Tenet To Explore Sale Of Conifer; Issues FY18 Outlook - Quick Facts

(RTTNews) - Tenet Healthcare Corp. (THC) said it will take additional steps to support its goal of improving its financial performance and enhancing shareholder value. In addition, Tenet Healthcare issued its outlook for fiscal 2018 and reaffirmed the previously announced shareholders rights plan until the 2018 annual meeting.

The actions announced by the company include an expansion of its previously announced cost reduction program, an update to the ongoing board refreshment process to ensure that its board of directors has the best mix of skills and experience to maximize the future value of the company, and exploring a potential sale of Conifer.

To assist in the process of exploring a potential sale of Conifer, Tenet has engaged Goldman, Sachs & Co. LLC as its financial advisor and Kirkland & Ellis LLP as its legal advisor. Conifer is a provider of healthcare business process services in the areas of hospital and physician revenue cycle management and value-based care solutions.

Tenet expects that a decision regarding a potential sale of Conifer would be made during the first half of 2018.

Tenet has increased the size of its previously announced cost reduction initiatives by $100 million, and now expects to achieve $250 million of annualized run-rate savings by the end of 2018. The company expects to realize about $125 million of the savings during calendar year 2018, up from its previous goal of $75 million.

Tenet said it will also add a Quality and Patient Experience Gatekeeper to its Annual Incentive Plan or AIP in 2018. The gatekeeper will require certain levels of improvement and performance across all key quality and patient experience measures in order for participants to be eligible to participate in the AIP.

Looking ahead to fiscal 2018, Tenet forecast earnings from continuing operations attributable to Tenet shareholders of $0.63 to $0.68 per share, adjusted earnings from continuing operations of $1.07 to $1.36 per share, and net operating revenues of $17.8 billion to $18.2 billion.

On average, analysts polled by Thomson Reuters expect the company to earn $1.27 per share for the year on revenues of $18.89 billion. Analysts' estimates typically exclude special items.