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EXHIBIT 99.1
[LOGO]Triad
HOSPITALS, INC. NEWS
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FOR IMMEDIATE RELEASE
Investor Contact: Media contact:
Deborah Little Patricia G. Ball, Ed. D.
Investor Relations Coordinator Vice President, Marketing & PR
972-701-2259 972-789-2719
Triad Announces Changes to Hospital Portfolio
. Acquires Remainder of SouthCrest Hospital, Tulsa, Oklahoma
. Sells Community Medical Center, Sherman, Texas
. Closes Mission Bay Hospital, San Diego, California
DALLAS, TX (January 2, 2001) - Triad Hospitals, Inc. (the "Company" or "Triad")
(Nasdaq: TRIH) announced that it has agreed to acquire the remaining 50%
interest in its SouthCrest Hospital ("SouthCrest") joint venture in Tulsa,
Oklahoma, from its not-for-profit partner, Hillcrest Healthcare System
("Hillcrest"). The transaction is subject to regulatory approvals and is
expected to close in January 2001.
SouthCrest, which opened in May 1999, is both Triad's and Tulsa's newest
hospital. Still partly under development and in its initial start-up phase, the
project incorporates an attractive, modern, acute care hospital with 116 all-
private rooms and available space to add 32 more beds, plus an ambulatory
surgery center and an adjacent medical office building. Triad will soon begin
build-out of additional operating rooms to meet existing market demand.
The acquisition will consolidate 100% ownership and control of the hospital in
Triad for the first time. The Company expects in the first quarter of 2001 to
begin reporting SouthCrest's financial performance on a consolidated basis,
instead of on an equity basis as it does now. Triad has managed the facility on
behalf of the joint venture since it opened.
Under the terms of the agreement, Triad will pay Hillcrest approximately $44
million, Hillcrest's investment in the project. Triad will have an option to
acquire an adjacent 26-acre parcel of land from Hillcrest for future expansion.
SouthCrest will continue to participate in Hillcrest's joint contracting network
that includes other Hillcrest hospitals in Tulsa. Under certain conditions and
for a limited time, Hillcrest will have an option to repurchase a 49% interest
in SouthCrest at then fair market value, subject to minimum valuations and
minimum returns on investment to Triad; if Hillcrest were to exercise the
option, Triad would retain governance of the facility and continue consolidating
it for financial reporting.
"We are excited about acquiring SouthCrest and remain enthusiastic about the
Tulsa market," said Triad Chairman and CEO, James D. Shelton. "Although still
in the development phase, SouthCrest has progressed beyond the higher risk stage
associated with the initial launch of a new hospital. Patient admissions
continue to grow, and we expect the hospital to be a major provider in the
market for years to come. We also expect the hospital to generate an attractive
return on our investment."
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"We are especially pleased that SouthCrest will maintain its special
relationship with our not-for-profit partner in Tulsa, Hillcrest HealthCare
System," said Mr. Shelton. "We have enjoyed our partnership with Hillcrest and
look forward to working cooperatively with them to serve the health care needs
of Eastern Oklahoma in the years ahead."
Sherman and Mission Bay
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On December 14, the Company completed the sale of Community Medical Center of
Sherman ("Sherman") in Sherman, Texas, for $16 million, in accordance with plans
previously announced by the Company. The sale included an ambulatory surgery
center. The Company will recognize a gain on the sale in the fourth quarter of
2000.
On November 30, the Company closed Mission Bay Hospital ("Mission Bay") in San
Diego, California, in accordance with plans previously announced by the Company
not to continue operations at the hospital and not to proceed with a $150
million replacement hospital in northern San Diego County. The Company expects
to incur an impairment charge and non-recurring operating losses related to the
Worker Adjustment Training and Notification ("WARN") Act and other costs
associated with closing the facility. The charges will be recorded in the
fourth quarter of 2000.
Future Company Performance
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"We remain comfortable with current estimates of earnings per share ("EPS") for
Triad's fourth quarter of 2000 in the $0.06-0.10 range, excluding the gain on
sale of Sherman and the impairment and non-recurring operating losses associated
with closing Mission Bay," said Mr. Shelton. "We also remain comfortable with
current estimates of EPS for 2001 in the $0.40-$0.50 range, after our
consolidation of SouthCrest, our sale of Sherman and our closure of Mission Bay.
We believe we are well positioned to complete our pending acquisition of Quorum
Health Group, Inc., and we expect to provide further guidance about 2001
performance objectives for the combined companies after we refine plans for
possible divestiture of select Quorum assets."
Triad owns and manages hospitals and ambulatory surgery centers in small cities
and selected high-growth urban markets. Upon closing of these and other
previously announced transactions, including its pending acquisition of Quorum
Health Group, Inc. (Nasdaq: QHGI), the Company will own and manage 51 hospitals
and 13 ambulatory surgery centers, with one additional ambulatory surgery center
under development. The Company completed a spin-off and began operations as an
independent company on May 11, 1999.
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This press release contains forward-looking statements based on current
management expectations. Numerous factors, including those related to market
conditions and those detailed from time-to-time in the Company's filings with
the Securities and Exchange Commission, may cause results to differ materially
from those anticipated in the forward-looking statements. Many of the factors
that will determine the Company's future results are beyond the ability of the
Company to control or predict. These statements are subject to risks and
uncertainties and, therefore, actual results may differ materially.
Readers should not place undue reliance on forward-looking statements, which
reflect management's views only as of the date hereof. The Company undertakes
no obligation to revise or update any forward-looking statements, or to make any
other forward-looking statements, whether as a result of new information, future
events or otherwise.
All references to "Company", "Triad", and "Triad Hospitals, Inc." as used
throughout this document refer to Triad Hospitals, Inc. and its affiliates.
