HispanicBusiness

Consolidated revenue from continuing operations for the year ended December 31, 2012, declined by $70.4 million over 2011, excluding the $13.7 million positive effect of the weaker Canadian dollar. Non same-facility operations contributed $54.3 million to the decline in revenue between years. Revenue from same-facility operations declined by $16.1 million, with an improvement from the Canadian operations of $20.7 million offset by the impact of the 2011 CMS Final Rule and lower census levels on the U.S. operations.

Consolidated EBITDA from continuing operations declined by $16.9 million to $183.2 million this year from $200.1 million in 2011, and represented 9.0% and 9.6% of revenue, respectively. Excluding the impact of prior years' reserves for self-insured liabilities of $16.6 million in 2012 and $42.8 million in 2011, EBITDA was $199.8 million, or 9.8% of revenue, this year compared to $242.9 million, or 11.6% of revenue, in 2011. This represented a decline of $43.1 million between years. Excluding a $1.4 million positive effect of a weaker Canadian dollar, EBITDA declined by $44.5 million, of which $37.5 million was from same-facility operations. Details by segmented operations are discussed below.

EBITDA from U.S. operations was US$111.1 million this year compared to US$135.8 million in 2011, and represented 8.5% and 9.6% of revenue, respectively. Excluding the increase in prior years' reserves for self-insured liabilities of US$16.6 million this year and US$43.3 million in 2011, EBITDA was US$127.7 million, or 9.8% of revenue, this period compared to US$179.1 million, or 12.7% of revenue, in 2011. This represented a decline of US$51.4 million between years. EBITDA from non same-facility operations declined by US$7.8 million (US$17.5 million contribution this year compared to US$25.3 million in 2011). Same-facility operations declined by US$43.6 million, with revenue declines of US$37.1 million and operating, administrative and lease cost increases of US$6.5 million. Revenue declined as a result of lower average Medicare and Managed Care rates totalling US$36.4 million, largely due to the impact of the 2011 CMS Final Rule, and lower census levels of US$30.8 million. This was partially offset by higher average Medicaid and private/other rates of US$23.4 million and other revenue improvements of US$6.7 million which included the impact of the extra day in the year. To mitigate the adverse impact of the 2011 CMS Final Rule, management implemented non-direct care related cost saving measures, which kept the year-over-year cost increases down to 0.6% at only US$6.5 million. Higher state provider taxes of US$6.5 million and increased provisions for self-insured liabilities of US$6.2 million were partially offset by lower labour-related costs of US$1.8 million, primarily due to a change in vacation policy, and other net cost reductions of US$4.4 million.

EBITDA from Canadian operations improved by $6.5 million to $72.2 million this year from $65.7 million in 2011, and represented 9.9% and 9.4% of revenue, respectively. Non same-facility operations contributed EBITDA of $5.2 million this year compared to $4.4 million in 2011, for a net improvement of $0.8 million between years. Same-facility operations improved by $5.7 million between years and included the favourable impact of $2.0 million in prior period revenue adjustments recorded in 2011. The remaining EBITDA improvement of $3.7 million was primarily due to funding enhancements, with higher revenue of $18.7 million partially offset by higher costs of $15.0 million.