.8    %     95,800       3.3    %
(h)
                                                                     
Discontinued
operations, net of
taxes:
Loss from operations       -             0.0    %      (3,103    )   -0.2   %
of entities sold
Impairment of              -             0.0    %      -             0.0    %
hospitals sold
Loss on sale, net         -            0.0    %     (66       )   0.0    %
Loss from discontinued
operations, net of        -            0.0    %     (3,169    )   -0.2   %
taxes
Net income                 58,758        1.8    %      92,631        3.1    %
Less: Net income
attributable to           14,525       0.4    %     18,327       0.6    %
noncontrolling
interests
Net income
attributable to
Community Health         $ 44,233       1.4    %    $ 74,304       2.5    %
Systems, Inc.
stockholders
                                                                     
Basic earnings (loss)
per share attributable
to Community Health
Systems, Inc. common
stockholders (j):
Continuing operations    $ 0.50                      $ 0.87
(f), (g), (h)
Discontinued              -                         (0.04     )
operations
Net income               $ 0.50                     $ 0.83      
                                                                     
Diluted earnings
(loss) per share
attributable to
Community Health
Systems, Inc. common
stockholders (j):
Continuing operations    $ 0.49                      $ 0.86
(f), (g), (h)
Discontinued              -                         (0.04     )
operations
Net income               $ 0.49                     $ 0.83      
                                                                     
Weighted-average
number of shares
outstanding (i):
Basic                     89,260                    89,412    
Diluted                   90,009                    89,858    
                                                   
_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (a)(b)
(in thousands, except per share amounts)
(Unaudited)

                      Nine Months Ended September 30,
                       2012                        2011
                                        % of Net                     % of Net

                       Amount          Operating   Amount          Operating

                                        Revenues                     Revenues
Operating revenues
(net of contractual    $ 11,226,580                 $ 10,183,654
allowances and
discounts)
Provision for bad       1,474,541                 1,283,267     
debts
Net operating           9,752,039     100.0  %     8,900,387     100.0  %
revenues
                                                                     
Operating costs and
expenses:
Salaries and             4,547,532      46.6   %      4,156,614      46.7   %
benefits
Supplies                 1,472,520      15.1   %      1,366,242      15.4   %
Other operating          2,140,025      22.0   %      1,893,138      21.3   %
expenses
Electronic health
records incentive        (73,592    )   -0.8   %      (40,227    )   -0.5   %
reimbursement (f)
Rent                     202,324        2.1    %      190,082        2.1    %
Depreciation and        536,362       5.5    %     481,046       5.4    %
amortization
Total operating         8,825,171     90.5   %     8,046,895     90.4   %
costs and expenses
                                                                     
Income from
operations (d), (e),     926,868        9.5    %      853,492        9.6    %
(f), (g), (h)
Interest expense,        462,347        4.7    %      485,928        5.5    %
net
Loss from early
extinguishment of        115,453        1.2    %      -              0.0    %
debt
Equity in earnings
of unconsolidated       (32,613    )   -0.3   %     (38,345    )   -0.4   %
affiliates
Income from
continuing               381,681        3.9    %      405,909        4.5    %
operations before
income taxes
Provision for income    121,038       1.2    %     125,630       1.4    %
taxes
Income from
continuing              260,643       2.7    %     280,279       3.1    %
operations (d), (e),
(f), (g), (h)
                                                                     
Discontinued
operations, net of
taxes:
Loss from operations     (466       )   0.0    %      (4,546     )   -0.1   %
of entities sold
Impairment of            -              0.0    %      (47,930    )   -0.5   %
hospitals sold
Loss on sale, net       -             0.0    %     (3,300     )   0.0    %
Loss from
discontinued            (466       )   0.0    %     (55,776    )   -0.6   %
operations, net of
taxes
Net income               260,177        2.7    %      224,503        2.5    %
Less: Net income
attributable to         57,111        0.6    %     53,486        0.6    %
noncontrolling
interests
Net income
attributable to
Community Health       $ 203,066       2.1    %    $ 171,017       1.9    %
Systems, Inc.
stockholders
                                                                     
Basic earnings
(loss) per share
attributable to
Community Health
Systems, Inc. common
stockholders (j):
Continuing
operations (d), (e),   $ 2.29                       $ 2.51
(f), (g), (h)
Discontinued            (0.01      )                (0.62      )
operations
Net income             $ 2.28                      $ 1.89       
                                                                     
Diluted earnings
(loss) per share
attributable to
Community Health
Systems, Inc. common
stockholders (j):
Continuing
operations (d), (e),   $ 2.27                       $ 2.49
(f), (g), (h)
Discontinued            (0.01      )                (0.61      )
operations
Net income             $ 2.27                      $ 1.87       
                                                                     
Weighted-average
number of shares
outstanding (i):
Basic                   89,028                     90,514     
Diluted                 89,465                     91,256     
                                                  
____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Income
(in thousands)
(Unaudited)

                       Three Months Ended         Nine Months Ended
                           September 30,               September 30,
                           2012         2011          2012       2011
                                                                   
Net income                 $  58,758     $  92,631     $ 260,177   $ 224,503
Other comprehensive
income (loss), net of
income taxes:
   Net change in fair
   value of interest          8,254         2,722        28,766      30,199
   rate swaps
   Net change in fair
   value of                   1,370         (4,029 )     3,509       (2,692  )
   available-for-sale
   securities
   Amortization and
   recognition of            1,202        790        3,483      2,369   
   unrecognized pension
   cost components
        Other
        comprehensive        10,826       (517   )    35,758     29,876  
        income (loss)
Comprehensive income          69,584        92,114       295,935     254,379
   Less: Comprehensive
   income attributable       14,525       18,327     57,111     53,486  
   to noncontrolling
   interests
Comprehensive income
attributable to
Community Health           $  55,059     $  73,787    $ 238,824   $ 200,893 
Systems, Inc.
stockholders
                                                     
_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Selected Operating Data (b)
($ In thousands)
(Unaudited)

                For the Three Months Ended September 30,
                 Consolidated                            Same-Store
                 2012           2011           %        2012           2011           %
                                                 Change                                   Change
Number of
hospitals (at      135             130                      130             130
end of period)
Licensed beds
(at end of         20,357          19,358                   19,327          19,358
period)
Beds in
service (at        17,274          16,542                   16,464          16,542
end of period)
Admissions         173,108         164,842       5.0  %     164,336         164,842       -0.3 %
Adjusted           355,672         334,644       6.3  %     337,252         334,644       0.8  %
admissions
Patient days       747,616         717,951                  707,598         717,951
Average length     4.3             4.4                      4.3             4.4
of stay (days)
Occupancy rate
(average beds      47.1      %     47.1      %              46.7      %     47.1      %
in service)
Net operating    $ 3,212,030     $ 2,945,477     9.0  %   $ 3,063,944     $ 2,946,032     4.0  %
revenues
Net inpatient
revenues as a
% of total net
operating
revenues
before             43.6      %     44.5      %              43.4      %     44.5      %
provision for
bad debts
Net outpatient
revenues as a
% of total net
operating
revenues
before             54.6      %     53.9      %              54.8      %     53.9      %
provision for
bad debts
Income from      $ 287,628       $ 283,803       1.3  %   $ 297,361       $ 293,049       1.5  %
operations
Income from
operations as
a % of net         9.0       %     9.6       %              9.7       %     9.9       %
operating
revenues
Depreciation
and              $ 182,207       $ 161,515                $ 175,921       $ 161,515
amortization
Equity in
earnings of      $ (7,419    )   $ (8,194    )            $ (7,491    )   $ (8,194    )
unconsolidated
affiliates
Liquidity
Data:
Adjusted         $ 477,254       $ 453,512       5.2  %
EBITDA (c)
Adjusted
EBITDA as a %
of net             14.9      %     15.4      %
operating
revenues
Net cash
provided by      $ 294,938       $ 235,550
operating
activities
Net cash
provided by
operating
activities as      9.2       %     8.0       %
a % of net
operating
revenues

_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Selected Operating Data (b)
($ In thousands)
(Unaudited)

                For the Nine Months Ended September 30,
                 Consolidated                            Same-Store
                 2012           2011           %        2012           2011           %
                                                 Change                                   Change
Number of
hospitals (at      135             130                      130             130
end of period)
Licensed beds
(at end of         20,357          19,358                   19,327          19,358
period)
Beds in
service (at        17,274          16,542                   16,464          16,542
end of period)
Admissions         528,445         509,508       3.7  %     501,562         509,508       -1.6 %
Adjusted           1,065,547       998,959       6.7  %     1,011,565       998,959       1.3  %
admissions
Patient days       2,302,714       2,237,614                2,172,575       2,237,614
Average length     4.4             4.4                      4.3             4.4
of stay (days)
Occupancy rate
(average beds      48.9      %     49.7      %              48.6      %     49.7      %
in service)
Net operating    $ 9,752,039     $ 8,900,387     9.6  %   $ 9,266,128     $ 8,887,439     4.3  %
revenues
Net inpatient
revenues as a
% of total net
operating
revenues
before             45.1      %     46.6      %              44.4      %     46.7      %
provision for
bad debts
Net outpatient
revenues as a
% of total net
operating          53.1      %     51.4      %              53.8      %     51.4      %
revenues
before
provision for
bad debts
Income from      $ 926,868       $ 853,492       8.6  %   $ 896,540       $ 875,652       2.4  %
operations
Income from
operations as
a % of net         9.5       %     9.6       %              9.7       %     9.9       %
operating
revenues
Depreciation
and              $ 536,362       $ 481,046                $ 518,057       $ 481,046
amortization
Equity in
earnings of      $ (32,613   )   $ (38,345   )            $ (32,791   )   $ (38,345   )
unconsolidated
affiliates
Liquidity
Data:
Adjusted         $ 1,495,843     $ 1,372,883     9.0  %
EBITDA (c)
Adjusted
EBITDA as a %
of net             15.3      %     15.4      %
operating
revenues
Net cash
provided by      $ 777,865       $ 820,235
operating
activities
Net cash
provided by
operating
activities as      8.0       %     9.2       %
a % of net
operating
revenues
                                                        
_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands, except share data)
(Unaudited)

                                             September 30,   December 31,
                                               2012             2011
ASSETS
Current assets
  Cash and cash equivalents                    $ 240,650        $ 129,865
  Patient accounts receivable, net of
  allowance for doubtful accounts of             2,091,217        1,834,167
  $2,199,088 and $1,891,334 at September 30,
  2012 and December 31, 2011, respectively
  Supplies                                       364,972          346,611
  Prepaid income taxes                           20,233           101,389
  Deferred income taxes                          89,797           89,797
  Prepaid expenses and taxes                     132,807          112,613
  Other current assets                          267,735        231,647    
  Total current assets                          3,207,411      2,846,089  
Property and equipment                           9,981,776        9,369,528
  Less accumulated depreciation and             (2,875,982 )    (2,513,552 )
  amortization
  Property and equipment, net                   7,105,794      6,855,976  
Goodwill                                        4,397,473      4,264,845  
Other assets, net                               1,530,477      1,241,930  
Total assets                                   $ 16,241,155    $ 15,208,840 
                                                                
LIABILITIES AND EQUITY
Current liabilities
  Current maturities of long-term debt         $ 99,194         $ 63,706
  Accounts payable                               809,255          748,997
  Accrued interest                               110,864          110,121
  Accrued liabilities                           961,910        988,315    
  Total current liabilities                     1,981,223      1,911,139  
Long-term debt                                  9,472,869      8,782,798  
Deferred income taxes                           704,725        704,725    
Other long-term liabilities                     999,080        949,990    
Total liabilities                               13,157,897     12,348,652 
Redeemable noncontrolling interests in          370,514        395,743    
equity of consolidated subsidiaries
                                                                
EQUITY
Community Health Systems, Inc. stockholders'
equity
  Preferred stock, $.01 par value per share,     -                -
  100,000,000 shares authorized; none issued
  Common stock, $.01 par value per share,
  300,000,000 shares authorized; 92,161,852
  shares issued and 91,186,303 shares            922              915
  outstanding at September 30, 2012 and
  91,547,079 shares issued and 90,571,530
  shares outstanding at December 31, 2011
  Additional paid-in capital                     1,104,570        1,086,008
  Treasury stock, at cost, 975,549 shares at     (6,678     )     (6,678     )
  September 30, 2012 and December 31, 2011
  Accumulated other comprehensive loss           (148,721   )     (184,479   )
  Retained earnings                             1,704,396      1,501,330  
  Total Community Health Systems, Inc.           2,654,489        2,397,096
  stockholders' equity
Noncontrolling interests in equity of           58,255         67,349     
consolidated subsidiaries
Total equity                                    2,712,744      2,464,445  
Total liabilities and equity                   $ 16,241,155    $ 15,208,840 

_____

For footnotes, see pages 12 and 13.







COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)

                                               Nine Months Ended
                                                 September 30,
                                                 2012            2011
Cash flows from operating activities
  Net income                                     $ 260,177        $ 224,503
  Adjustments to reconcile net income to net       536,362
  cash provided by operating activities:
  Depreciation and amortization                                     485,917
  Stock-based compensation expense                 30,708           31,588
  Loss on sale, net                                -                3,300
  Impairment of hospitals sold                     -                47,930
  Loss from early extinguishment of debt           115,453          -
  Excess tax benefit relating to stock-based       (1,545     )     (4,616   )
  compensation
  Other non-cash expenses, net                     22,482           14,279
  Changes in operating assets and liabilities,
  net of effects of acquisitions and
  divestitures:
  Patient accounts receivable                      (227,814   )     (90,805  )
  Supplies, prepaid expenses and other current     (68,247    )     (31,455  )
  assets
  Accounts payable, accrued liabilities and        103,156          146,166
  income taxes
  Other                                           7,133          (6,572   )
  Net cash provided by operating activities       777,865        820,235  
                                                                  
Cash flows from investing activities
  Acquisitions of facilities and other related     (312,927   )     (209,451 )
  equipment
  Purchases of property and equipment              (557,469   )     (532,845 )
  Proceeds from disposition of hospitals and       -                172,578
  other ancillary operations
  Proceeds from sale of property and equipment     4,808            9,251
  Increase in other investments                   (222,164   )    (130,980 )
  Net cash used in investing activities           (1,087,752 )    (691,447 )
                                                                  
Cash flows from financing activities
  Proceeds from exercise of stock options          5,750            18,880
  Repurchase of restricted stock shares for        (9,165     )     -
  payroll tax withholding requirements
  Deferred financing costs                         (135,647   )     (100     )
  Excess tax benefit relating to stock-based       1,545            4,616
  compensation
  Stock buy-back                                   -                (85,790  )
  Proceeds from noncontrolling investors in        535              1,229
  joint ventures
  Redemption of noncontrolling investments in      (39,709    )     (4,784   )
  joint ventures
  Distributions to noncontrolling investors in     (60,676    )     (49,928  )
  joint ventures
  Borrowings under credit agreements               5,924,377        83,000
  Issuance of long-term debt                       3,825,000        -
  Proceeds from receivables facility               300,000          -
  Repayments of long-term indebtedness            (9,391,338 )    (128,768 )
  Net cash provided by (used in) financing        420,672        (161,645 )
  activities
                                                                  
Net change in cash and cash equivalents            110,785          (32,857  )
Cash and cash equivalents at beginning of         129,865        299,169  
period
Cash and cash equivalents at end of period       $ 240,650       $ 266,312  

_____

For footnotes, see pages 12 and 13.






Footnotes to Financial Highlights, Financial Statements and Selected Operating
                                     Data

(a) The following table provides information needed to calculate income per
share, which is adjusted for income attributable to noncontrolling interests
(in thousands):

                            Three Months Ended     Nine Months Ended
                             September 30,           September 30,
                             2012      2011         2012         2011
Income from continuing
operations attributable to
Community Health Systems,
Inc. common stockholders:
Income from continuing       $ 58,758   $ 95,800     $ 260,643     $ 280,279
operations, net of taxes
Less: Income from
continuing operations
attributable to               14,525    18,327     57,111      53,486  
noncontrolling interests,
net of taxes
Income from continuing
operations attributable to
Community Health Systems,    $ 44,233   $ 77,473    $ 203,532    $ 226,793 
Inc. common stockholders -
basic and diluted
                                                                   
Loss from discontinued
operations attributable to
Community Health Systems,
Inc. common stockholders:
Loss from discontinued       $ -        $ (3,169 )   $ (466    )   $ (55,776 )
operations, net of taxes
Less: Loss from
discontinued operations
attributable to               -         -          -           -       
noncontrolling interests,
net of taxes
Loss from discontinued
operations attributable to
Community Health Systems,    $ -        $ (3,169 )   $ (466    )   $ (55,776 )
Inc. common stockholders -
basic and diluted
                                                                   

(b) Continuing operating results exclude discontinued operations for the three
and nine months ended September 30, 2012 and 2011. Both financial and
statistical results exclude entities in discontinued operations for all
periods presented.

(c) EBITDA consists of net income attributable to Community Health Systems,
Inc. before interest, income taxes, and depreciation and amortization.
Adjusted EBITDA is EBITDA adjusted to exclude discontinued operations,
gain/loss from early extinguishment of debt and net income attributable to
noncontrolling interests. The Company has from time to time sold
noncontrolling interests in certain of its subsidiaries or acquired
subsidiaries with existing noncontrolling interest ownership positions. The
Company believes that it is useful to present adjusted EBITDA because it
excludes the portion of EBITDA attributable to these third-party interests and
clarifies for investors the Company’s portion of EBITDA generated by
continuing operations. The Company uses adjusted EBITDA as a measure of
liquidity. The Company has included this measure because it believes it
provides investors with additional information about the Company’s ability to
incur and service debt and make capital expenditures. Adjusted EBITDA is the
basis for a key component in the determination of the Company’s compliance
with some of the covenants under the Company’s senior secured credit facility,
as well as to determine the interest rate and commitment fee payable under the
senior secured credit facility.

Adjusted EBITDA is not a measurement of financial performance or liquidity
under U.S. GAAP. It should not be considered in isolation or as a substitute
for net income, operating income, cash flows from operating, investing or
financing activities, or any other measure calculated in accordance with U.S.
GAAP. The items excluded from adjusted EBITDA are significant components in
understanding and evaluating financial performance and liquidity. This
calculation of adjusted EBITDA may not be comparable to similarly titled
measures reported by other companies.

The following table reconciles adjusted EBITDA, as defined, to net cash
provided by operating activities as derived directly from the condensed
consolidated financial statements (in thousands):

                  Three Months Ended           Nine Months Ended
                   September 30,                 September 30,
                   2012          2011           2012           2011
Adjusted EBITDA    $ 477,254        453,512      $ 1,495,843      1,372,883
Interest             (158,565 )     (159,480 )     (462,347  )     (485,928  )
expense, net
Provision for        (25,700  )     (36,717  )     (121,038  )     (125,630  )
income taxes
Loss from
operations of        -              (3,103   )     (466      )     (4,546    )
entities sold,
net of taxes
Other non-cash       15,596         20,901         51,645          46,123
expenses, net
Net changes in
operating assets
and liabilities,    (13,647  )    (39,563  )    (185,772  )    17,333    
net of effects
of acquisitions
and divestitures
Net cash
provided by        $ 294,938     $ 235,550     $ 777,865       820,235   
operating
activities

_____

Footnotes continued on the next page.






Footnotes to Financial Highlights, Financial Statements and Selected Operating
                               Data (Continued)

(d) Included in non-same-store income from operations and income from
continuing operations for the nine months ended September 30, 2012, is
approximately $102 million of net operating revenue and approximately $9
million of related expenses from an industry-wide settlement with the United
States Department of Health and Human Services and Centers for Medicare and
Medicaid Services based on a claim that acute-care hospitals in the U.S. were
underpaid from the Medicare inpatient prospective payment system in federal
fiscal years 1999 through 2011. The underpayments resulted from calculations
related to the rural floor budget neutrality adjustments implemented in
connection with the Balanced Budget Act of 1997. In addition, included in net
income attributable to noncontrolling interests is approximately $3 million
related to this settlement. Also included is an unfavorable adjustment to net
operating revenue of approximately $21 million related to the newly issued
Supplemental Security Income ratios for federal fiscal years 2006 through 2009
utilized for calculating Medicare Disproportionate Share Hospital
reimbursements. These adjustments resulted in an after-tax benefit to net
income of $0.48 per share (diluted).

(e) Included in income from operations and income from continuing operations
for the nine months ended September 30, 2012, is a pre-tax adjustment to
establish an accrual of $14 million, resulting in an after-tax charge to net
income of $0.10 per share (diluted), for certain legal matters.

(f) Included in income from operations and income from continuing operations
for the three and nine months ended September 30, 2012, is the Electronic
Health Records incentive reimbursement, which represents reimbursement from
Medicaid and Medicare related to certain of the Company’s hospitals and
Medicare and Medicaid for certain employed physicians. Total costs and
expenses related to the implementation of electronic health records were
approximately $23.5million and $46.9 million, including depreciation and
amortization of approximately $11.1 million and $25.0 million for the three
and nine months ended September 30, 2012, respectively. Total costs and
expenses related to the implementation of electronic health records were
approximately $7.8 million and $15.0 million for the three and nine months
ended September 30, 2011, respectively. No depreciation and amortization
expense was incurred during the three and nine months ended September 30,
2011.

(g) Included in non-same-store income from operations and income from
continuing operations are pre-tax legal and other costs, offset by insurance
recoveries beginning in June 2012, related to the Tenet Healthcare Corporation
(“Tenet”) lawsuit, governmental investigation and shareholder lawsuits of $1.6
million and $6.1 million for the three months ended September 30, 2012 and
2011, respectively, and $3.0 million and $12.3 million for the nine months
ended September 30, 2012 and 2011, respectively.

(h) Also included in income from operations and income from continuing
operations are pre-tax charges related to acquisition costs (other than Tenet)
of $2.5million and $2.4 million for the three months ended September 30, 2012
and 2011, respectively, and $9.1 million and $8.0 million for the nine months
ended September 30, 2012 and 2011, respectively.

(i) The following table sets forth components reconciling the basic
weighted-average number of shares to the diluted weighted-average number of
shares (inthousands):

                                       Three Months Ended  Nine Months Ended
                                        September 30,        September 30,
                                        2012      2011      2012      2011
Weighted-average number of shares       89,260     89,412    89,028     90,514
outstanding - basic
Add effect of dilutive securities:
Stock awards and options                749        446       437        742
Weighted-average number of shares       90,009     89,858    89,465     91,256
outstanding - diluted


(j) Total per share amounts may not add due to rounding.

                           Regulation FD Disclosure

The following tables set forth selected information concerning the Company’s
updated projected consolidated operating results for the year ending December
31, 2012. These projections are based on the Company’s historical operating
performance, current trends and other assumptions that the Company believes
are reasonable at this time. This 2012 guidance reaffirms the Company’s
previous guidance for 2012 provided on July 25, 2012, modified to reflect
certain changes as detailed in the guidance assumptions below. See page 16 for
a list of factors that could affect the future results of the Company or the
healthcare industry generally.

The following is provided as guidance to analysts and investors:

                                 2012 Projection Range         2011 Actual
Net operating revenues less
provision for bad debts (in       $ 12,800    to  $ 13,200     $ 11,906   *
millions) *
Adjusted EBITDA (in millions)     $ 1,965      to   $ 1,990      $ 1,837
Income from continuing            $ 3.80       to   $ 3.95       $ 3.33     **
operations per share - diluted
Same-store hospital annual          -0.5   %   to     1.5    %     -0.7   %
adjusted admissions growth
Weighted-average diluted shares     90         to     91           91
(in millions)
__________
* Any reference to net operating revenues means net operating revenues less
provision for bad debts.
** Excludes loss on early extinguishment of debt.




The following assumptions were used in developing the 2012 guidance provided
above:

  *Effective January 1, 2012, the Company adopted Accounting Standards Update
    2011-07, which requires the provision for bad debts expense associated
    with patient service revenue to be presented as an offset to the patient
    service revenue line item in the statement of operations. 2012 projection
    range and restated 2011 actual net operating revenues are presented net of
    projected and actual provision for bad debts, respectively.
  *The Company’s 2012 projection includes an aggregate $80 million of net
    operating revenues and $0.38 per share (diluted) of adjustments recognized
    in our operating results for the three months ended March 31, 2012,
    related to the Rural Floor Budget Neutrality Adjustment, the Supplemental
    Security Income payment update and the accrual of certain legal matters
    not previously included in our guidance.
  *The Company’s projection excludes loss on early extinguishment of debt.
  *The Company’s previously issued 2012 guidance for Adjusted EBITDA has been
    reduced by approximately 50 basis points, and its income from continuing
    operations per share (diluted) has been reduced by approximately $0.07, as
    a result of California no longer expecting an approved managed care
    component of its provider tax program during the second half of 2012.
    Currently, final approval from CMS on this component of California’s
    program is anticipated to occur in the first half of 2013.
  *Expressed as a percent of net operating revenues, Health Information
    Technology (HITECH) electronic health records incentive reimbursement for
    2012 is projected to be approximately 0.8% to 0.9%. Electronic health
    records-related total costs and expenses for 2012, expressed as a
    percentage of net operating revenues, are projected to be approximately
    0.4% to 0.6%, including depreciation and amortization, expressed as a
    percentage of net operating revenues, of approximately 0.2% to 0.3%. The
    projections related to HITECH incentive reimbursement and the related
    costs are based on the assumption that approximately one-third of our
    hospitals are Stage 1 compliant by September 30, 2012.
  *2012 projection includes four acquisitions which have closed prior to
    September 30, 2012.
  *Projected 2012 same-store hospital annual adjusted admissions growth does
    not take into account service closures and other unusual events.
  *Expressed as a percentage of net operating revenues, depreciation and
    amortization is projected to be approximately 5.6% to 5.8% for 2012;
    however, this is a fixed cost and the percentages may vary as revenue
    varies. Such amounts exclude the possible impact of any future hospital
    fixed asset impairments.
  *2012 projection includes an estimate of $0.05 to $0.07 per share (diluted)
    of acquisition costs that are required to be expensed.
  *The Company’s 2012 projection does not take into account resolution of
    government investigations or other significant legal settlements not
    resolved at October 30, 2012.
  *For the purpose of providing interest expense guidance, the Company has
    included approximately $10 million of additional interest expense for the
    remainder of 2012 as a result of the following: the issuance, in August
    2012, of $1.6 billion 5.125% Senior Secured Notes, the proceeds of which
    were used to repay non-extended term loans under our Credit Agreement,
    which bore interest at a variable rate approximating 2.50% at the time of
    repayment; and the modification, on August 22, 2012, extending the
    maturity of $340 million of term loans from July 25, 2014 to January 25,
    2017. Including these transactions, interest expense, expressed as a
    percentage of net operating revenues, is projected to be approximately
    4.8% to 4.9% for 2012; however, these percentages will vary as revenue and
    interest rates vary.
  *Total fixed rate debt, including swaps, is expected to average
    approximately 82% to 86% of total debt during the 4^th quarter of 2012.
  *On December 14, 2011, the Company adopted a new open market repurchase
    program for up to four million shares of the Company’s common stock, not
    to exceed $100 million in purchases. The new repurchase program will
    conclude at the earliest of three years, when the maximum number of shares
    has been repurchased, or when the maximum dollar amount has been expended.
    Through October 30, 2012, no shares have been repurchased and retired
    under this repurchase plan.
  *Expressed as a percentage of net operating revenues, equity in earnings of
    unconsolidated affiliates is projected to be approximately 0.3% to 0.4%
    for 2012.
  *Expressed as a percentage of net operating revenues, net income
    attributable to noncontrolling interests is projected to be approximately
    0.5% to 0.6% for 2012.
  *Expressed as a percentage of income from continuing operations before
    income taxes, provision for income tax is projected to be approximately
    31.0% to 33.0% for 2012.
  *Capital expenditures are projected as follows (in millions):

          2012
       
          Guidance
Total     $800   to   $850
                          

  *Net cash provided by operating activities is projected as follows (in
    millions):

          2012
       
          Guidance
Total     $1,200   to   $1,300




The projections set forth in this press release constitute forward-looking
statements within the meaning of Section 27A of the Securities Act, Section
21E of the Exchange Act and the Private Securities Litigation Reform Act of
1995. Although the Company believes that these forward-looking statements are
based on reasonable assumptions, these assumptions are inherently subject to
significant economic and competitive uncertainties and contingencies, which
are difficult or impossible to predict accurately and are beyond the control
of the Company. Accordingly, the Company cannot give any assurance that its
expectations will in fact occur and cautions that actual results may differ
materially from those in the forward-looking statements. A number of factors
could affect the future results of the Company or the healthcare industry
generally and could cause the Company’s expected results to differ materially
from those expressed in this filing.

These factors include, among other things:

  *general economic and business conditions, both nationally and in the
    regions in which we operate;
  *implementation and effect of adopted and potential federal and state
    healthcare legislation;
  *risks associated with our substantial indebtedness, leverage, and debt
    service obligations;
  *demographic changes;
  *changes in, or the failure to comply with, governmental regulations;
  *potential adverse impact of known and unknown government investigations,
    audits, and Federal and State False Claims Act litigation and other legal
    proceedings;
  *our ability, where appropriate, to enter into and maintain managed care
    provider arrangements and the terms of these arrangements;
  *changes in, or the failure to comply with, managed care provider contracts
    could result in disputes and changes in reimbursement that could be
    applied retroactively;
  *changes in inpatient or outpatient Medicare and Medicaid payment levels;
  *increases in the amount and risk of collectability of patient accounts
    receivable;
  *increases in wages as a result of inflation or competition for highly
    technical positions and rising supply costs due to market pressure from
    pharmaceutical companies and new product releases;
  *liabilities and other claims asserted against us, including self-insured
    malpractice claims;
  *competition;
  *our ability to attract and retain, at reasonable employment costs,
    qualified personnel, key management, physicians, nurses and other health
    care workers;
  *trends toward treatment of patients in less acute or specialty healthcare
    settings, including ambulatory surgery centers or specialty hospitals;
  *changes in medical or other technology;
  *changes in U.S. generally accepted accounting principles;
  *the availability and terms of capital to fund additional acquisitions or
    replacement facilities;
  *our ability to successfully acquire additional hospitals or complete
    divestitures;
  *our ability to successfully integrate any acquired hospitals or to
    recognize expected synergies from such acquisitions;
  *our ability to obtain adequate levels of general and professional
    liability insurance;
  *timeliness of reimbursement payments received under government programs;
    and
  *the other risk factors set forth in our public filings with the Securities
    and Exchange Commission.

The consolidated operating results for the three and nine months ended
September 30, 2012, are not necessarily indicative of the results that may be
experienced for any such future period or for any future year.

The Company cautions that the projections for calendar year 2012 set forth in
this press release are given as of the date hereof based on currently
available information. The Company is not undertaking any obligation to update
these projections as conditions change or other information becomes available.

Contact:

Community Health Systems, Inc.
W. Larry Cash, 615-465-7000
Executive Vice President and Chief Financial Officer
 
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