AmSurg Announces First-Quarter Net Earnings from Continuing Operations of $0.42 Per Diluted Share

http://www.businesswire.com/news/home/20100422006899/en

Adjusts 2010 Financial Guidance
NASHVILLE, Tenn.--(Business Wire)--
Christopher A. Holden, President and Chief Executive Officer of AmSurg Corp.
(NASDAQ: AMSG), today announced financial results for the first quarter ended
March 31, 2010. Revenues increased 6% for the quarter to $172,522,000 from
$163,424,000 for the first quarter of 2009. Net earnings from continuing
operations attributable to AmSurg common shareholders for the first quarter of
2010 were $12,847,000, an increase of 2% from $12,613,000 for the first quarter
of 2009. Net earnings from continuing operations per diluted share attributable
to AmSurg common shareholders were $0.42 for the first quarter of 2010, up 5%
from $0.40 for the first quarter of 2009. As expected, the results for the first
quarter of 2010 included an incremental negative impact of $0.01 per diluted
share from the revision of the Medicare payment system for ASCs.

Mr. Holden remarked, "While we met the mid-point of the range of our earnings
guidance for the period, the first quarter was challenging for the industry and
for AmSurg. Severe snowstorms in many of our markets and the difficult economic
environment resulted in a 4% decline in same-center procedures compared with the
first quarter last year. Average revenue per procedure increased 4% between the
comparable quarters due to procedure mix and pricing, which held the decline in
same-center revenue for the quarter to 2%.

"We estimate that the unusual winter weather during February reduced same-center
procedures by approximately 5,000, the absence of which would have resulted in
same-center revenues level with first quarter revenues last year. However, we
also experienced a decline in same-center procedures during the quarter
primarily related, we believe, to the soft economic environment. This trend was
generally experienced throughout our same-center base, without significant
variations in any particular geography or surgical specialty.

"Due to the addition of 14 centers during 2009, as well as the acquisition of
one large orthopaedic center during the first quarter of 2010, total procedures
for the quarter increased 2% from the first quarter of 2009. This increase,
combined with the increase in average revenue per procedure, produced our 6%
growth in revenues for the quarter. In addition to the center acquired in the
first quarter, we completed the first quarter with four centers under letter of
intent and one center under development, which is expected to open in early
2011.

"Net cash flows provided by operating activities were $54.3 million for the
first quarter of 2010, and distributions to noncontrolling interests, which are
included in cash flows from financing activities, were $30.2 million. Net cash
flows provided by operating activities less distributions to noncontrolling
interests were $24.1 million, or 1.9 times net earnings from continuing
operations attributable to AmSurg common shareholders and were sufficient to
fund the majority of our net capital expenditures for the first quarter of $31.2
million. Total debt increased $11.2 million for the first quarter, and the ratio
of total debt to capitalization was 37% at the end of both the first quarter of
2010 and fiscal 2009. The ratio of total debt at March 31, 2010, to trailing 12
months EBITDA, was 2.6 compared with a ratio of 2.5 at December 31, 2009. We
continue to expect to refinance and expand our revolving credit facility in the
second quarter of 2010. We anticipate that this new facility, along with our
strong operating cash flow, will leave us well positioned to fund our
acquisition strategy for the foreseeable future.

"The non-weather related decline in same-center procedures that we experienced
during the first quarter has continued in April. Based on this experience
year-to-date, we are today adjusting our financial guidance for 2010 and
establishing guidance for the second quarter of 2010 as follows:

* Revenues in a range of $715.0 million to $735.0 million for 2010 compared with
a range of $720.0 million to $750.0 million previously.
* Same-center revenues are expected to decline 1% to 2% for 2010 compared with
being flat for the full year previously.
* Guidance for the addition of 13 to 16 new centers for the year has not
changed.
* Net cash flow provided by operating activities less distributions to
noncontrolling interests in a range of $100.0 million to $105.0 million compared
with a range of $105.0 million to $110.0 million previously.
* Net earnings from continuing operations per diluted share attributable to
common shareholders for 2010 in a range of $1.69 to $1.75 compared with a range
of $1.77 to $1.80 previously, both of which include a negative $0.06 impact from
the effect of the revised Medicare payment system revision and a negative $0.11
impact from higher interest costs related to the refinancing our revolving
credit facility.
* Net earnings from continuing operations per diluted share attributable to
common shareholders for the second quarter of 2010 in a range of $0.41 to $0.44
per diluted share, including a negative $0.01 impact from the effect of the
revised Medicare payment system revision and a negative $0.04 impact from the
higher interest costs related to the refinancing of our credit facility."

The information contained in the preceding paragraphs is forward-looking
information, and the attainment of these targets is dependent not only on
AmSurg`s achievement of its assumptions discussed above, but also on the risks
and uncertainties listed below that could cause actual results, performance or
developments to differ materially from those expressed or implied by this
forward-looking information.

Mr. Holden concluded, "The second quarter is usually our strongest quarter
seasonally; however, the continuing same-center procedure decline in the first
few weeks of April supports a cautious outlook, despite our having met earnings
guidance for the first quarter. We believe the adjustment to guidance is prudent
given these circumstances.

"We remain confident that the longer-term outlook is positive for the
freestanding ASC industry and AmSurg in particular. Demographic trends,
healthcare reform, disease progression in large underserved populations, an
increased focus on quality and transparency and a long-term and continuing
migration of procedures to the most affordable modality are all favorable for
the ASC industry. AmSurg is positioned to benefit from these trends not only as
the operator of the largest number of ASCs in the industry, but also from its
leading market share in GI and ophthalmology based on operating 15% and 5%,
respectively, of the country`s Medicare-certified centers in each specialty."

AmSurg Corp. will hold a conference call to discuss this release today at 5:00
p.m. Eastern time. Investors will have the opportunity to listen to the
conference call over the Internet by going to www.amsurg.com and clicking
"Investor Relations" or by going to www.earnings.com at least 15 minutes early
to register, download, and install any necessary audio software. For those who
cannot listen to the live broadcast, a replay will be available at these sites
shortly after the call and continue for 30 days.

This press release contains forward-looking statements. These statements, which
have been included in reliance on the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, involve risks and uncertainties.
Investors are hereby cautioned that these statements may be affected by the
important factors, among others, set forth in AmSurg`s Annual Report on Form
10-K for the fiscal year ended December 31, 2009, and other filings with the
Securities and Exchange Commission, including the following risks: adverse
impacts on the Company`s business associated with current and future economic
conditions; the risk that payments from third-party payors, including government
healthcare programs, may decrease or not increase as the Company`s costs
increase; adverse developments affecting the medical practices of the Company`s
physician partners; the Company`s ability to maintain favorable relations with
its physician partners; the Company`s ability to acquire and develop additional
surgery centers on favorable terms; the Company`s ability to grow revenues by
increasing procedure volume while maintaining its operating margins and
profitability at its existing centers; the Company`s ability to manage the
growth in its business; the Company`s ability to obtain sufficient capital
resources to complete acquisitions and develop new surgery centers; the
Company`s ability to compete for physician partners, managed care contracts,
patients and strategic relationships; adverse weather and other factors that may
affect the Company`s surgery centers; the Company`s failure to comply with
applicable laws and regulations; the risk of changes in legislation, regulations
or regulatory interpretations that may negatively affect the Company; the risk
of becoming subject to federal and state investigation; the risk of regulatory
changes that may obligate the Company to buy out interests of physicians who are
minority owners of its surgery centers; potential liabilities associated with
the Company`s status as a general partner of limited partnerships; liabilities
for claims brought against our facilities; the Company`s legal responsibility to
minority owners of its surgery centers, which may conflict with its interests
and prevent it from acting solely in its best interests; risks associated with
the potential write-off of the impaired portion of intangible assets; and
potential liability relating to the tax deductibility of goodwill. Consequently,
actual results, performance or developments may differ materially from the
forward-looking statements included above. AmSurg disclaims any intent or
obligation to update these forward-looking statements.

AmSurg Corp. acquires, develops and operates ambulatory surgery centers in
partnership with physician practice groups throughout the United States. At
March 31, 2010, AmSurg owned a majority interest in 203 continuing centers in
operation and had one center under development.

AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data
(Dollars in thousands, except per share amounts)

For the Three Months
Ended March 31,
Statement of Earnings Data: 2010 2009

Revenues $ 172,522 $ 163,424

Operating expenses:
Salaries and benefits 51,854 48,992
Supply cost 23,037 19,866
Other operating expenses 37,574 34,039
Depreciation and amortization 5,797 5,647

Total operating expenses 118,262 108,544

Operating income 54,260 54,880

Interest expense 1,871 2,027

Earnings from continuing operations before income taxes 52,389 52,853
Income tax expense 8,724 8,546

Net earnings from continuing operations 43,665 44,307

Discontinued operations:
(Loss) earnings from operations of discontinued interest in surgery centers, net of income tax (benefit) expense (153 ) 8

Net earnings 43,512 44,315

Less net earnings attributable to noncontrolling interests:
Net earnings from continuing operations 30,818 31,694
Net (loss) earnings from discontinued operations (3 ) 5

Total net earnings attributable to noncontrolling interests 30,815 31,699

Net earnings attributable to AmSurg Corp. common shareholders $ 12,697 $ 12,616

Amounts attributable to AmSurg Corp. common shareholders:
Earnings from continuing operations, net of tax $ 12,847 $ 12,613
Discontinued operations, net of tax (150 ) 3

Net earnings attributable to AmSurg Corp. common shareholders $ 12,697 $ 12,616

Earnings per share-basic:
Net earnings from continuing operations attributable to AmSurg Corp. common shareholders $ 0.43 $ 0.40
Net loss from discontinued operations attributable to AmSurg Corp. common shareholders (0.01 ) -

Net earnings attributable to AmSurg Corp. common shareholders $ 0.42 $ 0.40

Earnings per share - diluted:
Net earnings from continuing operations attributable to AmSurg Corp. common shareholders $ 0.42 $ 0.40
Net loss from discontinued operations attributable to AmSurg Corp. common shareholders (0.01 ) -

Net earnings attributable to AmSurg Corp. common shareholders $ 0.41 $ 0.40

Weighted average number of shares and share equivalents (000's):
Basic 30,212 31,244
Diluted 30,716 31,406

AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data, continued
(Dollars in thousands, except per share amounts)

For the Three Months
Ended March 31,
Operating Data: 2010 2009

Continuing centers in operation at end of period 203 191
New centers added during the period 1 3
Centers under development/not opened at end of period 1 3
Centers under letter of intent 4 1
Average number of centers in operation 202 191
Average revenue per center $ 853 $ 857
Same center revenues (decrease) increase (2 %) 0 %
Procedures performed during the period 308,306 303,026
Income tax expense attributable to noncontrolling interests $ 186 $ 163
Reconciliation of net earnings to EBITDA (1):
Net earnings from continuing operations attributable to AmSurg Corp. common shareholders $ 12,847 $ 12,613
Add: income tax expense 8,724 8,546
Add: interest expense, net 1,871 2,027
Add: depreciation and amortization 5,797 5,647

EBITDA $ 29,239 $ 28,833

(1) EBITDA is defined as earnings before interest, income taxes and depreciation and amortization. EBITDA should not be considered a measure of financial performance under
generally accepted accounting principles. Items excluded from EBITDA are significant components in understanding and assessing financial performance. EBITDA is an
analytical indicator used by management and the health care industry to evaluate company performance, allocate resources and measure leverage and debt service capacity.
EBITDA should not be considered in isolation or as an alternative to net income, cash flows generated by operations, investing or financing activities, or other financial
statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Because EBITDA is not a measurement determined in
accordance with generally accepted accounting principles and is thus susceptible to varying calculations, EBITDA as presented may not be comparable to other similarly
titled measures of other companies. Net earnings from continuing operations attributable to AmSurg Corp. common shareholders is the financial measure calculated and
presented in accordance with generally accepted accounting principles that is most comparable to EBITDA as defined.

AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data, continued
(Dollars in thousands)

March 31, December 31,
Balance Sheet Data: 2010 2009

Assets

Current assets:
Cash and cash equivalents $ 33,172 $ 29,377
Accounts receivable, net of allowance of $12,905 and $12,375 respectively 68,768 66,886
Supplies inventory 9,090 8,745
Deferred income taxes 2,582 2,324
Prepaid and other current assets 14,261 15,408
Current assets held for sale 26 34

Total current assets 127,899 122,774

Long-term receivables and deposits - 56
Property and equipment, net 111,056 112,084
Goodwill 851,952 813,876
Intangible assets, net 9,695 9,797
Long-term assets held for sale 166 170

Total assets $ 1,100,768 $ 1,058,757

Liabilities and Equity

Current liabilities:
Current portion of long-term debt $ 5,475 $ 5,657
Accounts payable 13,208 14,821
Accrued salaries and benefits 15,758 18,156
Other accrued liabilities 2,554 3,208
Income taxes payable 4,428 402
Current liabilities held for sale 31 37

Total current liabilities 41,454 42,281

Long-term debt 300,461 289,041
Deferred income taxes 75,784 71,665
Other long-term liabilities 22,147 22,036
Noncontrolling interests - redeemable 135,655 123,363
Equity:
Common stock, no par value 70,000,000 shares authorized, 30,908,862 and 30,674,327 shares outstanding, respectively 165,972 163,729
Retained earnings 355,933 343,236
Accumulated other comprehensive loss, net of income taxes (1,610 ) (1,849 )

Total AmSurg Corp. equity 520,295 505,116
Noncontrolling interests - non-redeemable 4,972 5,255

Total equity 525,267 510,371

Total liabilities and equity $ 1,100,768 $ 1,058,757

AMSURG CORP.
Unaudited Selected Consolidated Financial and Operating Data, continued
(Dollars in thousands)

For the Three Months
Ended March 31,
Statement of Cash Flow Data: 2010 2009

Cash flows from operating activities:
Net earnings $ 43,512 $ 44,315
Adjustments to reconcile net earnings to net cash flows provided by operating activities:
Depreciation and amortization 5,797 5,647
Share-based compensation 1,231 1,074
Excess tax benefit from share-based compensation (46 ) -
Deferred income taxes 3,706 3,734
Increase (decrease) in cash and cash equivalents, net of effects of acquisition and dispositions, due to changes in:
Accounts receivable, net (966 ) (4,568 )
Supplies inventory 18 225
Prepaid and other current assets 1,135 2,652
Accounts payable (1,653 ) 764
Accrued expenses and other liabilities 1,523 5,289
Other, net 67 180

Net cash flows provided by operating activities 54,324 59,312

Cash flows from investing activities:
Acquisition of interest in surgery centers and related transactions (27,675 ) (16,326 )
Acquisition of property and equipment (3,510 ) (7,420 )
Repayment of notes receivable - 1,522

Net cash flows used in investing activities (31,185 ) (22,224 )

Cash flows from financing activities:
Proceeds from long-term borrowings 36,621 25,950
Repayment on long-term borrowings (25,913 ) (20,663 )
Distributions to noncontrolling interests (30,229 ) (29,945 )
Proceeds from issuance of common stock upon exercise of stock options 296 -
Repurchase of common stock - (12,587 )
Capital contributions and ownership transactions by noncontrolling interests (140 ) -
Excess tax benefit from share-based compensation 46 -
Financing cost incurred (25 ) (2 )

Net cash flows used in financing activities (19,344 ) (37,247 )

Net increase (decrease) increase in cash and cash equivalents 3,795 (159 )
Cash and cash equivalents, beginning of period 29,377 31,548

Cash and cash equivalents, end of period $ 33,172 $ 31,389

AmSurg Corp.
Claire M. Gulmi, 615-665-1283
Executive Vice President and Chief Financial Officer

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