Medical Facilities Corporation Reports 2021 Second Quarter Financial Results

TORONTO, Aug. 12, 2021 /CNW/ - Medical Facilities Corporation ("Medical Facilities," "MFC," or the "Corporation") (TSX: DR), reported its financial results today for the three-month and six-month periods ended June 30, 2021. All amounts are expressed in U.S. dollars unless indicated otherwise.

Q2 2021 Summary
(For continuing operations¹ compared to Q2 2020)

• Facility service revenue increased 44.2% to $97.6 million;
• Total revenue and other income increased 10.5% to $98.1 million, despite a decrease of $20.6 million in government stimulus income;
• Income from operations decreased 3.7% to $16.9 million; and,
• EBITDA² decreased 3.7% to $23.7 million.

"The volume recovery continued in the second quarter as we neared pre-pandemic levels", said Robert O. Horrar, President and CEO of Medical Facilities. "We continue to be cautiously optimistic in our outlook for the remainder of 2021. While vaccines continue to roll out across the country, there is still a lot of uncertainty due to the Delta variant. Our balance sheet remains strong and we are well-positioned to evaluate the right growth opportunities in the back half of 2021."

Financial Results

Financial Results from Continuing Operations	For the three months ended			For the six months ended
	June 30			June 30
(thousands of U.S. dollars, except per share amounts and where otherwise noted)	2021	% change	2020	2021	% change	2020
Facility service revenue	97,572	44.2%	67,659	191,568	19.4%	160,421
Government stimulus income	572	(97.3%)	21,145	4,705	(77.7%)	21,145
Total revenue and other income	98,144	10.5%	88,804	196,273	8.1%	181,566
Consolidated operating expenses	81,202	14.0%	71,218	160,972	5.2%	152,945
Income from operations	16,942	(3.7%)	17,586	35,301	23.3%	28,621
Finance costs (net interest expense)	1,615	76.5%	915	3,157	34.3%	2,351
Finance costs (changes in values of derivative instruments and gain/loss on foreign currency)	(192)	(103.5%)	5,535	4,457	892.7%	449
Share of equity loss in associates	100	(79.0%)	476	142	(84.8%)	934
Income tax expense	3,563	8.5%	3,283	5,382	85.4%	2,903
Net income^3	11,856	60.7%	7,377	22,163	0.8%	21,984
Earnings per share
Basic	$0.17	1,600.0%	$0.01	$0.28	(9.7%)	$0.31
Diluted	$0.15	1,400.0%	$0.01	$0.28	(6.7%)	$0.30

Reconciliation of Net Income to EBITDA and Adjusted EBITDA^2	For the three months ended			For the six months ended
	June 30			June 30
(thousands of U.S. dollars, except where otherwise noted)	2021	% change	2020	2021	% change	2020
Net income	11,856	60.7%	7,377	22,163	0.8%	21,984
Income tax expense	3,563	8.5%	3,283	5,382	85.4%	2,903
Share of equity loss in associates	100	(79.0%)	476	142	(84.8%)	934
Finance costs	1,423	(77.9%)	6,450	7,614	171.9%	2,800
Depreciation and amortization	6,756	(3.7%)	7,017	13,529	(4.0%)	14,090
EBITDA	23,698	(3.7%)	24,603	48,830	14.3%	42,711
Transaction costs on sale of Unity Medical and Surgical Hospital	-	-	-	-	(100.0%)	450
Adjusted EBITDA	23,698	(3.7%)	24,603	48,830	13.1%	43,161

Distributable Cash Flow	For the three months ended			For the six months ended
	June 30			June 30
(thousands of dollars, except per share amounts and where otherwise noted)	2021	% change	2020	2021	% change	2020
Cash available for distribution^2 (C$)	7,475	(9.1%)	8,225	15,369	(9.9%)	17,056
Distributions (C$)	2,178	-	2,178	4,355	-	4,355
Distributions per common share (C$)	0.07	-	0.07	0.14	-	0.14
Payout ratio^2	29.2%	10.2%	26.5%	28.3%	11.0%	25.5%

During the quarter, MFC paid a quarterly cash dividend of C$0.07 per common share (or C$0.28 per share on an annualized basis), which represented an annualized yield of 3.99% on the June 30, 2021 closing price of $7.01 per common share.

As at June 30, 2021, MFC had consolidated net working capital of $48.1 million, compared to $45.0 million on December 31, 2020.

MFC's financial statements and management's discussion and analysis, for the three-month and six-month periods ended June 30, 2021, will be filed on SEDAR at www.sedar.com on Thursday, August 12, 2021, and will also be available on Medical Facilities' website at www.medicalfacilitiescorp.ca.

¹ Continuing operations is defined as consolidated operations excluding Unity Medical and Surgical Hospital and RRI Mishawaka Hospital, LP, which were treated as discontinued operations in the financial results for the three-month and six-month periods ended June 30, 2021 and June 30, 2020.

² EBITDA, adjusted EBITDA, cash available for distribution and payout ratio are non-IFRS financial measures. While Medical Facilities believes that these measures are useful for the evaluation and assessment of its performance, they do not have any standard meaning prescribed by IFRS, are unlikely to be comparable to similar measures presented by other issuers, and should not be considered as alternatives to comparable measures determined in accordance with IFRS. For further information on these non-IFRS financial measures, including a reconciliation of each of these non-IFRS financial measures to the most directly comparable measure calculated in accordance with IFRS, please refer to Medical Facilities' most recently filed management's discussion and analysis, available on SEDAR at www.sedar.com.

³ Net Income is attributable to the owners of the Corporation and the non-controlling interest holders.

Notice of Conference Call

Management of MFC will host a conference call today, August 12, 2021 at 8:30 am ET to discuss its second quarter financial results. All interested parties may join the conference call by dialing 647-792-1240 or 1-800-437-2398 approximately 15 minutes prior to the call to secure a line.

A live audio webcast of the call will be available at https://bit.ly/MFC2021Q2. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. The webcast will be archived on MFC's website following the call date.

About Medical Facilities

Medical Facilities, in partnership with physicians, owns a diverse portfolio of highly rated, high-quality surgical facilities in the United States. MFC's ownership includes controlling interest in four specialty surgical hospitals located in Arkansas, Oklahoma, and South Dakota, and an ambulatory surgery center ("ASC") located in California. In addition, through a partnership with NueHealth LLC, Medical Facilities owns a controlling interest in five ambulatory surgery centers located in Michigan, Missouri, Nebraska, Ohio, and Pennsylvania. MFC also owns non-controlling interests in a specialty surgical hospital in Indiana and an ASC in Missouri. The specialty surgical hospitals perform scheduled surgical, imaging, diagnostic and other procedures, including primary and urgent care, and derive their revenue from the fees charged for the use of their facilities. The ASCs specialize in outpatient surgical procedures, with patient stays of less than 24 hours. For more information, please visit www.medicalfacilitiescorp.ca.

Caution concerning forward-looking statements

Statements made in this news release, other than those concerning historical financial information, may be forward-looking and therefore subject to various risks and uncertainties.  Some forward-looking statements may be identified by words like "may", "will", "anticipate", "estimate", "expect", "intend", or "continue" or the negative thereof or similar variations. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements.  Factors that could cause results to vary include those identified in Medical Facilities' filings with Canadian securities regulatory authorities such as legislative or regulatory developments, intensifying competition, technological change and general economic conditions.  All forward-looking statements presented herein should be considered in conjunction with such filings.  Medical Facilities does not undertake to update any forward-looking statements; such statements speak only as of the date made.

SOURCE Medical Facilities Corporation

David Watson, Chief Financial Officer, Medical Facilities Corporation, 416.848.7380 or 1.877.402.7162, [email protected]; Trevor Heisler, Investor Relations, NATIONAL Capital Markets, 416.848.1434, [email protected]

Related Links

http://www.medicalfc.com