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Envision Healthcare Corp. reported fourth-quarter earnings of 54 cents per share that beat the Zacks Consensus Estimate by 20%. Earnings significantly declined from $1.08 reported in the year-ago quarter, due to high operating expense.
Adjusted EBITDA for the fourth quarter came at $211.4 million, up 14.8% year over year.
The company reported net revenues of $2 billion, which beat the Zacks Consensus Estimate by 1% and improved 68% year over year.
The company incurred a net benefit of approximately $600 million from a reduction of deferred tax liabilities from the Tax Reform Act as well as a non-cash impairment charge of $500 million in goodwill reduction in its Physician Services segment.
Envision Healthcare Corporation Price, Consensus and EPS Surprise
Total operating expenses of $2.36 billion increased 82.7% year over year, due to higher salaries and benefits, insurance expenses and depreciation & amortization expenses.
Favorable Segment Performance
Physician Services
Net revenues from the segment were $1.67 billion, reflecting an increase of 8.3% year over year. The revenue growth was driven by 8.6% contribution from acquisitions and 0.4% from same contracts.
Adjusted EBITDA was $133.1 million, up 10.5% year over year.
Ambulatory Services
Net revenues were $333.1 million, up nearly 2% year over year, led by procedure volume growth.
For the reported quarter, adjusted EBITDA was $78.3 million, up 23.1% year over year thanks to a $7.7 million favorable legal settlement.
Financial Update
Envision Healthcare had cash and cash equivalents of $312.2 million, down 1.4% year over year.
Total long-term debt increased 8.2% year over year to $6.26 billion as of Dec 31, 2017.
The company’s ratio of total net debt to trailing 12-month EBITDA on Dec 31, 2017 as calculated under its credit agreement was 4.6 times.
Net cash provided by operating activities was $236.4 million as of Dec 31, 2017, up from $68.8 million as of Dec 31, 2016.
First-Quarter 2018 Guidance
The company expects adjusted EPS within the range of 61 cents and 67 cents and adjusted EBITDA in the band of $195-$205 million.
Full-Year 2018 Guidance
The company expects net revenues in the range of $8.35 to $8.53 billion, adjusted EBIDTA of $960 million to $1 billion and adjusted EPS between $3.46 and $3.70.
Among the other firms in the medical sector that have reported fourth-quarter earnings so far, the bottom line at Centene Corp. (CNC - Free Report) , Aetna Inc and UnitedHealth Group Inc. (UNH - Free Report) beat their respective Zacks Consensus Estimate
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Envision Healthcare (EVHC) Q4 Earnings Beat, Revenues Rise
Envision Healthcare Corp. reported fourth-quarter earnings of 54 cents per share that beat the Zacks Consensus Estimate by 20%. Earnings significantly declined from $1.08 reported in the year-ago quarter, due to high operating expense.
Adjusted EBITDA for the fourth quarter came at $211.4 million, up 14.8% year over year.
The company reported net revenues of $2 billion, which beat the Zacks Consensus Estimate by 1% and improved 68% year over year.
The company incurred a net benefit of approximately $600 million from a reduction of deferred tax liabilities from the Tax Reform Act as well as a non-cash impairment charge of $500 million in goodwill reduction in its Physician Services segment.
Envision Healthcare Corporation Price, Consensus and EPS Surprise
Envision Healthcare Corporation Price, Consensus and EPS Surprise | Envision Healthcare Corporation Quote
Total operating expenses of $2.36 billion increased 82.7% year over year, due to higher salaries and benefits, insurance expenses and depreciation & amortization expenses.
Favorable Segment Performance
Physician Services
Net revenues from the segment were $1.67 billion, reflecting an increase of 8.3% year over year. The revenue growth was driven by 8.6% contribution from acquisitions and 0.4% from same contracts.
Adjusted EBITDA was $133.1 million, up 10.5% year over year.
Ambulatory Services
Net revenues were $333.1 million, up nearly 2% year over year, led by procedure volume growth.
For the reported quarter, adjusted EBITDA was $78.3 million, up 23.1% year over year thanks to a $7.7 million favorable legal settlement.
Financial Update
Envision Healthcare had cash and cash equivalents of $312.2 million, down 1.4% year over year.
Total long-term debt increased 8.2% year over year to $6.26 billion as of Dec 31, 2017.
The company’s ratio of total net debt to trailing 12-month EBITDA on Dec 31, 2017 as calculated under its credit agreement was 4.6 times.
Net cash provided by operating activities was $236.4 million as of Dec 31, 2017, up from $68.8 million as of Dec 31, 2016.
First-Quarter 2018 Guidance
The company expects adjusted EPS within the range of 61 cents and 67 cents and adjusted EBITDA in the band of $195-$205 million.
Full-Year 2018 Guidance
The company expects net revenues in the range of $8.35 to $8.53 billion, adjusted EBIDTA of $960 million to $1 billion and adjusted EPS between $3.46 and $3.70.
Zacks Rank & Other Releases
Envision Healthcare carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among the other firms in the medical sector that have reported fourth-quarter earnings so far, the bottom line at Centene Corp. (CNC - Free Report) , Aetna Inc and UnitedHealth Group Inc. (UNH - Free Report) beat their respective Zacks Consensus Estimate
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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