1. Analysis of the For-Profit Hospital Industry HCA and Tenet By: Zach Evans Todd Passmore Rachel Taylor Gina Throneberry

2. Hospital Industry Overview Total Number of All U.S. Registered * Hospitals 5,801 Total Staffed Beds in All U.S. Registered * Hospitals 987,440 Total Admissions in All U.S. Registered * Hospitals 35,644,440 Total Expenses for All U.S. Registered * Hospitals $426,849,488,000 * Registered Hospitals are those that meet AHA’s criteria for registration as a hospital facility. Registered hospitals include AHA member hospitals as well as nonmember hospitals. Source: 2001 survey by the American Hospital Association – www.hospitalconnect.com

3. HCA Healthcare Corporation www.hcahealthcare.com

10. Consolidated Income Statement 2001 2002 Net Operating Revenues: $17,953 $19,729 Operating Expenses: $16,997 $18,896 Net Income: $956 $833 Earnings Per Share: $1.78 $1.59 *Note: All dollar figures in millions except Earnings Per Share

11. Balance Sheet 2001 2002 Current Assets: $4,141 $4,505 Investments & Other Assets: $2,133 $2,034 Property & Equipment: $8,919 $9,721 Other Intangible Assets: $2,051 $2,080 Current Liabilities: $3,184 $3,739 Long-term Debt: $6,553 $6,497 Shareholders Equity: $4,762 $5,702 *Note: All dollar figures in millions

12. Ratios 2001 2002 Current Ratio: 1.300 1.202 Debt/Equity Ratio: 1.376 1.139 Return on Equity: 0.201 0.146 Current Ratio – an indication of a company’s ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Source: investorwords.com. Debt/Equity Ratio – a measure of a company’s leverage; a company with a higher debt/equity ratio can offer greater returns to shareholders but is considered riskier. Source: investorwords.com. Return on Equity – a measure of a company’s return on money provided by the firm’s owners. Source: quickmba.com.

13. Tenet Healthcare Corporation www.tenethealthcare.com

22. Consolidated Income Statement 2001 2002 Net Operating Revenues: $12,053 $13,913 Operating Expenses: $10,506 $11,819 Net Income: $643 $785 Earnings Per Share: $1.34 $1.60 *Note: All dollar figures in millions except Earnings Per Share

23. Balance Sheet 2001 2002 Current Assets: $3,226 $3,394 Investments & Other Assets: $395 $363 Property & Equipment: $5,976 $6,585 Other Intangible Assets: $133 $183 Current Liabilities: $2,166 $2,584 Long-term Debt: $4,202 $3,919 Shareholders Equity: $5,079 $5,619 *Note: All dollar figures in millions

24. Ratios 2001 2002 Current Ratio: 1.190 1.310 Debt/Equity Ratio: 0.827 0.698 Return on Equity: 0.130 0.140 Current Ratio – an indication of a company’s ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Source: investorwords.com. Debt/Equity Ratio – a measure of a company’s leverage; a company with a higher debt/equity ratio can offer greater returns to shareholders but is considered riskier. Source: investorwords.com. Return on Equity – a measure of a company’s return on money provided by the firm’s owners. Source: quickmba.com.

25. Analysis of the For-Profit Hospital Industry HCA and Tenet By: Zach Evans Todd Passmore Rachel Taylor Gina Throneberry