Tenet Reports Third Quarter Adjusted EBITDA Growth of 40% to $269 Million

  Tenet Reports Third Quarter Adjusted EBITDA Growth of 40% to $269 Million

                    5.8% Growth in Net Operating Revenues

                     1.4% Increase in Adjusted Admissions

                     6.3% Growth in Outpatient Surgeries

         3.7% Increase in Net Patient revenue per Adjusted Admission

Business Wire

DALLAS -- November 07, 2012

Tenet Healthcare Corporation (NYSE:THC) today reported Adjusted EBITDA of $269
million for the third quarter ended September 30, 2012, an increase of $77
million, or 40 percent, as compared to Adjusted EBITDA of $192 million in the
third quarter of 2011. Net income attributable to common shareholders was $40
million, or $0.37 per diluted share, compared to $6 million, or $0.05 per
diluted share in the third quarter of 2011.

“Strong revenue growth and disciplined cost control continue to drive our
solid financial performance,” said Trevor Fetter, president and chief
executive officer. “Adjusted EBITDA increased 40 percent to create the
Company’s strongest third quarter in the last ten years. Net revenues grew by
5.8 percent reflecting strong volume increases and continued pricing strength.
Our volume growth was one of the strongest in the investor-owned healthcare
provider sector, and we recorded our eighth consecutive quarter of positive
growth in adjusted admissions. Volume growth was led by a 6.3 percent increase
in outpatient surgeries. Cost control was excellent. Conifer Health Solutions,
Tenet’s services business, reported another solid quarter contributing $24
million to Adjusted EBITDA.”

“As we look to the fourth quarter, state officials in California recently
informed the hospital industry that the managed care portion of the California
Provider Fee program is not likely to be approved in 2012,” said Mr. Fetter.
“This program had been expected to contribute more than $40 million to
Adjusted EBITDA in the fourth quarter. We now expect these earnings to be
recognized in 2013. As a result of this delay and recent trends in volumes and
payer mix, we now expect Adjusted EBITDA of approximately $1.2 billion for
2012.”

Discussion of Results (Percentage changes compare Q3’12 to Q3’11, unless
otherwise noted.)

In the third quarter, adjusted admissions increased by 1.4 percent, and total
admissions declined by 0.5 percent. Outpatient surgeries extended their strong
growth trend increasing by 6.3 percent and total emergency department visits
increased by 4.9 percent.

Net operating revenues were $2.221 billion, an increase of $121 million, or
5.8 percent, compared to net operating revenues of $2.100 billion in the third
quarter of 2011.

Bad debt expense as a percent of revenues was 8.5 percent, an increase of 20
basis points compared to 8.3 percent in the third quarter of 2011. The
increase in bad debt expense was largely the result of the 7.9 percent
increase in uninsured and charity outpatient visits.

Net patient revenue per adjusted admission was $11,579, an increase of 3.7
percent. This pricing increase primarily reflects improved terms in our
contracts with commercial managed care payers.

Selected operating expenses, defined as the sum of salaries, wages and
benefits, supplies and other operating expenses, increased by only 1.5 percent
on a per adjusted admission basis. This favorable cost performance exceeded
the Company’s expectations for the quarter. Supply costs were extremely
well-controlled, declining 2.2 percent per adjusted admission.

Cash and cash equivalents were $83 million at September 30, 2012 compared to
$82 million at June 30, 2012. The balance on the Company’s bank line was $175
million at September 30, 2012, a reduction of $25 million as compared to a
balance of $200 million as of June 30, 2012. Approximately $60 million of
California Provider Fee program revenues have been recognized in Adjusted
EBITDA in 2012 that have not yet been received.

Outlook for Adjusted EBITDA in Fourth Quarter 2012 and Full Year 2013

The outlook range for Adjusted EBITDA in the fourth quarter of 2012 is $313
million to $353 million. This range reflects the delayed recognition of the
revenue from the managed care portion of the California Provider Fee program
into 2013. The Company’s Outlook for 2013 Adjusted EBITDA is in a range of
$1.325 billion to $1.425 billion, slightly above analyst consensus estimates.

Management’s Webcast Discussion of Third Quarter Results

Tenet management will discuss the Company’s third quarter 2012 results on a
9:00 AM (ET) webcast on November 7, 2012. This webcast may be accessed through
Tenet’s website at www.tenethealth.com/investors.

Additional information regarding Tenet’s quarterly results of operations,
including detailed tabular operational data, is contained in its Form 10-Q
report, which will be filed with the Securities and Exchange Commission and
posted on the Tenet investor relations website before the webcast. This press
release includes certain non-GAAP measures, such as Adjusted EBITDA. A
reconciliation of Adjusted EBITDA to net income attributable to Tenet common
shareholders is included in the financial tables at the end of this release.

Tenet Healthcare Corporation, a leading health care services company, through
its subsidiaries operates 49 hospitals, over 100 free-standing outpatient
centers and Conifer Health Solutions, a leader in business process solutions
for health care providers that serves more than 500 hospital and health care
entities nationwide. Tenet’s hospitals and related health care facilities are
committed to providing high quality care to patients in the communities they
serve. For more information, please visit www.tenethealth.com.

This document contains “forward-looking statements” – that is, statements
relating to future, not past, events. In this context, forward-looking
statements often address our expected future business and financial
performance and financial condition, and often contain words such as “expect,”
“anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.”
Forward-looking statements by their nature address matters that are, to
different degrees, uncertain. Particular uncertainties that could cause our
actual results to be materially different than those expressed in our
forward-looking statements include the factors disclosed under
“Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year
ended Dec. 31, 2011, our quarterly reports on Form 10-Q, periodic reports on
Form 8-K and other filings with the Securities and Exchange Commission. The
Company assumes no obligation to update forward-looking statements contained
in this press release as a result of new information or future events or
developments.

Tenet uses its company web site to provide important information to investors
 about the company including the posting of important announcements regarding
              financial performance and corporate developments.



TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

(Dollars in
millions except    Three Months Ended September 30,
per share
amounts)
                    2012         %         2011         %        Change
                                                                     
Net operating
revenues:
Net operating
revenues before     $ 2,427                  $ 2,289                 6.0    %
provision for
doubtful accounts
Less: Provision
for doubtful         206                    189                  9.0    %
accounts
Net operating         2,221       100.0 %      2,100       100.0 %   5.8    %
revenues
Operating
expenses:
Salaries, wages       1,050       47.3  %      1,002       47.7  %   4.8    %
and benefits
Supplies              376         16.9  %      379         18.0  %   (0.8   )%
Other operating       539         24.2  %      527         25.1  %   2.3    %
expenses, net
Electronic health     (13     )   (0.6  )      —           —     %   (100.0 )%
record incentives                       %
Depreciation and      110         5.0   %      100         4.8   %   10.0   %
amortization
Impairment of
long-lived assets
and goodwill, and     6           0.3   %      8           0.4   %
restructuring
charges, net
Litigation and
investigation        —          —     %     5          0.2   %
costs
Operating income      153         6.9   %      79          3.8   %
Interest expense      (103    )                (59     )
Investment           1                      1       
earnings
Income from
continuing
operations,           51                       21
before income
taxes
Income tax           (18     )               (4      )
expense
Income from
continuing
operations,           33                       17
before
discontinued
operations
Discontinued
operations:
Income (loss)         4                        (2      )
from operations
Net losses on
sales of              (1      )                —
facilities
Income tax           (4      )               —       
expense
Loss from
discontinued         (1      )               (2      )
operations
Net income            32                       15
Less: Preferred       1                        6
stock dividends
Less: Net income
(loss)
attributable to      (9      )               3       
noncontrolling
interests
Net income
attributable to
Tenet Healthcare    $ 40                    $ 6       
Corporation
common
shareholders
                                                                     
Amounts
attributable to
Tenet Healthcare
Corporation
common
shareholders
Income from
continuing          $ 30                     $ 8
operations, net
of tax
Income (loss)
from discontinued    10                     (2      )
operations, net
of tax
Net income
attributable to
Tenet Healthcare    $ 40                    $ 6       
Corporation
common
shareholders
                                                                     
Earnings (loss)
per share
attributable to
Tenet Healthcare
Corporation
common
shareholders
Basic
Continuing          $ 0.29                   $ 0.07
operations
Discontinued         0.09                   (0.02   )
operations
                    $ 0.38                  $ 0.05    
Diluted
Continuing          $ 0.28                   $ 0.07
operations
Discontinued         0.09                   (0.02   )
operations
                    $ 0.37                  $ 0.05    
Weighted average
shares and
dilutive
securities
outstanding (in
thousands):
Basic                 104,244                  117,188
Diluted               107,311                  120,908



TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
                  
(Dollars in
millions except     Nine Months Ended September 30,
per share
amounts)
                    2012         %         2011         %         Change
                                                                      
Net operating
revenues:
Net operating
revenues before     $ 7,373                  $ 7,018                  5.1   %
provision for
doubtful accounts
Less: Provision
for doubtful         585                    536                   9.1   %
accounts
Net operating         6,788       100.0 %      6,482       100.0 %    4.7   %
revenues
Operating
expenses:
Salaries, wages       3,166       46.7  %      3,001       46.3  %    5.5   %
and benefits
Supplies              1,164       17.1  %      1,167       18.0  %    (0.3  )%
Other operating       1,604       23.7  %      1,526       23.5  %    5.1   %
expenses, net
Electronic health     (13     )   (0.2  )%     (50     )   (0.8  )%   (74.0 )%
record incentives
Depreciation and      314         4.6   %      298         4.6   %    5.4   %
amortization
Impairment of
long-lived assets
and goodwill, and     12          0.2   %      18          0.3   %
restructuring
charges, net
Litigation and
investigation        3          —     %     24         0.4   %
costs
Operating income      538         7.9   %      498         7.7   %
Interest expense      (303    )                (275    )
Investment           2                      3       
earnings
Income from
continuing
operations,           237                      226
before income
taxes
Income tax           (90     )               (73     )
expense
Income from
continuing
operations,           147                      153
before
discontinued
operations
Discontinued
operations:
Income (loss)         7                        (17     )
from operations
Impairment of
long-lived assets
and goodwill, and     (100    )                —
restructuring
charges, net
Net gains on
sales of              1                        —
facilities
Income tax           24                     24      
benefit
Income (loss)
from discontinued    (68     )               7       
operations
Net income            79                       160
Less: Preferred       11                       18
stock dividends
Less: Net income
(loss)
attributable to      (24     )               8       
noncontrolling
interests
Net income
attributable to
Tenet Healthcare    $ 92                    $ 134     
Corporation
common
shareholders
                                                                      
Amounts
attributable to
Tenet Healthcare
Corporation
common
shareholders
Income from
continuing          $ 129                    $ 128
operations, net
of tax
Income (loss)
from discontinued    (37     )               6       
operations, net
of tax
Net income
attributable to
Tenet Healthcare    $ 92                    $ 134     
Corporation
common
shareholders
                                                                      
Earnings (loss)
per share
attributable to
Tenet Healthcare
Corporation
common
shareholders
Basic
Continuing          $ 1.25                   $ 1.06
operations
Discontinued         (0.36   )               0.05    
operations
                    $ 0.89                  $ 1.11    
Diluted
Continuing          $ 1.21                   $ 1.03
operations
Discontinued         (0.35   )               0.05    
operations
                    $ 0.86                  $ 1.08    
Weighted average
shares and
dilutive
securities
outstanding (in
thousands):
Basic                 103,613                  120,204
Diluted               106,904                  124,466



TENET HEALTHCARE CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)

                                                 September 30,  December 31,
(Dollars in millions)                             2012            2011
ASSETS
Current assets:
Cash and cash equivalents                         $  83           $  113
Accounts receivable, less allowance for              1,338           1,278
doubtful accounts
Inventories of supplies, at cost                     154             161
Income tax receivable                                13              7
Current portion of deferred income taxes             394             418
Assets held for sale                                 —               2
Other current assets                                502           378     
Total current assets                                 2,484           2,357
Investments and other assets                         126             156
Deferred income taxes, net of current portion        338             374
Property and equipment, at cost, less                4,173           4,350
accumulated depreciation and amortization
Goodwill                                             771             736
Other intangible assets, at cost, less              578           489     
accumulated amortization
Total assets                                      $  8,470       $  8,462   
                                                                  
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt                 $  243          $  66
Accounts payable                                     629             760
Accrued compensation and benefits                    379             376
Professional and general liability reserves          72              75
Accrued interest payable                             110             112
Accrued legal settlement costs                       7               64
Other current liabilities                           389           362     
Total current liabilities                            1,829           1,815
Long-term debt, net of current portion               4,508           4,294
Professional and general liability reserves          322             337
Accrued legal settlement costs                       2               2
Other long-term liabilities                         524           506     
Total liabilities                                    7,185           6,954
Commitments and contingencies
Redeemable noncontrolling interests in equity        16              16
of consolidated subsidiaries
Equity:
Shareholders’ equity:
Preferred stock                                      45              334
Common stock                                         7               7
Additional paid-in capital                           4,437           4,427
Accumulated other comprehensive loss                 (49     )       (52     )
Accumulated deficit                                  (1,337  )       (1,440  )
Common stock in treasury, at cost                   (1,879  )      (1,853  )
Total shareholders’ equity                           1,224           1,423
Noncontrolling interests                            45            69      
Total equity                                        1,269         1,492   
Total liabilities and equity                      $  8,470       $  8,462   



TENET HEALTHCARE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
                                                      
(Dollars in millions)                                    Nine Months Ended
                                                         September 30,
                                                         2012        2011
Net income                                               $ 79         $ 160
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization                              314          298
Provision for doubtful accounts                            585          536
Deferred income tax expense                                58           102
Stock-based compensation expense                           24           17
Impairment of long-lived assets and goodwill, and          12           18
restructuring charges, net
Litigation and investigation costs                         3            24
Amortization of debt discount and debt issuance            16           23
costs
Pre-tax loss from discontinued operations                  92           17
Other items, net                                           (7     )     (10  )
Changes in cash from changes in operating assets and
liabilities:
Accounts receivable                                        (653   )     (618 )
Inventories and other current assets                       (106   )     (32  )
Income taxes                                               (2     )     (44  )
Accounts payable, accrued expenses and other current       (23    )     (96  )
liabilities
Other long-term liabilities                                20           (10  )
Payments against reserves for restructuring charges        (56    )     (27  )
and litigation costs and settlements
Net cash used in operating activities from                (19    )    (34  )
discontinued operations, excluding income taxes
Net cash provided by operating activities                  337          324
Cash flows from investing activities:
Purchases of property and equipment—continuing             (358   )     (294 )
operations
Purchases of property and equipment—discontinued           (2     )     (4   )
operations
Purchases of businesses or joint venture interests         (38    )     (56  )
Proceeds from sales of facilities and other assets —       45           —
discontinued operations
Proceeds from sales of marketable securities,              9            31
long-term investments and other assets
Other items, net                                          (2     )    (1   )
Net cash used in investing activities                      (346   )     (324 )
Cash flows from financing activities:
Repayments of borrowings under credit facility             (1,458 )     —
Proceeds from borrowings under credit facility             1,553        —
Repayments of other borrowings                             (76    )     (4   )
Proceeds from other borrowings                             292          —
Repurchases of preferred stock                             (292   )     —
Deferred debt issuance costs                               (3     )     —
Repurchases of common stock                                (26    )     (196 )
Cash dividends on preferred stock                          (13    )     (18  )
Distributions paid to noncontrolling interests             (9     )     (8   )
Other items, net                                          11         6    
Net cash used in financing activities                     (21    )    (220 )
Net decrease in cash and cash equivalents                  (30    )     (220 )
Cash and cash equivalents at beginning of period          113        405  
Cash and cash equivalents at end of period               $ 83        $ 185  
Supplemental disclosures:
Interest paid, net of capitalized interest               $ (288   )   $ (255 )
Income tax (payments) refunds, net                       $ (9     )   $ 9

                                                                                                    
                                                                                                    
TENET HEALTHCARE CORPORATION
SELECTED STATISTICS – CONTINUING HOSPITALS
(Unaudited)
                                                                                                    

(Dollars in
millions
except per                                            
patient
day, per
admission
and per       Three Months Ended September 30,            Nine Months Ended September 30,
visit
amounts)
              2012           2011         Change        2012           2011           Change
                                                                                                    
Net
inpatient     $ 1,501         $ 1,444       3.9  %        $ 4,656         $ 4,529         2.8  %
revenues
Net
outpatient    $ 789           $ 734         7.5  %        $ 2,346         $ 2,192         7.0  %
revenues
                                                                                                    
Number of
acute care
hospitals       49              49          —         *     49              49            —        *
(at end of
period)
Licensed
beds (at        13,216          13,119      0.7  %          13,216          13,119        0.7  %
end of
period)
Average
licensed        13,216          13,106      0.8  %          13,177          13,113        0.5  %
beds
Utilization
of licensed     47.8      %     49.1    %   (1.3 )%   *     49.5      %     50.9      %   (1.4 )%  *
beds
Patient         580,594         591,948     (1.9 )%         1,788,490       1,823,397     (1.9 )%
days
Adjusted
patient         911,233         909,960     0.1  %          2,778,244       2,770,685     0.3  %
days
Net
inpatient     $ 2,585         $ 2,439       6.0  %        $ 2,603         $ 2,484         4.8  %
revenue per
patient day
Total           124,869         125,458     (0.5 )%         381,195         382,487       (0.3 )%
admissions
Adjusted
patient         197,778         194,965     1.4  %          597,570         586,395       1.9  %
admissions
Net
inpatient     $ 12,021        $ 11,510      4.4  %        $ 12,214        $ 11,841        3.2  %
revenue per
admission
Average
length of       4.65            4.72        (1.5 )%         4.69            4.77          (1.7 )%
stay (days)
Total           94,260          92,574      1.8  %          282,910         271,086       4.4  %
surgeries
Outpatient      1,035,236       987,318     4.9  %          3,113,615       2,971,933     4.8  %
visits
Net
outpatient    $ 762           $ 743         2.6  %        $ 753           $ 738           2.0  %
revenue per
visit
                                                                                                    
Sources of
net patient
revenue
Medicare        22.1      %     22.5    %   (0.4 )%   *     23.8      %     23.1      %   0.7  %   *
Medicaid        7.7       %     8.0     %   (0.3 )%   *     8.4       %     9.1       %   (0.7 )%  *
Managed         58.9      %     58.2    %   0.7  %    *     57.2      %     57.0      %   0.2  %   *
care
Indemnity,
self-pay        11.3      %     11.3    %   —    %    *     10.6      %     10.8      %   (0.2 )%  *
and other
                                                                                                    
                                                                                                    
* This change is the difference between the 2012 and 2011 amounts shown.



TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Fiscal 2012 by Calendar Quarter
(Unaudited)

(Dollars in millions                                               Nine
except per share        Three Months Ended                       Months
amounts)                                                           Ended
                         03/31/12     06/30/12     09/30/12      09/30/12
                                                                   
Net operating
revenues:
Net operating revenues
before provision for     $ 2,491       $ 2,455       $ 2,427       $ 7,373
doubtful accounts
Less: Provision for       189         190         206         585     
doubtful accounts
Net operating revenues     2,302         2,265         2,221         6,788
Operating expenses:
Salaries, wages and        1,062         1,054         1,050         3,166
benefits
Supplies                   399           389           376           1,164
Other operating            531           534           539           1,604
expenses, net
Electronic health          —             —             (13     )     (13     )
record incentives
Depreciation and           100           104           110           314
amortization
Impairment of
long-lived assets and
goodwill, and              3             3             6             12
restructuring charges,
net
Litigation and            2           1           —           3       
investigation costs
Operating income           205           180           153           538
Interest expense           (98     )     (102    )     (103    )     (303    )
Investment earnings       1           —           1           2       
Income from continuing
operations, before         108           78            51            237
income taxes
Income tax expense        (42     )    (30     )    (18     )    (90     )
Income from continuing
operations, before         66            48            33            147
discontinued
operations
Discontinued
operations:
Income from operations     2             1             4             7
Impairment of
long-lived assets and
goodwill, and              —             (100    )     —             (100    )
restructuring charges,
net
Net gains (losses) on      —             2             (1      )     1
sales of facilities
Income tax benefit        (1      )    29          (4      )    24      
(expense)
Income (loss) from
discontinued              1           (68     )    (1      )    (68     )
operations
Net income                 67            (20     )     32            79
Less: Preferred stock      6             4             1             11
dividends
Less: Net income
(loss) attributable to    3           (18     )    (9      )    (24     )
noncontrolling
interests
Net income (loss)
attributable to Tenet    $ 58         $ (6      )   $ 40         $ 92      
Healthcare Corporation
common shareholders
                                                                   
Amounts attributable
to Tenet Healthcare
Corporation common
shareholders
Income from continuing   $ 57          $ 42          $ 30          $ 129
operations, net of tax
Income (loss) from
discontinued              1           (48     )    10          (37     )
operations, net of tax
Net income (loss)
attributable to Tenet    $ 58         $ (6      )   $ 40         $ 92      
Healthcare Corporation
common shareholders
                                                                   
Earnings (loss) per
share attributable to
Tenet Healthcare
Corporation common
shareholders
Basic
Continuing operations    $ 0.55        $ 0.40        $ 0.29        $ 1.25
Discontinued              0.01        (0.46   )    0.09        (0.36   )
operations
                         $ 0.56       $ (0.06   )   $ 0.38       $ 0.89    
Diluted
Continuing operations    $ 0.52        $ 0.39        $ 0.28        $ 1.21
Discontinued              0.01        (0.45   )    0.09        (0.35   )
operations
                         $ 0.53       $ (0.06   )   $ 0.37       $ 0.86    
Weighted average
shares and dilutive
securities outstanding
(in thousands):
Basic                      102,843       103,753       104,244       103,613
Diluted                    121,218       106,927       107,311       106,904



TENET HEALTHCARE CORPORATION

SELECTED STATISTICS – CONTINUING HOSPITALS
(Unaudited)
                                                            
(Dollars in
millions
except per                                                       Nine Months
patient day,
per
admission and
per visit        Three Months Ended                              Ended
amounts)
                 03/31/12        06/30/12        09/30/12        09/30/12
                                                                 
Net inpatient    $ 1,607         $ 1,548         $ 1,501         $ 4,656
revenues
Net outpatient   $ 766           $ 791           $ 789           $ 2,346
revenues
                                                                 
Number of
acute care         49              49              49              49
hospitals (at
end of period)
Licensed beds
(at end of         13,175          13,176          13,216          13,216
period)
Average            13,138          13,176          13,216          13,177
licensed beds
Utilization of     51.6      %     49.2      %     47.8      %     49.5      %
licensed beds
Patient days       617,459         590,437         580,594         1,788,490
Adjusted           947,116         919,895         911,233         2,778,244
patient days
Net inpatient
revenue per      $ 2,603         $ 2,622         $ 2,585         $ 2,603
patient day
Total              131,190         125,136         124,869         381,195
admissions
Adjusted
patient            202,860         196,932         197,778         597,570
admissions
Net inpatient
revenue per      $ 12,249        $ 12,371        $ 12,021        $ 12,214
admission
Average length     4.71            4.72            4.65            4.69
of stay (days)
Total              93,228          95,422          94,260          282,910
surgeries
Outpatient         1,031,611       1,046,768       1,035,236       3,113,615
visits
Net outpatient
revenue per      $ 743           $ 756           $ 762           $ 753
visit
                                                                 
Sources of net
patient
revenue
Medicare           26.5      %     22.7      %     22.1      %     23.8      %
Medicaid           7.5       %     10.0      %     7.7       %     8.4       %
Managed care       55.9      %     56.8      %     58.9      %     57.2      %
Indemnity,
self-pay and       10.1      %     10.5      %     11.3      %     10.6      %
other



TENET HEALTHCARE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS

Fiscal 2011 by Calendar Quarter

(Unaudited)
                                                                      
(Dollars in
millions         Three Months Ended                                      Year Ended
except per
share amounts)
                 03/31/11     06/30/11     09/30/11     12/31/11      12/31/11
                                                                         
Net operating
revenues:
Net operating
revenues
before           $ 2,429       $ 2,300       $ 2,289       $ 2,353       $ 9,371
provision for
doubtful
accounts
Less:
Provision for     179         168         189         181         717     
doubtful
accounts
Net operating      2,250         2,132         2,100         2,172         8,654
revenues
Operating
expenses:
Salaries,
wages and          1,017         982           1,002         1,014         4,015
benefits
Supplies           396           392           379           381           1,548
Other
operating          491           508           527           494           2,020
expenses, net
Electronic
health record      (25     )     (25     )     —             (5      )     (55     )
incentives
Depreciation
and                98            100           100           100           398
amortization
Impairment of
long-lived
assets and         8             2             8             2             20
goodwill, and
restructuring
charges, net
Litigation and
investigation     11          8           5           31          55      
costs
Operating          254           165           79            155           653
income
Interest           (118    )     (98     )     (59     )     (100    )     (375    )
expense
Loss from
early              —             —             —             (117    )     (117    )
extinguishment
of debt
Investment        1           1           1           —           3       
earnings
Income (loss)
from
continuing         137           68            21            (62     )     164
operations,
before income
taxes
Income tax
benefit           (50     )    (19     )    (4      )    12          (61     )
(expense)
Income (loss)
from
continuing
operations,        87            49            17            (50     )     103
before
discontinued
operations
Discontinued
operations:
Loss from          (10     )     (5      )     (2      )     (1      )     (18     )
operations
Impairment of
long-lived
assets and         —             —             —             (6      )     (6      )
goodwill, and
restructuring
charges, net
Litigation
settlements,
and                —             —             —             (17     )     (17     )
investigation
costs
Income tax        5           19          —           8           32      
benefit
Income (loss)
from              (5      )    14          (2      )    (16     )    (9      )
discontinued
operations
Net income         82            63            15            (66     )     94
(loss)
Less:
Preferred          6             6             6             6             24
stock
dividends
Less: Net
income
attributable      3           2           3           4           12      
to
noncontrolling
interests
Net income
(loss)
attributable
to Tenet         $ 73         $ 55         $ 6          $ (76     )   $ 58      
Healthcare
Corporation
common
shareholders
                                                                         
Amounts
attributable
to Tenet
Healthcare
Corporation
common
shareholders
Income (loss)
from
continuing       $ 80          $ 40          $ 8           $ (60     )   $ 68
operations,
net of tax
Income (loss)
from
discontinued      (7      )    15          (2      )    (16     )    (10     )
operations,
net of tax
Net income
(loss)
attributable
to Tenet         $ 73         $ 55         $ 6          $ (76     )   $ 58      
Healthcare
Corporation
common
shareholders
                                                                         
Earnings
(loss) per
share
attributable
to Tenet
Healthcare
Corporation
common
shareholders
Basic
Continuing       $ 0.66        $ 0.33        $ 0.07        $ (0.55   )   $ 0.58
operations
Discontinued      (0.06   )    0.12        (0.02   )    (0.15   )    (0.09   )
operations
                 $ 0.60       $ 0.45       $ 0.05       $ (0.70   )   $ 0.49    
Diluted
Continuing       $ 0.61        $ 0.32        $ 0.07        $ (0.55   )   $ 0.56
operations
Discontinued      (0.05   )    0.12        (0.02   )    (0.15   )    (0.08   )
operations
                 $ 0.56       $ 0.44       $ 0.05       $ (0.70   )   $ 0.48    
Weighted
average shares
and dilutive
securities
outstanding
(in
thousands):
Basic              121,726       121,699       117,188       108,114       117,182
Diluted            141,295       125,937       120,908       108,114       121,295



TENET HEALTHCARE CORPORATION

SELECTED STATISTICS – CONTINUING HOSPITALS

(Unaudited)
                                                             
(Dollars in
millions
except per
patient
day, per
admission
and per       Three Months Ended                                    Year Ended
visit
amounts)
              03/31/11      06/30/11      09/30/11     12/31/11    12/31/11
                                                                    
Net
inpatient     $ 1,619       $ 1,466       $ 1,444       $ 1,499     $ 6,028
revenues
Net
outpatient    $ 720         $ 738         $ 734         $ 736       $ 2,928
revenues
                                                                    
Number of
acute care
hospitals       49            49            49          49            49
(at end of
period)
Licensed
beds (at        13,123        13,086        13,119      13,119        13,119
end of
period)
Average
licensed        13,123        13,111        13,106      13,119        13,115
beds
Utilization
of licensed     53.8    %     50.0    %     49.1    %   48.9    %     50.4      %
beds
Patient         635,463       595,986       591,948     589,848       2,413,245
days
Adjusted
patient         948,356       912,369       909,960     902,762       3,673,447
days
Net
inpatient     $ 2,548       $ 2,460       $ 2,439       $ 2,541     $ 2,498
revenue per
patient day
Total           131,437       125,592       125,458     125,347       507,834
admissions
Adjusted
patient         197,459       193,971       194,965     193,631       780,026
admissions
Net
inpatient     $ 12,318      $ 11,673      $ 11,510      $           $ 11,870
revenue per                                             11,959
admission
Average
length of       4.83          4.75          4.72        4.71          4.75
stay (days)
Total           87,507        91,005        92,574      91,200        362,286
surgeries
Outpatient      990,411       994,204       987,318     982,083       3,954,016
visits
Net
outpatient    $ 727         $ 742         $ 743         $ 749       $ 741
revenue per
visit
                                                                    
Sources of
net patient
revenue
Medicare        23.2    %     23.5    %     22.5    %   23.1    %     23.1      %
Medicaid        11.5    %     7.5     %     8.0     %   8.6     %     9.0       %
Managed         54.6    %     58.2    %     58.2    %   58.1    %     57.2      %
care
Indemnity,
self-pay        10.7    %     10.8    %     11.3    %   10.2    %     10.7      %
and other



TENET HEALTHCARE CORPORATION

SEGMENT REPORTING

(Unaudited)
                                             
                                                  September 30,  December 31,
                                                 2012            2011
Assets
Hospital Operations                               $   8,381       $  8,389
and other
Conifer                                              89           73     
Total                                             $   8,470      $  8,462  
                                                                  
                        Three Months Ended        Nine Months Ended

                        September 30,             September 30,
                        2012        2011          2012            2011
Capital
expenditures:
Hospital Operations     $ 105       $ 98          $   352         $  289
and other
Conifer                  3         2             8            9      
Total                   $ 108      $ 100        $   360        $  298    
                                                                  
Net operating
revenues:
Hospital Operations     $ 2,193     $ 2,076       $   6,725       $  6,425
and other
Conifer
Tenet                     94          68              274            192
Other customers          28        24            63           57     
                          2,315       2,168           7,062          6,674
Intercompany             (94   )    (68   )        (274   )      (192   )
eliminations
Total                   $ 2,221    $ 2,100      $   6,788      $  6,482  
                                                                  
Adjusted EBITDA:
Hospital Operations     $ 245       $ 180         $   793         $  812
and other
Conifer                  24        12            74           26     
Total                   $ 269      $ 192        $   867        $  838    
                                                                  
Depreciation and
amortization:
Hospital Operations     $ 108       $ 98          $   307         $  292
and other
Conifer                  2         2             7            6      
Total                   $ 110      $ 100        $   314        $  298    
                                                                  
Adjusted EBITDA         $ 269       $ 192         $   867         $  838
Depreciation and          (110  )     (100  )         (314   )       (298   )
amortization
Interest expenses         (103  )     (59   )         (303   )       (275   )
Litigation and            —           (5    )         (3     )       (24    )
investigation costs
Impairments of            (6    )     (8    )         (12    )       (18    )
long-lived assets
Investment earnings      1         1             2            3      
Income before           $ 51       $ 21         $   237        $  226    
income taxes
                                                                            

Due to the fact that Conifer’s revenues from providing services to Tenet’s
hospitals were based on third-party billing terms in 2012 but not in 2011, the
following table presents 2012 Adjusted EBITDA on a comparable basis to the
2011 presentation.

                                                    
                                  Three Months Ended     Nine Months Ended

                                  September 30,          September 30,
                                  2012      2011        2012      2011
Adjusted supplemental EBITDA:
Hospital Operations and other     $  260     $  180      $  840     $  812
Conifer                             9         12         27        26
Total                             $  269     $  192      $  867     $  838
                                                                    

(1) Reconciliation of Adjusted EBITDA

Adjusted EBITDA, a non-GAAP term, is defined by the Company as net income
(loss) attributable to Tenet Healthcare Corporation common shareholders before
(1) cumulative effect of changes in accounting principle, net of tax, (2) net
income attributable to noncontrolling interests, (3) preferred stock
dividends, (4) income (loss) from discontinued operations, net of tax, (5)
income tax (expense) benefit, (6) investment earnings (loss), (7) gain (loss)
from early extinguishment of debt, (8) net gain (loss) on sales of
investments, (9) interest expense, (10) litigation and investigation (costs)
benefit, net of insurance recoveries, (11) hurricane insurance recoveries, net
of costs, (12) impairment of long-lived assets and goodwill and restructuring
charges, net of insurance recoveries, and (13) depreciation and amortization.
The Company’s Adjusted EBITDA may not be comparable to EBITDA reported by
other companies.

The Company provides this information as a supplement to GAAP information to
assist itself and investors in understanding the impact of various items on
its financial statements, some of which are recurring or involve cash
payments. The Company uses this information in its analysis of the performance
of its business excluding items that it does not consider as relevant in the
performance of its hospitals in continuing operations. In addition, from time
to time we use this measure to define certain performance targets under our
compensation programs. Adjusted EBITDA is not a measure of liquidity, but is a
measure of operating performance that management uses in its business as an
alternative to net income (loss) attributable to Tenet Healthcare Corporation
common shareholders. Because Adjusted EBITDA excludes many items that are
included in our financial statements, it does not provide a complete measure
of our operating performance. Accordingly, investors are encouraged to use
GAAP measures when evaluating the Company’s financial performance.

The reconciliation of net income (loss) attributable to Tenet Healthcare
Corporation common shareholders, the most comparable GAAP term, to Adjusted
EBITDA, is set forth in the first table below for the three and nine months
ended September 30, 2012 and 2011.



TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures
Table #1 - Reconciliation of Adjusted EBITDA to Net Income Attributable to
Tenet Healthcare Corporation Common Shareholders
(Unaudited)

(Dollars in millions)         Three Months Ended      Nine Months Ended
                               September 30,             September 30,
                               2012       2011          2012       2011
Net income attributable to
Tenet Healthcare Corporation   $ 40        $ 6           $ 92        $ 134
common shareholders
Less: Net (income) loss
attributable to                  9           (3    )       24          (8    )
noncontrolling interests
Preferred stock dividends        (1    )     (6    )       (11   )     (18   )
Income (loss) from
discontinued operations, net    (1    )    (2    )      (68   )    7     
of tax
Income from continuing           33          17            147         153
operations
Income tax expense               (18   )     (4    )       (90   )     (73   )
Investment earnings              1           1             2           3
Interest expense                (103  )    (59   )      (303  )    (275  )
Operating income                 153         79            538         498
Litigation and investigation     —           (5    )       (3    )     (24   )
costs
Impairment of long-lived
assets and goodwill, and         (6    )     (8    )       (12   )     (18   )
restructuring charges, net
Depreciation and                (110  )    (100  )      (314  )    (298  )
amortization
Adjusted EBITDA                $ 269      $ 192        $ 867      $ 838   
                                                                     
Net operating revenues         $ 2,221    $ 2,100      $ 6,788    $ 6,482 
                                                                     
Adjusted EBITDA as % of net
operating revenues (Adjusted     12.1  %     9.1   %       12.8  %     12.9  %
EBITDA margin)

                                                                 
                                                                     
TENET HEALTHCARE CORPORATION
Additional Supplemental Non-GAAP Disclosures
Table #2 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Net Income Attributable to Tenet Healthcare Corporation Common
Shareholders
for Years Ending December 31, 2012 and 2013
(Unaudited)
                               
(Dollars in Millions)            2012                    2013
                                 Low         High        Low         High
Net Income Attributable to       $ 134       $ 175       $ 258       $ 335
Common Shareholders
Less:
Net (income) loss attributable     20          25          (15   )     (10   )
to noncontrolling interests
Preferred stock dividends          (12   )     (12   )     0           0
Loss from discontinued            (75   )    (70   )    (5    )    0     
operations, net of tax
Income from continuing             201         232         278         345
operations
Income tax expense                (129  )    (148  )    (177  )    (220  )
Income from continuing
operations, before income          330         380         455         565
taxes
Investment earnings                0           0           0           0
Interest expense                   (410  )     (390  )     (460  )     (420  )
Net loss from extinguishment      0         0         0         0     
of long-term debt
Operating income                   740         770         915         985
Litigation and investigation       (10   )     (5    )     0           0
costs
Impairment of long-lived
assets and goodwill, and           (20   )     (15   )     0           0
restructuring charges
Depreciation and amortization     (410  )    (430  )    (410  )    (440  )
Adjusted EBITDA                  $ 1,180    $ 1,220    $ 1,325    $ 1,425 



Table #3 - Reconciliation of Outlook Adjusted EBITDA to
Outlook Normalized Income from Continuing Operations
for Years Ending December 31, 2012 and 2013
(Unaudited)
                                                               
(Dollars in Millions except      2012                    2013
per share amounts)
                                 Low         High        Low         High
Adjusted EBITDA (from Table      $ 1,180     $ 1,220     $ 1,325     $ 1,425
#1)
                                                                     
Depreciation and                   (410  )     (430  )     (410  )     (440  )
amortization
Interest expense                  (410  )    (390  )    (460  )    (420  )
Normalized income from
continuing operations before     $ 360       $ 400       $ 455       $ 565
income taxes
Income tax expense ^(a)           (140  )    (156  )    (177  )    (220  )
Normalized income from           $ 220       $ 244       $ 278       $ 345
continuing operations ^ (a)
Preferred stock dividends          (12   )     (12   )     0           0
Net (income) loss
attributable to                   (12   )    (7    )    (15   )    (10   )
noncontrolling interests
Normalized net income
attributable to common           $ 196      $ 225      $ 263      $ 335   
shareholders ^(a)
                                                                     
Weighted average shares            107         107         99          99
outstanding (in millions)
Normalized earnings per
share - continuing                 1.83        2.10        2.66        3.38
operations ^ (a)
                                                                     
^(a) Uses tax rate of 39 percent excluding unusual adjustments.

Contact:

Tenet Healthcare Corporation
Media:
Rick Black, 469-893-2647
Rick.Black@tenethealth.com
or
Investors:
Thomas Rice, 469-893-2522
Thomas.Rice@tenethealth.com
 
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