For-profit Tenet Healthcare has raised its guidance for the remainder of 2021 after reporting higher second quarter profits, revenues and volumes both year over year and compared to the opening frame of 2021.
“The state of the enterprise today reflects our continuous effort to foster top-quality environments for our patients and the communities we serve, as well as our dedicated professionals, whose continued commitment and hard work is carried out at every corner of the organization,” Ron Rittenmeyer, executive chairman and CEO, said in a statement.
Tenet reported $120 million in net income from continuing operations for the second quarter of 2021 ending on June 30—a 36% increase over the $88 million reported in the same quarter of 2020 and a 23% jump over the $97 million reported in the first quarter of 2021.
The company noted that its profits include $24 million in pretax COVID-19 stimulus funding during the most recent quarter. It had received $523 million in pretax stimulus grant income during the same quarter last year.
Overall net operating revenues for the latest quarter landed just shy of $5 billion. This was a roughly 36% increase over last year’s $3.6 billion and about 3% more than the almost $4.8 reported in 2021’s first quarter.
Net operating revenues for the company’s hospital segment were just shy of $4.1 billion for the quarter, versus almost $3.1 billion during the second quarter of 2020 and $3.9 billion in the first quarter of 2021. Ambulatory service revenues hit $664 million, up again from last year’s $368 million and the first quarter of 2021’s $646 million.
Hospital admissions were up 13.7% compared to the same period during the prior year and, year-to-date, are just a hair higher than last year at a 0.1% increase.
This is a marked turnaround from the volumes hit Tenet suffered during the second quarter of 2020, when admissions dropped 20.3% compared to the year prior.
Tenet also reported year-over-year volume gains for its outpatient visits (70.6%), emergency room visits (35%), hospital surgeries (37%) and same-facility system-wide surgical cases for its ambulatory surgery business (68.2%).
Dallas-based Tenet Healthcare currently operates 65 hospitals. It employs 108,000 people across its hospitals, more than 450 other healthcare facilities and Conifer Health Solutions, its revenue cycle management and value-based care services group.
Last month Tenet announced plans to sell off five of its hospitals to Steward Health Care for $1.1 billion, a deal set to close in the third quarter of 2021. In April it wrapped up the sale of its urgent care platform to FastMed for $80 million.
Looking ahead, Tenet has upped its third-quarter and full-year financial guidance for shareholders.
For the former, the company expects net operating revenues to land between $4.6 billion and $4.8 billion, which takes into account lost revenue from the divestiture of its five Florida hospitals. Income is expected to fall between $335 million and $375 million.
For the full year, Tenet is anticipating its net operating revenues to run somewhere between $19.25 billion and $19.65 billion, while net income from continuing operations is thought to land within the $681 million and $781 million range.
“Our second-quarter results continue to reflect our long-term strategy and transformation progress, resulting in our ability to adapt and perform on a consistent and sustainable trajectory,” Rittenmeyer said. “We continued to focus our efforts on the expansion of healthcare access in alignment with community need, including investments in high-acuity service lines for patients with chronic conditions and the addition of lower-cost ambulatory settings in key locations around the country.”